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CISG CASE PRESENTATION

Germany 17 January 2007 Appellate Court Saarbrücken (Marble panel case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/070117g1.html]

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

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Case identification

DATE OF DECISION: 20070117 (17 January 2007)

JURISDICTION: Germany

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

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 5 U 426/96-54

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

CASE HISTORY: 1st instance Landgericht Saarbrücken (14 O 364/99) 16 June 2006 [affirmed]

SELLER'S COUNTRY: Italy

BUYER'S COUNTRY: Germany

GOODS INVOLVED: Natural stone marble panels


UNCITRAL case abstract

GERMANY: Saarländisches Oberlandesgericht 17 January 2007

Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/128],
CLOUT abstract no. 1236

Reproduced with permission of UNCITRAL

Abstract prepared by Ulrich Magnus and Jan Lüsing

The decision by the Higher Regional Court of Saarbruecken clarifies the concept of objective minimum standard in respect to the seller’s obligation to package the goods under article 35 CISG and gives an example of a reasonable excuse under article 44 CISG for the failure to give notice required according to articles 38 and 39 of the Convention.

The buyer, a German company dealing with natural stones, bought marble stone panels from the Italian seller. The contract did not contain ad hoc terms for packaging. During the carriage, an accident occurred damaging the panels. Since the expert entrusted by the transport insurance company stated that the seller’s packaging was insufficient, the insurance company and the carrier refused to compensate the damages.

The buyer thus sued the seller claiming that because the latter had failed to load and package the panels in an adequate manner the goods were non-conforming, according to article 35(2) CISG. The seller objected that the buyer had failed to notify the lack of conformity within a reasonable time and that the buyer had no reasonable excuse for this failure (article 44 CISG). The seller also stated that the goods had been packaged in the same way for previous deliveries: therefore, its liability for the alleged packaging defects was to be excluded under article 35(3) CISG.

The Higher Regional Court dismissed the seller’s appeal against the District Court’s decisions, which had sustained the buyer’s complaint. The Higher Regional Court stated that article 35(2) CISG sets an objective minimum standard for the usual or adequate manner of packaging of the goods: a packaging is adequate if it is sufficient for protecting the goods from damages on the foreseeable route of transport. Referring to the insurance expert’s opinion, the court found that the seller had failed to package the marble stone panels in an adequate manner and that the seller’s liability was not excluded under article 35(3) CISG, since it had failed to prove that the previous deliveries had been of the same kind of goods.

The court acknowledged that the buyer had not given notice of the defects in a reasonable time, but it found that the buyer had a reasonable excuse pursuant to article 44 CISG. According to the court, such an excuse can be accepted if the failure to notify is so “insignificant… that it can be waived in the course of usual and fair business dealings”. The Court, however, stressed that being article 44 an exception, it must be narrowly interpreted and that its application requires balancing the interests of the parties. Such exercise requires considering the extent of the buyer’s failure to notify, the consequences of the complete loss of remedies for the buyer, the seller’s detriment caused by the failure to notify, and the buyer’s effort to meet the requirements of the notification.

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IHR headnote

Reproduced from Internationales Handelsrecht (2/2008) 56

"1. Whether an insufficient packaging constitutes a breach of the seller's obligation is to be determined against the question of whether the goods were packaged in a usual and suitable way according to the standards in the seller's country, if the parties did not agree on any special arrangements.

"2. A packaging is suitable if it suffices to protect the goods from damage on the foreseeable route of transport.

"3. The fact that the goods were packaged in the same way for previous deliveries does not constitute a tacit agreement on the type and way of packaging.

"4. Art. 44 CISG is to be interpreted narrowly as it constitutes an exception to the rule. A failure to give notice of defects may be excused if it is of so little weight that in fair business dealings allowances for this failure are usually made and the grave consequences of a total loss of all of the buyer's rights is therefore not justified.

"5. The 'reasonable excuse' does not refer to a default in the technical sense, rather, a general consideration of all circumstances and equity is required."

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Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 8 ; 9 ; 18 ; 35 ; 39(1) ; 44 [Also cited: Articles 45 ; 74 ]

Classification of issues using UNCITRAL classification code numbers:

8C [Interpretation of party's statements or other conduct: interpretation in light of surrounding circumstances];

9C [Practices established by the parties];

18A3 [Criteria for acceptance of offer: silence or inactivity [generally] insufficient];

35B4 ; 35C1 [Conformity of goods to contract (requirements implied by law): packaging to protect goods in usual manner for similar goods; Exception to seller's liability for non-conformity: buyer's knowledge of non-conformity at time of contracting];

44A [Excuse for failure to notify pursuant to Art. 39(1)]

Descriptors: Intent ; Usages and practices ; Acceptance of offer ; Burden of proof ; Standard terms and conditions ; Conformity of goods ; Lack of conformity notice, timeliness ; Excuse

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Editorial remarks

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Citations to other abstracts, case texts and commentaries

CITATIONS TO OTHER ABSTRACTS OF DECISION

Unavailable

CITATIONS TO TEXT OF DECISION

Original language (German): Internationales Handelsrecht (2/2008) 55-60

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) Saarbrücken

17 January 2007 [5 U 426/96-54]

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

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

JUDGMENT

  1. The appeal of the [Seller] against the judgment of District Court (Landgericht) Saarbrücken of 16 June 2006, 14 O 364/99 is dismissed.

  2. The [Seller] bears the costs of the appellate proceedings

  3. The judgment is provisionally enforceable. The [Seller] may prevent enforcement by depositing a security in the amount of 115 % of the amount to be enforced, as long as the [Buyer] does not provide security in the same amount

  4. The dispute value is fixed at EUR 23,606.80

  5. Further appeal is not admitted

FACTS

The initial Plaintiff [Shipper] is a transport company. The initial Defendant (which is now Cross-Plaintiff) [Buyer] provides services relating to natural stone. Initially, [Shipper] brought an action against [Buyer] for payment of transport costs. Both parties have eventually reached a settlement in relation to the sum claimed by [Shipper]. They have also agreed that there should be no further mutual claims in this respect.

The present dispute is solely concerned with a counterclaim brought by [Buyer] who seeks compensation from the Third-Party Cross-Defendant [Seller] in respect to transport damage.

An accident occurred during the transport of about 300 sqm of natural stone marble panels which [Shipper] carried out for [Buyer] on 24 February 1999. [Shipper] had commissioned the intervening party to the present proceedings to carry out the transport service. [Buyer] had bought the panels from [Seller] on the basis of a contract for the supply of goods to be manufactured or produced. There had been no particular agreements concerning the packaging of the goods.

By letter dated 26 February 1999, [Buyer] requested [Shipper] to determine the exact damage. The transport insurance company of the party which had been served with a third party notice commissioned Expert G. of Company C.G. GmbH to provide an expert opinion on the extent of the transport damage. On 2 March 1999 the damaged goods were examined and claims were filed against [Shipper] by letter of 10 March 1999, seeking financial redress. Further details in respect to the amount claimed were submitted by letter of 24 March 1999. The intervening party's transport insurance company denied liability for any damages in its letter dated 3 May 1999. Liability was also denied by [Shipper]. By letter of 8 May 1999, [Buyer] brought claims against [Seller] because of the damage incurred and informed about the existence and contents of the expert opinion.

POSITION OF THE PARTIES in the Court of First Instance

Position of [Buyer]

[Buyer] argues that the District Court (Landgericht) Saarbrücken had jurisdiction to adjudicate the dispute in accordance with Art. 6 No. 1, No. 3 and Art. 17 No. 1 of the Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters of 27 September 1968. The goods which had been intended for [Buyer] had been damaged because of an emergency braking by the truck driver. The way in which the goods had been loaded onto the vehicle and the particular manner of packaging had been inappropriate and the goods had thus not been in conformity with the contract in the sense of Art. 35 CISG. [Seller] was liable pursuant to Arts. 45, 74 CISG. [Buyer] calculated its losses at EUR 47,876.10. [Seller] was jointly liable with [Shipper], because it had taken part in causing the damage. [Buyer] had complied with the relevant time limit to notify the non-conformity.

[Buyer] has requested the Court to order [Seller] to pay EUR 15,520.07 plus 5% interest since 24 March 1999. It also requests that [Seller] be ordered to pay EUR 32,356.03 plus 5% interest since pendency of proceedings.

Position of [Seller]

The Third-Party Cross-Defendant [Seller] has requested the Court to dismiss [Buyer]'s action.

JUDGMENT OF THE COURT OF FIRST INSTANCE

In its judgment of 16 June 2006, the District Court (Landgericht) Saarbrücken ordered [Seller] to pay [Buyer] the amount of EUR 23,606.80 and dismissed the claim for the remainder. It affirmed its jurisdiction to adjudicate the [Buyer]'s counterclaim and allowed a claim for damages because of poor packaging of the marble panels pursuant to Art. 35 CISG. However, the District Court (Landgericht) made deductions relating to the amount of damages.

POSITION OF THE PARTIES IN THE APPELLATE PROCEEDINGS

Position of [Seller]

This judgment was served upon [Seller] on 22 June 2006. The latter has filed an appeal against this judgment before the Appellate Court of the Saarland (Saarländisches Oberlandesgericht) by way of its written submission via fax on 21 July 2006. In its appeal, [Seller] challenges the jurisdiction of the District Court (Landgericht). [Seller] also alleges that the District Court had incorrectly allowed an excuse for a delayed notice of the non-conformity. Finally, the Cross-Defendant [Seller] asserts that it had not been responsible to ensure proper protection of the goods during transport.

[Seller] requests that the claim of the [Buyer] be dismissed.

Position of [Buyer]

[Buyer] requests the dismissal of the appeal. It defends the judgment of the Court of First Instance

REASONING OF THE COURT

[Seller]'s appeal is admissible but not justified . The District Court (Landgericht) was correct to affirm its jurisdiction over the dispute and to allow [Buyer]'s claim for damages against [Seller].

1. [Jurisdiction and choice of forum]

The District Court (Landgericht) Saarbrücken rightfully assumed to have jurisdiction to consider [Buyer]'s counterclaim.

      a) According to preceding jurisprudence of the German Federal Supreme Court (Bundesgerichtshof), an appeal may be based on a violation of rules governing international jurisdiction to adjudicate disputes (BGH [*] NJW [*] 2004, 1456). The Appellate Court is competent to determine the international jurisdiction of a court, notwithstanding the German law on the modernization of civil procedure (Gesetz zur Reform des Zivilprozesses) of 27 July 2001 (BGBl [*] p. 1887). § 513(2) ZPO [*], which provides that an appeal may not be based on the contention that a first instance court had incorrectly assumed its own jurisdiction, does not -- like § 545(2) ZPO -- refer to matters regarding international jurisdiction (Zöller/Gummer/Heßler, ZPO, 25th ed., § 513 para. 8; Baumbach/Lauterbach/Albers/Hartmann/Albers, ZPO, 63rd ed., § 513 para. 5). This assumption is supported by the fact that the issue of international jurisdiction is more relevant than questions on territorial, subject-matter or functional jurisdiction. International jurisdiction is concerned with delineating the sovereignty between countries and is a decisive criterion to determine the applicable rules of private international law and procedural law. As a consequence, international jurisdiction often indirectly determines the applicable substantive body of law, as well. In contrast to a mere delineation of jurisdiction among German courts, a decision on the international jurisdiction of a court may thus be liable to pre-determine the outcome of a case on the merits (BGH [*], see above, with further references).

      b) The international jurisdiction of German courts -- here: the District Court (Landgericht) Saarbrücken -- follows from Art. 17 Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters of 27 September 1968.

For the present dispute which is litigated by a German buyer against an Italian seller, international jurisdiction is to be determined according to the provisions set out in the Brussels Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters of 27 September 1968 (BGBl [*] 1972 II, 773; 1973 II, 60). The Brussels Convention entered into force on 1 February 1973 after having been signed by its Contracting Parties - including the Federal Republic of Germany and Italy (Kropholler, Europäisches Zivilprozeßrecht, 5th ed., 1996, Einl. paras. 1 and 5).

If -- as in the present case -- the defendant is domiciled in a state other than the state where the court is located, Art. 3(1) Brussels Convention provides that the latter state may take international jurisdiction only by virtue of the rules set out in Sections 2 to 6 of the Convention. Should the particular requirements of any such provision not be fulfilled, the general rule of Art. 2 Brussels Convention applies, according to which a party may only be sued in the courts of the state where it is domiciled.

            aa) The District Court (Landgericht) has correctly assumed the existence of a choice of forum agreement by the parties pursuant to Art. 17 Brussels Convention.

                  (1) The District Court has refrained from exactly specifying the order it has based its reasoning on. Instead, it has generally referred to a "contract".

In its letter of 29 January 2001, [Seller] itself submitted that the contract for delivery dated 16 July 1998 was the relevant contract. This contract specifies Saarbrücken, Germany, as the chosen forum to resolve any disputes. On the basis of this order, which has been signed by both parties and contains an express determination of the forum, Saarbrücken, a corresponding legally binding choice of forum can be assumed. Thus, [Seller] bears the burden to prove that, despite the content of the contractual document, no such agreement had been concluded. In this respect, [Seller] has failed both to sufficiently substantiate its allegation and to bring proof. The mere formal concerns raised by [Seller] in this respect do not suffice to rebut the existence of a legally valid choice of forum. With regard to the formal requirements for the validity of a choice of forum agreement (agreement in written form), Art. 17 Brussels Convention contains a conclusive provision which does not allow for recourse to domestic law and which has to be interpreted autonomously and in a uniform manner. Therefore, the validity of the agreement in question may not be challenged by [Buyer] on the mere basis that the choice of forum clause constituted a so-called "dangerous clause" (in Italian: "clausole onerose o vessatorie") and had not been expressly confirmed through a separate signature as required under Art. 1341(2) Cc [*]. In the same manner, Art. 2 of the Italian law on civil procedure (Codice di Procedura Civile) would have generally prohibited any exclusion of jurisdiction of Italian courts by way of agreements with aliens but this rule has been overridden by Art. 17 Brussels Convention, which constitutes a mandatory provision in international law given the fact that Italy has ratified the Brussels Convention (cf. for these issues OLG [*] Düsseldorf, judgment of 6 January 1989, case docket 16 U 77/88, NJW-RR [*] 1989, 1330 et seq. with further references; for the primacy of the Brussels Convention over international law cf. Kropholler, Einl. para. 13, Art. 2 para. 15 and Art. 17 paras. 18 and 19; Geimer/Schütze, Europäisches Zivilverfahrensrecht, 1997, Art. 17 paras. 71, 72). The challenge by [Seller] of a failure to adhere to the required written form is therefore not justified.

                  (2) However, even if the Court did not base its decision on the order of 16 July 1998 as this delivery does not refer to the relevant delivery to Frankfurt airport but to the delivery of material to a construction site in Munich, the choice of forum agreement would still remain valid.

Pursuant to Art. 17(1)(2)(a) Brussels Convention, a choice of forum agreement is valid even if a written declaration of intent has been submitted by only one party. This rule seeks to facilitate international trade. The so-called "semi-written form" requires clear evidence that the parties have agreed on the provision relating to the choice of a forum. Such agreement need not be made in express terms but can also be made impliedly. However, in any case, the intention of the parties must be clearly expressed in order to ensure that a choice of forum will not be subconsciously included in a contract, since it may have significant consequences on the parties (Kropholler, Europäisches Zivilprozeßrecht, Art. 17 para. 23; see also 8th ed. 2005, Art. 23 para. 33).

It follows from the contractual documents and from the circumstances of the conclusion of the contract with the sufficient degree of certainty that the parties have effectively agreed to make Saarbrücken the forum to resolve disputes arising out of their contract for delivery of materials in relation to the construction project at Frankfurt airport.

This contract was preceded by [Buyer]'s inquiry of 20 April 1998. In this inquiry, [Buyer] requested [Seller] to submit a binding offer for specified operations regarding natural stone.

According to item 8 of the inquiry, any contract should inter alia be based on Saarbrücken becoming the forum for possible legal proceedings. It is clear from [Buyer]'s letter that it would only be willing to conclude a contract if the other party accepted its "basic conditions" which were stated before the specific description of obligations.

[Seller] submitted its offer of 24 April 1998 with express reference to [Buyer]'s earlier specific inquiry. It did not refer to the "basic conditions" contained in the inquiry.

Subsequent to oral negotiations between the parties on 13 October 1998 -- the content of which follows only indirectly from a transcript signed by both parties in relation to the goods to be delivered and to payment terms -- [Buyer] placed a definitive order on 14 October 1998. On this occasion, the provision to choose Saarbrücken as the legal forum was repeated.

Therefore, the choice of forum provision was sufficiently perceivable for [Seller]. The [Seller] did not object to it.

It is true that these facts are not sufficient to prove that the parties have agreed on the choice of forum clause in the same manner as they have agreed on the other provisions specified in the order relating to the obligations to be performed by either party. However, taking the further contracts which have been concluded by the parties within the same temporal context and which concerned deliveries of goods into account, the non-objection can only lead to the conclusion that the parties have properly agreed on Saarbrücken as their legal forum in respect to the contract in question as well.

For the assessment of whether the parties have impliedly agreed on Saarbrücken to be their legal forum, the fact that the parties had already concluded another contract on 16 July 1998 for delivery of natural stones for a construction project in Munich at this point in time, and thus before the conclusion of the contract in question, should not be neglected. This contract -- which [Seller] itself originally presented as relevant -- also provided for Saarbrücken to be the legal forum and was signed by both parties. The correspondence until submission of the order on 16 July 1998, which has been submitted to the Court by [Buyer] after the closing of the oral hearing on 20 December 2000, demonstrates that [Seller] has generally accepted Saarbrücken as the legal forum for any contracts concluded with [Buyer]. [Buyer]'s inquiry in respect to the purchase price of 2 June 1998 expressly mentions the legal forum Saarbrücken. The subsequent offer issued by [Seller] dated 10 June 1998 refers to this inquiry and merely contains additional information on pricing. On 16 June 1998, [Buyer] sent [Seller] a modified offer in which Saarbrücken is once again mentioned as the legal forum. This offer has subsequently been amended by [Seller] in relation to prices and payment terms whereas the provision to choose Saarbrücken as the legal forum has not been deleted in any of its letters. The final order of 16 July 1998 -- as is the case with all submitted orders -- provides for Saarbrücken as the legal forum and has been signed by both parties.

The conduct on the part of [Seller] which follows from the correspondence with [Buyer] thus clearly expresses that it has generally accepted Saarbrücken as the legal forum to resolve disputes arising out of the contractual relationship between them. According to the principle of good faith, [Seller] is bound by this conduct. This result is additionally confirmed by the fact that [Seller] has only challenged the formal validity of the clause in the course of the proceedings.

2. [Buyer's claim for damages]

The District Court (Landgericht) correctly allowed [Buyer]'s claim for damages pursuant to Art. 35 CISG.

[Seller]'s allegation that the District Court had wrongfully denied the presence of both an exemption from liability under Art. 35(3) CISG and the fulfilment of the legal requirements for a delayed notification under Art. 44 CISG is not justified.

Art. 35(1) CISG provides that the seller must deliver goods which are of the quantity, quality and description required by the contract and which are contained or packaged in the manner required by the contract. However, if the parties to an international contract for the supply of goods to be manufactured or produced to which the CISG applies fail to determine any requirements concerning the packaging, the objective minimum standard will apply as provided by Art. 35(2) CISG. In order to determine whether or not the obligation to deliver has been breached, it must be examined whether the goods are contained or packaged in the manner usual and adequate for such goods. In general, the standards in the seller's country determine the adequacy for usual purposes (OGH [*], judgment of 13 April 2000, case docket 2 Ob 100/00w, IPrax [*] 2001, 149-152 = IHR [*] 2001, 117).

The parties have not reached an agreement on the manner according to which the goods had to be packaged. The mere assertion that previous deliveries by [Seller] had been packaged in the same manner cannot be seen as an implied agreement on such packaging that does not properly protect the goods during transport.

Since these deliveries had reached [Shipper] without any damage, the latter had no reason to deal with the issue of packaging. Moreover, not all of these cases concerned deliveries of marble panels of the particular type. A packaging is adequate if it is sufficient to protect the goods from damage during its foreseeable route to their destination (Staudinger/Magnus, CISG, Art. 35 para. 42). The usual and adequate manner of packaging marble panels is to store and fasten them onto pallets.

The goods must be packaged in a way that they are protected from damage during transport. According to the expert opinion prepared by E___, [Seller]'s packaging (use of pallets) had not been adequate. In any event, it would have required additional protective measures using supporting poles.

Expert E___ explains in his written opinion that the damage caused to the panels had been caused by inappropriate packaging and a failure to secure the goods. […]

Following the findings of the expert, the Court is convinced that the construction of the pallets and thus the packaging itself has been a significant cause of the damage.

The packaging falls within the scope of [Seller]'s responsibilities and is not a duty of the carrier as [Seller] has argued. Art. 8 CMR [*] merely requires the carrier to examine the packaging in respect to the condition which is visible from the outside. The carrier has no duty to examine the packaged goods in respect to their suitability to be transported. He merely has to check whether the actual condition of the particular manner of packaging deviates from the usual standard (e.g., holes, bumps, cracks). Generally, it cannot be expected from a carrier to have specific knowledge in respect to any goods in particular or to have any instruments to effect detailed examinations. However, it can be expected from a carrier to have a general knowledge in respect to the modes of packaging of those goods which he usually carries (Koller, Transportrecht, 5th ed., CMR, Art. 8 para. 3). The necessary care under Art. 17(2) CMR, however, requires the carrier to check the packaging from the outside in respect to its suitability for transport. Naturally, this check concerning the security of transport only needs to be carried out with the skill of a layman, which means that the carrier may only be accused of a failure to check if the improper manner of packaging is obvious (Koller, Art. 17 para. 37). It has not been established in the present case that the carrier has detected the improper packaging.

The expert opinion can be neglected insofar as the expert has stated that it was obvious that the pallets had not been properly loaded. This could only lead to a concurrent liability of the carrier but would not bar [Seller]'s liability.

The same applies to the protection of the loaded goods. A carrier has no duty to examine the adequacy of any shipment. He solely has to ensure that transport is safe (BGH [*], judgment of 24 September 1987, case docket I ZR 197/85, VersR [*] 1988, 244 et seq.; Koller, Art. 17 para. 37). The carrier is only obliged to ensure that goods are loaded properly and that they will not incur damages in such instances where the carrier recognizes that the goods have not adequately been packaged or where it is plainly obvious that there is a real danger of a damaging event. None of this is apparent in the present case.

3. [No exemption from liability]

[Seller]'s is also not exempt from liability according to Art. 35(3) CISG. [Seller] bears the burden to demonstrate and prove that the requirements for an exemption from liability are fulfilled if it seeks to rely on the provision (Soergel, 13rd ed., CISG, Art. 35 para. 24). [Seller] has failed to do so. The mere and flat submission that the goods had always been packaged in such a manner and that [Shipper] had been aware of this is insufficient. [Seller] would have had to make specific submissions in respect to the other instances of similar but uncontested packaging. In particular, it is does not follow from the file that these previous deliveries were of identical goods.

4. [Excuse for Buyer's failure to notify lack of conformity]

It is true that [Buyer] (translator's note: typing error in the original judgment) has not notified [Seller] (translator's note: typing error in the original judgment) about the specific non-conformity within a reasonable time as required under Art. 39 CISG. However, an excuse is applicable for not having given the notice within due time (Art. 44 CISG).

      a) The notification of a lack of conformity must enable the other party to recognize the intention to complain about the condition of the goods and must specify the nature of the lack of conformity so as to enable the seller to understand what the buyer is complaining about (cf. Münchener Kommentar/Gruber, BGB, 4th ed., CISG, Art. 39 para. 7). These requirements have not been fulfilled by the telephone call of 25 February 1999 during which [Buyer] (translator's note: typing error in the original judgment) merely ordered new goods. Even if the reason for the new order had been communicated, it was not possible for [Seller] to understand the telephone call as a notification about a lack of conformity when in the context of a fresh order it has merely been informed of an occurrence of damage.

The notification in the letter dated 8 May 1999 has not been made within the required time limit. In respect to Art. 39 CISG, regard must be had to the seller's interest not to be subject to non-conformity claims for an indefinite period of time after delivery . On the other hand, justified claims on the part of the buyer should not be excluded by erecting overly formalistic legal barriers. These interests must be given consideration when determining the meaning of "reasonable".

The damage occurred on 24 February 1999. The damage was reported to [Shipper] on 26 February 1999. The [Buyer] reported the damage to [Seller] on 25 February 1999, when it ordered new marble panels which -- as stated above -- does not constitute a relevant notification about the lack of conformity.

Claims were raised against [Seller] on 8 May 1999 after the carrier's insurance had denied liability and communicated the opinion prepared by Expert G. to [Buyer] on 3 May 1999. As more than two months had passed, the notice would have been given too late even under a generous interpretation of the reasonable time limit, in particular, as on 25 February 1999 [Buyer]'s representative (Witness M.) was at the site and could have discovered that the goods had not been delivered on adequate pallets.

      b) However, the District Court (Landgericht) correctly held that, in accordance with Art. 44 CISG, there was an excuse for not having complied with the duty to notify.

Pursuant to Art. 44 CISG, a buyer may claim damages if he has a reasonable excuse for his failure to give the required notice about a lack of conformity. A reasonable excuse is present if the conduct of the buyer deserves some fair understanding and forbearance due to the circumstances of the individual case.

In particular, this is the case if the failure to make the required notification is so insignificant -- especially with due consideration of personal circumstances affecting the buyer -- that it can be waived in the course of usual and fair business dealings, and should therefore not be subject to the severe consequences of a full exclusion of liability (Staudinger/Magnus, Art. 44 para. 10). On the other hand, Art. 44 CISG is an exceptional provision and should be interpreted narrowly (BGH [*], judgment of 11 January 2006, case docket VIII ZR 268/04, VersR [*] 2006, 1554 et seq. = IHR [*] 2006, 82).

[Seller] fails to consider that the term "reasonable excuse" does not relate to fault as a technical legal term. The application of Article 44 CISG requires a balancing of interests according to the criteria of fairness.

Within the balancing exercise, the severity of the failure to comply with the duty, the consequences of a full exclusion of liability, the detriment inflicted on the seller due to the failure to notify, and the buyer's efforts in complying with the requirements relating to the notification must in particular be considered (Münchener Kommentar/Gruber, 4th ed., CISG, Art. 44 para. 5; Schlechtriem/Schwenzer/Huber/Schwenzer, CISG, 4th ed., Art. 44 paras. 4 and 5).

The District Court (Landgericht) correctly held that a reasonable excuse has been present. Only after Legal Expert G. had submitted his opinion was it discovered that [Seller] had been partly responsible for the damage resulting from inadequate packaging. The expert opinion reached [Buyer] by letter of 3 May 1999 which was sent by the carrier's insurance. On 8 May 1999, [Buyer] raised claims against [Seller]. Therefore, [Buyer] notified [Seller] of the non-conforming packaging immediately after it had become aware thereof. [Buyer] could not be expected to raise any claims before that date without any useful evidence, running the risk to be subject to legal proceedings. On the other hand, [Seller] knew that considerable damage had occurred to the shipped goods during transport as a result of the immediate order of substitute materials during February 1999. This holds true despite the fact that at the time [Seller] could not yet be held legally responsible for the damage. [Seller] has not suffered any inappropriate detriment from being subject to legal claims two months later, since the damage has properly been determined and immediately been recorded after the accident. In this case, fairness requires to assume a sufficiently reasonable excuse for the delay in giving notice.

5. [Seller]'s appellate challenge of the amount of damage as determined by the District Court (Landgericht) has not been sufficiently substantiated . [Seller] completely fails to discuss the arguments raised in the judgment, which is not legally erroneous.

The decision on costs is based on § 97 ZPO [*].

The decision on the provisional enforceability is based on §§ 708 No 10, 711 ZPO [*].

Further appeal is not admitted.


FOOTNOTES

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

Translator's note on other abbreviations: BGB = Bürgerliches Gesetzbuch [German Civil Code]; BGBl = Bundesgesetzblatt [German federal law gazette]; BGH = Bundesgerichtshof [German Federal Supreme Court]; Cc = Codice civile [Italian Civil Code]; CMR = Convention on the Contract for the International Carriage of Goods by Road; IHR = Internationales Handeslrecht [German law journal]; IPrax = Praxis des Internationalen Privat- und Verfahrensrechts [German law journal]; NJW = Neue Juristische Wochenschrift [German law journal]; NJW-RR = Neue Juristische Wochenschrift Rechtsprechungsreport [German law journal]; OGH = Oberster Gerichtshof [Austrian Supreme Court]; OLG = Oberlandesgericht [German Regional Appellate Court]; VersR = Versicherungsrecht [German law journal]; ZPO = Zivilprozessordnung [German Code of Civil Procedure].

** Jan Henning Berg has been a law student at the University of Osnabrück, Germany and at King's College London. He participated in the 13th Willem C. Vis Moot with the team of the University of Osnabrück. He has coached the team of the University of Osnabrück for the 14th Willem C. Vis and 4th Willem C. Vis (East) Moot.

*** Ph.D. candidate Daniel Nagel has studied law at the University of Heidelberg and at the University of Leeds.

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Pace Law School Institute of International Commercial Law - Last updated June 6, 2013
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