Czech Republic
32 Cdo 824/2007
Supreme Court of the Czech Republic




[CLOUT Case no. 1451. Abstract prepared by Petr Dobiáš and Šárka Bittenglová]

The case ensued from the dispute between a German seller (plaintiff) and a Czech
buyer (defendant) for payment of manufactured paint, damages and interest on late
payment. The seller argued that the buyer breached its contractual obligations to pay
the price for the goods and presented to the case materials the buyer’s order (offer)
to conclude a contract of sale and the documentary evidence by the deed (writing),
which, according to the seller’s opinion, should prove the existence of the contract
of sale between the parties.

The Court of First Instance established that from the language of Article 55 CISG a
price or a provision for its determining do not have to be stated explicitly but a
contract of sale has to be validly concluded following the rules provided for in
Article 18 CISG. The evidence presented by the seller, however, did not confirm that
the respective proposal (the aforementioned buyer’s order) for concluding the
contract had been in any way accepted by the seller which also failed to prove the
buyer’s breach of contractual obligations and the buyer’s delay in payment under
the contract. Therefore, there were no grounds to deem that the contract of sale was
concluded validly and, in the sense of Article 55 CISG, the buyer did not have any
obligation to pay the price for the manufactured paint and the seller was not able to
claim the payment of the price or damages as well as an interest on delay.

The Appellate Court agreed with the decision of the Court of First Instance. Relying on Article 18(3) CISG, it also assessed the fact that the seller did not prove its
indication of assent by performing an act such as dispatching the goods, within the
period of time laid down in Article 18(2), for example, on the basis of the
mentioned order or as a result of the practices which the parties have established
between them or of usage. In the Appellate Court’s view the documentary evidence
by the deed also could not help to prove the existence of the contract of sale
between the parties because this document contained merely the buyer’s request for
explanation of the change in wrapping of the paint.

The seller brought an extraordinary appeal to the Supreme Court against the
Appellate Court’s decision, arguing that the conclusion of the court as to the
non-existence of the contract of sale was incorrect and it was necessary to consider
the practice established between the parties, usages and the subsequent conduct of
the parties.

The Supreme Court, drawing on provisions of the CISG (Articles 55, 18(2), 18(3)),
decided that the rules on the purchase price are applicable only on the condition that
the contract of sale has been validly concluded. Therefore, it was necessary to
assess whether there was a contract of sale and whether it was valid in accordance
with Article 18, sections (2) and (3). Since the Supreme Court found that these facts
were analysed by the lower courts and the reasoning of the Appellate Court did not
contradict substantive law, i.e. Article 18 CISG, it dismissed the seller’s appeal.




Case law on UNCITRAL texts ( A/CN.9/SER.C/ABSTRACTS/155}}}}