Denmark 21 December 2004 Western Appellate Court (Check valves case)
[Cite as: http://cisgw3.law.pace.edu/cases/041221d1.html]
DATE OF DECISION:
CASE NUMBER/DOCKET NUMBER: Unavailable
CASE HISTORY: 1st instance District Court Grenaa 6 February 2003 [affirmed]
SELLER'S COUNTRY: Italy
BUYER'S COUNTRY: Denmark
GOODS INVOLVED: Check valves
DENMARK: Western High Court, 21 December 2004 (Buyer ApS v. Seller s.r.l.)
Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/100],
CLOUT abstract no. 994
Reproduced with permission of UNCITRAL
Abstract prepared by Joseph Lookofsky, National Correspondent, and René F. Henschel
An Italian seller and a Danish buyer entered into contracts for the sale of 1,241 check-valves for installation of petrol stations in Denmark and elsewhere in Scandinavia. Prior to the sale the buyer had requested that the seller confirm that the valves "can be used with petrol" and the seller subsequently confirmed that the valves were "for petrol".
Some months after delivery and installation of the valves, one of the buyer's customers complained that the rubber gaskets in 35 of the valves installed had cracked, and that these cracks had caused the valves to leak. Subsequently, the cracks were found to be due to the influence of MTBE, which is an additive used in Scandinavia as a means to increase the octane value in petrol.
The buyer commenced an action against the seller, claiming that the valves delivered were defective, because they could not resist MTBE and that the buyer was entitled to damages incurred as a result of costs incurred in connection with the replacement of the valves delivered with other valves capable of resisting the MTBE additive. The seller contested that the valves which it had delivered were defective, maintaining in this connection that the use of MTBE in petrol was unusual and limited to countries within Scandinavia. The seller further maintained that the buyer had failed to examine the goods and that the buyer had not provided the seller with sufficient notice of the alleged nonconformity. For these reasons, the seller disputed that the buyer was entitled to damages.
The High Court held that the seller was obligated to deliver valves which could be used with petrol containing MTBE. In the Court's opinion, the seller had not established that the use of MTBE in petrol was limited to the Scandinavian countries, nor had the seller established that it was not obligated to take into account that the valves were to be used with petrol containing MTBE. For these reasons, the goods did not conform to the contract under article 35(1) CISG, just as the goods as delivered were not fit for the purposes for which goods of the same kind would ordinarily be used, article 35(2)(a) CISG.
As regards notice of nonconformity, the High Court held that the buyer's notice was sufficient under article 39 CISG, even though the notification only related to some of the valves in the order concerned. Although the High Court did not refer specifically to article 38 CISG, the court of first instance had held that the buyer was not obligated to test the valves prior to their resale and use by its customers. Noting that the seller had not taken the initiative to repair the nonconformity pursuant to article 48 CISG, the High Court held that the seller was liable for what the Court (while not referring specifically to article 74 CISG) described as the "foreseeable" loss incurred by the buyer in connection with the replacement of the nonconforming valves.Go to Case Table of Contents
APPLICATION OF CISG: Yes
APPLICABLE CISG PROVISIONS AND ISSUES
Key CISG provisions at issue:
Classification of issues using UNCITRAL classification code numbers:
CITATIONS TO OTHER ABSTRACTS OF DECISION
CITATIONS TO TEXT OF DECISION
Original language (Danish): CISG Nordic website <http://www.cisgnordic.net/041221DK.shtml>
CITATIONS TO COMMENTS ON DECISION
UnavailableGo to Case Table of Contents