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CISG CASE PRESENTATION

Slovak Republic 27 June 2007 Supreme Court [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/070627k2.html]

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

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Case identification

DATE OF DECISION: 20070627 (27 June 2007)

JURISDICTION: Slovak Republic

TRIBUNAL: Supreme Court of the Slovak Republic

JUDGE(S): JUDr. Jozef Stefanko (Chairman), JUDr. Ivana Izakovicova and JUDr. Anna Petrulakova

CASE NUMBER/DOCKET NUMBER: 2 Obo 244/2006

CASE NAME: Unavailable

CASE HISTORY: 1st instance Regional Court in Bratislava (5 Cb 13/2003-35) 21 September 2005 [reversed]

SELLER'S COUNTRY: Germany (plaintiff)

BUYER'S COUNTRY: Slovak Republic (defendant)

GOODS INVOLVED: [-]


Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 58 ; 59

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 (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

Supreme Court of the Slovak Republic

27 June 2007 [2 Obo 244/2006]

Translation [*] by Juraj Kotrusz [**]

JUDGMENT
IN THE NAME OF THE SLOVAK REPUBLIC

The Supreme Court of the Slovak Republic deciding in a three-member panel composed of the Chairman JUDr. Jozef Stefanko and Members JUDr. Ivana Izakovicova and JUDr. Anna Petrulakova in case of Plaintiff E & L, GmbH, B, [Seller], [with its registered office in the Republic of Germany], represented by attorney JUDr. R., versus Defendant R., [Buyer], [with its registered office in the Slovak Republic], represented by attorney JUDr. D., regarding payment of US $29,144.50 and appurtenances, on appeal of the [Buyer] against the judgment of the Regional Court in Bratislava from 21 September 2005, rec. 5Cb 13/2003-135,

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

The challenged judgment of the Regional Court in Bratislava of 21 September 2005, rec. 5 Cb 13/2003-135 is reversed and the action is dismissed.

The [Seller] is obliged to pay to the [Buyer] a sum in amount of 217,925.- Slovak koruna [Sk] as a reimbursement of costs of the proceedings.

REASONING

In the challenged judgment, the Regional Court in Bratislava by its judgment of 21 September 2005, rec. no. 5Cb 13/2003-135 decided that the [Buyer] is obliged to pay to the [Seller] a sum of US $39,144.50 and interest of:

   -    19% annually on the sum of US $20,206 for the period from 13 July 1998 until 23 October 1999;
   -    12% annually on the sum of US $20,206 for the period from 26 October 1999 until payment;
   -    19% annually on the sum of US $5,179 for the period from 3 November 1998 until 25 October 1999;
   -    12% annually on the sum of US $5,179 for the period from 26 October 1999 until payment; and
reimbursement of costs of the proceedings in the amount of 237,875.- Slovak koruna [Sk].

The Court of First Instance reasoned its judgment by stating that the [Seller] claimed in the proceedings its right to payment of principal and interest as a purchase price for delivered goods, as billed by:

   -    Invoice no. 170089 of 16 January 1998 with maturity of 180 days;
   -    Invoice no. 170723 of 26 January 1998 with maturity of 180 days; and
   -    Invoice no. 177301 of 7 May 1998 with maturity of 180 days.

The [Buyer] failed to pay the price in the prescribed period of time and the Court of First Instance therefore found the claim justified and obligated the [Buyer] to pay the claimed sum with appurtenances.

The Court of First Instance did not accept the argument of the [Buyer] about lack of legitimacy to the claim, as it was proved in the proceedings that the [Seller] was at the time of delivery of the goods conducting business under the business name S. I. GmbH which, by resolution of the general assembly of the [Seller] of 24 June 1998, was subsequently changed to B & L. S., GmbH with its registered office in H. as it was registered by the Companies Register on 16 September 1998. The action was filed with the Court on 4 June 2002 and the [Seller] was therefore identified correctly. In the course of the proceedings, the [Seller] merged with company B & L GmbH with its registered office in B and the court therefore affirmed change of parties to the proceedings.

The Court of First Instance also did not uphold the [Buyer]'s argument about the expiration of the limitation period, as the Court found to be proved from testimony of witnesses that the [Buyer] did not oppose the maturity period of 180 days with respect to the invoices.

The Court granted the right to interest under sec. 369 part 1 of the Slovak Commercial Code.

The Court of First Instance decided about reimbursement of costs of the proceedings under sec. 142 part 1 of the Slovak Civil Procedure Code (hereinafter referred to as "CPC") and granted to the [Seller], which was successful in the proceedings, reimbursement of its costs amounting to 237,857.- Sk.

[Buyer's position]

The [Buyer] filed an appeal against the judgment and asked the Appellate Court to change the judgment of the Court of First Instance and to dismiss the action in its entirety.

   -    The [Buyer] argued that the Court of First Instance decided incorrectly about the invoked passing of limitation period. The contract of sale was not concluded in written form and the [Seller] was delivering goods upon purchase orders and the [Buyer] handed over the goods and the parties to the proceedings did not oppose to the fact that the purchase price has not been paid by the [Buyer].
 
   -    The [Buyer] stated that the right of the [Seller] for payment of the purchase price emerged on the first day after the goods were placed at the [Buyer]'s disposal. The [Seller] asserted its right after the four-year limitation period had passed. Non-stating of maturity date in the invoices cannot be considered as an agreement about the maturity date.

The [Buyer] also alleged that the calculation of interest was incorrect, as the Court of First Instance decided about interest contrary to art. 7.4.9 part 2 of the UNIDROIT Principles of international commercial contracts, since it granted the interest under provisions referring to domestic trade.

In addition, the [Buyer] opposed the legitimacy of the [Seller]'s action, since its record from the Companies Register submitted to the Court does not evidence when the succession to the right of the original seller occurred.

[Seller's position]

The [Seller] asked the Appellate Court to uphold the judgment of the Court of First Instance as substantially correct. The [Seller] argued that it is irrelevant to refer to the UN Convention on Contracts for the International Sale of Goods or the Slovak Commercial Code with respect to the invoked passing of limitation period, as both legal instruments determine the due date in a same way; as both prefer the due date of purchase price agreed by parties to a contract, as it was done in this case.

[Ruling of the Court]

The Supreme Court of the Slovak Republic as an appellate court (sec. 10 part 2 CPC) tried the case under sec. 212 part 1 CPC and decided under sec. 214 part 1 CPC that the appeal of the [Buyer] is justified.

   -    Under article 58(1) of the UN Convention on Contracts for the International Sale of Goods (hereinafter referred to as the "Convention"), if the buyer is not bound to pay the price at any other specific time, he must pay it when the seller places either the goods or documents controlling their disposition at the buyer's disposal in accordance with the contract and this Convention. The seller may make such payment a condition for handing over the goods or documents.
 
   -    Under article 59 of the Convention, the buyer must pay the price on the date fixed by or determinable from the contract and this Convention without the need for any request or compliance with any formality on the part of the seller.

By its action filed on 4 June 2002, the [Seller] claimed the right to payment of 39,144.50 USD with appurtenances as the purchase price for the goods delivered under the contract of sale concluded in oral form between the [Seller] under its former name B & L; S GmbH, with its registered office in H I and the [Buyer]. The [Seller] delivered the goods upon purchase orders of the [Buyer] and billed the purchase price by invoices:

   -    No. 170089 of 16 January 1998 for the sum of US $20,206;
   -    No. 170723 of 26 January 1998 for the sum of US $13,759.50; and
   -    No. 177301 of 7 May 1998 for the sum of US $5,179.

The parties to the proceedings did not oppose these facts. However, the parties to the proceedings disagreed about the due date of the invoices. With reference to the abovementioned articles of the Convention -- which under article 1(1) of the Convention is applicable to the relationship of parties to the contract of sale - the purchase price for the goods delivered must be paid by buyer within the period agreed by the parties to the contract and if no such agreement was made, buyer must pay the price without any further call after the goods are placed at disposal of buyer.

In the proceedings held by the Court of First Instance, that Court decided about the invoked passing of the purchase price incorrectly when deciding that, with respect to the claim for purchase price, the limitation period has not passed. That Court referred to testimony of the witnesses who stated that the parties to the contract agreed about the maturity period of 180 days with respect to the drawn invoices. Both parties to the contract stated that there was no written agreement made prescribing the maturity period of the invoices.

The [Seller] argued that such agreement was concluded in an oral form between representative of the [Seller] Mr. V. and representative of the [Buyer] Mrs. V. The representative of the [Buyer] Mrs. V. argued in the proceedings that no such agreement was made. The witness, regional agent of the [Seller], Mr. V. stated that no written agreement about the maturity date was made but argued that an oral agreement was concluded between Mr. K.W. and probably the [Buyer].

The testimony of the witnesses recorded by the Court of First Instance does not prove with considerable degree of certainty that the parties to the proceedings concluded an agreement about the due date of purchase price. The due date prescribed in the invoices by the [Seller] cannot be qualified as an agreement about due date of purchase price. Since no agreement about the due date of the purchase price was made in the contract of sale -- under the abovementioned provisions of the Convention, the purchase price has to paid after the [Seller] handed over the goods and the [Buyer] was invoiced for the goods.

   -    With respect to the invoice of 16 January 1998, the goods were delivered on 20 January 1998;
   -    With respect to the invoice of 26 January 1998, the goods were delivered before drawing of this invoice in 1997, but the documents relevant to the goods were delivered enclosed with the invoice of 26 January 1998; and
   -    With respect to the invoice of 7 May 1998 the goods were delivered on 31 April 1998.

The parties to the contract did not oppose these facts.

The Court determined from the abovementioned evidence that the [Seller] filed its action on 4 June 2002 and did so after the passing of the limitation period. The [Buyer] invoked passing of the limitation period with respect to this claim. Therefore this claim cannot be enforced by the Court.

The Appellate Court therefore changed the judgment of the Court of First Instance with reference to sec. 220 CPC and dismissed the action in its entirety.

The Court granted to the [Buyer] full reimbursement of its costs of proceedings under sec. 142 part 1 CPC, as it was successful in defending its position in its entirety.

Instruction: An appeal against this judgment is not admissible.

Bratislava, 27 June 2007

JUDr. Jozef Stefanko
Chairman of the Panel


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of the Republic of Germany 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 United States of America (US dollars) are indicated as [US $].

** 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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Pace Law School Institute of International Commercial Law - Last updated June 3, 2009
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