- International Court of Arbitration at the Belarusian Chamber of Commerce and Industry
RIGHT TO CLAIM DAMAGES - REQUIREMENTS (ART. 74 CISG)
[CLOUT Case no. 1544. Abstract prepared by Jan Iosifovich Funk and Inna Vladimirovna Pererva, National Correspondents].
A contract for the sale of goods was concluded between the parties, in accordance with which the Dutch seller (the defendant), took upon itself the obligation to supply the Belarusian buyer (the plaintiff) with hydraulic trolleys for tomato cultivation.
In breach of its obligations, the defendant supplied the plaintiff with hydraulic trolleys without hydraulic platform lifting. As a result of those circumstances, the plaintiff was unable to provide appropriate care for its tall-growing tomato varieties, since without a hydraulic platform it was not possible to care for tomatoes at height, and, that being the case, part of the harvest from the upper clusters of tomatoes perished, and plant tops overgrew and broke off. Those circumstances continued for several months until the defendant had corrected the deficiencies in the hydraulic trollies.
The plaintiff calculated the damages over the aforementioned several months expressed as the value of the lost portion of the harvest, on which it was entitled to rely and which it traditionally gathered. In support of its argument the plaintiff submitted an expert opinion from a specialist in tomato cultivation, in which it was noted that it was essential that the plants receive the appropriate care using platform mechanisms, namely special trolleys. Without such care the quantity of clusters on the plants decreased, the quality deteriorated and in summer the plants overheated. Further, the plaintiff submitted the opinion of a commission comprising representatives of independent organizations, which inspected the planted areas and assessed the losses incurred by the plaintiff on account of the lack of hydraulic trollies. Lastly, the plaintiff submitted to the arbitral tribunal its monthly turnover balance sheets and monthly journals of received agricultural products to confirm tomato yields and the difference in harvest volume obtained with hydraulic trollies and without them.
On the basis of the submitted evidence, the arbitral tribunal concluded that the plaintiff had demonstrated its unearned, lost profit on account of the existence of all of the legal facts constituting the said legal phenomenon under Articles 74 and 77 CISG, namely: the existence of a breach by the defendant; a causal link between the breach and the loss of revenue; the acquisition of such revenue by the plaintiff under normal business conditions; the declaration by the defendant of the possibility of the existence of such loss by the plaintiff in connection with a breach by the defendant of obligations assumed under the contract; and the performance by the plaintiff of all necessary actions to minimize the loss.
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