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| Abstract | ||||||||||||||||||
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| A Swiss seller and a German buyer concluded a contract for the sale of a coiling machine to be developed and produced by the seller according to the buyer's specifications. After delivery of the machine to the buyer's premises, the buyer claimed certain non-conformities. The parties agreed to send the machine back to the seller for repair and improvement. On its way back the machine was further damaged as it had not been sufficiently protected for transportation by the haulage company that had loaded it and that had been hired by the seller. The buyer had given no loading instructions. Because of the transportation damage the seller refused to repair and improve the machine. On its part, the buyer refused to accept it.
The appellate court, in overruling the decision of the court of first instance, held CISG applicable according to Arts. 1(1)(a) and 3(1) CISG. The court held that the buyer had the right to declare the contract avoided according to Arts. 45 (1), 46, 47 and 49 (1) CISG and it was therefore entitled to reimbursement of the contract price according to Art. 81 (2) CISG as the seller had refused to repair the machine. The court held that the buyer was not responsible for the damage to the machine during transport and therefore did not lose its right to reimbursement (Art. 82 CISG). The court held that, according to the agreement regarding the repair and improvement of the machine whereby the seller took charge of the transport of the machine back to its premises, the buyer only had to place the machine at the seller's disposal at the buyer's premises (Art. 31 (c) CISG). It held that it had been up to the seller to load and protect the machine for transport and that the buyer would have been responsible only if it had realized the insufficiency of protection or if it had loaded the machine itself. The seller could not prove this. The court awarded the buyer interest on the refunded price (Art. 84(1)CISG) at the rate determined by the law otherwise applicable to the contract (i.e. Swiss law). |