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CISG CASE PRESENTATION

Belarus 8 November 2006 Commercial Court of the Brest Region [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/061108b5.html]

Primary source(s) of information for case presentation: Unilex database

Case Table of Contents


Case identification

DATE OF DECISION: 20061108 (8 November 2006)

JURISDICTION: Belarus

TRIBUNAL: Commercial Court of the Brest Region

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 333-7/2006

CASE NAME: Unavailable

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Russian Federation (plaintiff)

BUYER'S COUNTRY: Belarus (defendant)

GOODS INVOLVED: [-]


Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 78

Classification of issues using UNCITRAL classification code numbers:

78B [Rate of interest]

Descriptors: Interest

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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=1383&step=Abstract>

CITATIONS TO TEXT OF DECISION

Original language (Russian): <http://www.lawbelarus.com/repub2008/sub10/text10745.htm>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation) [first draft]

The CISG Translation Network

The Decision of the Economic Court of the Brest Region from 8 November 2006 (Case No. 333-7/2006)
n the buyer does not pay for the delivered goods the seller has a right to claim payment of the price,
penalties agreed in the contract, and rate of interest.”

The text of the document with amendments and additions on 1 January 2009
 

The Decision of the Economic Court of the Brest Region

8 November 2006 (Case No. 333-7/2006)

Translation [*] by Aleksandra Mirgorodskaia [**]

The Economic Court of the Brest Region in an open court session examined the case for the claim of the [Seller], the Russian Federation, Moscow, against the [Buyer] for ordering to pay 222 721.24 Russian Rubles (RUR).

STATED THE FOLLOWING:

The [Seller] claimed the [Buyer] to pay RUR 222 721.24, RUR 168 168.00 of which is the sum of the price of goods delivered to the [Buyer] and not paid for; RUR 33 465.43 represent the contractual penalties for a delay in payment, and RUR 21 087.81 represent the rate of interest.

During the Court session on 1 November 2006, the Court took a recess until 8 November 2006 (the first business day), 16:45.

The parties were duly notified of the time and the place of the court session.

Taking into account the fact that both parties were duly notified of the time and the place of the court session and that materials of the case were enough for examining the case, the Court considered the examination of the case in the absence of the Buyer's counsel.

The [Buyer] acknowledged the debt in full, which was expressed in the reconciliation of operations act.

On the day of the case hearing, the [Buyer] requested the Court examine the case without participation of his/her counsel.

DECISION:

After examining the case, the Court stated that the claim should be granted in the amount of RUR 168 168.00 for the price; RUR 33 465.43 for penalties for the period from 22 August 2005 until 25 September 2006 for 398 days counting 0.05 per cent of the debt for a day; and RUR 21 087.81 for rate of interest based on the refinancing rate of 11.5 per cent per year fixed by the Central Bank of the Russian Federation and applicable on the day of making the decision.

REASONING:

According to the case record, it was ascertained that the [Seller] and the [Buyer] concluded contract No. 100/04/03 on 18 March 2005. According to the contract, the [Seller] was obliged to deliver and the [Buyer] was obliged to accept the goods and pay the price of RUR 168 168.00 for the goods.

The [Seller] sent the goods, square of steel U8A, to the [Buyer's] address under to the Contract, with Bill of Lading No. 100010 on 3 May 2005 along with commercial invoice No. 100010 for the sum of RUR 168 168.00.

According to Article 2.3 of the Contract, the [Buyer] was obliged to pay for the delivered goods via counter-supply of used swages for steel 5XHM during the 90 day period from the moment of sending the goods, e.g. until 1 August 2005.

According to Article 4.1 of the Contract, in case of the [Buyer's] breach of time limits for counter-supply before 1 August 2005 the Contract becomes monetary and the [Buyer] is obliged to pay for the goods delivered by the [Seller] during the next 15 banking days, e.g. until 22 August 2005.

The [Seller] repeatedly requested payment from the [Buyer], however, the sum of the price for the delivered goods in the amount of RUR 168 168.00 was not paid.

According to Article 290 of the Civil Code of the Republic of Belarus, obligations should be performed properly. The [Buyer] did not perform its contractual obligations properly by non-payment.

According to Article 4.1 of the Contract, in case of non-payment for delivered goods before 22 August 2005, the [Buyer] pays penalties in the amount of 0.05 per cent of the debt per day to the [Seller].

The [Buyer] did not pay the price in the amount of RUR 168 168.00 until 25 September 2006, resulting in the delay of 398 days, which amounted to RUR 33 465.43.

According to Article 78 of the UN Convention on Contracts for the International Sale of Goods, if a party fails to pay the price or any other sum that is in arrears, the other party is entitled to interest on it, without prejudice to any claim for damages recoverable under article 78.

According to the Act of the Plenary Meeting of the Supreme Economic Court of the Republic of Belarus of 7 June 2001 No. 3 (section 42), when the Vienna Convention is applicable, penalties are determined according to the rules of applicable law.

If currency of payment under a contract is a foreign currency, principles of international commercial contracts based on international usages, which do not contradict with national law of the Republic of Belarus, can be applied (section 1 of article 1093 of the Civil Code of the Republic of Belarus).

According to Article 7.4.9 of the UNIDRIOT Principles, the rate of interest shall be the average bank short-term lending rate to prime borrowers prevailing for the currency of payment at the place for payment, or where no such rate exists at that place, then the same rate in the state of the currency of payment. In the absence of such a rate at either place the rate of interest shall be the appropriate rate fixed by the law of the State of the currency of payment.

The currency of payment under Contract No. 100/04/03 of 18 March 2005 is Russian Ruble.

According to Article 395 of the Civil Code of the Russian Federation, the party in breach should pay rate of interest based on the refinancing rate fixed by the Central Bank of the Russian Federation and applicable on the day of claim.

According to telegram of the Central Bank of the Russian Federation of 23 June 2006 No. 1696-Y, the Central Bank of the Russian Federation fixed the following refinancing rates: from 26 June 2006 up to the present -- 11.5 per cent.

The interest rate amounted to RUR 2 108 780.65.

Taking into account the fact that the claims are rightful, proved by documents, and are not disproved by the [Buyer], the claims are granted in full.

The state fee should be related to the [Buyer] in a proportion to the part of claims granted.

For the above said, in accordance with articles 127, 133, 190, 192 -- 194, 201, 207 of the Economic Procedure Court of the Republic of Belarus, with articles 290, 311, 366 of the civil Code of the Republic of Belarus, the court --

STATED:

To order the [Buyer] to pay to the [Seller] RUR 168 168.00 representing the contract price, RUR 33 465.43 representing contractual penalties, RUR 21 087.81 of interest and RUR 4 140.82 of the state fee, totaling RUR 226 862.06.

To give an order after the decision comes into force.

The decision may be reviewed in the appellate instance in the Economic Court of the Brest Region within 15 days after its announcement.


FOOTNOTES

* All translations should be verified by cross-checking against the original text.

** Aleksandra Mirgorodskaia, a law student of Saint Petersburg State University, a participant in the Willem C. Vis Commercial Arbitration Moot. E-mail: <mirgorodskaia.a@gmail.com>.

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Pace Law School Institute of International Commercial Law - Last updated June 9, 2015
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