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| Abstract | ||||||||||||||||||
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| A German buyer ordered a certain amount of fabric from an Italian seller. Before the actual order, the buyer obtained from the seller a sample of the fabric. According to the contract, the seller delivered the fabric in three installments to the buyer's factory in Romania, where the fabric were made up into clothes.
The buyer, after receiving two months later the manufactured clothes in Germany, informed the seller by telephone about some defects in the fabric and refused to pay the price. It alleged that the fabric was teased and did not correspond to the sample of textile fabric it had received from the seller before entering onto the contract. The seller commenced an action to recover the unpaid price. The court held that the contract was governed by CISG since both parties had their place of business in two Contracting States (Art. 1(1)(a) CISG). In the court's opinion the buyer had lost its right to rely on non conformity of the goods as it did not examine the goods within as a short period as practicable in the circumstances, as set forth under Art. 38 CISG. The court stated that in a sale by sample the buyer is not exempted from its obligation to examine the goods, even if the sample did not contain any defects. With respect to the form of proper examination, it stated that in a sale involving carriage of the goods in a place different from the buyer's place of business, the goods are to be examined at the place of delivery of the goods (here: Rumania). Moreover, in a case of goods which are to be processed into final products, the goods are to be processed on a test basis and examined accordingly. The court stated that in a sale of fabric like in the case at hand, the duty to examine requires the examination of the filament, color and the condition of the surface. According to the court, the buyer also failed to give notice of non-conformity within a reasonable time as set forth under Art. 39 CISG. In the opinion of the court, in cases like the one at hand the reasonable time should be of no more than one month after the buyer could have discovered the defects of the goods. Therefore, the court considered the notice given less than two months after delivery of the first installment as not timely given. The court finally awarded interest to the seller pursuant to Art. 78 CISG. As to the applicable interest rate, the court applied Italian law as the law applicable to the contract by virtue of the German private international law rules. |