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CISG CASE PRESENTATION

China 25 December 2006 Shanghai No. 2 Intermediate People's Court [District Court] (Cabinets and accessories case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/061225c1.html]

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

Case Table of Contents


Case identification

DATE OF DECISION: 20061225 (25 December 2006)

JURISDICTION: People's Republic of China

TRIBUNAL: Shanghai No. 2 Intermediate People's Court [District Court]

JUDGE(S): Jiang Nan (Presiding judge); Cui Xuejie and Lu Ping (Assistant judges)

CASE NUMBER/DOCKET NUMBER: Unavailable

CASE NAME: A.G.A Firm v. Shanghai Yixuan Import & Export Co. Ltd and Foshan Gena Cleaning Instruments Manufacturers Co. Ltd.

CASE HISTORY: Unavailable

SELLER'S COUNTRY: People's Republic of China (defendant)

BUYER'S COUNTRY: Israel (plaintiff)

GOODS INVOLVED: Cabinets and accessories


Classification of issues present

APPLICATION OF CISG: Yes [Article 1(1)(a)]

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 30 ; 33(b) ; 45 ; 67(1) ; 74

Classification of issues using UNCITRAL classification code numbers:

Unavailable

Descriptors: Unavailable

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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 (Chinese): Click here for Chinese text of case; see also CISG-China Case [IPC/26]: <http://aff.whu.edu.cn/cisgchina/en/news_view.asp?newsid=52>

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

Shanghai No. 2 Intermediate People's Court [25 December 2006]

A.G.A Firm v. Shanghai Yixuan Import & Export Co Ltd and Foshan Gena Cleaning Instruments Manufacturers Co Ltd.

Translation [*] by Fan Yao [**]

[...]

I. THE TRIAL PROCEEDINGS

Plaintiff A.G.A Firm [of Israel] (hereinafter "[Buyer]) filed a lawsuit with this court on 7 July 2006 against Defendants Shanghai Yixuan Import & Export Co. Ltd. (hereinafter "[Seller One]") and Foshan Gena Cleaning Instruments Manufacturers Co. Ltd (hereinafter "[Seller Two]") [both of the People's Republic of China] because of a sales contract dispute. This court accepted the suit and established a collegiate bench according to the law. On 13 October 2006, the court held a public trial. Xu Yonglin, representative of [Buyer]; You Renjie, representative of [Seller One]; and Yin Qingqiu, representative of [Seller Two] participated..

This case has finished all of its proceedings.

II. POSITION OF THE PARTIES

A. [Buyer]'s claims

[Buyer] alleges that:

On 23 March and 30 March 2005, [Buyer] signed Contracts No. HC-PF200503-1, HC-PF200502-1 with [Seller One], stipulating that [Seller One] should supply cabinets and accessories to [Buyer]. There were also another two sales contracts between [Seller One] and [Seller Two] which provided that [Seller Two] should produce the products ordered by [Buyer], and be responsible for product packing, shipping into containers, and carrying into the warehouse appointed by the Customs.

On 28 May and 30 June 2005, [Buyer] received the goods under the contracts. There were problems with the goods under both Contract HC-PF200503-1 and Contract HC-PF200502-1:

      [Buyer] found that the goods under Contract HC-PF200503-1 were not packed separately in barcodes; instead they were mixed packed, which caused [Buyer] to be unable to sell the goods. Based upon the good cooperative relationship it had with [Seller One], [Buyer] did not return the goods to [Seller One], but spent a number of hours of labor and provided materials for the re-arrangement of the goods. [Buyer] also purchased packages locally and re-packed the goods.

      In addition, as [Buyer] was selling the goods under Contract HC-PF200502-1, it found that there was a size shortage in the stainless connection links in seven sets of products numbered in KC-108. According to the contract, the size should have been 74 centimeters, while the actual size was 72 centimeters. Although [Seller One] orally promised that it would re-supply the stainless connection links in conformity with the contract, it never performed. Consequently, [Buyer] had to dispose of the seven sets of goods as scrap. In addition, six faucets sold under Contract HC-PF200502-1 were lost in shipment. Moreover, [Seller One] did not deliver the goods in a timely manner; this prevented [Buyer] from selling the goods normally and caused [Buyer] to suffer an economic loss.

Having failed to resolve this matter by consultation with [Seller One] and [Seller Two], the [Buyer] requested the court to rule that:

   1.    [Seller One] should compensate [Buyer] the economic loss of US $16,682.40;
   2.    [Seller One] should compensate the attorneys' fees to [Buyer], which is RMB 6,500;
   3.    [Seller Two] should undertake joint and several liability on [Seller One]'s obligations.

In order to prove its claims, [Buyer] submitted to this court the following evidence:

1. Sales Contract No. HC-PF200503-1 signed by [Buyer] and [Seller One] on 23 March 2005;

2. Sales Contract No. HC-PF200502-1 signed by [Buyer] and [Seller One] on 30 March 2005;

Evidence Exhibits 1 and 2 were submitted to prove that [Buyer] and [Seller One] had established a sales contractual relationship;

3. A receipt showing payment of US $67,752 for the goods to [Seller One] by the consignee, "Home Center Ltd.", appointed by [Buyer] on 18 July 2005, to prove that [Buyer] has paid for the goods under these two sales contracts;

4. A damage calculation, to prove the composition of [Buyer]'s loss;

5. The consultation letter sent by [Buyer] to [Seller One], seeking to negotiate the situation;

6. The contract signed by [Buyer] for hiring attorneys and the invoice for paying attorneys' fees to prove that [Buyer] has paid the attorneys' fees for this case.

B. Defense of [Seller One]

[Seller One rebuts this, stating that:

It accepts the facts that the two contracts sued on by [Buyer] have been signed by the parties, and that the breach of contract alleged by [Buyer] is true, but alleges that it is [Seller Two] that was responsible for producing, packing and shipping the goods under the contracts. [Seller One] has reasonably fulfilled its obligations in the contract performance, namely. timely transferring the objections submitted by [Buyer] to [Seller Two]

Since [Seller Two] did not take reasonable measures to cure the breach of contract, [Buyer]'s loss resulting from it should be undertaken by [Seller Two] and [Seller One] should not be held liable.

To prove its defenses, [Seller One] provided the following evidence:

1. The two sales contracts numbered HC-PF200503-1 and HC-PF200502-1 entered into between [Seller One] and [Seller Two] on 24 March, and 4 April 2005, to prove that [Seller One] purchased the goods in this dispute from [Seller Two] in order to perform the sale contracts it signed with [Buyer];

2. The order list confirmed by fax sent by [Seller Two] to [Seller One] on 8 April 2005; the e-mails sent by [Seller Two] to [Seller One] on 9 April 2005; the e-mails sent by [Seller One] to [Seller Two] on 12 and 18 April of the same year, to prove that [Seller Two] knew well that the goods under Contract HC-PF200503-1 had different barcodes, and that it should pack the goods separately according to the barcodes;

3. The Notarization issued by Public Notary of Shanghai Jing'an District on 20 January 2006; the e-mails in which [Seller One] required [Seller Two] to provide the details of the packing situation on 15 July 2005; the consultation fax sent by [Seller One] to [Seller Two] on 18 July 2005; the packing lists faxed by [Seller Two] to [Seller One] on 22 July; the export customs declaration issued by Customs on 1 June 2005; the civil judgment handed down by the People's Court of Shanghai, Jing'an District in case No (2006), Jing Min Er (Shang) Chu Zi No.2, to prove the breach of contract by [Seller Two].

4. The IP long-distance phone call lists recording communications between [Seller One] and [Seller Two] from March to August 2005; the flight tickets for when [Seller One] sent its staff to Israel to settle the mixed packing affairs on 25 June 2005; faxes sent by [Seller One] to [Seller Two] on 13 May; the tele-transfer receipt documenting that [Seller One] paid [Seller Two] separately for six faucets on 8 August, to prove that under the condition of the breach of contract by [Seller Two], [Seller One] consulted actively and took reasonable measures to mitigate the loss.

C. Defense of [Seller Two]

[Seller Two] states that:

First of all, the present lawsuit submitted by [Buyer] is inconsistent with the law and the court should dismiss it. The Petition that [Buyer] relies upon was signed in January 2006 by its legal representative. It was a Petition that had been dismissed. The commencement of the present lawsuit needs a separate legal signing procedure by the legal representative of [Buyer] so as to confirm the true intent of [Buyer], otherwise, the lawsuit filed by [Buyer] should be dismissed.

Second, [Seller Two] did not have a sales contractual relationship with the [Buyer]. The entity which signed the sales contracts with [Buyer] was [Seller One], so the requests to [Seller Two] submitted by [Buyer] should be dismissed. It is true that [Seller Two] signed contracts with [Seller One], selling ceramics cleaning instruments to [Seller One] However, the contracts do not stipulate that the goods and responsibilities under the contract have connections with [Buyer]. Therefore, the request by [Buyer], which states that [Seller Two] should undertake joint and several liability, lacks factual and legal basis.

Third, [Seller Two] did not know that [Buyer] had signed sales contracts with [Seller One] and it could not foresee the dispute between [Buyer] and [Seller One], as well as the liabilities for breach of contract. So [Seller Two] should not be held liable.

Lastly, [Seller Two] did not breach the contracts signed between it and [Seller One] Based upon [Seller One]'s arrears, [Seller Two] has filed a separate lawsuit against [Seller One].

[Seller Two] submitted the following evidence to the court to prove its claims:

1. A payment receipt showing that [Seller One] made a 10% payment to [Seller Two] under Contract HC-PF200503-1 on 7 April 2005;

2. A payment receipt showing that [Seller One] made a 40% payment to [Seller Two] under Contract HC-PF200502-1 on 27 May 2005;

Evidence Exhibits 1-2 were submitted to prove that [Seller One] did not pay 80% of the contract price before the delivery of the goods according to the contract, thus [Seller Two] had the right to suspend the delivery by using the defense to ask for [Seller One]'s performance at first.

3. Waybills for [Seller Two]'s delivery on 1 June 2005, to prove that [Seller Two] delivered the goods under Contract HC-PF200502-1 in the condition that it only received 50% of the payment;

4. The second page of the trade acceptance which was due on 1 July issued by [Seller One] resulting from [Seller Two]'s consultation, to prove that [Seller One] has confirmed to pay.

5. The first page of the aforementioned trade acceptance, to prove the preceding trade acceptance issued by [Seller One] has been abolished.

6. The two contracts numbered HC-PF200503-1 and HC-PF200502-1 signed by and between [Seller One] and [Seller Two] on 24 March and 4 April 2005, to prove that there is a sales contractual relationship between [Seller One] and [Seller Two].

D. [Buyer]'s response

[Buyer] alleges that:

It filed a lawsuit on 16 January 2006. Because of the lack of related procedural materials, the court dismissed the suit. The present lawsuit, is a new one after [Buyer] completely prepared all of the procedural materials, which is a manifestation of the parties' true intention. The statements by [Seller Two] cannot be supported.

III. FACTS IDENTIFIED BY THE COURT

Through the trial hearings, the court finds that:

On 23 March 2005, [Buyer] and [Seller One] signed a sales contract numbered HC-PF200503-1, agreeing that [Seller One] would provide the [Buyer] the following products:

   -    85 sets of K-MC206 solid-wood mirror cabinets and scrub mirror frames, US $43 per set;
   -    85 sets of K-C206 manual assembly solid-wood cabinets, faucets and ceramics basins, US $127 per set; and
   -    85 sets of K-S306 solid-wood side cabinets and glass doors, US $45 per set.

The product packing clause provides that the products should be packed in suitable cardboard boxes and wooden frames, and should come with adequate fillers to prevent damages in transport. There should be clear and corresponding marks and barcodes on all of the boxes. And the contract stipulates that, if [Seller One] does not perform the contract in accordance with the product packing clause, [Buyer] has the right to ask [Seller One] for compensation in the amount of the price of the goods delivered in default, plus 30% punitive damages, as well as to undertake all of the costs resulting from the breach, which include but are not limited to labor costs.

On 28 May 2005, after [Buyer] received the goods under the contract, it found the goods were not separately packed in barcodes according to the contract, but were mixed with each other goods. [Buyer] then organized its staff to re-arrange the goods at the local place. [Seller One] has not questioned these facts.

On 30 March 2005, [Buyer] and [Seller One] signed another sales contract numbered HC-PF200502-1, providing that [Seller One] would supply the following products to [Buyer]:

   -    120 sets of K-MC206 mirror frames, US $43 per set;
   -    100 sets of KC-108 manual assembly shelves and ceramics basins, the product size (mm) is 1,000500900, US $127 per set;
   -    120 sets of K-S306 side cabinets, US $45 per set;
   -    100 sets of K-MC206 mirrors, US $32 per set;
   -    100 sets of K-C109 manual assembly shelves and faucets, US $152 per set.

Delivery on board at Guangzhou Port within 40 days after the contract is signed;

All prices are FOB Guangzhou.

The contract also provides that if [Seller One] does not deliver the goods in due time, upon timely notice [Seller One] must pay corresponding fines for delivery delay according to the following schedule: delay for 7 days, [Buyer] will deduct the goods payment in rate of 0.5% of the total payment per day, delay for 8-30 days, [Buyer] will deduct the goods payment in rate of 1% of the total payment per day.

On 30 June 2005, after [Buyer] received the goods, it found that in seven sets of KC-108 manual assembly shelves, three stainless connection links in each set had a size shortage. The faucets in six sets of K-C109 products were damaged in shipment. [Seller One] was 20 days late in tendering the goods. At the trial, [Buyer] confirmed that the goods [Seller One] delayed tendering were KC-108 and K-C109 products, the total value of the goods was US $27,900.

Both of the two preceding contracts stipulate that the consignee is "Home Center Ltd." On 18 July 2005, "Home Center Ltd." paid for the goods. US $67,752 was paid to [Seller One]; the payment did not deduct the fines resulting from the delivery delay. [Seller One] does not have objections to this fact, either.

The court also finds that:

In order to perform the two aforementioned contracts, on 24 March and 4 April 2005 [Seller One] separately signed with [Seller Two] another two contracts having the same contract numbers, agreeing that [Seller Two] would provides K-C106, K-C108 and K-C109 products to [Seller One].

Again, the court finds that:

[Buyer] filed a lawsuit with this court on 16 January 2006: Assaf Gov Ari came to this court for himself, and signed the Petition and letter of authorization in front of the judges. Since the company's business license submitted by [Buyer] had not been certified by the Embassy of China in the State of Israel, and [Buyer] could not submit the identification certificate of its legal representative, this court dismissed the lawsuit of [Buyer] on 5 April 2005. On 31 May, the Shanghai High People's Court dismissed the appeal of [Seller One] and upheld the judgment of this court. On 7 July, the agent specially authorized by [Buyer], holding the company certificate that supplemented the certificate procedure and other related documents, using the Petition and letter of authorization signed by Assaf Gov Ari in front of the judges, filed the lawsuit with this court once again.

The above facts can be proved by the following evidence: Exhibits 1-3 provided by [Buyer], Exhibit 1 and the customs declaration in Exhibit 3 provided by [Seller One], Exhibits 3 and 6 submitted by [Seller Two], plus the statements of the parties, thus this court accepts them.

IV. ISSUES

According to the claims of the parties, the core issues are:

   A.    Whether this lawsuit is consistent with the procedural requirements;
   B.    Whether the basis of loss alleged by [Buyer] is established;
   C.    Whether the claim requested by [Buyer] that [Seller Two] should undertake a joint and several liability with [Seller One], and the claim submitted by [Seller One] that it is [Seller Two] that should be responsible for the compensation to [Buyer], are established.

A. Concerning issue A

The Court believes that:

Although the legal representative of [Buyer] did not separately sign another Petition and letter of authorization for the present lawsuit, this is a lawsuit that was filed by [Buyer] once again before this Court after it had cured the procedural flaws of its first prosecution, using the Petition and letter of authorization once signed by the legal representative of [Buyer], Assaf Gov Ari, in front of the Judge. This prosecution should be recognized as a manifestation of [Buyer]'s true intention; it is not unjustified for the Court to accept this case. The objections alleged by [Seller Two] cannot be established, and this Court does not support them.

B. Concerning issue B

[Buyer] has provided a loss calculation to prove its claims, which is as follows:

      1. The loss for the size shortage in three stainless connection links in each set of the seven sets of KC-108 manual assembly shelves

      [Buyer] states that this loss should be calculated in the product price per set, which is US $127 agreed to in the contract, and should be US $889 in total. [Seller One] holds that it is true that there are seven sets of products that have the size shortages in the connection links, but only one connection link in each set has this problem. Thus, [Buyer] can re-assemble them, and the actual amount of the size shortages in connection links is three sets. Besides, product KC-108 is a set of assembly products, connection links are only accessories. The loss calculated in the price of a whole set submitted by [Buyer] is not reasonable. [Seller Two] believes that the product loss in the contact signed between [Seller One] and it can be calculated in the product price per set, and three sets in total.

This court holds that:

In the seven sets of manual assembly shelves alleged by [Buyer], three stainless connection links in each set have a size shortage. [Seller One] confirms that the amount of the products that have size shortages is seven sets, but it believes that only one connection link in each set has such a problem, and through the re-assembling work, the actual amount should be three sets. Because [Seller One] accepts that there are seven sets of products that have size shortages, and it did not provide any evidence to show that through the re-assembling work, the actual amount of size shortages should be three sets, this court holds that the fact that seven sets of products have size shortages alleged by [Buyer] is established. Concerning the compensation amount, [Buyer] use the price of the whole set of product to calculate the loss of the size shortages in connection links. Since this calculation method is not reasonable, this court cannot support the total amount submitted by [Buyer]. Considering the claims of [Seller Two], the court identifies the amount of the loss in its discretion as US $360.

      2. The loss of the damage of the faucets in the six sets of K-C109 products

      [Buyer] submits that the damage of the six faucets occurred during the maritime transport and that [Seller One] and [Seller Two] are still responsible for the compensation. Calculated in US $152 per set, the total loss of this item would be US $912. [Seller One] holds that this loss was not so caused, and it should not undertake this responsibility. [Seller Two] believes that, this loss occurred during marine transport, but the compensation is irrelevant to it.

This court decides that:

In the two sales contracts signed between [Buyer] and [Seller One], the payment condition is agreed as "FOB Guangzhou". According to this term, [Seller One] should deliver the goods at the specified port appointed by [Buyer], once the goods pass over the ship's rail, the risk of loss is transferred to [Buyer]. Therefore, [Seller One] did not undertake any liabilities after the goods passed over the ship's rail. Therefore, the [Buyer] having confirmed that the loss of the six faucets was caused during maritime transport, the claim for [Buyer] to ask for the compensation from [Seller One] and [Seller Two] cannot be established, and this court does not uphold it.

      3. The calculation of the fines for delivery delay of KC-108 and K-C109 products

      [Buyer] submits that [Seller One] delayed the delivery of goods for twenty days, and the calculation of fines should be made according to the formula recited in the contract. Given that [Seller One] accepts this claim of [Buyer], this court confirms that the fine that [Seller One] should undertake for delivery delay is US $4,603.50.

      4. The loss for mixed packing of the goods under Contract HC-PF200503-1

      [Buyer] believes that, pursuant to the contract terms, based upon the fact that [Seller One] mixed packing the goods under the contract, [Buyer] has the right to ask [Seller One] to compensate in the amount of the total price of the goods, plus 30% punitive damages, and to undertake any costs resulting from the mixed packing, which include but are not limited to the labor cost. At present, [Buyer] abandons the compensation for the total goods price, but only asks for the 30% punitive damages, which would be US $5,482.50. Besides, [Buyer] re-arranged the mixed packing goods in Israel, on which it spent US $2,500 for labor. [Buyer] alleges that these two items of payment should be undertaken by [Seller One] and [Seller Two]. [Seller One] advises that it has no objections to [Buyer]'s claim for 30% punitive damages according to the contract. Although [Seller One] accepts the amount that [Buyer] spent on the labor for re-arranging the goods, it argues that [Buyer] did not provide any payment receipts that can prove [Buyer] has actually paid this amount, thus it objects to the authenticity of this cost.

This court holds the view that:

Since [Seller One] confirms the fact of mixed packing and has no objections to the request of [Buyer] asking for US $5,482.50 punitive damages, the court upholds this amount of loss submitted by [Buyer]. Meanwhile, [Seller One] accepts the fact that [Buyer] has re-arranged the goods and the legitimacy of the labor costs resulting from it. Also, in the sales contracts signed between [Buyer] and [Seller One], it clearly provides that the compensation [Seller One] should be responsible for due to the breach of contract contains labor costs. Hence, the court supports this part of the loss submitted by [Buyer], which is US $2,500.

      5. The attorneys' fees submitted by [Buyer].

      [Buyer] submitted Evidence Exhibit 6 to prove this claim. [Seller One] accepts the authenticity of this evidence, but alleges that this request does not have legal basis.

This court holds that:

According to Evidence Exhibit 6, it can be proved that [Buyer] has paid the attorneys' fees. Nevertheless, given that neither of the two contracts in this dispute expressly stipulates the undertaking of the attorneys' fees when there is a dispute, the request of [Buyer] that [Seller One] should be responsible for the attorneys' fees, not only lacks factual basis, but also has no legal basis. The court cannot support this request.

To conclude, this Court upholds US $12,946 of the loss submitted by [Buyer], but cannot support the other losses alleged by [Buyer].

C. Concerning issue C

[Buyer] has not provided any evidence on this point.

[Seller One] uses Evidence Exhibit 1 and the packing list in Evidence Exhibit 3 that it provided to prove that it is [Seller Two]'s responsibility to pack the goods mixed, also to support its allegation that [Seller Two] should be liable for the delivery delay by using Evidence Exhibit 1 and the customs declaration in Evidence Exhibit 3. [Buyer] accepts the above evidence. [Seller Two] accepts the authenticity of the customs declaration in Evidence Exhibit 1, but denies the authenticity of the packing list. As to this issue, [Seller Two] submits Evidence Exhibits 1-3 and Evidence Exhibit 6 to prove its claims, holding that since [Seller One] did not pay for the goods in accordance with the contract, it was reasonable for it to delay the delivery. Except for the authenticity of the packing list, [Buyer] cannot give any evidence examination opinions on the other Evidence Exhibits provided by [Seller Two] to prove relevant conduct of [Seller One] and [Seller Two], for the reason that [Buyer] did not participated in these performances. [Seller One] confirms the authenticity of the Evidence Exhibits provided by [Seller Two], but it believes that it did not breach the contract.

This court holds that:

The authenticity of Evidence Exhibit 1 and the customs declaration in Evidence Exhibit 3 provided by [Seller One], as well as Evidence Exhibits 1-3 and Evidence Exhibit 6 provided by [Seller Two], are accepted by this Court. Concerning the packing list in Evidence Exhibit 3 provided by [Seller One], this Court does not accept it and holds that it is not relevant to the present case since this Evidence Exhibit involves the contract performance between the [Seller One] and [Seller Two]. As [Buyer] signed the sales contracts with [Seller One] rather than [Seller Two], [Seller One] should perform the obligations under its contracts with the ]Buyer]. The signing and performance of the contracts between [Seller One] and [Seller Two] is another legal relationship. Though the subject matter of the two legal relations is the same, it does not affect the fact that [Seller One] should undertake the liability for breach of contract independently to [Buyer]. Consequently, the statement of [Seller One] that, since the breach of contract claimed by [Buyer] was caused by [Seller Two], [Seller Two] should be held liable for the compensation, lacks legal basis, and the court does not adopt it. Besides, given that [Buyer] and [Seller Two] do not have a direct legal relationship, [Buyer] merely relies upon the connections in the subject matter of the contracts to ask [Seller Two] to undertake the joint and several liability. This request also lacks legal basis and should not be supported by the court.

V. JUDGMENT

A. Applicable law

To sum up, this court holds that:

[Buyer] is an entity established in Israel. Israel and China are both Contracting States to "United Nations Convention on Contracts for the International Sales of Goods" (CISG). Since [Buyer] and [Seller One] did not choose the applicable law to solve the dispute in the present two contracts, and did not expressly exclude the application of the CISG either, the applicable law in this case should be the CISG.

B. The court's judgment

The two sales contracts signed by and between [Buyer] and [Seller One] represent the parties' true intent. The Court confirms the validity and legitimacy of these contracts. Both parties should perform their obligations under the contracts. [Seller One] delivered defective goods, delayed in delivery and mixed packed the goods; thereby it should undertake the compensation to [Buyer] according to the contracts, which is to compensate [Buyer]'s loss of US $12,946. [Buyer]'s further requests that [Seller One] should compensate the attorney's fees and other costs, as well as that [Seller Two] should be jointly and severally liable with [Seller One] lack factual and legal basis, and cannot obtain this court's support.

Pursuant to Article 30, Article 33(b), Article 45, and Article 67(1) of the CISG, this court handed down the following judgment:

   1.    [Seller One] should compensate [Buyer] for the loss of US $12,946 within ten days from the date this judgment comes into effect;
   2. The other requests submitted by [Buyer] are not supported.

Should there be an objection to this judgment, [Buyer] may appeal by submitting a Petition of Appeal with copies for the other parties through this Court to the Shanghai High People's Court within 30 days after the judgment is served; [Seller One] or [Seller Two] may appeal by submitting a Petition of Appeal with a copy for the other party through this court to the Shanghai High People's Court within 15 days after the judgment is served.

Presiding judge: Jiang Nan; Assistant judges: Cui Xuejie and Lu Ping

25 December 2006

Court clerk: Guo Qiang


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Israel is referred to as [Buyer] and Defendants of the People's Republic of China are referred to as [Seller One] and [Seller Two]

** Fan Yao, graduate student studying International Economic Law at the School of Law, Tsinghua University, Beijing, has participated in the 6th annual Willem C. Vis (East) International Commercial Arbitration Moot.

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