Switzerland 23 May 2005 Kantonsgericht [District Court] Nidwalden (Farm machines case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/050523s1.html]
DATE OF DECISION:
JUDGE(S): CASE NUMBER/DOCKET NUMBER: ZK 04 26 CASE NAME: CASE HISTORY: Unavailable SELLER'S COUNTRY: Switzerland (plaintiff) BUYER'S COUNTRY: Germany (defendant) GOODS INVOLVED: Farm machines and spare parts Reproduced from 5 Internationales Handelsrecht (2005) 6:253 "1. The burden of proof is to be determined by the CISG whilst the necessary degree of judicial conviction is subject to the lex fori. This means that under Swiss law the judge has to be convinced of the correctness of a factual statement. "2. The interest rate and the limitation periods are subject to the law that is applicable to the case according to the private international law of the lex fori." SWITZERLAND: Kantonsgericht Nidwalden (Farm machines and spare parts case) 23 May 2005 [ZK 04 26]
Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/90],
Reproduced with permission of UNCITRAL
UNCITRAL case abstract
CLOUT abstract no. 906
CASE NUMBER/DOCKET NUMBER: ZK 04 26
CASE HISTORY: Unavailable
SELLER'S COUNTRY: Switzerland (plaintiff)
BUYER'S COUNTRY: Germany (defendant)
GOODS INVOLVED: Farm machines and spare parts
Reproduced from 5 Internationales Handelsrecht (2005) 6:253
"1. The burden of proof is to be determined by the CISG whilst the necessary degree of judicial conviction is subject to the lex fori. This means that under Swiss law the judge has to be convinced of the correctness of a factual statement.
"2. The interest rate and the limitation periods are subject to the law that is applicable to the case according to the private international law of the lex fori."Go to Case Table of Contents
SWITZERLAND: Kantonsgericht Nidwalden (Farm machines and spare parts case) 23 May 2005 [ZK 04 26]
Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/90],
Reproduced with permission of UNCITRAL
A German supplier delivered used agricultural machinery and spare parts to a Swiss trader. The buyer subsequently made several instalment payments. The dispute related to the balance of the price still owed to the seller. The latter referred the case to the Cantonal Court of Nidwalden.
Relying on the general principles of the CISG, the court placed the onus of proving payment of the sale price on the buyer. The latter was unable to furnish sufficient proof of an alleged cash payment of 10,000 Swiss francs; the court accordingly allowed the main claim. It also acknowledged the seller's entitlement to interest on arrears as from the due date of payment of the price (article 78 CISG), the rate of interest being fixed in conformity with national law as determined by Swiss private international law.
The court examined in the light of Swiss civil law the question whether, as alleged by the defendant, the plaintiff's claim was statute-barred.Go to Case Table of Contents
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:
4A ; 4B [Scope of Convention (issues covered): burden of proof ("in parts explicitly, but mostly implicitly); Issues excluded: "questions concerning extent of proof and the required extent of conviction of the judge are to be solved in accordance with the lex fori"); Issues excluded: statute of limitations]; 57A [Place for payment]; 78B [Rate of interest]
4A ; 4B [Scope of Convention (issues covered): burden of proof ("in parts explicitly, but mostly implicitly); Issues excluded: "questions concerning extent of proof and the required extent of conviction of the judge are to be solved in accordance with the lex fori"); Issues excluded: statute of limitations];
57A [Place for payment];
78B [Rate of interest]
CITATIONS TO OTHER ABSTRACTS OF DECISION
CITATIONS TO TEXT OF DECISION
Original language (German): CISG-online.ch website <http://www.cisg-online.ch/cisg/urteile/1086.pdf>; see also 5 Internationales Handelsrecht (2005) 6:253-256
Translation (English): Text presented below
CITATIONS TO COMMENTS ON DECISION
German: Fountoulakis, Case commentary, 5 Internationales Handelsrecht (2005) 6:244-248Go to Case Table of Contents
Queen Mary Case Translation Programme
23 May 2005 [ZK 04 26]
Translation [*] by Thomas Arntz [**]
Edited by Mariel Dimsey [***]
A. - The Plaintiff [Seller] is a joint-stock company (Aktiengesellschaft) specialized in trading and repairing agricultural machines and special-purpose vehicles. The Defendant [Buyer], a limited liability company (Gesellschaft mit beschränkter Haftung), is active in the field of agricultural machines and environmental technology. The founder and present sales manager of [Seller] and the manager of [Buyer] have known each other personally for some time from previous business transactions. At the end of April and the beginning of May 1999, [Seller] delivered "Occasions"-agricultural machines and spare parts worth [Sf] (Swiss francs) 57,045.05 to [Buyer]. In the course of time [Buyer] paid several installments. The amount of [Buyer]'s remaining debt is in dispute.
B. - After a conciliation attempt on June 28, 2004, [Seller] brought an action against [Buyer] before the District Court of Nidwalden on July 23, 2004, and requested that:
[Seller] of Switzerland reasoned, that because [Buyer] has its seat in ___ Germany, the issue is international; accordingly, the question of jurisdiction has to be decided based on the Lugano Convention (Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, adopted at Lugano on September 16, 1988). The court seized of the matter has jurisdiction according to Art. 5(1) of the Lugano Convention in conjunction with Art. 57(1)(a) CISG pursuant to which, in the absence of an agreement as to the place of payment, the purchase price has to be paid at the seller's place of business.
Concerning the substance of the matter, [Seller] asserted that it sold to the [Buyer] a cargo plane type AEBI TP 57 at a price of [Sf] 42,800.00, as well as four exchange brake calipers at a price of [Sf] 148.50, payable in cash and due upon receipt of the goods. In the course of time, [Buyer] also showed an interest in purchasing a tractor type Wiesel 222. The parties then agreed that [Buyer] would pay a price of [Sf] 10,750.00 for the tractor type Wiesel 222 and would pick it up on April 22, 1999, together with the AEBI cargo plane and the brake calipers. During another visit shortly before April 22, 1999, [Buyer] bought new side doors for the cargo plane at a price of [Sf] 3,051.50, as well as various spare parts, namely a fender TT 80 for [Sf] 124.95, a rubber profile for [Sf] 114.45 and a ball-and-socket joint for [Sf] 55.15. [Buyer] received the goods - except the side doors which had been fitted to the AEBI Transporter and which [Buyer] had picked up on April 22, 1999 - on May 13 and 14, 1999. In the time between April 22 to May 14, 1999, [Buyer] thus received goods worth [Sf] 57,045.05.
[Seller] further stated that, at the time of conclusion of the sales contracts, [Buyer] had promised to pay cash upon collection of the goods. But on April 22, 1999, M.R. (acting on behalf of [Buyer]) only handed over to F.S. (an employee of [Seller]) a folder containing a check for [Sf] 20,000.00. F.S. took the check out of the folder, put a handwritten receipt into the folder and handed it back to M.R. Upon inquiry as to when the outstanding purchase price would be paid, P.K. (of [Buyer]'s firm) assured that it would be transferred within the following days. This did not happen. After repeated reminders and inquiries [Buyer] finally handed over a check in July 1999, however not as promised beforehand for [Sf] 6,808.00 but, after deductions of the bank fees, only for [Sf] 6,798.00. Again [Seller] repeatedly complained that [Buyer] had not paid the full amount. On March 7, 2000, P.K. handed over [Sf] 10,000.00 and promised once again that the remaining sum would be paid in the near future. A week later another [Sf] 700.00 were transferred to the account of [Seller].
Then [Buyer] suddenly asserted that on April 22, 1999, M.R. (acting on behalf of [Buyer]) had handed over to ([Seller]'s employee) F.S., not only a check for [Sf] 20,000.00, but had also paid [Sf] 10,000.00 in cash on that day. [Seller] takes a different view. It reminded [Buyer] repeatedly of the outstanding amount. Each time, [Buyer], in response assured [Seller] that payment would be made soon without this ever taking place. On May 9, 2003, [Buyer] transferred [Sf] 4,430.00 and finally on January 13, 2004, another [Sf] 2,500.00 to [Seller]'s account. The outstanding amount of [SF] 12,617.05 has not been paid to date.
C. - By answer dated September 9, 2004, [Buyer] requested the court to dismiss the case with costs.
[Buyer] argued that Art. 5(1) of the Lugano Convention was not applicable due to the absence of agreed or presumed place of performance. Accordingly there is no place of performance in the sense of Art. 57 CISG in Switzerland which in turn leads to a lack of jurisdiction of the court seized of the matter.
[Buyer] confirms that it bought the goods described by [Seller] and that they agreed on payment in cash upon collection of the goods. [Buyer] entrusted M.R., a long standing acquaintance of [Buyer]'s manager with the pickup of the goods on April 22, 1999. M.R. received a folder from [Buyer] containing a check for [Sf] 20,000.00 and [Sf] 10,000.00 in cash notes. The check as well as the [Sf] 10,000.00 in cash were put into the folder in the presence of M.K. (an employee of [Buyer]). M.R. gave the closed folder to F.S. (an employee of [Seller]) who was working at the reception of [Seller]. [Seller]'s employee then went to the office and came back after a few minutes to tell M.R. that everything was fine. Thus, the outstanding amount was reduced by the [Sf] 10,000.00 paid in cash on April 22, 1999. [...] The alleged receipt was not in the folder. Otherwise [Buyer] would have contacted [Seller] immediately and would have complained about the missing receipt. Since [Buyer] has had a regular business relationship with [Seller] in previous years without any irregularity so far, [Buyer] expected [Seller] to have booked the payment correctly even without issuing a receipt. This was also the way it was practiced in previous transactions. Contrary to [Seller]'s assertions, there was no subsequent inquiry as to the outstanding sum. As soon as it became obvious to [Buyer] that [Seller] had not taken the [Sf] 10,000.00 in cash into account, differences arose between the parties as to the amount of the outstanding debt. During the conversations with [Seller] that followed, [Buyer] made it clear that the [Sf] 10,000.00 in cash had been paid upon collection of the goods and would therefore have to be deducted from the outstanding amount.
Finally, [Buyer] invokes the statute of limitations. According to [Seller]'s statement, the payment was due on June 1, 1999. [Seller] did not take legal action until 2004, nearly five years after the alleged payment date. Thus, the claim has become time-barred.
E. - By separate submission of September 9, 2004, [Buyer] accused the court of bias on the ground that the senior partner of [Seller], L.S., is an assessor at the District Court Nidwalden. Therefore, [Buyer] requests referral to another court.
F. - By reply of October 19, 2004, and rejoinder of December 6, 2004, the parties adhere to their motions. Further pleadings of the parties will be addressed in the following considerations if necessary.
G. - By order of December 10, 2004, [Seller] was given the opportunity to file a demurrer against the evidence provided by [Buyer] in its rejoinder, which it did by letter of December 28, 2004.
H. - The main hearing was held on May 23, 2005, before the Civil Chamber of the District Court Nidwalden. For [Seller], L.S. Sr. and L.S. Jr., as well as their legal representative were present. [Buyer] was represented by its manager, P.K., and its attorney at law. The summoned witnesses F.S. and M.K. were also present.
a) At the beginning of the hearing, the presiding judge greeted the attendants, introduced the bench and explained the procedure.
b) Afterwards, M.K. was interviewed. As she declared that she was an employee of [Buyer], she was not questioned as a witness, but as a party. M.K. stated that she had notice of the proceedings. She knew that the parties were doing business with each other. She is responsible for the secretarial work and talked with her husband in this context. She only does the preparatory work for the bookings while the bookings themselves are done by a trustee. She remembers preparing [Sf] 10,000.00 for the settlement of an account of [Seller] in April 1999. Moreover, she made out a check for [Sf] 20,000.00. She put the [Sf] 10,000.00 in cash and the check into the folder and made a copy of the check. Asked why the cash was put into the folder in addition to the check, M.K. answered that the check was made out because it "was executed in the course of business" ("über das Geschäft laufen") while the [Sf] 10,000.00 was to be "handled in cash" ("in bar laufen"). She believes that this was so agreed. She put the money into an A-5 moneybag made of artificial leather. She does not remember the denomination of the money, but she guesses there were some bills of [Sf] 100 and some bills of [Sf] 50. Afterwards, her husband handed the envelope over to M.R. (who was acting on behalf of [Buyer]). M.K. was then shown a letter by [Buyer] addressed to [Seller] dated June 23, 1999, (KB 9) which includes, among other things, the following section: "a. account payment [Sf] 20,000 upon receipt of the goods". M.K. confirmed having composed this letter on her typewriter. Asked why only one "on account payment" of [Sf] 20,000.00 was recorded in "KB9", Mrs. M.K. answered, that the content of this letter was identical to the figures she had listed in her bookkeeping. The amount of [Sf] 10,000.00 was not listed in her bookkeeping, because it was so agreed. The [Sf] 10,000.00 "appeared" later. She did not know what exactly had been agreed. Upon inquiry as to whether she could remember where the bills came from, M.K. replied that the bills of [Sf] 100 came from an earlier transaction with another customer and were exchanged afterwards. However, she did not remember the banking institution where the money was exchanged. Asked why she did not prepare a receipt for the [Sf] 10,000.00, she answered that she did not because it was not recorded in the bookkeeping, she left it at that.
Afterwards, the parties' representatives were given the opportunity to ask additional questions. While [Seller]'s representative did not make use of this, [Buyer]'s attorney furnished two new collective documents (BB 1 and BB 2). Upon presentation of collective document 1 and inquiry whether this document constituted the accounts, which acted as the draft for her letter of June 23, 1999, (KB 9 and collective document 1 respectively), Mrs. M.K. answered that she stamped the accounts "booked" (collective document 1, pages 3 to 5) and hand-wrote the rate of exchange. Based on these accounts, she wrote the letter of June 23, 1999 (KB 9).
c) Afterwards, F.S., a member of the Board of Directors of [Seller]'s firm, was questioned as a party. Asked whether she had notice of the present proceedings, she answered that she called her husband's attention to the fact that money was missing, but did not have notice of the process itself. She performs the administrative work at the company, "the day-to-day work that has to be done". She does not do the bookkeeping but she operates the cash register. She remembers receiving a payment from M.R. (on behalf of [Buyer]) in April 1999 for the purchase of an "Aebis". M.R. came to them and gave her a folder. While she does not remember the features of the folder, she remembers that she had to "open something". She took a check out of the folder, wrote a receipt and put the receipt back into the folder. Mrs. F.S. added that she opened the folder, picked up the pad and then wrote the receipt. The folder only contained the check, nothing more. Upon presentation of the receipt of April 22, 1999, (KB 8a), F.S. confirmed that this was the receipt she wrote for the receipt of the check. She does not know why the check was handed over directly and not through a bank. As far as she knows, it was the first transaction between the parties.
Upon additional questioning by [Seller]'s legal representative as to whether she knew how the transaction "K" continued, F.S. (of [Seller]'s firm) answered that Mr. P.K. (of [Buyer]'s firm) bought other machines including, so she believes, brake calipers. However, he never paid. There were several telephone calls and conversations. Later on he came to them and handed over [Sf] 10,000.00 in cash. As always, she issued a written receipt. Subsequently, she advised her husband several times that Mr. P.K. should eventually pay. She does not remember the denomination of the [Sf] 10,000.00 cash, which was, as she mentioned before, handed over at a later point in time.
Upon presentation of the handwritten invoice for the cargo plane AEBI TP 57 and the tractor "Wiesel" (BB 1, pages 3 and 4), and the additional question of [Buyer]'s legal representative as to whether it was her handwriting, Mrs. F.S. (of [Seller]'s firm) identified the handwriting to be her husband's. Upon subsequent presentation of [Seller]'s invoices for the tractor "Wiesel" and the cargo plane AEBI TB 57 (KB 4 and 6), she stated that she did not know why these invoices show a different purchase price than the others she was just shown.
d) Afterwards, [Seller]'s legal representative said that, regarding the newly presented collective documents, that Mr. P.K. (of [Buyer]'s firm) requested Mr. L.S. (of [Seller]'s firm) to issue these invoices, so that he could use them as a basis for handling the customs formalities. Mr. P.K. asked for the invoices to contain a lower amount. The customs form (BB 2) was completed based on this amount. His client was simply sulfilling the wishes of its customers.
e) Finally both legal representatives made use of the possibility to discuss the suit and to do their final pleading, which was not recorded on the transcript in accordance with Art. 136 ZPO (Code on Civil Procedure of the Canton of Nidwalden - Gesetz über den Zivilprozess des Kantons Nidwalden). After the final pleadings of the parties and their legal representatives, the court deliberated and judged the matter.
I. - The summary of the judgment was served upon the legal representative of [Seller] on June 6, 2005, and upon the legal representative of [Buyer] on June 20, 2005. By letter of June 28, 2005, the latter asked for the complete judgment.
GROUNDS FOR THE DECISION
1. - a) [Seller] has its seat in ___ Switzerland, [Buyer] in ___ Germany. Thus, the suit concerns an international issue. Accordingly, the question of jurisdiction has to be decided based on the Lugano Convention which entered into force as of January 1, 1992, in Switzerland and as of March 1, 1995, in Germany. Pursuant to Art. 5(1) of the Lugano Convention, contractual claims can be brought before the court at the place of performance of the obligation in question. Where the place of performance is located depends primarily on the agreement of the parties, if such an agreement is permitted by the applicable law. If there is no such agreement the place of performance is to be determined according to the "lex causae", the domestic law which is applicable according to the conflict of law rules of the forum state (Oscar Vogel / Karl Spühler, Grundriss des Zivilprozessrechts und des internationalen Zivilprozessrechts der Schweiz [Compendium of the Civil Procedure Law and International Civil Procedure Law of Switzerland], 7th ed., p. 112, para. 45l et seq.).
b) The matter in dispute at hand is the payment of the purchase price. Thus, the place where the payment is to be made has to be examined in order to determine which court has jurisdiction.
Both parties state that they agreed that Mr. M.R. of [Buyer] would pick up the goods at the seat of [Seller] in ___ Switzerland and would pay in cash. Thus, it can be assumed that the parties agreed upon a place of performance concerning the payment of the purchase price - they have impliedly agreed on a place of performance in ___ Switzerland. The place of performance in the sense of Art. 5(1) of the Lugano Convention thus is at the seat of [Seller] in ___ Switzerland. Based on this, the District Court of Nidwalden has jurisdiction to hear the claim.
Even if an agreement as to the place of performance was missing, the court seized of the matter has jurisdiction pursuant to Art. 1(2) IPRG (Swiss Federal Code on Private International Law - Bundesgesetz über das internationale Privatrecht, (IPRG, SR 291) in connection with Art. 57(1) CISG (the application of the CISG is to be examined below)).
[Buyer]'s view, pursuant to which Art. 5(1) of the Lugano Convention does not apply due to the absence of agreed or presumed place of performance, cannot be upheld.
c) The subject matter jurisdiction of the District Court Nidwalden results from Art. 14(2) GerG (Court Code of the Canton Nidwalden - Gerichtsgesetz).
2. - [Buyer] accuses the District Court of bias. It asserts that the senior partner of [Seller], L.S., is a member of the court seized of the matter. That is why it requests the referral to another court. However, as can be seen by looking at the official website of the Appellate Court of Nidwalden (Obergericht des Kantons Nidwalden) (<http://www.nw.ch/index_obergericht_d.html>), L.S. is a member of the Appellate Court, which is the appeal instance for decisions of the District Court of Nidwalden as a court of first instance. However, L.S. is not a member of the District Court of Nidwalden which can be seen by looking at the official website of the District Court of Nidwalden (http://www.nw.ch/index_ kantonsgericht_d.html>) as well as the state calendar of the Canton of Nidwalden 2002 to 2006 (p. 72 et seq.). If this matter were to proceed to the Appellate Court, then L.S. would need to resign based on Art. 39(4) GerG. Thus, the assertions made by [Buyer] are unfounded.
3. - The parties undisputedly concluded several sale agreements for "Occasions"- machines and spare parts. [Seller] has its seat in Switzerland, [Buyer] in Germany. Thus the CISG, which entered into force for Switzerland as of March 1, 1991, and for Germany as of January 1, 1991, applies (Art. 1(1)(a) CISG).
3.1. The CISG does not deal with all the questions which may arise out of the delivery of goods. It contains provisions concerning the conclusion, the interpretation and the content and effects of the contract, which means the rights and obligations arising out of the sales agreement (Christoph Brunner, UN-Kaufrecht - CISG, Kommentar zum Übereinkommen der Vereinten Nationen über Verträge über den internationalen Warenkauf von 1980 [Commentary on the United Nations Convention on Contracts for the International Sale of Goods of 1980], Bern 2004, Art. 4 CISG, para. 1). In its scope, the CISG also deals with the question of the burden of proof - in parts explicitly but mostly impliedly: As a rule, every party has to prove that the requirements of the provision on which it relies are met. Conversely, questions concerning the extent of proof and the required extent of conviction of the judge are to be solved in accordance with the lex fori, in the present case, according to Swiss private law (Brunner, supra, Art. 4 CISG, para. 56 et seq.).
According to literature and case law, an allegation is to be considered as proven, if the judge is convinced of the truth of that allegation. His conviction of the existence of that fact has to be based on objective aspects. Thus, the reality of a fact does not need to be proven with certainty; it is sufficient that doubts appear as negligible. Not sufficient, on the other hand, is the existence of the fact on a balance of probabilities. It is unacceptable to base a judgment on mere likelihood, where the judge is not convinced and doubts remain, or to base the judgment on merely plausible and thus on not proven assertions (BGE 118 II 235 E. 3c; Hans Schmidt in: Basler Kommentar [Basel Commentary], Zivilgesetzbuch I [Civil Code I], Art. 1 - 456 ZGB, 2. Ed., Basel 2002, Art. 8 ZGB, para. 17).
3.2. a) In the present case, the fact that the parties agreed on a purchase price of [Sf] 57,045.05 for the "Occasions" - machines and spare parts is undisputed. The fact that [Seller] performed its main obligation under the contract by preparing the goods for collection at the agreed point in time is also undisputed. Pursuant to Art. 53 CISG, [Buyer] is thus obliged to pay the purchase price.
b) [Seller] asserted that [Buyer] made several partial payments in the time between April 22, 1999, to January 13, 2004, which amount to a total of [Sf] 41,928.00, the outstanding amount thus being [Sf] 12,617.05. [Buyer], on the other hand, counters that the outstanding amount is reduced by the [Sf] 10,000.00 in cash allegedly handed over to [Seller] on April 22, 1999. [Buyer] thus admits owing [Seller] a minimum of [Sf] 2,617.05 ([Sf] 12,617.05 minus the [Sf] 10,000.00 in dispute). Accordingly, the only issue to be determined is whether [Buyer] handed over [Sf] 10,000.00 in cash to [Seller] on April 22, 1999.
3.3. a) Since [Seller] performed its obligation under the contract by preparing the goods for collection at the agreed point in time, [Buyer] bears the burden of proving the partial performance of its contractual obligation, namely, the handing over of the [Sf] 10,000.00 in cash.
b) [Buyer] asserts that its manager, P.K., in the presence of M.K. (an employee of [Buyer], put both a check for [Sf] 20,000.00 and [Sf] 10,000.00 in cash into a folder and then gave the folder to M.R. (a long-standing acquaintance of P.K.). Then M.R. gave it to [Seller].
On the occasion of the hearing on May 23, 2005, M.K. was questioned on this issue. She said that she could remember preparing [Sf] 10,000.00 in cash for the settlement of an account of [Seller] in April 1999 and having put the cash into a folder together with the check for [Sf] 20,000.00 made out by her. She made a copy of the check but she did not prepare a receipt for the [Sf] 10,000.00 in cash because this amount was not supposed to be directly recorded in the bookkeeping (protocol, p. 3 et seq.). On the other hand, F.S. (of [Seller]'s firm), who was also interviewed on May 23, 2005, on the other hand, asserted that M.R. handed over to her a folder containing only a check for [Sf] 20,000.00. After opening the folder, she picked up the writing pad, wrote a receipt and put it into the folder (protocol p. 6).
Concerning the assertion of M.K. the Court notes that M.K. is not able to provide relevant information as to the handing over of the money since she was not present at the handing over.
M.R. as a witness of [Buyer] also could not confirm that, in addition to the check, the [Sf] 10,000.00 in cash was handed over to [Seller] on April 22, 1999. [Buyer] claims to have given the closed folder to M.R. and that he in turn handed it over to the employee at the reception and Mrs. F.S., respectively. Mrs. F.S. went to the office and came back after a few minutes to tell Mr. M.R. that everything was fine (answer, p. 2 at the bottom). These remarks align with the testimony of F.S., who claims to have opened the folder at the reception, then to have gone and retrieved the writing pad and finally to have written a receipt (protocol p. 6). Thus, M.R. neither saw how [Buyer] put the [Sf] 10,000.00 in cash into the folder, nor could he, based on its own perception, confirm that [Seller] received the cash. Therefore M.R. was not heard as a witness.
Since neither M.K., nor M.R. can confirm the assertions made by [Buyer], the court sees no reason to believe that [Buyer] really handed over [Sf] 10,000.00 in cash to [Seller] on April 22, 1999.
c) Furthermore, the record, as it stands, gives no indications which could support the assertion made by [Buyer]. [Buyer] did not provide any documents. In contrast, [Seller] relies, among other things, on the letter of [Buyer] of June 23, 1999, (KB 9) in which [Buyer] mentions that it made an on account payment of [Sf] 20,000.00 upon collection of the goods on April 22, 1999. M.K. (of [Buyer]'s firm) stated that the alleged handing over of the [Sf] 10,000.00 in cash was not directly recorded by the bookkeeping and therefore was not mentioned in the letter, as agreed. Because the cash was not recorded by the bookkeeping, she did not prepare a receipt (protocol, p. 3 et seq.).
Irrespective of the way [Buyer] organized its bookkeeping, it is not understandable why [Buyer] itself confirmed a partial payment of only [Sf] 20,000.00 in its letter to [Seller], when it asserts to have paid [Sf] 30,000.00. Furthermore, it also does not make sense that [Buyer]'s (M.K.), experienced in business transactions, on the one hand, made a copy of the check (collective document 1, p. 2), but, on the other hand, did not require a receipt from [Seller] regarding the [Sf] 10,000.00 in cash alledgedly handed over at the same time. Not in the least due to this fact, the court has serious doubts as to whether cash was actually handed over on April 22, 1999, whether this really did take place.
d) On the occasion of the hearing of May 23, 2003, [Buyer] presented three handwritten accounts for the cargo plane AEBI TP 57 for [Sf] 16,744.00, for the tractor "Wiesel" for [Sf] 7,440.00 and for a few full-sight doors for [Sf] 2,624.00 to prove its assertions (collective document 1, p. 3 to 5). It is, however, not clear what [Buyer] seeks to derive from this fact, since it does not deny that the purchase price was [Sf] 57,045.05. These accounts are not relevant to the present case and cannot be used to prove the alledged payment of the [Sf] 10,000.00 in cash.
e) In summary, it has to be concluded that [Buyer] could not substantiate its assertions. Neither M.K., nor the witness M.R. can provide the necessary evidence. Neither can [Buyer] prove the payment based on the files. Thus, the court considers the assertion of [Buyer] concerning the payment of the [Sf] 10,000.00 in cash on April 22, 1999, as unproven. Therefore, [Seller]'s claim in the amount of [Sf] 12,617.05 is to be allowed in its entirety.
4. - [Seller] asserts that [Buyer] made the following partial payments in the time between April 22, 1999, to January 13, 2004:
|-||April 22, 1999||[Sf]||20,000.00;|
|-||June 23, 1999||[Sf]||6,798.00;|
|-||March 7, 2000||[Sf]||10,000.00;|
|-||March 20, 2000||[Sf]||700.00;|
|-||May 9, 2003||[Sf]||4,430.00;|
|-||January 13, 2004||[Sf]||2,500.00;|
Thus, [Seller] requires [Buyer] to pay default interest of 5 %
|-||from June 1,1999 to June 23,1999 (23 days) on [Sf] 37,045.05||= [Sf]||117.70;|
|-||from June 24,1999 to March 7, 2000 (258 days) on [Sf] 30,247.05||= [Sf]||1,069.00;|
|-||from March 8, 2000 to March 20, 2000 (13 days) on [Sf] 20,247.05||= [Sf]||36.05;|
|-||from March 21, 2000 to May 9, 2003 (1145 days) on [Sf] 19,547.05||= [Sf]||3,065.95;|
|-||from May 10, 2003 to January 132004 (249 days) on [Sf] 15,117.05||= [Sf]||515.65;|
amounting to a total of [Sf] 4,804.35. Moreover, [Buyer] owes [Seller] default interest of 5 % on the outstanding amount of [Sf] 12,617.05 since January 14, 2004.
4.1. If a party fails to pay the purchase price or any other sum that is in arrears, the other party in entitled to interest on this sum pursuant to Art. 78 CISG. That right to interest arises at the time the payment is withheld after the main claim is due. The time of maturity of the claim is to be determined in accordance with the parties' agreement or, if there is none, pursuant to Arts. 58 and 59 CISG (Brunner, supra, Art. 78 CISG, para. 4). However, the CISG is silent on the level of the interest rate payable. According to the prevailing opinion in literature and prevailing case law, this question is to be decided in accordance with the domestic law applicable pursuant to the conflict of law rules of the forum state (BGE of October 28, 1998, 4C.197/1998 E. 6 with further references = http://www.cisg-online.ch, no. 413; Brunner, supra, Art. 78 CISG, para. 8).
Concerning the purchase of movable and material things, the The Hague Convention on the Law Applicable to the International Sale of Goods of June 15, 1995 (The Hague Convention) is applicable pursuant to Art. 118(1) IPRG [*]. Pursuant to Art. 3(1) of the The Hague Convention, the contract is subject to the domestic law of the State, in which the seller, at the time it receives the order, has its habitual residence. Since [Seller] has its seat in O., Switzerland, the interest rate has to be determined according to Swiss law. Thus, the default interest rate is 5% (Art. 104(1) OR (Swiss Code of Obligations - Obligationenrecht)).
4.2. a) At the time of conclusion of the contracts, the parties undisputedly agreed that [Buyer] would pay for the goods in cash upon collection of the goods on April 22, 1999, as well as on May 13 and 14, 1999. Consequently, the purchase price was due on these dates. Thus, [Buyer] was in default since May 15, 1999, if not before.
b) As a result of the evidence heard, it can be assumed that [Buyer] did not pay [Sf] 30,000.00 as asserted, but only [Sf] 20,000.00 on April 22, 1999 when it collected the Aebi cargo plane. Furthermore, [Buyer] does not deny having made the partial payments asserted by [Seller] in the time between June 23, 1999, to January 13, 2004. Thus, it owes [Seller] default interest of 5 % on the outstanding amount reduced by the respective partial payments. Therefore, [Seller]'s claim is allowed in its entirety and [Buyer] is liable to pay default interest in the amount of [Sf] 4,804.35 as well as default interest of 5 % on [Sf] 12,617.05.
5. - Finally [Buyer] invokes the period of limitation, relying on the fact that [Seller] itself considered payment of the purchase price to be due on June 1, 1999 and that it did not take legal action until 2004, five years later. Thus, the claim is allegedly time-barred.
5.1. The CISG contains no statute of limitations provisions. Thus, the law applicable to the statute of limitations has to be determined in accordance with the domestic conflict of law provisions (Brunner, supra, Art. 4 CISG, para. 18). Because [Seller] has its habitual residence or rather its seat, in Switzerland, the statute of limitations provisions of Swiss law are applicable (Art. 118(1) IPRG [*] in connection with Art. 3(1) of the The Hague Convention).
5.2. In principle, all claims prescribe after 10 years, unless Federal Civil Law (Bundeszivilrecht) contains a different provision (Art. 127 OR [*]). But the statute of limitations can be interrupted, on the one hand, by acknowledgement by the debtor, namely by payment of interest and partial payment, on the other hand, by raising an action or a defense before a court as well as the summoning to a conciliation attempt. If such an interruption occurs, the period of limitation starts anew (Art. 135(1), (2) OR in connection with Art. 137(1) OR).
The fact that [Buyer] made partial payments in addition to the one of April 22, 1999, namely on June 23, 1999, March 7, 2000, March 20, 2000, as well as on May 9, 2003, and finally on January 13, 2004, is on record and undisputed. As rightfully stated by [Seller], [Buyer] acknowledged its dept and interrupted the period of limitations every time it made a partial payment, the last time on January 13, 2004. Thus, the plea that the claim is statute-barred is unfounded and therefore has to be dismissed.
6. - Pursuant to Art. 99(1) ZPO [*], the parties have to bear the court costs proportional to the extent they have lost the case. Accordingly, [Buyer] has to bear the entire court costs, which amount to [Sf] 1,800.00 in accordance with §§ 4(1), 13, 37 and 38 PKoV (Code of Court Costs - Prozesskostenverordnung).
The party who requests the complete executed copy of the judgment has to bear the additional costs (§ 8 a PkoV). Since [Buyer], by writing of June 28, 2005, requested the reasons for the decision, it has to bear the additional expenses amounting to [Sf] 957.00.
Thus, the court costs amount to [Sf] 2,757.00. The amount is set off with the advance of costs made by [Seller] ([Sf] 1,800.00) and is paid to this extent.
[Buyer] has to reimburse the [Sf] 1,800.00 to [Seller] internally and directly (§ 9(3) PkoV).
[Buyer] also has to pay [Sf] 957.00 to the court cashier within 30 days after final judgment by the enclosed payment order.
7. - Furthermore the parties are obliged to pay compensation to their opponent in proportion to the extent they have lost the case (Art. 99(1) ZPO [*]). The compensation is calculated according to the provisions on fees (Art. 93 ZPO). Pursuant to § 53(1) PKoV the lawyer's fees are [Sf] 1,500.00 to [Sf] 4,500.00 if the amount in dispute is between [Sf] 10,000.00 and [Sf] 20,000.00. Relevant for the determination of the fees within these limits are the economic and personal importance of the case for the party, the difficulty of the case and the kind and amount of the work, as well as the amount of time spent (§ 45 PKoV).
By writing of May 27, 2005, the legal representative of [Seller] submitted a fee in the amount of [Sf] 5,349.35 to the court. Considering the above mentioned principles, the fee can be accepted. Accordingly, [Buyer] is obliged to pay compensation in the amount of [Sf] 5,349.35 to [Seller].
* 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 Switzerland (Swiss francs) are indicated as [Sf].
Translator's note on other abbreviations: IRPG = Bundesgesetz über das internationale Privatrecht [Swiss Federal Code on Private International Law]; OR = Obligationenrecht [Swiss Code of Obligations]; PkoV = Prozesskostenverordnung [Code of Court Costs]; ZPO = Gezetz über den Zivilprozess des Kantons Nidwalden [Code of Civil Procedure of the Canton of Nidwalden].
** Thomas Arntz is a law student at the University of Cologne. During 2003-2004 he spent a year in Clermont-Ferrand, France, as an Erasmus student. In 2004/2005 he participated in the Twelfth Willem C. Vis Moot.
*** Mariel Dimsey, LL.M., is a Research Assistant and Teaching Assistant at the University of Basel, Switzerland.Go to Case Table of Contents