Switzerland 21 September 2004 District Court Luzern-Land (Watches case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/040921s1.html]
DATE OF DECISION:
CASE NUMBER/DOCKET NUMBER: 11 04 4 / ZU 016
CASE HISTORY: Unavailable
SELLER'S COUNTRY: Switzerland (plaintiff)
BUYER'S COUNTRY: Germany (defendant)
GOODS INVOLVED: Watches
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:
50A [Buyer's right to reduce price for non-conforming goods]; 74A [General rules for measuring damages: loss suffered in consequence of breach]; 78A [Interest on delay in receiving price or any other sum in arrears].
50A [Buyer's right to reduce price for non-conforming goods];
74A [General rules for measuring damages: loss suffered in consequence of breach];
78A [Interest on delay in receiving price or any other sum in arrears].
CITATIONS TO ABSTRACTS OF DECISION
(a) UNCITRAL abstract: Unavailable
(b) Other abstracts
CITATIONS TO TEXT OF DECISION
Original language (German): CISG-online.ch website <http://www.cisg-online.ch/cisg/urteile/963.pdf>
Translation (English): Text presented below
CITATIONS TO COMMENTS ON DECISION
UnavailableGo to Case Table of Contents
Queen Mary Case Translation Programme
21 September 2004 [11 04 4 / UZ 016]
Translation [*] by Todd Fox [**]
Edited by Mariel Dimsey [***]
The reduced court costs amount to 2,000 Swiss francs [CHF]. These will be deducted from the 3,100 CHF court costs pre-paid by the [Seller]. The Court will refund the remaining amount of 1,100 CHF to the [Seller].
The [Buyer] is ordered to reimburse the [Seller] for the pre-paid court costs of 2,000 CHF and the pre-paid costs of 165 CHF for the justice of the peace. The [Buyer] is also ordered to reimburse the [Seller] for attorneys' fees in the amount of 4,380 CHF (including 200 CHF in expenses and taxes).
If a complete transcript of the judgment is demanded, the court costs are 4,000 CHF.
It is undisputed that the invoked Court has both subject matter and venue jurisdiction in this action due to the domicile of the [Buyer] in Adligenswil and the amount in controversy of over 8,000 CHF (see Answer; Art. 3, 1(a) GestG [*]; § 9 ZPO). The parties' right to sue and standing to be sued are not disputed (see Answer). Since the [Buyer] failed to appear at the judicial proceedings on 3 and 20 September 2004 without excuse (Official Record 15-18, VP pg. 1-2), the Court must decide based on the files and verbal testimony brought by the [Seller] (§ 89 ZPO).
The formation of sales contracts for watches is confirmed only by receipts in the amount of HK $8,129.51 ([Seller]'s exhibit 18) and US $35,259.22 ([Seller]'s exhibit 19-44). The correspondence of the parties presented ([Seller]'s exhibit 4-11) shows that watches were delivered and accepted. The [Buyer] has made no substantiated objection to this point or to the amount of the sales prices (see Answer). The [Buyer]'s claim of an agreement for the delivery of free samples has remained unproven. (see Answer pg. 2, Counterclaim, pg. 2).
Since it is undisputed that at the time of the formation of these contracts the [Buyer]'s domicile was in Lübeck [Germany] (Answer, pg. 8), and since both Germany and Switzerland are Contracting States of the 1980 United Nations Convention on Contracts for the International Sale of Goods (CISG), the CISG applies in this case (Art. 1(1)(a) CISG). It is undisputed that the [Buyer] timely and adequately notified the [Seller] of problems with the watches "(...)" and "(...)" ([Buyer]'s exhibits 4-12 and 18-21; see also [Buyer]'s exhibits 13-17 in which the [Seller] refers to problems with quality), and thereby gave notice of defects. (Arts. 38, 39 CISG). The correspondence presented indicates that the [Buyer] demanded neither delivery of substitute goods, nor repair (Art. 46(2), (3) CISG), nor avoidance (Art. 49 CISG), but rather requested a reduction in the price (Art. 50 CISG). In fact, no other claim is made (see Answer).
In an e-mail dated March 12, 2005, the [Buyer] gave assurance of payment and requested "a relatively small compensation for the problems" ([Buyer]'s exhibit 21). In a subsequent e-mail, the [Buyer] inquired whether he could deduct US $5,000 for the quality-related problems, which was accepted by the [Seller] via e-mail dated May 8, 2004 ([Seller]'s exhibit 11). It is undisputed that this sum of US $5,000 was not sought in the present action (US $35,259.22 minus US $5,000, in accordance with [Seller]'s exhibits 19-44, equals the amount sued upon of US $30,259.22).
The [Buyer] claims damages in the amount of US $50,500 arising from alleged repair costs, other expenses, and lost profits as a set-off (Answer pg. 5-8). A reduction of the sales price pursuant to Art. 50 CISG can generally be combined with claims for damages under Arts. 74-77 CISG (Art. 45(1), (2) CISG). The party claiming damages bears the burden of proving both the existence and amount of the damages, as well as their causal relation to the breach of contract (Schlechtriem, Kommentar zum UN-Kaufrecht [CISG Commentary], 3d ed. 2000, paras. 47-48 to Art. 74 CISG). Such proof is completely absent in the case at bar; no motions for the admission of evidence were made.
During the proceedings on 20 September 2004, the [Seller] permissibly amended its pleadings (§ 98 ZPO [*]) to demand the damages in the currency of the contracts, i.e., in Hong Kong dollars ([Seller]'s exhibit 18) and U.S. dollars ([Seller]'s exhibits 19-44), rather than in Swiss francs (VP pg. 2). Since a petition for the satisfaction of debts in foreign currencies requires that the obligee provide the obligor with the opportunity to perform with foreign currency, and since the prayer for relief is to be formulated accordingly (Leu, Basler Komm. [Basler Commentary], 3rd. ed. 2003, para. 10. to Art. 84 OR [*]; ZR 1991 Nr. 37), this procedure is correct. Interest on arrears is not due from 24 March 2003, the date S [...] Marketing & Vertrieb GmbH received notice of the demand for payment ([Seller]'s exhibit 17); but rather from 2 December 2003, the presumed date of the [Buyer]'s receipt of the petition against him (see [Seller]'s exhibit 2; official record 2 and 4).
The value of the dispute in this case for the purpose of fixing court costs and attorneys' fees (Official Record 20) amounts to 104, 943.73 CHF (Leu, supra, para. 10 to Art 84 OR). On 26 January 2004, the date suit was filed, HK $8,129.51 equaled 1,300.83 CHF, and US $30,259.22 equaled 37,600.10 CHF. On 29 April 2004, the date the Answer with the set-off claim was filed, the equivalent of US $50,500.00 was 60,033.22 CHF according to the exchange converter <www.oanda.com.converter.classic>; (see §§ 2, 7, 15, 17(3), 51 and 55 KoV [*]). Only the expenses of [Seller]'s counsel occurring in the judicial proceedings, estimated at 200 CHF, can be taken into consideration (§§ 50(1) and 69, 70 KoV; see also Studer/Rüegg/Eiholzer, Der Luzerner Zivilprozess [Luzern Civil Procedure Commentary], para. 2 to § 196 ZPO [*]). Since the obligee is entitled to collect the debt collection costs in advance, no interest of legal protection exists for the judicial order to pay costs (see Official Record 20; Art. 68(2) SchKG [*]; § 100(1) ZPO).
* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Switzerland is referred to as [Seller] and Defendant of Germany is referred to as [Buyer]. Amounts in the currency of Hong Kong (Hong Kong dollars) are indicated as [HK $]; amounts in U.S. currency as [US $]; amounts in the currency of Switzerland (Swiss francs) as [CHF].
Translator's note on other abbreviations: GestG = Gerichtsstandsgesetz [Swiss law regarding venue]; KoV = Verordung über die Geschäftsführung der Konkursämter [Swiss law regarding debt payment and bankruptcy]; OR = Obligationenrecht [Swiss Law of Obligations]; SchKG = Bundesgesetz vom 11. April 1889 Schuldsbetreibung und Konkurs [Swiss law regarding debt payment and bankruptcy]; ZPO = Zivilprozessordnung [Swiss Code of Civil Procedure].
** Todd Fox received his J.D. from Rutgers University and his LL.M. summa cum laude from the University of Freiburg, Germany. He is currently and Associate with Monte & McGraw, P.C. in Pennsylvania and an Associate with the Institute of International Commercial Law of the Pace University School of Law.
*** Mariel Dimsey, LL.M., is a Research Assistant and Teaching Assistant at the University of Basel, Switzerland.Go to Case Table of Contents