Go to Database Directory || Go to CISG Table of Contents || Go to Case Search Form || Go to Bibliography

CISG CASE PRESENTATION

Germany 8 January 2004 District Court Trier (Synthetic window parts case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/040108g1.html]

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

Case Table of Contents


Case identification

DATE OF DECISION: 20040108 (8 January 2004)

JURISDICTION: Germany

TRIBUNAL: LG Trier [LG = Landgericht = District Court]

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 7 HKO 134/03

CASE NAME: German case citations do not identify parties to proceedings

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Germany (plaintiff)

BUYER'S COUNTRY: Luxemburg (defendant)

GOODS INVOLVED: Synthetic window parts


Case abstract

GERMANY: Landgericht Trier 8 January 2004

Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/80], CLOUT abstract no. 819

Reproduced with permission of UNCITRAL

Abstract prepared by Jan C. Engelmann

The buyer, which had its statutory seat in the Grand Duchy of Luxemburg, contracted on several occasions with the German seller for the purchase of window parts. The seller mentioned its general terms and conditions on the reverse side of the invoices following conclusion of each contract. The general terms and conditions included a forum choice clause stating that the domicile of the seller, i.e., Germany, was considered the place of jurisdiction. Later on, the seller sued the buyer for payment of the goods in Germany. The buyer opposed the claim on the ground that German courts had no jurisdiction.

The court found that the seller's claim was inadmissible due to lack of jurisdiction. The court noted that the issue of agreement on general terms and conditions was governed by the law underlying the contract. Since Germany and Luxemburg were both contracting states of the CISG, the CISG was to be considered the applicable law. The court pointed out that according to articles 14-24 CISG, simply referring to existing standard terms and conditions doesn't imply their binding incorporation into the contract. Furthermore, printing the standard terms on the backside of the invoices was not enough to incorporate them into the contract since at that point in time the contractual agreement was already concluded (articles 14-24, CISG). Consequently, the court held that the choice-of-forum agreement was not valid.

Go to Case Table of Contents

Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 4 ; 7 ; 8 ; 18 ; 19 [Also cited: Article 14 ]

Classification of issues using UNCITRAL classification code numbers:

4B1 [Scope of Convention (issues excluded): validity under domestic law];

7B1 [Materials for interpretation: international case law];

8A [Intent of party making statement or engaging in conduct];

18A [Acceptance of offer: criteria for acceptance];

19A [Reply purporting to accept but containing additions or modifications]

Descriptors: Internationality ; Scope of Convention ; Validity ; Standard terms and conditions ; Intent ; Acceptance of offer ; Battle of the forms

Go to Case Table of Contents

Editorial remarks

Go to Case Table of Contents

Citations to other abstracts, case texts and commentaries

CITATIONS TO OTHER ABSTRACTS OF DECISION

Unavailable

CITATIONS TO TEXT OF DECISION

Original language (German): [3/2004] Internationales Handesrecht 115-117; CISG-online.ch website <http://www.cisg-online.ch/cisg/urteile/910.pdf>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

English: [2005] Schlechtriem & Schwenzer ed., Commentary on UN Convention on International Sale of Goods, 2d (English) ed., Oxford University Press, Art. 8 para. 56

German: Herber, Ammerkung zu OLG Düsseldorf 1-23 U 70/03 und LGH Trier 7 HKO 134/03, Internationales Handelsrecht (May/June 2004) 117-118

Go to Case Table of Contents

Case text (English translation)

Queen Mary Case Translation Programme

District Court (Landgericht) Trier

8 January 2004 [7 HK.O 134/03]

Translation [*] by Veit Konrad [**]

Edited by Todd Fox [***]

FACTS OF THE CASE

Plaintiff [Seller] brings a claim against Defendant [Buyer], seated in Luxembourg, for payment of 26,687.23 plus 10 % interest due under a sales contract for synthetic window parts which were delivered during 2000 and 2001. This sum includes 27,227 Deutsche Mark [DM] = 13,920.94, due under an invoice dated 31 August 2001, and an amount of 24,674.32 DM = 12,615.72, which remains from a due amount of 61,402.13 DM, as documented in several other invoices related to this contract, minus compensation of 36,727.83 DM from insurance for irretrievable receivables.

[Seller] alleges that the court has jurisdiction on this case because it is undisputed that each of [Seller]'s invoices refers to its "terms and conditions on reverse," and Condition No. 11 thereof states:

"Place of performance, place of jurisdiction

"The place of performance is the headquarters of the seller. If the buyer is a merchant, a public legal entity, or a public trust, the place of jurisdiction is the headquarters of the buyer. Export transactions will also be governed by German law."

Defendant [Buyer] petitions for the dismissal of [Seller]'s claim. [Buyer] denies that the District Court of Trier has jurisdiction in this case and further holds [Seller]'s claim to be unjustified.

JUDGMENT

[Seller]'s claim cannot be admitted. The District Court does not have jurisdiction in this case.

I. International jurisdiction in this case is governed by the Council Regulation (EC) No 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters from 22 December 2000, [hereinafter "Brussels I Regulation"] since the claim was brought after the regulation had entered into force (Art. 66(1) of Brussels I Regulation).

According to Arts. 2(1) and 60(1)(a) of the Brussels I Regulation, suit against [Buyer] must be brought in Luxembourg because that is where [Buyer] has its statutory seat.

II. Contrary to [Seller]'s submissions, there is no choice-of-forum agreement pursuant to Arts. 23(1)(a) and 63(2) of the Brussels I Regulation that would confer jurisdiction for this case on the District Court of Trier.

Art. 63(2) of the Brussels I Regulation places restrictions on the effectiveness of agreements on jurisdiction that are formed with natural or legal persons domiciled in Luxembourg. The reasoning behind this rule is that since agreements in which parties seated in Luxembourg are involved very often have an international character, Luxembourg parties could, to a large extent, be deprived of Luxembourg jurisdiction (Kropholler, Europäisches Zivilprozeßrecht, 7th ed., Art. 63 of the Brussels I Regulation, para. 4). Therefore, the application of Art. 23(1)(b) and (c) of the Brussels I Regulation is excluded; in order to be valid, an agreement conferring jurisdiction must be either in writing or evidenced in writing within the meaning of Art. (1)(a) of the Brussels I Regulation.

Contrary to [Seller]'s pleading, the jurisdictional clause entailed in Condition No. 11 of [Seller]'s standard terms does not confer jurisdiction on the District Court of Trier, the place where [Seller] is domiciled.

      1. [Seller]'s standard terms have not been effectively incorporated into the contract between the parties.

The incorporation of standard terms is governed by the lex causae (generally accepted opinion, see Kropholler, supra, Art. 5 of the Brussels I Regulation, para 28; Piltz, Handbuch des Vertragsrechts in EG-Staaten, UN-Kaufrecht [Handbook on Contract Law in EU States, UN Sales Law], para. 44).

As both Germany and Luxembourg are Member States of the United Nations Convention on Contracts for the International Sale of Goods (CISG), the contractual relations between the parties are governed by the CISG. Whether the [Seller]'s standard terms were incorporated into the contract is determined according to Arts. 14-24 CISG (generally accepted opinion; see, e.g., U.S. Court of Appeals, 9th Cir. of 5 May 2003 [Chateau des Charmes Wines Ltd. v. Sabaté, USA, Inc., 328 F.3d 528 (9th Cir. 2003)] in: IHR [*] 2003, p. 295). The provisions of Art. 14 et seq. CISG do not allow the mere reference to existing standard terms to lead to their binding incorporation into a contract (Piltz, supra, UN-Kaufrecht, paras. 43, 44). It is in no way sufficient that the [Seller]'s standard terms were only ever mentioned on the invoices, since at the time the invoices are sent the contracts are already concluded (see U.S. Court of Appeals, supra).

      2. Even if the standard terms had been effectively incorporated into the agreement, the jurisdiction clause of Condition No. 11 would be ineffective since it does not meet the form requirements of Arts. 23(1)(a), 63(2) of the Brussels I Regulation. The form requirements necessitate more than simply handing over the standard terms or including them as an enclosure (see Kropholler, supra, Art. 23 of Brussels I Regulation, paras 35, 36). Simply printing the standard terms on the reverse of an invoice is not at all sufficient. It furthermore does not meet the writing requirement if a jurisdiction clause, as part of standard terms and conditions, is placed on the reverse of the document containing the written contract. In such cases it is not ensured that the other party actually agreed to the clause which deviates from the general rules concerning jurisdiction. Rather, it is necessary that the text of the contract itself, which is signed by both parties, expressly reference the standard terms including the jurisdiction clause, and that at the time of the conclusion of the contract the standard terms be available to the other party (Kropholler, supra).

There are no written statements of [Buyer] concerning the incorporation of [Seller]'s standard terms. [Buyer] regularly placed its orders for delivery orally with a representative of [Seller], who in turn passed them on to [Seller]. These orders contained no references to [Seller]'s standard terms. There are no written order confirmations which may have contained references to [Seller]'s standard terms. Only the [Seller]'s invoices contain the standard terms printed on the reverse with the reference to them on the front page. Under these circumstances, it is not discernable when and in what manner the [Buyer] was supposed to have agreed in writing to the jurisdiction clause contained in the [Seller]'s standard terms.

The [Seller] cannot successfully resort to a practice established between the parties because the provisions of Art. 23(1)(b) and (c) of the Brussels I Regulation do not apply here; moreover, it cannot be determined that the parties had ever at an earlier time based their business relationship on the jurisdiction agreement.

III. The District Court of Trier also does not have jurisdiction as a court for the place of performance under Arts. 5(1)(b), 63(1) of the Brussels I Regulation.

Art. 5 (1)(b) of the Brussels I Regulation provides that a party domiciled in a Member State may be sued in another Member State in the court of the place where the obligation in question is performed or would be performed; for the sale of moveable goods this means - so far as not otherwise agreed - the place where, under the contract, the goods were delivered or should have been delivered (Art. 5(1)(b) Brussels I Regulation). However, Art. 63(1) of the Brussels I Regulation allows [Buyer], as a Luxembourg business, to refuse to submit to the jurisdiction of the foreign court if the final place of delivery of the goods is in Luxembourg (Art. 63(1) Brussels I Regulation).

It is undisputed that the window parts were delivered to Luxembourg. Luxembourg is therefore the place of performance or the final place of delivery within the meaning of the above-mentioned provisions. A different result could only be reached if the parties had contractually agreed upon a different place of performance or final place of delivery. At best, this could have occurred through the effective incorporation of [Seller]'s standard terms, which in Condition No. 11 fixed the [Seller]'s headquarters as the place of performance. However, as discussed above, [Seller]'s standard terms were not properly incorporated into the contract between the parties. Moreover, such an abstract stipulation of place of performance would be ineffective as to form.

According to the jurisprudence of the European Court of Justice (ECJ) on Art. 5(1) of the Brussels Convention [*], an agreement over the place of performance is ineffective when its purpose is not to fix the place where the obligor is to fulfill its obligation, but rather aims solely to stipulate a certain jurisdiction while evading formal requirements (Judgment of the European Court of Justice, 20 February 1997, in: NJW [*] 1997, p. 1431 et seq.; see also BGH [*] NJW-RR [*] 1998, 755 = MDR [*] 1997, p. 874). This jurisprudence on the so-called "abstract stipulations on place of performance" must also apply to Arts. 5(1)(b), 63(1) of the Brussels I Regulation now in force. Even though parties are free, without following a certain form, to choose a different place of performance than that supplied by the legal provisions applicable to the contract, under the system of the jurisdiction regulation, however, they may not fix a place of performance, which has no connection with the realities of the contract and where the contractual obligations could not be fulfilled according to the contract, for the sole purpose of stipulating jurisdiction (see ECJ, supra). This follows from the wording of Art. 5(1)(b) of the Brussels I Regulation, which focuses on the actual place of performance according to where delivery takes place or should have taken place. In particular, it would be contrary to the meaning and purpose of the special provisions of Art. 63(1) and (2) of the Brussels I Regulation if the form requirements for jurisdiction agreements could be evaded through abstract clauses on place of performance contained in standard terms and conditions. Otherwise, these provisions would be undermined to a large extent and their circumvention invited (Kropholler, supra, Art. 5 of the Brussels I Regulation, para. 29).

In the present case, it cannot be presumed that the purpose of the place of performance clause here was to fix an actual, substantive, place of performance, i.e., it cannot be presumed that the clause shows a connection to the realities of the contract and is not meant to merely have a procedural effect.

IV. This Court is aware of the fact that in a decision dated 4 April 2003 in a supplementary procedure brought by the [Seller] regarding a preliminary injunction issued, a Luxembourg District Court (Bezirksgericht von und zu Luxemburg) denied its own jurisdiction. This decision from provisional proceedings does not have a binding effect on the decision of this Court. Also, that decision does not really conflict with the reasoning of this Court, since in the Luxembourg proceedings the incorporation of [Seller]'s standard terms was undisputed between the parties.

This Court has considered whether [Buyer]'s objection to the jurisdiction of the Luxembourg court could constitute an abuse of the law within the meaning of 242 [good faith] BGB [*]. However, this does not appear to be the case. The [Seller] has also acted contradictorily by each time assuming contrary legal positions in the various courts. Moreover, it must be considered that in the preliminary injunction proceedings, the Luxembourg court did not bind itself with regards to the main issue dealt with here.

V. The complaint is accordingly rejected as inadmissible; costs follow according to 91 ZPO [*].

The claim for preliminary enforceability is conform to 709(2) ZPO.


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Germany is referred to as [Seller] and Defendant of Luxembourg is referred to as [Buyer]. Amounts in former German currency (Deutsche Mark) are indicated as [DM]; amounts in the European currency (Euro) are indicated as [].

Translator's note on abbrevations: Brussels Convention = Convention of 27 September 1968 on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters; BGB = Bürgerliches Gesetzbuch [German Civil Code]; BGH = Bundesgerichtshof [Federal Supreme Court of Germany]; IHR = Internationales Handelsrecht [International Commercial Law (German law journal)]; MDR = Monatschrift für Deutsches Recht [German Law Monthly (German law journal)]; NJW = Neue Juristische Wochenschrift [New Weekly Journal of Law (German law journal)]; NJW-RR = Neue Juristische Wochenschrift, Rechtsprechungsreport [New Weekly Journal of Law, Decisional Report (German law journal)]; ZPO = Zivilprozessordnung [German Code of Civil Procedure].

** Veit Konrad has studied law at Humboldt University, Berlin since 1999. During 2001-2002 he spent a year at Queen Mary College, University of London, as an Erasmus student.

*** Todd Fox received his J.D. from Rutgers University and his LL.M. summa cum laude from the University of Freiburg, Germany. A member of the Bar of the State of Pennsylvania, he is an Associate of the Institute of International Commercial Law.

Go to Case Table of Contents
Pace Law School Institute of International Commercial Law - Last updated January 8, 2009
Comments/Contributions
Go to Database Directory || Go to CISG Table of Contents || Go to Case Search Form || Go to Bibliography