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CISG CASE PRESENTATION

Germany 31 August 2006 Appellate Court Köln (Chlorine tablets case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/060831g1.html]

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

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Case identification

DATE OF DECISION: 20060831 (31 August 2006)

JURISDICTION: Germany

TRIBUNAL: OLG Köln [OLG = Oberlandesgericht = Provincial Appellate Court]

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 16 U 20/06

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

CASE HISTORY: 1st instance Landgericht Köln (83 O 99/03) 22 February 2006 [affirmed]

SELLER'S COUNTRY: Switzerland (plaintiff)

BUYER'S COUNTRY: Germany (defendant)

GOODS INVOLVED: Chlorine tablets


IHR headnote

Reproduced from Internationales Handelsrecht (2/2007) 71

"The buyer is to carry out spot checks on bulk commodities without undue delay."

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Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 25 ; 38 ; 39 ; 49

Classification of issues using UNCITRAL classification code numbers:

25B [Definition of fundamental breach];

38A [Buyer's obligation to examine goods: time for examining goods];

39A1 ; 39A2 [Requirement to notify seller of lack of conformity: buyer must notify seller within reasonable time; Specification of nature of non-conformity: degree of specificity required];

49A [Buyer's right to avoid contract (grounds for avoidance): fundamental breach]

Descriptors: Fundamental breach ; Avoidance ; Examination of goods ; Lack of conformity notice, specificity ; Lack of conformity notice, timeliness

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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): CISG-online.ch website <http://www.cisg-online.ch/cisg/urteile/1406.pdf>; Internationales Handelsrecht (2/2007) 71-72

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation)

Queen Mary Case Translation Programme

Appellate Court (Oberlandesgericht) Köln

31 August 2006 [16 U 20/06]

Translation [*] by Jan Henning Berg [**]

Edited by Institut für ausländisches und Internationales
Privat- und Wirtshaftsrecht der Universität Heidelberg
Daniel Nagel, editor
[***]

JUDGMENT

The appeal filed by Defendant-Appellant [Buyer] against the judgment of the District Court (Landgericht) Köln of 22 February 2006 (case docket 83 O 99/03) is dismissed. [Buyer] bears the costs of the appellate proceedings.

FACTS

Following a sales contract between the parties, the Swiss Plaintiff-Appellee [Seller] delivered on 8 August 2003 water treatment chemicals (chlorine tablets) to [Buyer]. Delivery was effected to the subcontractor of [Buyer] in Belgium as had been agreed upon. By way of a corresponding notice of non-conformity from the Belgian subcontractor, [Buyer] notified [Seller] of the lack of conformity of the goods with respect to several aspects by letter delivered on 13 August 2003. After previous telephone calls and the exchange of letters between the parties, [Buyer] finally declared avoidance of the contract by letter dated 16 September 2003. [Buyer] relies on an inspection report of 17 November 2003 being the result of an analysis of the goods which had been ordered by [Buyer]. With its memorandum of 3 December 2003, [Buyer] particularly alleges that the delivered tablets contained too little chlorine.

After taking evidence, the District Court affirmed [Seller]'s action for payment of the residual purchase price of EUR 11,084. The District Court dismissed a cross-action initiated by [Buyer] for reimbursement of its advance payment of EUR 3,300 and of its expenses for the analysis of the goods in the amount of EUR 830 as well as for the declaration of a duty for compensation of [Seller] founded on a possible damage due to resale of the goods.

[Buyer] upholds its submissions filed during the First Instance proceedings with the present appeal.

REASONING OF THE COURT

The appeal is admissible but not justified.

The Court has stated in its procedural consideration of 2 August 2006 in accordance with 522(2) ZPO [*]:

[Buyer] has failed to substantiate any legally relevant defenses against the claim for payment of the residual purchase price. Irrespective of whether or not there is sufficient evidence concerning an alleged lack of chlorine, the District Court, in its outcome, made a proper assessment of the case. It held that [Buyer] had no right to avoid the contract.

a) [No claims for Buyer from transport damage and short delivery]

Any transport damage on the account of [Seller] following the clause "DDP" as well as any short delivery are not fundamental as required by Art. 49(1)(a) CISG. This view expressed in the judgment of the District Court is correct and has been expressly conceded by [Buyer]. Any claims for a reduction in price have not been brought forward by [Buyer].

b) [No claims from package identification]

The same applies to the package identification, in respect to which the Court affirms the opinion of the District Court. [Buyer]'s appeal, that merely reverses the legal position of the District Court, provides no cause for further reasoning.

c) All other lacks of conformity that were asserted by [Buyer] in its procedural response and notified towards [Seller] have not been established pursuant to the factual findings made in First Instance.

d) [No right to rely on alleged defect having to do with content of chlorine]

The alleged defect of too little chlorine content had not been referred to at all in either [Buyer]'s notices of non-conformity or its declaration of avoidance of the contract and was introduced by [Buyer] only during the present proceedings. In that respect, the contract was declared avoided only on 3 December 2003 when [Buyer] based its defense against [Seller]'s action and its cross-action on the corresponding factual assertions. At that stage however, [Buyer] had already forfeited its right due to its failure to comply with its duties to inspect the goods and notify the seller under Arts. 38, 39 CISG. To avoid forfeiting its rights under the CISG, [Buyer] must discover and notify of the lack at an earlier stage. For the present case of a delivery of generic goods, [Buyer] had the duty to randomly inspect and analyze the goods immediately after delivery and not only after the accrual of disputes in order to give a corresponding notice of the analysis in accordance with Art. 39 CISG (OLG [*] Köln OLGR [*] 2001, 155). It had not complied with this duty until the analysis of the goods during November 2003. Moreover, the reasons for the delayed inspection emerged solely from [Buyer]'s own sphere of responsibility and, at any rate, not from the sphere of [Seller]. For the particular delivery at hand, an immediate inspection would have been crucial. This is only supported by the existence of the present proceedings with the dispute between the parties concerning the question of whether and to which extent the content of chlorine of the tablets as determined by SGS Belgium as well as the appointed expert allows for conclusions to the exact time of delivery. It is the purpose of Art. 38, 39 CISG to prevent any such dispute and to enable the parties to take appropriate measures.

Furthermore, [Buyer] has not contested the findings by the expert that the goods could have been put to a secondary use -- if applicable with a price reduction. In fact it must be demonstrated by a party relying on avoidance of the contract that the goods in question can not be sold or put to another use (BGH [*] NJW [*] 1996, 2364). However, [Buyer] has not brought forward any arguments.

2. Finally, [Buyer] has not contested the opinion expressed by the District Court that the lack of right to rely on avoidance of the contract would render the cross-action unfounded.

There is nothing which could be added to this assessment.

The decision on costs is based on 97(1) ZPO [*].


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff-Appellee of Switzerland is referred to as [Seller] and Defendant-Appellant of Germany is referred to as [Buyer]. Amounts in the uniform European currency (Euro) are indicated as [EUR].

Translator's note on other abbreviations: BGH = Bundesgerichtshof [German Federal Supreme Court]; NJW = Neue Juristische Wochenschrift [a German law journal]; OLG = Oberlandesgericht [German Appellate Court]; OLGR = Oberlandesgericht-Report [Collection of decisions rendered by the German Appellate Courts]; ZPO = Zivilprozessordnung [German Code on Civil Procedure].

** Jan Henning Berg is a law student at the University of Osnabrück, Germany and participated in the 13th Willem C. Vis Moot with the team of the University of Osnabrück.

*** Daniel Nagel has been a law student at Heidelberg University since October 2002 and an exchange student at Leeds University in 2004/2005.

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Pace Law School Institute of International Commercial Law - Last updated September 12, 2007
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