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| A Swiss seller and a French buyer concluded a contract for the sale of acrylic cotton, which the buyer re-sold to a final user. The goods were delivered to the French buyer, who re-delivered them to the final user. When the final user complained that the goods were defective, the French buyer gave notice of non-conformity to the Swiss seller, first by telephone and then in writing, three months after delivery. The French buyer settled the matter with the final user and almost one year later brought an action against the Swiss seller claiming damages for non-conformity.
The seller objected that the buyer's action was time-barred under Swiss domestic law, which provides for a one-year limitation period for warranty claims, running from delivery of the goods (Art. 210(1) of the Swiss Code of Obligations). The court of first instance (Tribunal de première instance de Genève, 14-03-1997) decided in favor of the buyer, holding that the one-year limitation of warranty claims could not be applied and that, instead, the ten-year limitation period for general contractual claims (provided by Art. 127 of the Swiss Code of Obligations) was applicable, so that the buyer's claim was not time-barred. The seller appealed on the issue of the limitation period. The Court of Appeals decided in favor of the buyer, but on different grounds. The appellate court noted that the matter of limitation period is not governed by CISG (Art. 4 CISG). Since Switzerland has not ratified the UN Convention on the Limitation Period in the International Sale of Goods (New York, 1974), the matter is governed by Swiss domestic law, being the law otherwise applicable to the contract by virtue of the Swiss private international law rules (in the case at hand the 1955 Hague Convention on the law applicable to international sales of goods). The appellate court, however, rejected the lower court's view that the ten-year limitation period for general contractual claims applies and held applicable the one-year limitation period for warranty claims. The court further held that the buyer's notice of non-conformity had been timely given, and that although the buyer's action had been brought more than one year after the date of delivery, its claim was not time-barred. In the opinion of the court, the one-year limitation of warranty claims provided by Swiss domestic law conflicts with the two-year cut-off period provided by Art. 39(2) CISG. The court further noted that this problem arises with respect to other domestic laws, such as German law which solved it by providing that the limitation period begins to run only when a notice of non-conformity under Art. 39 CISG has been given. On this ground, the court concluded that the Swiss law on the limitation period should be adapted to and harmonized with the Convention, and therefore the one-year limitation period should be extended until the expiry of the two-year cut-off period provided by Art. 39(2) CISG. (Editors' note: An appeal against this judgment is pending before the Swiss Federal Supreme Court.) |