A Finnish seller and a buyer from the United Arab Emirates concluded a contract on the sale of steel plates to be delivered FOB Tallinn. The seller provided the buyer a certificate of quality of the steel plates. Upon arrival of the steel plates in the United Arab Emirates, the buyer examined the goods, and notified the seller, that the steel plates did not conform with the contract, since it was impossible for the buyer to use the steel for the intended purpose. Therefore, the buyer demanded a price reduction. The seller contested the buyer's demand with reference to among others the fact, that the goods was sold FOB and furthermore, the seller contested the relevance of the certificate of quality.
The Appeal Court held that, as the seller had comitted itself to deliver steel plates of a certain quality, it must have been aware of the purpose of the steel plates sold. Secondly, if the contract involves the carriage of goods, the buyer's examination of the goods may be deferred until the goods have reached their destination, in this case, the port in the United Arab Emirates, Art. 38(2) CISG. The Court further referred to Art. 67 CISG and to art. 36 CISG stating that the time for evaluating conformity of goods is the time for passing of the risk. But even if the buyer had made an examination according to Art. 38(2) CISG, regard had to be taken to a trade usage concerning checking of the goods saying that the buyer had to give the seller an opportunity to be present while checking the goods. This trade usage was applicable according to Art. 9 CISG, since the buyer had not contested its applicability.
Accordingly, even though the statements concerning the results of the examination of the goods supported the buyers claim of lack of conformity, it was unclear whether the examination was carried out using the steel consignment sold by the seller and how large a part of the goods was non-conforming. Consequently, the Court found that the credibility of the examination was weakened, and therefore the buyer had not established the non-conformity of the goods. |