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CISG CASE PRESENTATION

Belgium 24 April 2006 Appellate Court Antwerp (GmbH Lothringer Gunther Grosshandelsgesellschaft für Bauelemente und Holzwerkstoffe v. NV Fepco International) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/060424b1.html]

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

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Case identification

DATE OF DECISION: 20060424 (14 April 2006)

JURISDICTION: Belgium

TRIBUNAL: Hof van Beroep [Appellate Court] Antwerpen

JUDGE(S): Renauers, Ponet and Reich

CASE NUMBER/DOCKET NUMBER: 2002/AR/2087

CASE NAME: GmbH Lothringer Gunther Grosshandelsgesellschaft für Bauelemente und Holzwerkstoffe v. NV Fepco International

CASE HISTORY: 1st instance Rechtbank van Koophandel Antwerpen 28 November 2001 and 5 June 2002

SELLER'S COUNTRY: Belgium

BUYER'S COUNTRY: Germany

GOODS INVOLVED: Construction materials (wood)


English summary

Reproduced from CISG-Belgium database

"According to the general conditions, Belgian law is applicable. Because this is an international sale of goods, the CISG is applicable.

"According to the hierarchy of rules, the terms of the contract should be applied first, then the CISG and finally Belgian general rule. Thus, the will of the parties (art. 8) and usages (art. 9) should only be applied if the contract does not contain a clear term, since the contract precludes the CISG in the hierarchy.

"If the buyer cannot prove binding periods for delivery, he cannot claim late delivery.

"Partial deliveries are not a violation of article 35(1) if the buyer has accepted and even requested those, all the more since he has accepted several partial deliveries without reservation. This is not changed by his non-signing of a document that was intended to formalize the partial deliveries.

"Deliveries had to be done 'cash against documents.' Since the buyer requested partial deliveries, the seller could do nothing else but handing over 'delivery orders' instead of the B/L.

If the buyer breaches his obligation to pay the price and take delivery, the seller can avoid the contract and resell the goods. If, however, he waits six months before he organizes the resale, he breaches this obligation to mitigate. Two / three months can be considered as a reasonable period for a resale. Thus, damages may be lowered.

"The seller can claim the insurance fee based on article 85(1): taking insurance is a reasonable measure for the preservation of the goods. Based on the same article, costs of storage can also be claimed.

"The interest rate is determined by the lex contractus. If there is a resale, the interest only starts to run from the moment of payment of the resale. In order for supplementary damages to be awarded, the seller must prove that the damage was higher than the awarded interest. The CISG does not determine whether capitalization of interest is possible. In any event, the creditor has to prove that he has the right to capitalization, e.g. because he had to pay extra interest himself.

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Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 6 ; 8 ; 9 ; 25 ; 26 ; 35 ; 74 ; 75 ; 77 ; 78 ; 85 [Also cited: Articles 11 ; 29 ; 33 ; 34 ; 49 ; 53 ; 80 ]

Classification of issues using UNCITRAL classification code numbers:

6A [Convention yields to contract: modification of Convention by contract];

8A [Interpretation of party's statement or other conduct: intent of party making statement or engaging in conduct];

9D [Usages and practices: impact on provisions of Convention];

25A1 [Effect of fundamental breach: avoidance of contract];

26A [Effective notification of avoidance];

35A [Conformity of goods to contract: quality, quantity and description required by contract];

64A21 [Seller's right to avoid contract (grounds for avoidance): Buyer does not pay or take delivery within additional period set by the seller under art. 63];

74A [General rules for measuring damages: loss suffered as consequence of breach];

75A1 [Damages established by substitute transaction after avoidance: resale by aggrieved seller];

77A [Obligation to take reasonable measures to mitigate damages];

78A [Interest on delay in receiving price or any other sum in arrears: regular interest, compound interest];

85A [Seller's duty to preserve goods when buyer delays taking delivery or making concurrent price payment]

Descriptors: Autonomy of parties ; Intent ; Usages and practices ; Avoidance ; Conformity of goods ; Nachfrist ; Fundamental breach ; Damages ; Cover transactions ; Mitigation of Loss; Interest ; Preservation of goods

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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

English: Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=1152&step=Abstract>

CITATIONS TO TEXT OF DECISION

Original language (Dutch): CISG-Belgium database <http://www.law.kuleuven.ac.be/ipr/eng/cases/2006-04-24%20Antwerpen.html>; Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=1152&step=FullText>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation) [second draft]

Queen Mary Case Translation Programme

Hof van Beroep [Court of Appeal] Antwerp
GmbH Lothringer Gunther Grosshandelsgesellschaft für
Bauelemente und Hozwerkstoffe v. NV Fepco International

24 April 2006 [2002/AR/2087]

Translation [*] by Kristof Cox [**]

[...]

I. In an interim judgment of 22 November 2004 the Court declared the appeal of the claimant on appeal [Buyer] and the incidental appeal of the defendant on appeal [Seller] partly unfounded in so far that the [Buyer] claimed that the first judge should have declined jurisdiction.

Further, the Court declared that the Court of First Instance correctly assumed jurisdiction and was competent to hear the case.

Before any further decision on the validity of the [Buyer]'s appeal and the incidental appeal of the [Seller], the Court re-opened the debates to allow the parties to take a position on the applicable law, in particular on the implications of the applicability of the CISG on the claims and defenses of the parties.

As to the applicable law, it was decided in the interim judgment that:

   -    The parties made an explicit choice of law for Belgian law, based on article 3 of the European Convention on the law applicable to contracts, so that Belgian law is applicable.
 
   -    The contract between the parties is a sales contract for movable goods and this sale has an international dimension since the seller and the buyer are located in different States;
 
   -    Ratione temporis, the CISG is applicable in Belgium since 1 November 1997, so that the parties have to take positions according to the CISG and that thereto the debates were re-opened.

II. [...]

III. [...]

IV. [...]

V. FURTHER EVALUATION

      A. The original main claim of the [Seller]

            A.1. On the applicable rules

            In the interim judgment of 22 November 2004, it has already been decided that the contract between the parties was formed on the basis of the confirmation of order of 4 October 1999 and that the general conditions of the [Seller] are (exclusively) applicable to this contract. According to article 13.0 of the general conditions of the [Seller], Belgian law is applicable.

In the interim award it was also decided that the CISG was applicable too, since the dispute concerned an international sale of movable goods (and ratione temporis applicable in Belgium since 1 November 1997).

The [Seller] states correctly that -- according to article 6 of the CISG -- the parties can exclude the applicability of this Convention, or can deviate from any of its provisions.

The parties have not excluded the applicability of the CISG. Nevertheless, it is so that in the hierarchy of rules the contract of 4 October 1999 has to be applied first (including the general conditions of the [Seller]), then the CISG and finally (in so far as necessary) Belgian internal law.

The [Buyer] argues that the application of the CISG to the dispute implies that weight has to be given to the will of the parties to interpret the contract between them, and this according to article 8 CISG. Moreover, according to the [Buyer] weight has to be given to customs and trade practices that are sources of contractual duties according to article 9 CISG.

In the opinion of the Court, the will of the parties (article 8 CISG) and customs and trade practices (article 9 CISG) only have to be taken into account is so far as the contract of 4 October 1999 has no clear provision since the contract precedes the CISG in the hierarchy of rules.

            A.2. On the claimed contractual breaches of the [Seller]

            As a ground for appeal, the [Buyer] states that it validly refused payment of the invoices of the [Seller] considering the several contractual breaches of the [Seller] that are, according to the [Buyer]:

   -    Late delivery
   -    Partial deliveries
   -    Delivery without bill of lading or other documents under agreement;
   -    Delivery of plates of bad quality.

It has to be investigated whether these contractual breaches can be claimed against the [Seller] as the Buyer does.

                  a) On the late delivery

                  According to the [Buyer], binding terms for the three shipments were determined, namely, November, December 1999 and January 2000 and the first judge wrongly decided that these were merely "expected dates of shipment".

We agree with the first judge that no binding dates for delivery were agreed on in the contract. The general conditions state: "expected shipment. November/December/January 2000)". Further, article 3.0 of the general conditions of the [Seller] states that: "Unless the indicated date for shipment is explicitly guaranteed, prior information on the date of shipment is merely an estimate, based on the assessment by the seller at that moment."

The [Buyer] has not proved that binding terms were agreed on. From unilateral item of evidence 57, which according to the [Buyer] shows that it had undertaken obligations towards its own clients, it cannot be deduced at all that binding terms were agreed on. In its final briefs, the [Buyer] states that it cannot spontaneously lodge the confirmations of order of its clients on which item of evidence 57 is based, since these are confidential documents. It is obvious that the [Buyer] has to lodge the necessary items of evidence itself to support [Buyer]'s point of view, which [Buyer] has not done.

Also, on the basis of the letter of 14 January 2000 of the [Seller], it cannot be concluded that binding dates for delivery have been agreed on. With this letter, a commercial settlement was made concerning a late delivery, in which the [Seller] allowed a single reduction of US $9,880.42, under the condition that all the future shipments would be accepted. In a fax of the same day, this commercial settlement was accepted by the [Buyer]. Therefore, this was a commercial settlement between the parties for a specific incident and not a written recognition of delays. The [Buyer] incorrectly deduces a confession out of court of the delays by the [Seller].

Since the binding terms for shipment have not been proven by the [Buyer], who carries the burden of proof, there is no reason to accept the request of the [Buyer] to require the [Seller] to produce a number of documents to prove the late delivery. In particular, the [Buyer] incorrectly claimed the production of the contracts of purchase, the booking notes and the bills of lading.

The [Buyer] thus incorrectly defends that the late deliveries by the [Seller] constitute a breach of article 33(b) CISG in which it is stated that goods have to be delivered within the agreed terms. There is no proof of a breach concerning the timely delivery of goods, neither on the basis of the contract of 4 October 1999, nor in the CISG.

                  b) On the partial deliveries

                  The [Buyer] rejects that it would have accepted the partial deliveries, that were -- according to [Buyer] -- detrimental to [Buyer]. [Buyer] means that the burden of proof for an agreement on such partial deliveries is on the [Seller], who does not prove any consent in this matter according to the [Buyer].

According to the [Buyer], the unilateral partial deliveries are a breach of article 35(1) CISG, in which it is stated that the seller has to deliver goods according to the agreed quantities.

From the items of evidence, in particular the fax of the [Seller] to the [Buyer] of 21 April 2000 in which the [Seller] confirmed that the partial deliveries were at the request of the [Buyer], and from the letter of 24 May 2000 from the German counsel of the [Buyer] in which the counsel confirmed that the contract allows for partial deliveries and that the parties agreed on this, this shows that the [Buyer] has not only accepted the partial deliveries, but moreover, that these were made at [Buyer]'s request, all the more since the [Buyer] has accepted several partial deliveries without reservation and/or protest.

From the mere fact that at a certain moment the [Seller] has tried to formalize the partial deliveries and has suggested a "memorandum of addendum 1" to the [Buyer] -- who has not signed this document -- it cannot be deduced that the [Buyer] has never accepted the partial deliveries.

In its final briefs, the [Buyer] lodges a new item of evidence 61 which shows, according to [Buyer], that the deliveries by the [Seller] were a complete chaos, with as a result that the clients of the [Buyer] avoided their contracts. From this new unilateral item of evidence (a table with orders and purchases), it cannot be deduced that the [Seller] failed to meet its duty of delivery.

Finally, also article 3.0 of the general conditions of the [Seller] allowed partial deliveries. It reads: "Unless provided otherwise, partial shipments are allowed according to the choice of the seller."

Thus, it has to be concluded that no breach of the contract of 4 October 1999, nor a breach of article 35 CISG is proven as to partial deliveries by the [Seller]

                  c) On the delivery without original documents

                  Further, the [Buyer] contends that the contract between the parties provided for payment "cash against documents", as is shown according to [Buyer] by the confirmation of contract of 6 October 1999 and the confirmation of order of the [Seller].

The [Buyer] alleges that the not handing over of the documents is a breach of contract according to article 34 CISG, where it is stated that the seller has to hand over the documents at the time and place required by the contract.

It is not contested between the parties that the deliveries had to happen "cash against documents".

It has to be found that for every package of goods a B/L was made, which gives the holder the right to claim the handing over of the goods. If a B/L cannot be delivered, i.e., if a package for shipment to which a B/L applies is split, this can be replaced by a "delivery order" that gives the holder the right to claim the handing over of the goods to which it applies, just like a B/L.

The [Seller] states correctly that there was nothing else [Seller] could do but hand over a delivery order, since the [Buyer] requested to pick up only parts of the delivered packages, considering the rights attached to the B/L. Moreover, the [Buyer] admitted that it had paid several deliveries, also without the handing over of the original documents, so that [Buyer] has agreed with the procedure followed with regard to the handing over of delivery orders for the partial deliveries.

Thus, it was not correct for the [Buyer] suddenly to request the handing over of the original documents, at the latest on 18 April 2000) in [Buyer]'s letter of 13 April 2000. Notwithstanding the fact that the [Buyer] incorrectly refused acceptance of the goods without B/L, the [Seller] honored this request. The [Seller] shows that it handed over these documents to the [Buyer] before the requested date.

Thus, the [Buyer] incorrectly invokes a contractual breach or a breach of article 34 CISG on the handing over of documents at delivery.

                  d) On the quality of the delivered plates

                  Finally, the [Buyer] contends that there were very pertinent complaints about the quality of the deliveries which constitute a breach of article 35(1) CISG. The [Buyer] adds that the [Seller] has only paid a remuneration for part of these problems.

It has to be found that the [Buyer] does not prove at all that the delivered goods did not conform to the contractually agreed quality. The first judge correctly rejected the complaints about the quality. Thus, there is no breach of article 35(1) CISG either.

*    *    *

Finally, the [Buyer] urges for the hearing of Ms. Kämpf, who was according to [Buyer] a privileged witness at the execution of the contract and whose statement could enlighten the exact agreements between the parties. Even though both the CISG (article 11) and Belgian law (in commercial affairs, article 25 Commercial Code) allow proof by means of witnesses, the suggested hearing of witnesses is not helpful.

            A.3. On the duty of acceptance by the [Buyer] and the [Buyer]'s right to avoid of the contract

            The [Buyer] states that it had the right to avoid the contract according to article 49(1)(a) CISG, given the fact that the breaches of contract of the [Seller] amounted to a fundamental breach in the sense of article 25 CISG. The [Buyer] defends that it has avoided the contract by notice of 19 April 2000 according to article 26 CISG. It is the [Buyer]'s position that, in case of avoidance, both parties are released from their contractual obligations, at least that they are released from responsibility according to article 80 CISG.

Under A.2 it was already decided that no contractual breaches by the [Seller] were proven. Thus, the [Buyer] was not entitled to consider the contract avoided on account of the [Seller] by letter of 19 April 2000.

By contrast, it is the [Buyer] itself which did not comply with its contractual duties of acceptance and payment on the basis of the contract of 4 October 1999, which provides under the special conditions: "Conditions of payment. Cash against documents within three days after the first offer" and on the basis of article 7.0 of the general conditions, where it is provided that acceptance and payment have to be made notwithstanding any dispute, be it that acceptance and payment would be done without prejudice. The [Seller] rightly refers to article 53 CISG, which states that the seller is obliged to pay the price and to accept the goods, in accordance with the provisions of the contract and the Convention.

Since the [Seller] correctly invoked the breach of the contractual duties of acceptance and payment, [Seller] was allowed to invoke in its letter of 27 September 2000 the avoidance of the part of the contract that was not executed based on article 64(1)(b) CISG, after [Seller] granted the [Buyer] a final period for execution of the contract in [Seller]'s letter of 25 September 2000. Since this did not happen, the [Seller] was allowed to resell the goods on 28 September 2000.

            A.4. On the resale based on article 77 CISG and article 11 of the contract

            The [Buyer] incorrectly states that no legal basis for the [Seller]'s claim is indicated.

The [Seller] organized a resale, which is provided in both the contract (article 11.0) and the CISG. Therefore, [Seller] has a legal basis for a claim for damages after resale in the sense of article 75 CISG, where it is stated that if a contract is avoided and if, in a reasonable time after avoidance, the seller or the buyer has performed a cover purchase, the party that claims damages is entitled to the difference between the agreed price and the price of the cover purchase as well as any further damages recoverable under article 74.

A party that invokes the contractual breach of the other party, however, also has a duty to mitigate damages under article 77 CISG.

The [Buyer] correctly contends that the (former) counsel of the [Seller] already announced on 12 April 2000 that he would resell the goods within seven days, while the resale eventually only took place on 28 September 2000. The Court agrees with the [Buyer] that the [Seller] is bound to organize the resale within a short period and that [Seller] has failed to meets its duty to mitigate damages by waiting +/- six months before organizing the resale. Moreover, the [Seller] itself refers to case law where a period of two months after the avoidance of the contract is considered to be a reasonable period for the resale. In this case, however, the resale was only organized after nearly six months.

By the breach of the [Seller] of its duty to mitigate damages, the party that has to pay damages -- in this case the [Buyer] -- is entitled to a reduction of the damages in the amount by which the loss should have been mitigated (article 77 in fine CISG). The Court will take this into account in the calculation of the damages. It is already decided now that the resale principally should have taken place within a reasonable period of three months. The extra costs for the period after 12 July 2000 will have to be deducted from the damages.

For the sake of completeness, the Court remarks that the [Buyer] incorrectly denies the causal link between its faults and the damage of the [Seller]. According to article 74 CISG, the [Seller] is entitled to compensation of all damage that was foreseeable at the moment of the concluding of the contract and [Seller] sufficiently proved the causal link.

            A.5. On the claimed damages and the right to compound interest

                  1. Damages

The [Buyer] contends that the claim of the [Seller] should at least be diminished. The [Seller] incorrectly contends that the new argument of the [Buyer] after the interim judgment of 22 November 2004 is inadmissible. Given the fact that parties were invited in the interim judgment to "take a position on the applicable law, in particular on the implications of the applicability of the CISG on the several claims and defenses of the parties" the [Buyer] was free to take a position on the amount of damages and this in the light of the applicable law, including the CISG. Thus, the new argument of the [Buyer] on the calculation of damages is admissible.

Taking into account the [Seller]'s breach of the duty to mitigate its loss, the [Seller] is entitled to the following damages:

                        a) The balance of the price after the resale

                        The [Seller] claims the sum of US $166,539.20 that refers to the balance of the unpaid invoices (US $506,731.39), from which the income from the resale is deducted (US $374,917.91), increased by the sum of US $3,420.43 for insurance, and increased by the sum of US $31,305.29 for interest till 31 October 2000.

The [Buyer] rejects the calculation of these damages with regard to the following points:

   -    For the calculation of the price of wood in relation to the resale, a price of US $205/m should be assumed, being the price that the [Seller] would have obtained if [Seller had sold to a third person in a timely manner. According to the [Buyer], the [Seller] could only get a price of 187 /m because of the untimely resale.

In the opinion of the Court, the [Buyer] has not proved that a price of US $205/m could have been obtained if the resale would have taken place within a shorter period. The [Seller] correctly points out that the [Buyer] itself offered 186/m, so that now [Buyer] incorrectly contends that the price of 187/m acquired at the resale would be too low. Moreover, it is only in [Buyer]'s briefs on appeal that the [Buyer] first rejected the applied price of wood, while neither in the prior correspondence between the parties, nor in the briefs in first instance was the calculation of the price of wood rejected.

Thus, the [Seller] is entitled to the amount of US $131,813.48, being the balance of the unpaid invoices, reduced by the revenue from the resale, as calculated by the [Seller]

   -    The [Buyer] contests that the insurance fee is due, at least the amount is not proven according to [Buyer].

In the opinion of the Court, the [Seller] is entitled to an insurance fee based on article 85(1) CISG, according to which the seller must take all reasonable measures for the conservation of the goods if the buyer is in breach of its duty of acceptance or payment. The taking of insurance for the stored goods is a reasonable measure for the preservation of the goods, so that the [Seller] can principally claim the reimbursement of the insurance fees.

The [Seller] claims insurance fees for nine months, being from February 2000 till 31 October 2000 (date of the delivery after resale). Earlier it was decided that the resale should have taken place within a reasonable period of three months and that the extra costs for the period after 12 July 2000 should be deducted from the amount of damages to which the [Seller] is entitled. Thus, the [Seller] is only entitled to the insurance fees till this date and the debates are reopened to allow the [Seller] to recalculate the insurance fees till 12 July 2000.

   -    According to the [Buyer], the [Seller] does not explain how the interest of US $31,305.29 is calculated. Moreover, according to the [Buyer], an excessive interest rate is used.

According to article 78 CISG, interest is due in case of late payment and interest commences to run without the need for an order. Since the interest rate is not determined by the CISG, it is determined by the lex contractus, in casu Belgian law.

The CISG does not forbid that the parties determine conventional interest. Moreover, article 6 CISG allows the parties to determine the damages themselves.

According to Belgian law, the conventional interest claimed by the [Seller] on the basis of article 5 of [Seller]'s general conditions -- that are deliberately reduced to 9 % -- are certainly not exaggerated. Thus, the claimed interest rate of 9 % is applied.

It is accepted that, if there is a resale in the sense of article [75] CISG, the interest runs from the payment of the resale. Accordingly, the [Seller] is only entitled to conventional interest at the rate of 9 % from the date of payment of the resale till the date of full payment.

The debates are re-opened to allow the [Seller] to recalculate the claimed interest.

                        b) The costs for storage

                        The [Seller] claims an amount of US $20,770 for costs for storage. The [Buyer] rejects the costs for storage and states that these costs cannot be charged. Moreover, according to the [Buyer] the amount of these costs is not proven.

Incurring costs for the preservation of the stored goods is a reasonable measure for the preservation of the goods, so that the [Seller] is principally entitled to the reimbursement of the costs for storage, based on article 85(1) CISG.

The [Seller] calculates the costs for storage until 3 November 2000. However, just as for the insurance fees, it is the opinion of the Court that the extra costs for the period after 12 July 2000 should be deducted from the amount of damages that is due to the [Seller], since the resale should have taken place within a reasonable period. Thus, the [Seller] is only entitled to the costs for storage until this date and the debates are re-opened to allow the [Seller] to recalculate costs for storage until 12 July 2000.

                        c) Administrative and management costs

                        The [Seller] claims an extra sum of US $50,000 as damages for administrative and management costs. According to the [Buyer], these claims are completely unfounded, lacking any proof of these costs.

According to article 78 CISG, interest is due in case of late payment, without prejudice to the right to damages.

For complementary damages to be admissible under the CISG, the claimant has to prove that the damage is higher than the accorded interest. In casu, the [Seller] has not proved that it suffered complementary damage and [Seller] has not shown that it is entitled to complementary damages, all the more since the general conditions of the [Seller] do not mention a conventional penalty clause and the [Seller] does no more than claiming complementary damages which [Seller] estimates in equity at US $50,000.

The first judge decided correctly that the claim of the [Seller] for administrative and management costs was unfounded. The incidental appeal of the [Seller] on this point is unfounded.

                        d) Costs of courier and bank

                        The [Seller] claims 272.44 costs for courier and bank, made for the unnecessary transfer of documents. Since the [Seller] lodges item of evidences in evidence of costs for courier and bank, the claim of 272.44 is accepted. These were indeed unnecessary costs the [Seller] made because the [Buyer] wrongfully refused to accept the goods;

                  2. Compound interest

                  The [Seller] claims compound interests. After compound interest, the [Seller] claims payment of the main sum of US $256,652.95, increased with the interest at 9 % since 20 February 2005 until the date of full payment. According to the [Buyer], the interest claimed by the [Seller] must be reduced and compound interests cannot be granted.

The CISG is silent on the question whether compound interests is possible.

Article 78 CISG mentions "interest on the price or any other sum", from which some authors conclude that no interest on interest is due. Other authors state that interests on interest can be framed in the practices between parties in the sense of article 9 CISG.

However, it is required that the claimant prove that -- because of the breach -- he had to pay interest on interest himself to his financer for withdrawn credit. In any event, under the CISG, compound interest is not accorded automatically and the claimant, in this case the [Seller], has to prove that it is entitled to compound interest, e.g., because [Seller] had to pay extra interests itself since it lacked the payments that were due. In as much as the [Seller] has not proved this, the request for compound interest (which the [Seller] founds on article 1154 of the Civil Code) is rejected.

Conclusion on the claims of the [Seller]:

So far the claim of the [Seller] is already founded for the amount of US $131,813.48 + 272.44 . The debates are re-opened for the recalculation of the insurance fees, the costs for storage and interest, as described earlier. The request for compound interests is rejected.

[...]

      D. Legal costs associated with the resale, attorneys' fees and other legal costs

            D.1. Legal costs associated with the resale and attorneys' fees

            The [Seller] filed an incidental appeal to require the [Buyer] to pay legal costs of the resale in an amount of US $3,016.24 and attorneys' fees for 1 provisionary, with re-opening of debates for further determination. The [Buyer] states that attorneys' fees cannot be recovered and that this claim has to be rejected. Further, [Buyer] contests the quantum of the claim.

The [Seller] correctly states that the Supreme Court (Cour de Cassation) has accepted that attorneys' fees are recoverable in so far as the attorneys' fees are necessary (Cass. 28 February 2002, R.W. 2002-03, 19; Cass. 2 September 2004, R.W. 2004, 535).

It cannot be disputed that the attorneys' fees in this case are necessary.

But it has to be examined whether the [Seller] has proved the amount of its claim. For the legal costs of the resale, the [Seller] refers to item of evidence B.22. This item of evidence, however, is only a fax of the counsel of the [Seller] of 31 May 2000 to the counsel of the [Buyer], in which legal costs for the resale are mentioned for an amount of 3,016.24 . The [Seller] does not lodge any item of evidence to explain the legal costs. It is not enough to mention in a demand a unilaterally calculated sum for legal costs in order to be entitled to these costs. Lacking proof of these costs, this part of the claims is declared unfounded.

Further, the [Seller] claims the sum of 1 provisionary for the attorney's fees and the re-opening of the debates for the calculation of the eventual sum.

Considering that no calculation whatsoever of the claimed costs and the bill of the attorney is presented and the [Seller] only mentions a provisional sum, it has to be decided that the [Seller] has not presented the necessary information which it has to calculate the claimed damage correctly, so that the claim for attorneys' fees has to be rejected.

The incidental appeal of the [Seller] for the legal costs of the resale and for attorneys' fees is unfounded.

            D.2. Other legal costs

            Now that the claim of the [Seller] for the payment of attorneys' fees is declared unfounded, the [Seller] will be entitled to the claimed indemnity for procedure [indemnité de procédure] on appeal.

The final decision on the other legal costs is withheld pending the re-opening of the debates.

[...]


FOOTNOTES

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

** Kristof Cox is a researcher at the Institute for International Trade Law at the Catholic University of Leuven (Belgium). He is preparing a Ph.D. on the effects of an arbitration award on third parties. Further, he regularly publishes articles and case notes on the CISG and International Commercial Arbitration. Kristof Cox can be contacted at <kristif.cox@law.kuleuven.be>.

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Pace Law School Institute of International Commercial Law - Last updated April 23, 2007
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