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CISG CASE PRESENTATION

Slovak Republic 22 May 2007 Regional Court in Kosice (Plastic bottles case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/070522k1.html]

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

Case Table of Contents


Case identification

DATE OF DECISION: 20070522 (22 May 2007)

JURISDICTION: Slovak Republic

TRIBUNAL: Regional Court in Kosice

JUDGE(S): JUDr. Juraj Schwarcz

CASE NUMBER/DOCKET NUMBER: 6 Cb 896/2000

CASE NAME: Unavailable

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Czech Republic (plaintiff)

BUYER'S COUNTRY: Slovak Republic (defendant)

GOODS INVOLVED: Plastic bottles


Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 4 [Also cited: Articles 14 ; 53 ]

Classification of issues using UNCITRAL classification code numbers:

4B [Scope of Convention (issues excluded): Assignment]

Descriptors: Scope of Convention ; Assignment

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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 (Slovak): Click here for Slovak text of case

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

Unavailable

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Case text (English translation)

Queen Mary Case Translation Programme

Regional Court in Kosice

22 May 2007 [6 Cb/896/2000]

Translation [*] by Juraj Kotrusz [**]

JUDGMENT
IN THE NAME OF THE SLOVAK REPUBLIC

The Regional Court in Kosice, deciding by a single judge, JUDr. Juraj Schwarcz, in the case of Plaintiff JUDr. J. V., receiver in bankruptcy of K., cooperative society of disabled persons [Seller], with its registered office in K., Z.H. ___, Czech Republic, versus Defendant 1.) M.T., s.r.o. and Defendant 2.) Ing. M.M. [Buyer], with its residence in K., ___, S.N.V. [Slovak Republic] , regarding payment of 148,910.- Czech koruna [Kc] and appurtenances

h a s   d e c i d e d   a s   f o l l o w s:

The court dismisses the action against the Defendant 1.).

Defendant 2), the [Buyer], is obliged to pay to the [Seller] a sum in amount of 148,910.92 Czech koruna [Kc] and to pay reimbursement of costs of the proceedings amounting to 6,788.- Slovak koruna [Sk] within three days after the judgment comes into force.

The court stays the proceedings with respect to residual part of the action.

REASONING

The [Seller] claimed its right to payment of the sum of 148,910.- Kc (consisting of principal 147,112.- Kc and interest amounting to 637.- Kc, 559.98 Kc and 602.- Kc) with interest of 0,1 % daily on this sum for the period of default, i.e., 58.17 Kc, 60.45 Kc and 28.49 Kc daily (with respect to each invoice).

The [Seller] stated that it delivered the goods to the [Buyer] -- plastic bottles in value of 147,112.- Kc. The [Seller] drew invoices no. 210613 for the sum of 58,170.- Kc, no. 210585 for the sum of 60,450.- Kc and no. 920317 for the sum of 28,490.- Kc. The [Seller] subsequently claimed its right to interest on these invoices amounting to 637.- Kc, 559.98 Kc and 602.- Kc. The [Seller] therefore claimed from the [Buyer] the total sum of 148,910.98 Kc.

Defendant 1.) responded to the call for payment by recognizing its debt towards the [Seller] in its entirety; Defendant 2.), the [Buyer], did not react to the call and did not prove that its obligation was transferred to Defendant 1.).

The [Seller] asked the court to bind both defendants jointly and severally to pay the principal of 148,910.98 Kc and agreed interest of 0.1 % daily for the period of default.

The court issued the order for payment and both defendants jointly filed a protest against this order and argued that they are not legitimate parties to these proceedings. The defendants confirmed that the [Buyer] as a natural person - entrepreneur was conducting business as a member of association M.T. until 28 February 1994 and was handed over the goods as they were specified by the [Seller] and billed by the abovementioned invoices amounting to 148,910.- Kc. The defendants disagreed the allegation in the [Seller]'s action that, upon agreement with Ing. J.M. after dissolution of association on 28 February 1994, all claims and obligations of the [Buyer] were transferred to Defendant 1.) [Company M. T. s.r.o.]. The [Seller] was informed about these facts, as is clear from mutual correspondence. The subject liable to the [Seller] for the debt is company M. T. K. s.r.o., with its registered office in S. N. V. [Slovak Republic], as it is clear from the contract of sale of enterprise of 30 June 1996 concluded by Defendant 1.) and P. s.r.o. with its registered office in S. N. V. which subsequently on 1 July 1996 changed its business name to M.T.K., s.r.o..

The defendants stated in the protest that they opposed the claimed interest as prescribed in the order to payment.

The court investigated the record in the Trade Register of the District Bureau in Spisska Nova Ves from 15 April 1998 that Ing. M. M. [the Buyer], with its residence in T., S.N.V., acquired permission to conduct business on 19 February 1992 and ceased its activities on 2 December 1992. The court investigated from purchase order no. 20/93 of 4 August 1993 (rec. no. 13) that the [Buyer] ordered the delivery of 3,000 bottles of 1,000 ml for a unit price of 4.75 Czechoslovak koruna [Kcs] and 50,000 bottles of 200 ml for a unit price of 2.30 Kcs. The court identified the [Buyer] by its identification number prescribed at the order together with part of its business name. The entire business name of the [Buyer], as stated in the Trade Register is Ing. M. M. M. - T.

The fact that the goods were delivered to the [Buyer] is evidenced by customs declarations which state that in October 1993 the [Seller] delivered the goods and the [Buyer] did not oppose this fact in its protest.

The court qualified the relationship in question under the UN Convention on Contracts for the International Sale of Goods (notice no. 160/1991 Coll.), since article 1(1)(a) of the Convention states that this Convention governs contracts of sale between parties whose places of business are in different States, when these States are Contracting States.

   -    Part II. of the Convention regulates in article 14 the concluding of a contract stating that a proposal for concluding a contract addressed to one or more specific persons constitutes an offer if it is sufficiently definite and indicates the intention of the offeror to be bound in case of acceptance. A proposal is sufficiently definite if it indicates the goods and expressly or implicitly fixes or makes provision for determining the quantity and the price.
 
   -    Under article 53 of the Convention the buyer must pay the price for the goods and take delivery of them as required by the contract and this Convention.

The court determined from the evidence gathered that:

   -    The [Seller] and the [Buyer] concluded a contract of sale under the Convention;
 
   -    The [Seller] fulfilled its obligations under the contract and delivered the ordered goods to the [Buyer];
 
   -    However, the [Buyer] failed to fulfil its obligation to pay the purchase price.

The court therefore upheld the [Seller]'s action with respect to this claim.

With respect to the argument of the defendants that another entity acquired the obligation in question and that Defendant 2.) [the Buyer], therefore cannot be liable for this obligation, the court refers to following provisions.

   -    Under sec. 531 part 1 of the Slovak Civil Code (hereinafter referred to as "CC") who makes an agreement with the debtor that he take over his debt, such person will substitute the debtor in his position, provided that the creditor agrees with such substitution. Consent of the creditor can be addressed to the original debtor or the new debtor.
 
   -    Under sec. 531 part 2 CC who takes over the debt of the debtor without consent of the creditor, will gain a position of a new debtor besides the original debtor.
 
   -    Under sec. 533 CC who agrees in a written form with the original debtor without consent of the creditor that he will pay the debt instead of the original debtor, will become a debtor besides the original debtor and will be bound to pay the debt jointly and severally.

With reference to the abovementioned provisions of the CC, private law recognizes taking over of a debt but always requires consent of the creditor. The debtor is obliged to evidence that such consent of the creditor was given. The [Buyer] did not evidence and did not even claim that such consent of the [Seller] was given and therefore there was no valid taking over of the goods.

Under sec. 476 part 1 of the Slovak Commercial Code, in a contract of sale of enterprise the seller undertakes to transfer to the buyer title to all goods, rights and assets which are connected to the enterprise and the buyer undertakes to take over all obligations connected to the enterprise and to pay the purchase price.

   -    Under sec. 476 part 2 of this act such contract has to be made in a written form.
 
   -    Under sec. 477 part 1 of this act all rights and obligations connected with the enterprise are transferred to the buyer.
 
   -    Under sec. 477 part 3 of this act no consent of the creditor is required in case of such transfer of obligations; the seller in this case guarantees fulfilling of such obligation by the buyer.

These provisions enable to the parties to a contract to transfer obligations without consent of the creditor provided that a contract of sale of enterprise is made in a written form. The buyer nevertheless does not waive its obligation to pay the debt, as he still guarantees to the creditor payment of the debt by the new debtor, where such guarantee has a statutory origin. The [Buyer] did not evidence in the proceedings concluding of a contract of sale of enterprise under sec. 476 et seq. of the Slovak Commercial Code. Also in case of proof of the concluding of such a contract, the court would still uphold the action with respect to the [Buyer], as it was guaranteeing payment of the debt to the creditor.

The [Seller] claimed in the proceedings also its right to payment of interest of 0.1 % daily from the sum of 1,798.98 Kc and argued that such interest was agreed by the parties but did not evidence its argument in any way Therefore the court dismissed the action with respect to this part.

As the [Seller] was not successful in asserting its claim only with respect to its marginal part, with reference to sec. 142 part 3 CPC, it is entitled to reimbursement of costs of the proceedings consisting of the paid court fee amounting to 6,788.- Sk.

With respect to Defendant 1.), the court investigated that the District Court in Kosice decided about erasure of company M.T. s.r.o. with its registered office in S. N. V., from the Companies Register of the Slovak Republic, since the Regional Court in Kosice dismissed by its resolution 3K 89/03 of 8 March 2006 the motion on declaration of bankruptcy because of lack assets of the debtor.

The court therefore stayed the proceedings with respect to Defendant 1.).

Instruction: An appeal against this judgment may be filed via this court within 15 days after its receipt.

Regional Court in Kosice, 22 May 2007

JUDr. Juraj Schwarcz
Judge


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of the Czech Republic is referred to as [Seller] and Defendant of the Slovak Republic is referred to as [Buyer]. Amounts in the currency of the Slovak Republic (Slovak koruna) are indicated as [Sk]; amounts in the currency of the Czech Republic (Czech koruna) are indicated as [Kc]; amounts in the currency of the Czechoslovak Republic (Czechoslovak koruna) are indicated as [Kcs].

** Juraj Kotrusz is a Slovak lawyer who studied law at the University of Trnava, Slovakia, and at the Hague Academy of International Law. He is the Editor of the CISG Slovakia website.

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