Croatia 26 July 2005 High Commercial Court (Industria Conciaria S.p.A. v. Simecki d.o.o.)
[Cite as: http://cisgw3.law.pace.edu/cases/050726cr.html]
DATE OF DECISION:
CASE NUMBER/DOCKET NUMBER: Pz-2728/4-3
CASE HISTORY: 1st instance Commercial Court Zagreb [partly reversed]
SELLER'S COUNTRY: Italy (Plaintiff)
BUYER'S COUNTRY: Croatia (defendant)
GOODS INVOLVED: [-]
CROATIA: High Commercial Court 26 July 2005 [Pz-2728/04-3]
Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/91],
CLOUT abstract no. 919
Reproduced with permission of UNCITRAL
The Italian seller delivered goods to the Croatian buyer as part of an ongoing business relationship. The buyer failed to pay the price for the last delivery claiming that it had never entered into a contractual relationship with the seller but with another Croatian company which acted as an intermediary. The seller sued the buyer in the Commercial Court of Zagreb for the payment of the price. The court found for the seller and ordered the buyer to pay the price plus interest accrued under Croatian law.
On appeal, the High Commercial Court affirmed in part and rejected in part the decision. The Court noted that the first instance court should have applied the CISG and not the Croatian Obligations Act. The CISG was applicable pursuant to article 1(1)(a) CISG because the parties' places of business were in different contracting states. The Court held that, because there was an ongoing business relationship between the seller and the buyer, the contract of sale was formed under articles 23 and 24 CISG when the buyer's order reached the seller. The court affirmed the lower court's decision that the buyer must pay the price, even though the proper legal basis for such ruling was article 53 CISG and not the corresponding provision of the Croatian Obligations Act.
The High Commercial Court also upheld the commercial court's decision that the seller's claim was not barred by the statute of limitation. The Court noted however that the commercial court should have applied the four year limitation period provided by the UN Convention on the Limitation Period in the International Sale of Goods of 1974 and not the five year period provided by the Italian Civil Code.
The Court rejected the lower court's decision on interest because this latter should have applied the interest rates defined by the Italian not the Croatian law. The Court noted that article 78 CISG regulates the payment of interest, but provides no criteria for determining the interest rate. Relying on article 7(2) CISG, the High Commercial Court applied Croatian private international law (Article 20(1) Croatian Private International Law Act) and found that the interest rate was governed by the Italian law as the law of the seller.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:
Excerpt from Marko Baretic / Saka Niksik, "Croatia", in: Franco Ferrari ed., The CISG and its Impact on National Legal Systems, Sellier European Law Publishers (2008) 101.
"[T]he High Commercial Court partly reversed the decision of the Commercial Court in Zagreb with the argument that the dispute between the Italian seller and the Croatian buyer ought to have been resolved on the basis of the CISG, and not on the basis of Italian substantive law applied by the lower court in this case. The High Court held that the lower court should have applied the CISG pursuant to its Art. 1(1)(a) since the contracting parties’ place of business was in different contracting states and the parties did not explicitly exclude the application of the CISG nor did they agree on a national substantive law to be exclusively applicable to their contract. Furthermore, the High Commercial Court held that the sales contract was concluded pursuant to Arts. 23 and 24 of the CISG, when the buyer’s order reached the seller. Hence, although the High Commercial Court affirmed the lower court’s decision, it emphasized that the decision should have been reached on the basis of the CISG."Go to Case Table of Contents
CITATIONS TO OTHER ABSTRACTS OF DECISION
CITATIONS TO TEXT OF DECISION
Original language (Croatian): Published at <http://www.vsrh.hr>
CITATIONS TO COMMENTS ON DECISION
UnavailableGo to Case Table of Contents