Spain 31 October 2006 Supreme Court
[Cite as: http://cisgw3.law.pace.edu/cases/061031s4.html]
DATE OF DECISION:
JURISDICTION:
TRIBUNAL:
JUDGE(S):
CASE NUMBER/DOCKET NUMBER: No. 1062/2006
CASE NAME:
CASE HISTORY: Unavailable
SELLER'S COUNTRY: Spain
BUYER'S COUNTRY: Spain
GOODS INVOLVED: Real property
SPAIN: Tribunal Supremo, 31 October 2006
Case law on UNCITRAL texts (CLOUT) abstract no. 736
Reproduced with permission of UNCITRAL
A Spanish buyer and a Spanish seller entered into a contract for the purchase of a real property. At the time of the contract, the seller was aware of the rights of a third party to the same real property pursuant to a verbal contract. The third party filed its claim after the buyer and the seller had signed the contract. When the buyer found out about the third party's claim, it withdrew from the contract and claimed its money back for breach of performance of the seller.
The claim was upheld and the seller appealed, until the case came before the Supreme Court. The court discussed the concept of a fundamental breach of one party, which would give the right of avoidance to the other. The court noted that a fundamental breach needed to take place intentionally and that this definition had been progressively specified in its jurisprudence, i.e. the breach needed to be a substantial violation of the contract leading to the failure of the legitimate expectations of the other contracting party. The court also observed that this evolution adjusted to the requirements of a fundamental breach contained in article 25 CISG, giving the right of avoidance pursuant to article 49 CISG, and also to the European Principles of Contract law. The court further noted that the dispositions of an international convention which formed part of its legal regime and that were also embodied into national law (commercial law) should help in the application of national law by interpreting it in accordance with the current social and legal development of the country. Consequently, the court held that the seller committed a fundamental breach by selling real property that was encumbered with the claim of a third party and it rejected the seller's appeal.
Go to Case Table of ContentsAPPLICATION OF CISG: No, dicta reference to CISG
APPLICABLE CISG PROVISIONS AND ISSUES
Key CISG provisions at issue:
Classification of issues using UNCITRAL classification code numbers:
Descriptors:
CITATIONS TO OTHER ABSTRACTS OF DECISION
Spanish: CISG-Spain and Latin America website <http://www.uc3m.es/cisg/respan56.htm>
CITATIONS TO TEXT OF DECISION
Original language (Spanish): CISG-Spain and Latin America website <http://www.uc3m.es/cisg/sespan56.htm>; see also Aranzadi/Westlaw 2006\8405
Translation: Unavailable
CITATIONS TO COMMENTS ON DECISION
Unavailable
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