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| Abstract | ||||||||||||||||||
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| A Spanish seller and a Jordanian buyer concluded a contract with a CIF clause for the sale of frozen stockfish which was shipped from the Spanish harbor of Vigo. It was an explicit term of the contract that the seller would take responsibility in case the goods resulted unfit for importation in Jordan according to Jordanian health authorities’ standards. Upon arrival in the Jordanian harbor of Aqabah the goods were found unfit for human consumption by Jordanian health authorities, and forbidden to enter in Jordan. The parties had then an exchange of correspondence in which the buyer informed the seller of the unfitness of goods for importation in Jordan and rejected them. The goods were then resold to a buyer in Estonia, and the seller reimbursed to the Jordanian buyer the price paid, having deducted the cost of the transportation of the goods from Aqabah (Jordany) to Vigo (Spain) and then to Tallin (Estonia). The Jordanian buyer commenced action for the recovery of the amount deducted.
The seller claimed that the contract had been concluded upon shipment of the goods at the harbor of Vigo and that the risk had passed to the buyer at that moment. Furthemore, the seller indicated that the goods had been inspected by Jordanian authorities one month later, that the notice of the defects had been sent two months after shipment, and that the action had been commenced two years after the date of conclusion of the contract, thus making any action by the buyer dismissible for being too late. The first instance court observed that, according to Arts. 30 and 35 CISG, the passing of risk on shipment does not exclude the seller’s obligation to deliver goods in conformity with the agreed terms of the contract. Since the parties had expressly agreed that goods must conform to Jordanian public health standards, lack of conformity to such provisions entailed breach of contract by the seller either under CISG and under domestic law. The court also observed that the seller’s defenses were inconsistent with its previous actions, namely accepting the rejection of goods and paying back the price, although reduced in amount, and that this behavior was unacceptable according to the "venire contra factum proprium" doctrine incorporated in the Spanish civil code. The court then held that the seller had accepted termination of contract. It also held that the contract was anyhow terminated by the buyer’s mere declaration of avoidance according to Art. 26 CISG, since CISG - contrary to some domestic laws - does not require any other formality for termination. According to the court, moreover, the notice of lack of conformity had been sent within the limits set forth by Arts. 38 and 39 CISG. The appellate court, fully confirming the decision of the court of first instance, ordered the seller to pay back to the buyer the amount it had deducted from the price repaid, plus interest according to the Spanish statutory rate. |