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CISG CASE PRESENTATION

France 29 March 2001 Appellate Court Orléans (TCE Diffusion v. Elettrotecnica Ricci) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/010329f1.html]

Primary source(s) of information for case presentation: Case text

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Case identification

DATE OF DECISION: 20010329 (29 March 2001)

JURISDICTION: France

TRIBUNAL: Cour d'appel d'Orléans

JUDGE(S): Remery (président); Magdeleine, Garnier (conseillers); Dupont (greffier)

CASE NUMBER/DOCKET NUMBER: 514 ; RG:00/02909

CASE NAME: Société TCE Diffusion S.a.r.l. v. Société Elettrotecnica Ricci

CASE HISTORY: 1st instance Tribunal de commerce de Montargis 6 October 2000 [affirmed in part]

SELLER'S COUNTRY: Italy (defendant)

BUYER'S COUNTRY: France (plaintiff)

GOODS INVOLVED: High tension neon transformers

Case abstract

France: Court of Appeal of Orleans 29 March 2001

Case Law on UNCITRAL texts (CLOUT) abstract no. 398

Reproduced with permission from UNCITRAL

The company T.C.E. Diffusion, established in France (La Bussière), entered into several successive sales contracts with the company Elettrotecnica RICCI, established in Italy (Ancona), relating to neon transformers. The buyer sued the seller in France before the Commercial Court of Montargis to obtain reimbursement of sums paid to the seller and the awarding of damages for commercial harm resulting from the loss of several customers.

The Montargis Commercial Court declared that it lacked jurisdiction; this was contested by the buyer, who consequently raised an objection. The Court of Appeal of Orleans was thus called upon to take a decision on the international jurisdiction of the court of first instance, possibly deriving from article 5(1) of the Brussels Convention in the version resulting from the San Sebastián Convention. In this regard, the Court of Appeal found that “there is no global document indicating that the parties agreed on the place of performance of the seller’s obligation to guarantee against hidden defects or, more generally, guarantee the conformity of the goods in the meaning of the Vienna Convention of 11 April 1980 on Contracts for the International Sale of Goods, which, being in force both in France and in Italy, is applicable to the case." The appeal judges then noted that nearly all the invoices referred to sale “ex-works Ancona” and that only one invoice mentioned delivery “free destination La Bussière” (sale of 9 October 1998). They deduced that, except in the case of this last sale, “the obligation to deliver the goods, as defined in article 31 of the above-mentioned Vienna Convention, was discharged, in the case in point, by the delivery of the goods to the first carrier at Ancona for transport to the buyer, and that its performance therefore took place in that city, as is confirmed by the words ‘ex-works Ancona’ appearing on nearly all the invoices."

The Court of Appeal essentially confirmed the first-instance judgement. However, the Court of Appeal declared that the Montargis Commercial Court had jurisdiction to rule on the consequences of the sale dated 9 October 1998, subject to the right of the company T.C.E. Diffusion itself to refer the whole dispute to another court.

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Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 31

Classification of issues using UNCITRAL classification code numbers:

31A1 [Place for delivery (contracts involving carriage of goods): obligation to hand goods to first carrier]

Descriptors: Delivery ; Jurisdiction

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Editorial remarks

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Citations to other abstracts, case texts and commentaries

CITATIONS TO OTHER ABSTRACTS OF DECISION

English: Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=495&step=Abstract>

CITATIONS TO TEXT OF DECISION

Original language (French): CISG - France website "http://Witz.jura.uni-sb.de/CISG/decisions/290301v.htm"; Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=495&step=FullText>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

English: Larry A. DiMatteo et al., 34 Northwestern Journal of International Law & Business (Winter 2004) 299-440 at n.537

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Case text (English translation) [second draft]

Queen Mary Case Translation Programme

Cour d'appel d'Orléans 29 March 2001
SARL T.C.E. Diffusion v. Elettrotecnica RICCI

Translation [*] by Yvonne P. Salmon [**]

Decision of the Court

Partial confirmation of Decision of First Instance: Commercial Court of Montargis 6 October 2000.

[…]

Report of the Dispute

The Court rules on a judgment of the Commercial Court of Montargis which was rendered on 6 October 2000, an appeal having been lodged by the Société transformateurs et composants pour enseignes lumineuses Diffusion (TCE Diffusion company) the [buyer], on 17 October 2000.

For a complete report of the facts, procedure, claims and arguments of the parties, it is expressly referred to the submitted decision, the appeal and the observations presented on 28 February 2001 by the Elettrotecnica RICCI company (Ricci company) the [seller] in reply.

In this judgment, it will only be recalled that the [buyer] ordered from the Italian company the [seller], established in Ancona, transformers for neon signs which presented functional defects. Calling upon the guarantee against hidden defects which she was owed by her supplier, the [buyer] brought proceedings against him, before the Commercial Court of Montargis, in the jurisdiction of which its registered office is located at La Bussière, for reimbursement of the amounts which had already been paid by her for the settlement of the invoices of the [seller] and for damages for commercial loss resulting from the loss of several customers.

In the appealed judgment the court accepted the defense that the Court of Montargis was not a court within the competent international jurisdiction, which was raised by the [seller] in favor of the courts of Ancona, and this is contested by the [buyer] in support of her appeal, as it will be expanded upon further in the grounds for this decision.

Grounds for the Judgment

Considering that, by application of the provisions of Article 5(1) of the Brussels Convention of 27 September 1968, in the version amended by the San Sebastian Accession Convention, which is applicable here, the [seller] cannot be sued before the Commercial Court of Montargis, on the grounds of the choice given by this text in contractual matters, and if this court is that of the place where the performance of the obligation in question was or should have been carried out; then that place can be determined directly by the parties or, failing this, should be determined by reference to the law which governs the disputed obligation, that law which is indicated by the conflict of law rules of the jurisdiction in which the matter is brought before court or which might also result from an international convention concerning substantive law which is applicable in the case at hand;

That, in the case at hand, the parties are bound by several international contracts for the sale of goods, each sale of transformers carried out by the [seller], having given rise to a distinct contract, as the [buyer] herself asserts it in her appeal, stating the particular sale which was the object of the invoice of 9 October 1998 which will be analyzed further;

That it is not evident from any general document that the parties had agreed upon the place of performance of the obligation of the seller to guarantee that the goods were free from hidden defects or, more generally, the conformity of the goods, within the meaning of the Vienna Convention on the International Sale of Goods of 11 April 1980 which, being in force both in France and in Italy, is applicable in this case;

That the existence of such a general determination of the place of performance does not result from any of the circumstances called upon by the [buyer], such as the fact that, in a letter, she referred to her sales policy "in France"; or

That the order forms of the [buyer] mention La Bussière as the place of storage, and not of delivery, of the goods, that this company sells or resells to third parties; or finally

That the [seller] asked the [buyer] to assume occasional responsibility for transport, all elements which are very unsatisfactory to establish the existence of a general guarantee agreement for determining the place of performance of the guarantee for all the sales concerned in these proceedings;

That an examination of the invoices issued by the [seller] and called upon by the [buyer] shows, in addition, that some of them do not indicate any place of delivery, that other invoices, which constitute almost the entirety, mention, on the contrary, a sale "ex works Ancona", the Incoterm which characterizes a sale from Ancona and which only one invoice, out of the twelve called upon, i.e., that of 9 October 1998, which has already been mentioned, refers to delivery "free destination La Bussière";

That, apart from the goods which formed the object of this invoice for an amount of 44,773.69 French francs, out of the 612,984.67 francs claimed in the proceedings for reimbursement, there is no agreement between the parties, either totally, or individually - i.e., sale by sale - indicating La Bussière as the place of delivery and performance of the guarantee obligation;

That, consequently, and apart from the sale of 9 October 1998, the obligation to deliver the goods, as defined by Article 31 of the aforementioned Vienna Convention, was realized, in this case, by the handing-over of the goods to the first carrier at Ancona for transportation to the purchaser and that its performance thus took place in that city, which moreover confirms the statement "ex works Ancona" which features on almost all of the invoices;

That, as opposed to what the [buyer] maintains, the fact that one single sale could justify the competence of the Commercial Court of Montargis could not lead to its jurisdiction for all the others, not only because the good administration of justice, on which the [buyer] bases her claim, would on the contrary justify that the entire case be judged by the court of Ancona, the defendant's natural court, but also because, on the basis of the above mentioned Brussels Convention, the connection is not in itself an attributive ground for competence, from which it results that the Commercial Court of Montargis cannot be declared to have jurisdiction, apart from the consequences of the sale of 9 October 1998, although even this partial and residual competence is not of significance for the settlement of the litigation and that the [buyer] will have unquestionable difficulties to ask this court, in addition to the refunding of the sum of 44,773.69 francs - if she manages to show that, among the transformers affected by defects, of which only the major part, but not the totality, according to its claim (p. 3), was defective, were those transformers which formed the subject of that sale - the payment of a lump sum in damages for a commercial loss which is not easily divisible;

That, consequently, the judgment is to be confirmed, except with regard to the sale of 9 October 1998, for which the jurisdiction of the Commercial Court of Montargis cannot be excluded - subject to the decision of the [buyer] - and, except insofar as this Court has indicated, the Court of Ancona to have jurisdiction, whereas, by application of the provisions of Article 96(1) of the New Code of Civil Procedure, it should have limited itself to remitting the parties to go before the competent jurisdiction; taking into account the fact that the [buyer's] appeal essentially fails, she will have to bear the costs of the appeal and she will be held liable to pay a complementary sum of 8,000 francs to the [seller] by application of Article 700 of the New Code of Civil Procedure.

On these grounds:

Ruling publicly, having heard both parties and in last instance:

Confirms the judgment made, except insofar as it implicitly failed to consider the consequences of the sale which gave rise to invoice number 153 of 9 October 1998, for 44,773.69 francs, which was issued by the [seller], and indicated the court of Ancona (Italy) to have jurisdiction;

States that the Commercial Court of Montargis is to have jurisdiction to judge the consequences of the aforementioned sale, leaving the [buyer] itself to bring this litigation in its entirety before another court; and

Considering Article 96 of the New Code of Civil Procedure; Non-suits the parties, in any case, to remit the case to the competent jurisdiction for all the other slaes; Stating that the parties shall be notificed of this judgment in accordance with the provisions of Article 87 of the New Code of Civil Procedure;

Condemns the [buyer] to pay the costs of the appeal; and Condemns the [buyer] to pay to the [seller] the additional sum of 8,000 francs by application of Article 700 of the New Code of Civil Procedure.

[…]

FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, the Plaintiff-Appellant of France is referred to as [buyer]; the Defendant-Appellee of Italy is referred to as [seller].

** Associate, Institute of International Commercial Law, Pace University School of Law.

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