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| A Dutch buyer had an exclusive sales agreement for the Benelux-countries with an Italian seller manufacturing agricultural machinery. The seller terminated the exclusive sales agreement. It then commenced an action against the buyer asking for payment of outstanding amounts of price and interest. The buyer counterclaimed damages caused by the termination of the exclusive sales agreement and asked to postpone the payment of the price until receiving payment of the said damages by the seller. It also claimed set-off with the seller's claim.
The Court confirmed the first instance decision holding that the request for postponement of payment by the buyer was not settled by CISG and had to be solved referring to the applicable domestic law (in the case at hand, Italian law). According to Italian law postponement was not granted to the buyer. Nor was the buyer entitled to offset its claim to damages with the seller's claim. The Court held that the question of set-off is not covered by CISG and is to be determined according to the applicable domestic law, that is Italian law. The Court granted the seller the outstanding price. The seller was also awarded interest according to Art. 78 CISG. As CISG does not determine the interest rate, the Court stated that it was to be determined in accordance with the domestic law otherwise applicable to the contract (Italian Law). Further the Court held that the seller had the right to recover the costs for request of payment as damages (Art. 74 CISG), insofar as they were proved by the seller. As to the seller's claim that the price should be paid in Dutch currency, the Court ruled that the price was to be paid in Italian currency and that the seller was not entitled to recover the claimed loss due to variation of the exchange rate between Dutch and Italian currency. Finally the question of breach of the exclusive distribution agreement was considered not to be governed by CISG and subject to the applicable domestic law. |