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| AGerman seller and an Austrian buyer concluded a contract for the sale of carpets. The goods were delivered, but the buyer paid only a part of the purchase price. The seller declared the contract avoided (terminated) and commenced legal action to recover the carpets relying on a retention of title clause contained in the contract. The buyer objected to the avoidance (termination) of the contract and to the validity of the retention of title clause. The Court held that the contract was governed by CISG as both parties had their places of business in Contracting States (Germany and Austria) (Art. 1(1)(a) CISG). The Court held that the seller had not declared the contract avoided (terminated) pursuant to Art. 63(1), 64(1)(b) CISG as it had not fixed to the buyer an additional period of time for payment. It was true that the buyer should have informed the seller formally that he wanted to declare the contract avoided (terminated). However, the Court considered the contract avoided (terminated) because the buyer had agreed to the seller's proposal of an immediate termination of the contract. The Court did not examine the issue of the validity of the retention of title clause, because the seller was entitled to restitution of the carpets by reason of the consensual avoidance (termination) of the contract. |