Belgium 30 June 2004 Appellate Court Gent (Van Oers BV v. NV Turbo's Hoet Truckcenter Productie) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/040630b1.html]
DATE OF DECISION:
CASE NUMBER/DOCKET NUMBER: 2003/AR/901
CASE HISTORY: 1st instance Rechtbank van Koophandel Kortrijk 12 November 2003
SELLER'S COUNTRY: Belgium (defendant)
BUYER'S COUNTRY: Netherlands (plaintiff)
GOODS INVOLVED: Trailers for trucks
APPLICATION OF CISG: Yes [Article 1(1)(a)]
APPLICABLE CISG PROVISIONS AND ISSUES
Key CISG provisions at issue:
Classification of issues using UNCITRAL classification code numbers:
25B [Definition of fundamental breach: substantial deprivation of expectation, etc.]; 46B1 [Buyer's right to require performance (requiring delivery of substitute goods):
remedy available only for fundamental breach]
25B [Definition of fundamental breach: substantial deprivation of expectation, etc.];
46B1 [Buyer's right to require performance (requiring delivery of substitute goods): remedy available only for fundamental breach]
Overview comments (CISG-Belgium database): "Application of CISG -- both Belgium and Netherlands Contracting States. Sale of goods to be produced -- CISG applicable. Fundamental breach -- not proved -- buyer cannot require substitute goods."Go to Case Table of Contents
CITATIONS TO ABSTRACTS OF DECISION
(a) UNCITRAL abstract: Unavailable
(b) Other abstracts
CITATIONS TO TEXT OF DECISION
Original language (Dutch): CISG-Belgium database <http://www.law.kuleuven.ac.be/ipr/eng/cases/2004-06-30.html>
Translation (English): Text presented below
CITATIONS TO COMMENTS ON DECISION
UnavailableGo to Case Table of Contents
Case text (English translation) [second draft]
Queen Mary Case Translation Programme
30 June 2004 [2003/AR/901]
Translation [*] by Kristof Cox [**]
3. The dispute concerns a sale of goods between parties who have their place of business in different States. Both Belgium and the Netherlands are party to the CISG since 1 November 1997 and 1 January 1992, respectively. The CISG is applicable to contracts of sale of goods between parties that have their place of business in different Member States, as in the case at hand. The rules of this Convention are incorporated in the national law of both States, so that the application of the national law of a Member State necessarily leads to the application of the CISG.
According to Article 3(1), contracts for the supply of goods to be manufactured or produced are to be considered sales. [Seller] incorrectly invokes Article 3(2): the invoices only mention "goods", while it is shown nowhere that in spite of this the preponderant part of the obligations of [Seller] consisted in the supply of labor (as [Seller] here alleges).
4. [Buyer] alleges that the trailers [Seller] delivered and listed in invoices 1060136 and 1060137 of 14 June 2001 are not in conformity with the order. The confirmations of order of 21 February 2001 and 5 March 2001 mention clearly a height of 4 meters externally and 2.4 meters internally, while in reality this was some 10 cm more. [Buyer] alleges that this was discovered at a control with an eye at the check by the Agency of Traffic.
The CISG applies only one uniform notion of conformity; in the system of that Convention no distinction is made between a warranty against hidden defects and the duty to deliver the goods: the position of the CISG is simply that the seller must deliver conforming goods (Article 35).
However, the CISG (Articles 38 and 39) obliges the buyer to examine the goods, or cause them to be examined, within as short a period as is practicable in the circumstances. Further, the buyer loses the right to rely on a lack of conformity of the goods if he does not give notice to the seller specifying the nature of the lack of conformity within a reasonable time after he has discovered it or ought to have discovered it.
5. [Seller] first stresses that [Buyer] accepted the trailers and paid without specific or timely protest. Moreover, [Seller] alleges that it is easy to discover a deviation such as that alleged by the [Buyer] and probably it would not be unnoticed in a fleet of similar trailers. Even though [Buyer] itself states that the deviation in height was discovered on 4 July 2001 (after a third party already installed a cooling installation), it is only for the first time in a letter of 30 August 2001 of [Seller] to [Buyer] that a sign of the dispute can be read:
"The legally permitted height of a trailer in the Netherlands is 4,000 mm. With this height, there can be no obstruction at any bridge ... Therefore we cannot understand that you do not accept this height. All our trailers for the Netherlands are built with a height of 4,000 mm.
We still offer that you bring one of your combinations to us, so that we can examine how these combinations can be driven within the legal requirements.
As we have already repeatedly stated yesterday, the problem is not in the trailer, but in the truck."
Unlike the allegations of [Buyer], [Seller] has not "conceded that it has made a mistake", neither in this letter, nor later. To the contrary, in its letter of 28 November 2001 [Seller] repeats:
|-||"Eventually the vehicles were permitted to traffic in the Netherlands, so that it is impossible to state that the vehicles were not constructed in conformity with Dutch regulations.
|-||Thus, the Board is not of the opinion that damages are due."|
Moreover, the allegations of [Buyer] with regard to the height are determined in a contradictory manner, while [Seller] disputes the alleged non-conformity up to today and stated from the beginning that the deviation in height is not caused by the trailer as such, but by the truck. In this regard, it is important to find that the unilateral determinations [Buyer] has caused to be performed by a third party (DEKRAKEURINGEN BV), indeed show that the height of the trailers that were delivered (on a truck DAF TE75PC) in unloaded position, is 411.15 cm in the front, but only 390 or 394 cm in the back.
[6.] [Buyer] never accepted [Seller]'s invitation of 30 August 2001 to offer a combination that it would adjust to the legal requirements. On the other hand, the invoices and declarations offered by [Buyer] show that the trailers were already adjusted at that moment.
Finally, [Buyer] does not deny that the vehicles - at this moment and already for three years - are in use. Moreover, it may be noted that the examination by B.V. DEKRA took place on 10 January 2002 and that at that occasion measurements were also performed "in the position as they are to be driven at this moment." Thus, [Buyer] cannot dispute that the trailers "are fit for the purposes for which goods of the same description are ordinarily used" (cf. Art. 35(2)(a) CISG); [Buyer] does not allege that it had to use another trailer instead of the one that was delivered.
In any event, [Buyer] has failed to prove that the alleged breach was fundamental. According to Article 25 CISG, a breach is fundamental if it results in such detriment to the other party as substantially to deprive him of what he is entitled to expect under the contract. This is not proved in the case at hand, so that [Buyer] cannot claim replacement of the trailers (cf. Article 46(2) CISG: "If the goods do not conform with the contract, the buyer may require delivery of substitute goods only if the lack of conformity constitutes a fundamental breach of contract. ..."), as it claims (cf. writ).
[7.] [Buyer] has not proved that it was impossible to trigger a useful contradictory examination, or to safeguard or fix its rights in another manner, so that less reliable witness evidence would have to be ordered on the basis of the negligence of [Buyer] itself. Moreover, this would not rebut what has preceded at all, so that such an examination should be refused as being useless.
On the same basis, an expert examination is not useful.
Thus, in what precedes, no evidence can be found of any timely or other useful examination, or of any timely notice of a certain non-conformity.
[8.] At the same time, [Buyer] claims damages to the amount of 10,000 €. In its final memorandum deposited on 17 May 2004, [Buyer] reasons that "the costs and losses ... can be calculated at 500 € to 1,000 € per trailer per month (extra kilometers and loss of time of manpower)."
According to Article 74 CISG, the damages consist of a sum equal to the loss, including loss of profit. However, [Buyer] has completely failed to provide evidence of such or other damage or loss of profit, so that this section of the [Buyer]'s claim lacks the necessary basis.
[9.] Neither the fact of the appeal, nor the finding that [Buyer] has not reached the result it aimed for, allows the Court to find that the [Buyer]'s appeal was vexatious.
Further, it is not sufficient that [Seller] considers this to be a useless dispute without any evidence, that the procedure was conducted with an eye at damaging the counter party, i.e., to challenge him with an inappropriate act, and that the proceedings were reckless, i.e., without considering the consequences. These facts are not present in this case.
The counterclaim of [Seller] on this account does not succeed.
FOR THOSE REASONS,
* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Netherland is referred to as [Buyer] and Defendant of Belgium is referred to as [Seller].
** Kristof Cox is a researcher at the Institute for International Trade Law at the Catholic University of Leuven (Belgium). He is preparing a Ph.D. on the effects of an arbitration award on third parties. Further, he regularly publishes articles and case notes on the CISG and International Commercial Arbitration. Kristof Cox can be contacted at <Kristof.email@example.com>.Go to Case Table of Contents