A French buyer and an Italian seller concluded a contract for the sale of machinery for the production of cosmetics. The machinery delivered turned out to be defective and the parties concluded a second contract to replace the defective machinery with machinery of a different type and price. After the new machinery had been delivered the buyer brought an action before a French court alleging that the new machinery was also defective. The buyer requested a court order that the seller repair the machinery and reimburse the costs it had sustained in attempting to repair it. The seller objected to the jurisdiction of the French courts.
The Court of first instance (Tribunal de Commerce de Paris, 28-10-1997) affirmed its jurisdiction to hear the case on the ground of Art. 5(1) of the EC Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters (Brussels, 1968). According to the Court of first instance the obligation in question was in fact the seller's obligation of conformity which derived from Art. 36(2) CISG, and the seller's attempts to remedy the non conformity had been performed at the buyer's place of business in France. The seller appealed on the issue of jurisdiction.
The Court of Appeals reversed the lower court's decision. According to this Court, the obligation in question was the seller's obligation to deliver conforming goods. Referring to Arts. 35(1) and 35(2)(a) CISG, the Court held that the obligation of conformity of the goods to their ordinary use is not independent from the obligation of delivery. Therefore both obligations must be performed at the same place. In the case at hand the parties had agreed that the place of delivery was the seller's place of business in Italy. Moreover, as required in the contract, the seller had handed the goods over to a carrier indicated by the buyer at its own premises. Therefore, under Art. 31(a) CISG the obligation to deliver conforming goods was to be performed at the seller's place of business. |