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CISG CASE PRESENTATION

Germany 13 May 2005 District Court Freiburg (PVC light panel case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/050513g1.html]

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

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Case identification

DATE OF DECISION: 20050513 (13 May 2005)

JURISDICTION: Germany

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

JUDGE(S): Jagmann

CASE NUMBER/DOCKET NUMBER: 2 O 401/04

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

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Belgium (defendant)

BUYER'S COUNTRY: Germany (plaintiff)

GOODS INVOLVED: PVC light panels


Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 31

Classification of issues using UNCITRAL classification code numbers:

31A [Place for delivery: contracts involving carriage of goods]

Descriptors: Delivery ; Jurisdiction

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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 (German): Unavailable

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation)

Queen Mary Case Translation Programme

District Court (Landgericht) Freiburg

13 May 2005 [2 O 401/04]

Translation [*] by Stefan Dietrich [**]

Edited by Camilla Baasch Andersen [***]

The 2nd Civil Division of the District Court of Freiburg adjudged through Chief Judge Dr. Jagmann, as Sole Judge, in the matter of Plaintiff K.G. [Buyer] of Germany vs. Defendant O SA.AG [Seller] of Belgium in a lawsuit involving 11,213.60 Euros, after an oral hearing of 8 April 2005:

The Court has jurisdiction -- internationally, locally and in regard to the subject matter -- for a ruling in this lawsuit.

FACTS

[Buyer] runs a sports center with a tennis hall in R ___. [Seller] is a Belgian company which sells light panels and building panels made of rigid PVC.

On 16 December 1995, [Seller] provided [Buyer] with sixteen light panels together with accessories for a price of 4,669.70 DM (DM = Deutsche Mark = Former German Currency). [Seller] issued an order, dated 16 December 1995, confirming the delivery (enclosure 1 AH of [Buyer]). The order referred to [Buyer]'s sports center as the delivery address and to V./Belgium as the place of jurisdiction; it also referred to [Seller]'s Sales and Delivery Terms.

Another delivery of light panels was carried out on 15 January 1996 at a price of 7,199.59 DM. [Seller] issued an invoice in regard to this delivery, dated 15 January 1996, which also referred to [Buyer]'s sports center as the delivery address, to V./Belgium as the place of jurisdiction and which contained a reference to [Seller]'s Sales and Delivery Terms (enclosure 2 AH of [Buyer]).

6 of [Seller]'s Sales and Delivery Terms states:

"Transfer of risk to the recipient takes place with the handing over of the goods to the shipper or carrier, at the latest, however, when the goods leave the factory or storage. The same applies in regard to FOB and CIF transactions as well as in respect to an agreement 'free destination' or similar."

The delivery of the light panels took place with [Seller]'s own truck.

[Buyer] presents a written declaration by [Seller], in which [Seller] assumed a "ten-year warranty" in regard to the hail-safety, corrosion resistance, weather resistance and ultraviolet-light resistance of the light panels. The light panels were installed by [Buyer] himself. They subsequently became deformed, tarnished and dark.

POSITION OF THE PARTIES

[Buyer]'s position

[Buyer] seeks the costs of replacing the light panels. [Buyer] alleges that the defects that arose are due to the inappropriate material delivered. The replacement of the panels would require expenses in the amount of 11,213.60 Euros. [Buyer] holds the view that the Court has international jurisdiction because the parties agreed upon a debt to be discharged at the creditor's domicile ("Bringschuld"), as the delivery was carried out from [Seller]'s facilities in Germany directly to [Buyer]'s domicile; that the agreement on the place of delivery results from the accounts and delivery notes. Due to the size of the light panels and the thus existing difficulties of transport, it would have been clear from the outset, that [Seller] would be bound to effect the delivery to the place of use.

[Buyer] applies to the Court to have [Seller] directed to pay 11,213.60 Euros to [Buyer] with interest since 22 July 2001 at 5% above the base rate.

[Seller]'s defense

[Seller] applies for dismissal of the action. [Seller] challenges the international competence of the Court. [Seller] alleges that an agreement on jurisdiction was effectively accomplished between the parties; furthermore, the parties would have agreed upon an obligation to be performed at debtor's place of business by dispatch of debtor ("Schickschuld"), so that the place of delivery would be [Seller]'s place of business. This should also follow from 6 of [Seller]'s Sales and Delivery Terms. [Seller] does not agree that a ten-year warranty was agreed upon and that the delivered light panels were defective. It is [Seller]'s position that the damages result solely from incorrect installation by [Buyer].

In regard to the further details of the parties' submissions, reference is directed to the pleadings they exchanged together with their attachments. The files of the independent procedure of taking evidence 2 OH -/- were the subject of the oral hearing.

REASONING OF THE COURT

I. The parties have first argued about the competence of the Court. In respect to this question, which is to be checked within the examination of the legitimacy of the action, it has to be adjudicated according to 280 ZPO (ZPO = German Civil Procedure Order) by way of an interim judgment. That an express order to negotiate on the legitimacy of the action separately, pursuant to 280(1) ZPO, was not ruled on during the oral hearing, does not preclude the issuance of an interim judgment. The issuance of an interim judgment does not require an express order to negotiate separately (BGH WM 1994, 1051, 1052; in a situation such as this. BGH NJW 1956, 1920, 1921; see also Stein /Jonas/ Leipold, ZPO 20th edit., 280 Rn. 16). [Seller] does not suffer a procedural disadvantage when the Court decides on questions of the legitimacy of the action in advance without ordering separate negotiation beforehand. This order simply makes for the economy of the proceedings. Accordingly, the ability to appeal the interim judgment does not depend on the ordering of a separate negotiation. For the rest, the parties were advised before the conclusion of the oral hearing -- insofar not recorded -- that in case of a revocation of the settlement, a decision on the competence of the Court would be handed down.

II. The Court of Appeal has jurisdiction - internationally, locally and in regard to the subject matter - for a ruling in this lawsuit.

      1. A binding agreement on jurisdiction, which could establish the competence of a Belgium Court, was not agreed upon by the parties. According to Art. 23 EuGVVO (EuGVVO = Council Regulation of December 2000 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters) an agreement on jurisdiction requires that it be in written form or verbally with a confirmation in writing or in a form which complies with the conventions that arose between the parties in international trade in a form which conforms with a commercial usage which was known to the parties or should have to been known and which is regularly respected or generally common to traders in regard to contracts of this kind in the relevant branch of business.

None of these requisites was brought forward. The fact alone that [Seller] included a clause on jurisdiction on her accounts and on her order confirmations, neither satisfies the requisites of a written agreement nor is therewith a written confirmation by [Buyer] and [Seller] on a previous oral agreement on hand, nor was there a commercial custom brought forward which allows for an accordant form.

      2. The Court's international competence follows from Art. 5 No. 1 b) EuGVVO.

Pursuant to this provision, a person whose domicile is within the sovereign territory of a Member State, can be sued in another Member State when a contract or claims out of a contract are the subject of the proceedings, namely, such a person can be sued at the Court of the place at which the obligation was fulfilled or would have to be fulfilled. Therefore, in case of a sale of movable goods pursuant to this provision, the place of performance is the place to which the goods were delivered according to the contract. This place is not only authoritative as the place of performance in regard to contractual primary claims, but also for warranty claims which follow from the delivery and miscellaneous contractual rights of subsidiary performance.

With this provision, an independent term of the place of performance was created for the first time, which deviates from the applicable legal position according to Art. 5 GVÜ (EuGH [= ECJ] NJW 1977, 491; NJW 2000, 719), which has to be ascertained independently from the substantive law which is applicable according to the provisions of Private International Law, according to the basic principles of law of the Council Regulation on jurisdiction and the recognition and enforcement of judgments in civil and commervial matters (Thomas/Putzo, ZPO, Art. 5 EuGVVO Rn 4).

However, this does not mean that in every case in which the goods sold are delivered to the buyer, that the domicile of the buyer constitutes the place of performance. In fact, the place of dispatch establishes the place of performance when, according to the contractual agreements, it can be derived from a destination purchase, because then the delivery pursuant to Art. 5 No. 1 b EuGVVO is already effected with the dispatch of the consignment (comp. Geimer/Schütze, European Civil Procedure Law, 2nd edit. 2004, Art. 5 Rn. 86; different view Hager/Bentele, IPRax [IPRax = German Law Journal] 2004, 73).

However, such a destination purchase was not agreed upon between the parties. The question whether a destination purchase is at hand thereby, and within the scope of Art. 5 No. 1 b EuGVVO, cannot be decided without recourse to the provisions of the substantive law which applies to the contractual relationship in the absence of concrete agreement. Since Germany and Belgium are Contracting States to the CISG, this question is to be appraised according to the provisions of the CISG. Pursuant to Art. 31(a) CISG, if the seller is not bound to deliver the goods at any other place and the contract of sale involves carriage of the goods, the seller's obligation to deliver calls for handing the goods over to the first carrier for transmission to the buyer. This place of the handing over also determines the place of performance (Staudinger/Magnus, BGB [2004], Art. 31 CISG Rn 24). In this case, in terms of Art. 5 EuGVVO, the seller "delivers" with the handing over to the carrier. However Art. 31(a) CISG only intervenes if a handing over to an independent carrier takes place, not, if the seller accomplishes the carriage with his own employees (Staudinger/Magnus l.c. Rn. 13).

The [Seller] took over the delivery herself in this case. Thus a handing over to a third party to determines the place of delivery and the place of performance and for this reason a destination purchase pursuant to Art. 31(a) CISG is not on hand.

This does not mean that for this reason Art. 31(a) CISG intervenes and that the place of delivery and the place of performance is to be understood as [Seller]'s domicile. The contract of sale undisputedly required a carriage of the goods. So that it was not agreed upon, that [Seller] had to make the goods available at [Seller]'s place of business.

Therefore, it has to be autonomously clarified in the context of Art. 5 EuGVVO, without regard to the applicable substantive law, what is to be understood as the place of the delivery. As Art. 5 No. 1 b 1st clause orients towards the provision of Art. 46 of the French Nouveau Code de Procédure, it offers to consider the French jurisprudence and literature (Schlechtriem/Schwenzer/Huber/Widmer, CISG, 4th ed. 2004, Art. 31 Rn 93). Accordingly, the actual place of performance of the obligation to deliver is situated where the buyer obtains the physical possession of the goods according to the contract (Schlechtriem/ Schwenzer/Huber/Widmer, l.c. Rn. 94, with many other references). If the seller takes over the transport of the goods himself, such as in this case, without employing of an independent carrier, the physical possession of the goods devolves to the buyer at the place of destination. Hence, this establishes the place of delivery and thus the place of performance which, in turn, establishes the competence of the Court (Schlechtriem/Schwenzer/Huber/Widmer l.c.).

This interpretation of Art. 5 No. 1 b 1 complies best with the actual contract and allows to determine the place of delivery under pragmatic criteria. Every other determination of the place of delivery in cases in which the seller takes on the transport himself, would contradict the pragmatic view of the one who delivers -- who brings the goods to another place. In these cases, this would establish a legal place of delivery which would not give consideration to the actual contractual handling.

A dissenting contractual agreement, which would have to be considered, does not arise from 6 of [Seller]'s Sales and Delivery Terms. Because, according to its wording, 6 simply contains a transfer of risk clause, and does not determine the place of performance (Palandt/Heinrichs, BGB, 64th ed., 2005, 269, Rn. 10; Schlechtriem/Schwenzer/Huber/ Widmer, l.c., Rn. 92; Staudinger/Magnus, l.c. Rn. 32). That simply a bearing of risk-clause is available, becomes particularly apparent by sentence two, which solely regulates the bearing of risk in regard to Incoterms clauses "fob" and "cif", which determine a place of delivery (comp. MünchKomm BGB/Westermann, 4th edit. 2004, 447 Rn. 10 f.; Palandt/Heinrichs, l.c. Rn. 10), but for the rest implies the standing of the clauses.

      3. The international competence of the Appellate Court also establishes the local competence, the subject-matter competence follows from 71, 23 GVG (GVG = German Judicature Act).

Engrossed by Kiefer as clerk of the District Court.


FOOTNOTES

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

** Stefan Dietrich, Dipl. iur University of Bochum, LL.M. University of London (2004/2005). His fields of law are International Commercial Law and Corporate Law. Since January 2006 articled clerk with the Higher Regional Court (OLG) Hamm.

*** Camilla Baasch Andersen, Lecturer in International Commercial Law, University of Leicester; Fellow of the Institute of International Commercial Law, Pace; Visiting Lecturer at University of London.

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Pace Law School Institute of International Commercial Law - Last updated May 24, 2006
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