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CISG CASE PRESENTATION

Netherlands 12 July 2001 District Court Rotterdam (Hispafruit BV v. Amuyen S.A.) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/010712n1.html]

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

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Case identification

DATE OF DECISION: 20010712 (12 July 2001)

JURISDICTION: Netherlands

TRIBUNAL: Rb Rotterdam [Rb = Arrondissementsrechtbank = District Court]

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: HA ZA 99-529

CASE NAME: Hispafruit BV v. Amuyen S.A.

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Argentina (defendant)

BUYER'S COUNTRY: Netherlands (plaintiff)

GOODS INVOLVED: Lemons, mandarins, oranges


Classification of issues present

APPLICATION OF CISG: Yes [Article (1)(a)]

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 12 ; 18(1) [Also cited: Articles 7 ; 11 ; 29 ; 79 ; 96 ]

Classification of issues using UNCITRAL classification code numbers:

12A [Effect of declaration by State preserving domestic formal requirements];

18A3 [Offers (critera for acceptance): silence or inactivity in and of itself insufficient]

Descriptors: Formal requirements ; Declaration, Art. 96 ; Offers ; Acceptance of offer

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Editorial remarks

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Citations to case abstracts, texts, and commentaries

CITATIONS TO ABSTRACTS OF DECISION

(a) UNCITRAL abstract: Unavailable

(b) Other abstracts

Unavailable

CITATIONS TO TEXT OF DECISION

Original language (Dutch): Nederlands Internationaal Privaatrecht (NIPR ) 2001 No. 278 [458-460]

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation) [second draft]

Queen Mary Case Translation Programme

Rechtbank [District Court] van Rotterdam

12 July 2001 [HA ZA 99-529]

Translation [*] by Evelien Visser [**]

<Hispafruit BV>, The Netherlands; Plaintiff [Buyer], represented by proc. mr. J.P.M. Borsboom;

v.

<Amuyen S.A.>, Argentina; Defendant [Seller], represented by proc. mr. P.W. van Baal, adv. mr. P.A.M. Laan;

[...]

FACTS

2. The following facts have been presented and have not been disputed during the proceedings.

      2.1 Following a contract of sale, the [Seller] shipped in 1997 different kinds of lemons, mandarins and oranges (two kinds) to the [Buyer].

      2.2 There was no written contract. The [Buyer] had created four documentary credits for the benefit of the [Seller] on or about 26 May 1997. All letters of credit state the following:

"Partial shipments [...] : allowed

Loading on board [...] at/from any Argentina port by vessel for transportation to [...] Rotterdam.

Latest date of shipment: [...] 97 September 25 [...]

Terms of delivery: CFR Rotterdam."

The letters of credit describe the goods in the following manner:

"L/C (lemons) for the amount of US $960,120.00 [...]

L/C (mandarins) for the amount of US $22,680.00 [...]

L/C (Valencia oranges) for the amount of US $45,360.00 [...]

L/C (Washington oranges) for the amount of US $23,310.00 [...]."

      2.3 The [Buyer] notified the [Seller] on 30 May 1997 by fax:

"Herewith we send you the citrus program the way we would like to receive it this year. Especially for the lemons we would like to receive them till the very last end of the season [...] ."

      2.4 This fax was accompanied by an overview which indicated per week (from week 22 to week 40) how many bales and pallets of the different kinds of fruit should be delivered. The overview also indicated which sizes of fruit should be delivered.

On 1 August 1997, the [Buyer] sent the [Seller] a fax containing "Quality Inspection Reports" and complained about the quality of the lemons received. More specifically, the [Buyer] complained that in total 78 pallets (4,914 cartons) ex m.s. "Royal Cooler" and ex m.s. "Winter Sun" contained Category II lemons, instead of the Category I lemons which were agreed to be delivered. The [Buyer] expressed his disappointment in the fax message, and also expressed his disappointment concerning the fact that another Dutch entrepreneur also received fruit directly from the [Seller]. In addition, the [Buyer] complained about the fact that the [Seller] did not keep up with the agreed delivery schedule.

[...]

3.  3.1 The [Buyer] claims to have the [Seller] pay USD 219,524,47 immediately, increased with interest to be calculated as of 23 October 1998 until the day of payment, upon which payment the [Buyer] will discharge the [Seller] of all obligations. The [Buyer] also claims to have the [Seller] ordered to pay all legal costs incurred by the [Buyer], including costs involved with the attachment.

      3.2 The [Buyer] based its claim on the following.

  1. The agreed delivery schedule is part of the agreed contract of sale;

  2. With regard to the lemons:

    (i) The [Seller] did not keep up with the delivery schedule, as a result of which the local market of the [Buyer] was over-satisfied with lemons;

    (ii) The [Seller] did not, contrary to what had been agreed, only deliver lemons of its own brand;

    (iii) The [Seller] breached the exclusivity arrangement it agreed upon with the [Buyer] by also selling lemons to other Dutch entrepreneurs;

    (iv) The agreements mentioned under (ii) and (iii) above concerning the "double" exclusivity (i.e., brand and area) were made in March/April 1997 during a meeting held in The Netherlands between the parties when also the delivery schedule was discussed;

    (v) 78 pallets of lemons received did not meet the agreed standard;

    (vi) The total damage incurred by the [Buyer] for which the [Seller] should be held liable amounts to US $217,574.30;

  3. The [Seller] did not deliver any mandarins at all; as a result of which the [Buyer] lost profits of up to US $11,340.00 for which the [Seller] should be held liable;

  4. The Valencia oranges were shipped too late and they were much too small. The loss caused by this for which the [Seller] should be held liable amounts to US $3,024.00.

DECISION

4.   4.1 The CISG (Trb. 1986, 61) applies to the contract of sale as the [Buyer] has its place of business in The Netherlands and the [Seller] has its place of business in Argentina, and both states are CISG Member States.

According to article 7 CISG, questions concerning matters governed by the CISG, but which are not expressly settled in it, are to be settled in conformity with the general principles on which the CISG is based or, in the absence of such principles, in conformity with the law applicable by virtue of the rules of private international law. In accordance with the rules of private international law of The Netherlands, the applicable law is in this case the law of Argentina, as no choice of law has been made and the contract of sale has the closest connection with Argentina (art. 4(1) of the Treaty of Rome, Trb. 1980, 156). The [Seller] provides the most characteristic performance of the contract according to article 4(2) of the Treaty of Rome, and, hence, the contract is regarded to have the closest connection with Argentina, the country where the [Seller] has its place of business. The court has not found any other circumstances which give reason to conclude that the contract of sale is more closely connected with another country than Argentina.

      4.2 Among other things, the parties disagree about the exact content of the contract of sale. The [Seller] claims that everything the parties have agreed has been laid down in the letters of credit and that, apart from that, there are in principle no other agreements. The [Buyer] does not allege that the content of the letters of credit has not been agreed upon, but has stated that the content of the letters of credit does not reflect the entire agreement between the parties and that what has been laid down therein has been supplemented, if not amended, by later agreements. In this sense, the [Buyer] invokes oral agreements with the [Seller], other issues in various fax messages, and issues flowing from trade usages.

      4.3 As far the lemons are concerned, the parties have a difference of opinion as to when the lemons should have been delivered by the [Seller]. It has become clear between the parties that the [Seller] has not exceeded the deadline (25 September 1997) set out in the letters of credit. The [Seller] has disputed that, apart from that date, it was bound to any sort of delivery schedule. The [Seller] has specifically disputed the argument of the [Buyer] that it should be regarded to have silently accepted the delivery schedule by not responding to the fax containing the delivery schedule as mentioned in paragraph 2.3 above (the good reception of which was not disputed). The [Seller] argued that not responding "could be regarded from a Dutch perspective [...] as rather careless", but that this can be regarded differently when one considers that the trade relationship between the [Buyer] and the [Seller] should be placed in an international context, or at least, in the context of the "Argentinean reality" and Argentinean law, in which context (in the absence of a written agreement) the conditions laid down in the letters of credit are to be regarded as the conditions of the contract of sale, and that these cannot be altered by subsequent unilateral notices by one of the parties and that the not responding thereto by the other party cannot be regarded as agreement with these unilateral alterations. The [Seller] also highlighted article 18(1) CISG which dictates that silence or inactivity does not in itself amount to acceptance. These issues raised by the [Seller] move the Court to consider the following.

      4.4 According to article 12 CISG, any provision of article 11, article 29 or Part II of the CISG that allows a contract of sale or its modification or termination by agreement or any offer, acceptance or other indication of intention to be made in any form other than in writing, does not apply where any party has his place of business in a State which has made a declaration under article 96 CISG. As Argentina has made such a declaration, and the [Seller] has its place of business there, the provisions referred to in article 12 CISG (the 'freedom of form' rules) are not directly applicable to this case (but see below).

      4.5 Article 12 CISG does not entail that the rules concerning form requirements laid down in the applicable domestic law of the State which made a declaration as meant in article 96 CISG (here: Argentina) automatically govern the contract of sale when one of the parties has its place of business in that State. The question whether the contract has been validly concluded, while considering the form requirements, should be answered by the law which is applicable according to the rules of private international law. This is also in accordance with article 7 CISG. Following the Dutch rules of private international law, articles 9(1), 9(2) and 9(4) of the Treaty of Rome are of importance.

      4.6 The [Buyer] claimed that already during the negotiations in the Netherlands in March/April 1997, the parties discussed the delivery schedule. If the parties then agreed - which the [Seller] disputes - that the [Buyer] would, as part of the carrying out of the contract of sale, draft a delivery schedule according to which the [Seller] should deliver the fruit at certain moments in time, this part of the contract is validly made when considering article 9(1) of the Treaty of Rome, as both parties were at the time of agreement thereof in the Netherlands and Dutch law does not impose any form requirements for these types of agreement (following Dutch law, the "freedom of form" rules laid down in articles 11 and 29 CISG apply unrestrictedly). The [Buyer] must evidence that the parties have agreed to draft a delivery schedule according to which the [Seller] should have delivered the fruit. Here, also trade usages can be used to interpret the circumstances at hand. If the [Buyer] delivers the necessary evidence, it should be noted that the [Seller], by not responding to the fax of 30 May 1997 (with which the delivery schedule was sent) must be regarded as having accepted this schedule. In this case, where further elaboration of the agreement concluded in the Netherlands is concerned, article 9(4) of the Treaty of Rome does not entail that acceptance by the [Seller] is only validly made when it meets the requirements of Argentinean law (being the law that governs the contract of sale or the law of the State where the legal act was carried out). Apart from certain form requirements, the [Seller] cannot successfully invoke article 18(1) CISG. The wording "in itself" of article 18(1) CISG already indicates that it is possible that additional factors arise which entail that silence or inactivity are in fact sufficient to assume acceptance has occurred. If it will be shown that the parties had agreed beforehand on a delivery schedule to be drafted by the [Buyer], this must be regarded as one of these additional factors which entails that the [Seller] is bound to the delivery schedule which was sent later in time, unless the [Seller] has objected to (the contents of) this schedule.

      4.7 If the [Buyer] does not succeed to provide the necessary evidence as mentioned in paragraph 4.6 above, it should be noted that the [Seller] cannot be regarded to have accepted the delivery schedule solely because it has not objected against to its terms after it was sent by the [Buyer]. When this schedule is not based on an earlier agreement, and only has been presented by the [Buyer] for the first time by fax, the Court finds ground to reason that valid acceptance thereof by the [Seller] is according to article 9(4) of the Treaty of Rome subjected to the form requirements imposed by Argentinean law. This need not be examined further, as the Court - not having assessed these form requirements yet - can already assume that the [Seller] did not (explicitly) agree with the delivery schedule.

      4.8 The [Buyer] must also evidence that the parties have agreed during the meetings in March/April 1997 that the [Seller] would only deliver lemons of its own brand and that the [Seller] would deliver to the [Buyer] only those lemons which were destined for the Dutch market. This is not evidenced by the provided documentation. Possible Argentinean form requirements concerning the validity of these agreements are not relevant as the [Buyer] has stated and needs to evidence that these agreements were made when both parties were in the Netherlands. Referral to article 9(1) of the Treaty of Rome and the considerations made above in paragraph 4.6.

[...]

      4.10 It has been shown that the [Seller] breached a contractual obligation by not delivering 2,520 boxes of mandarins (Ellendales). The [Seller] stated that the parties agreed to not have these mandarins delivered due to a long frost period which affected the quality of the mandarins. The [Seller] referred to handed over correspondence between parties concerning this matter.

[...]

      4.11 It can be concluded from this correspondence that on 10 September 1997 the [Buyer] no longer wished to receive these mandarins as the [Seller] indicated that it was not able to deliver mandarins which would meet the agreed quality standard. However, the [Buyer] did not thereby waive its possible right to damages for non-delivery of these mandarins. The [Seller]'s defense therefore fails on this point. The [Seller] also stated that the events should be qualified as an impediment beyond its control. According to article 79 CISG, the [Seller] is not liable for the non-delivery of these mandarins, if it evidences that this was caused by an impediment which was beyond its control and that it could not reasonably be expected to have taken the impediment into account at the time of the conclusion of the contract or to have avoided or overcome it or its consequences. The Court orders the [Seller] to evidence these factors. More specifically, it will have to show that, as a result of the enduring frost, during the relevant period, no other Ellendales were available which met the agreed standard, and also, that the [Seller] could not reasonably be expected to have taken the enduring frost and the possibility that it may not be able to fulfill its obligation to deliver these mandarins into account at the time of the conclusion of the contract.

FOR THESE REASONS,

      4.12 The claim concerning the Valencia oranges is dismissed.

[...]

Follows an order to produce evidence.

[...]


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, the Plaintiff of The Netherlands is referred to as [Buyer] and the Defendant of Argentina is referred to as [Seller].

** Meester in Nederlands Recht, Tilburg University, The Netherlands (1997), Master of Laws, University of Georgia School of Law, USA (1998), Doctor of Philosophy, University of Oxford, United Kingdom (2004), Advocaat with Houthoff Buruma London, United Kingdom and Rotterdam, The Netherlands.

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