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CISG CASE PRESENTATION

Switzerland 16 December 2008 Supreme Court (Laser microjet case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/081216s1.html]

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

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Case identification

DATE OF DECISION: 20081216 (16 December 2008)

JURISDICTION: Switzerland

TRIBUNAL: BGer [ = Bundesgerichtshof = Supreme Court]

JUDGE(S): Corboz (Président); Rottenberg Liatowitsch, Kolly (Juges)

CASE NUMBER/DOCKET NUMBER: 4A_326/2008; 4A_406/2008/ech

CASE NAME: Ecole Polytechnique Fédérale de Lausanne v. Y. S.A.

CASE HISTORY: 1st instance Tribunal cantonal de Vaud 28 January 2008

SELLER'S COUNTRY: Switzerland

BUYER'S COUNTRY: Taiwan

GOODS INVOLVED: Laser microjet machines


Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 2 ; 3 ; 66 ; 67

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 (French): CISG-online.ch database <http://www.globalsaleslaw.com/content/api/cisg/urteile/1800.pdf>; see also Swiss Supreme Court (Bger) website <http://www.bger.ch>

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

Swiss Federal Supreme Court
Ecole Polytechnique Fédérale de Lausanne v. Y. S.A.

16 December 2008

Translation [*] by Andrea Vincze [**]

Appeal against the judgment of the Civil Court of the Cantonal Tribunal of Canton Vaud, made on 28 January 2008.

FACTS OF THE CASE

A.  The principal business activity of [Defendant] Y. S.A. [of Switzerland] is the exploitation of inventions concerning lasers prepared by its president within the framework of his doctoral thesis at the Ecole Polytechnique Fédérale de Lausanne [Federal Polytechnic School of Lausanne] (hereinafter: Plaintiff EPFL or simply EPFL). EPFL, which is an autonomous institution under the federal public law and has a legal personality (Art. 5 para 1 of the Federal Act of 4 October 1991 on Federal Polytechnic Schools [Act on Federal Polytechnic Schools; RS [*] 414.110]), transferred its intellectual property rights to the inventor. In return, the school receives royalties on each machine sold. Y. S.A. rented the premises of the Confederation which are located in the buildings of EPFL, as well as premises of the Scientific Park Foundation also located on the EPFL site.

On 6 January 200, Y. S.A. made an offer to a Taiwanese company concerning a laser-microjet machine and different options. On 25 January 2000, the Taiwanese company confirmed the order of the machines in the value of CHF 661,862 and the order of different accessories. The delivery was to take place at the end of January 2002.

Early January 2002, Y. S.A. prepared the delivery of three machines, among them the one to be sent to the Taiwanese client, and the machines were packaged and placed on pallets. On 31 January 2002, an employee of Y. S.A. called A., a skilled carpenter by profession and employed by EPFL as caretaker, concerning the loading of the three machines. He had already performed loading without any problem, in presence of the representatives of Y. S.A. The truck supposed to pick up the pallet arrived late. In order to speed up the work, A. started loading with his fork lift, without asking for help from Y. S.A.'s employees who were waiting in the building.

A. started lifting up each pallet, measuring 120 cm x 100 cm x 190 cm and weighing approximately 1,000 kg, just a few centimeters high, in order to make sure that the equipment stays horizontal. After that, he grabbed the pallets without moving the forks of the elevator because he was afraid that the pallets would break in the middle because of the weight of the machine. At the moment when he started to turn towards the truck with the second pallet holding the machine that was to be sent to the Taiwanese client, the centrifugal force destabilized the load which flipped and fell on the ground from a height of more than 50 cm. The machine became unusable and Y. S.A. was forced to provide the client with its sample machine as replacement.

Y. S.A. asked EPFL for compensation. On 15 February 2002, Y.S.A. paid CHF 200,000 to EPFL, which began experiencing financial difficulties after the accident, "without admitting EPFL's liability and waiting for discussions to take place". Subsequent discussions were unsuccessful and EPFL sent a notice to Y S.A. requesting repayment of the CHF 200,000. Then the parties mutually notified each other about their respective payment demands concerning the sum of CHF 200,000, and CHF 542,250.05 (which Y. S.A. claimed from EPFL), respectively, and each requested rejection of the claim of the opposing party.

B.  On 28 April 2004, Plaintiff EPFL filed a claim with the Civil Court of the Cantonal Tribunal of Canton Vaud, requesting the court to order Y. S.A. (Defendant) to pay the sum of CHF 200,000 with an annual interest of 5% starting 20 March 2002, and to reject any arguments to the contrary. The Defendant Y S.A. requested rejection of the claim, and in its counterclaim, requested the court to order the opposing party to pay a sum finally reduced to CHF 304,089.45 with an annual interest of 5% from 1 February 2002 and to reject any arguments to the contrary concerning payment of this sum.

In its judgment of 28 January 2008, the Civil Court rejected the arguments of both parties. Essentially, the Court considered that A. willfully intervened in providing a service and ruled that no contractual relationship existed between the Plaintiff EPFL and the Defendant Y S.A., that the former [EPFL] took responsibility for the damage caused by its employee under Art. 55 CO, but found that the damages and interest requested by [Y. S.A.] in the amount of CHF 474,241 are unenforceable for being time-barred.

On 12 June 2008, the Plaintiff EPFL filed an appeal requesting reversal of the cantonal judgment, but withdrew it on 2 July 2008. In its judgment of 4 July 2008, the President of the Appeals Division of the Cantonal Tribunal of Canton Vaud took note of this and removed this cause of action.

C.  The Defendant Y S.A. filed a civil law appeal with the Federal Supreme Court, and, in addition to requesting the reimbursement of all costs and expenses, requested that the judgment of 28 January 2008 be modified to reflect the following:

"Plaintiff Ecole Polytechnique Fédérale de Lausanne owes a debt to Y. S.A. and must immediately pay a sum of CHF 304,089.45 with an annual interest of 5% from 1 February 2002; all counterarguments must be rejected in their entirety, and the court must pursue the proceedings; and the arguments of Ecole Polytechnique Fédérale de Lausanne must be rejected."

In short, Defendant Y S.A. argued that the rules of contractual or quasi-contractual liability apply and therefore, its damages claims were not excluded. The Plaintiff EPFL requested rejection of the appeal.

The Plaintiff EPFL also filed a civil law appeal with the Federal Supreme Court, and, in addition to requesting the reimbursement of all costs and expenses, requested modification of the judgment appealed to reflect the following:

"Y. S.A, must pay Ecole Polytechnique Fédérale de Lausanne (EPFL) the sum of CHF 200,000 (two-hundred thousand Swiss Francs), with an annual interest of 5% from 20 March 2002; Y. S.A.'s counterarguments relating to the demand to pay () must be rejected in their entirety concerning payment of CHF 200,000 (two-hundred thousand Swiss francs) with an annual interest of 5% from 20 March 2003."

In short, the Plaintiff EPFL contested all liability and further alleged that the opposing party did not suffer any damages when the accident occurred because at that time the risk had already passed to the buyer. The Defendant Y S.A. requested rejection of this appeal.

LEGAL REASONING

1. The two appeals attack the same judgment, involve the same set of facts and are closely related, therefore, it is reasonable to join the two appeals for the purposes of judicial economy and to make a single judgment on their merits (cf. Art. 71 LTF [*] and Art. 24 PCF [*]; ATF [*] 131 V 59, para 1, p. 60 et seq.).

2. The Federal Supreme Court examines the submitted appeals ex officio and within its own discretion (ATF 134 III 235, para 1).

      2.1. A civil law appeal can be filed for violation of the law, subject to the restrictions included in Art. 95 and 96 LTF. The Federal Supreme Court applies the law ex officio (Art. 106(1) LTF). Therefore, the court is not limited to consider the arguments submitted in the appeals or the grounds determined by applicable precedents; but the court may place an appeal on a ground other than the one referred to and it may reject an appeal upon adopting an argumentation different from the applicable precedents. Nevertheless, given the requirement to state the legal grounds (Art. 41(1) and (2) LTF), under the penalty of inadmissibility (Art. 108(1)(B) LTF), in principle, the Federal Supreme Court examines only the grievances submitted. Unlike on first instance, the court here is not required to treat all legal questions that may arise, as long as they are not argued before the court (ATF 134 III 102, para 1.1. p. 104 et seq.). Furthermore, the court cannot go into issues concerning the violation of constitutional law or issues concerning cantonal or intercantonal law, if such grievance was not raised and clearly indicated by the appellant (Art. 106(2) LTF). Concerning such grievances, the requirement to state the legal grounds corresponds to the provisions in Art. 90(1)(B) OJ [*] of the old public law appeal procedure; the appellant must argue the reasoning of the attacked judgment and he must present direct and circumstantial evidence on what constitutes a violation of constitutional law (cf. ATF 134 II 244, para 2.2.; 134 V 138, para 2.1.).

      2.2. A civil law appeal is admissible against decisions of last instance cantonal authorities (Art. 75(1) LTF). If, in case of certain grievances, the decision of a superior cantonal court can be remanded to another cantonal judicial authority, such decision cannot be considered as last instance decision as to the issues subject to such cantonal review. Without exhaustion of the channels of cantonal recourse, such issues may not be raised in a civil law appeal filed against the decision of the superior cantonal court.

First, these issues must be subject to cantonal review before filing with the Federal Supreme Court, if appropriate (cf. Art. 100(6) LTF).

Pursuant to the civil procedure of Canton Vaud, a judgment made by the Civil Court of the cantonal court can be subject to an appeal for reversal before the Appeals Division of the cantonal court, in particular, for violation of essential procedural provisions (Art. 444(1), Chapter 3 of the Code of Civil Procedure [of Vaud] enacted on 14 December 1966 [CPC/CD [*]; RSV [*] 270.11]). Pursuant to Art. 444(2) CPC/VD, no recourse is available, however, in case of grievances which may be subject to modification by the Federal Supreme Court. The federal law applicable to the Federal Supreme Court, which entered into force on 1 January 2007, replaced the appeal for modification with the civil law appeal (cf. Art. 72 et seq. LTF). Under this new type of appeal, grievances concerning the constitutional order are admissible (Art. 95 LTF; ATF 134 III 379, para 1.2. p. 382). However, Art. 444 al. 2 CPC/VD was not adopted in order to modify the ways of federal appeal (cf. ATF 124 I 101 para 3 and 4). Therefore, cantonal appeal for reversal of the judgment was available in this case for constitutional grievances, namely the complaint that fact finding was arbitrary (cf. JT[*] 2001 III 128).

In this case, the Defendant Y S.A. did not resort to cantonal appeal for reversal, and the Plaintiff EPFL withdrew its own appeal. Consequently, the situation arising out of this judgment appealed is definite and cannot be corrected or amended in the present proceedings (cf. Art. 105(2) LTF). The different argumentations by the parties will not be considered.

      2.3. An appellant must make conclusions on the merits (cf. Art. 42(1) LTF; ATF 134 III 379, para 1.3.). Conclusions concerning legal relationships are admissible if they are necessary for the interest of justice, for making an immediate ruling (cf. Art. 71 LTF and 25 PCF [RS 273]); in principle, such interest is missing where findings on performance are possible (cf. ATF 131 I 166, para 1.4. p. 169).

In this case, neither the Plaintiff EPFL nor the Defendant Y S.A. argued specifically any ground for establishing the opposing party's liability or for ordering the other party to pay a certain amount of money; that is, the arguments seem to state or allege simply that the opposing party owes a certain amount of money. As both parties request rejection of such payment claims, it can be accepted that they intended to mention performance rather than mentioning only the alleged debts.

3. The Defendant Y S.A. contests that the debt [owed to him] was time-barred. Y S.A. stated that the loading operations are not actions of pure good will and this necessarily raised some liability of the Plaintiff EPFL other than tort liability, to which the statute of limitation (Art. 60 CO) does not apply. Y S.A. raised several other possibilities, in particular that A. intervened under the lease contract or based on the transfer of intellectual property rights between the parties, by an unauthorized act or under other gratuitous contracts. Thereupon, the Y S.A. concludes that the statute of limitations was ten years.

      3.1. According to the Defendant Y S.A., A., an employee of the Plaintiff EPFL, performed loading as performance of a contractual obligation arising from a contract concluded between the parties. The Defendant Y S.A. bears the burden of proof concerning a contractual obligation (Art. 8 CC [*]) and failed to meet it because it only listed some different hypothetical possibilities.

The Defendant Y S.A. wanted to infer a contractual obligation arising out of the lease contracts based on which Y S.A. rents its premises on the Plaintiff EPFL's site and one of which was signed by it as representative of the lessor, the Confederation. As EPFL noted, EPFL is not party to these contracts. Nevertheless, it was not established nor invoked, that a clause in those contracts included an obligation for the EPFL to help the Respondent with loading of the machines sold. Yet, such on obligation of the lessor towards the tenant is not mandated by the law but it is an accessory obligation. In particular, contrary to what the Defendant Y S.A. argued, the duty to maintain the leased premises in a good condition and to preserve its safety, along with providing caretaker service, does not at all include the obligation to provide assistance with loading the machines manufactured by the tenant within the leased premises. Finally, we cannot detect the link that the Y S.A. tries to establish with regard the lessor's liability in case the leased premises have any defect.

The Defendant Y S.A. also tried to conclude that there is a contractual obligation to transfer its intellectual property rights. However, again, it has not been implied or alleged that a contract contained such a clause. Such an obligation does not follow from the nature of the contract. The fact that the Plaintiff EPFL receives monies and therefore has an interest in the Y S.A. delivering the machines does not change anything; no obligation follows from this to save Y S.A. costs incurred by the loading of the machines when [the Defendant Y S.A.] did it itself or by a contracted third party. In that regard, the court does not see the relevance of Y S.A.'s argument, according to which the preservation of a machine subject to transferred intellectual property rights, in particular, when the sale of such machine gives rise to payment of royalties, constitutes evidence of an ancillary obligation of the transferor.

The Defendant Y S.A. also alleged that it can be considered that the loading of the machine by A. took place within the framework of a new contract limited to loading. However, it is not sufficient to invoke a possibility and Y S.A. must prove the conclusion of such a contract with the Plaintiff EPFL. Yet, not one relating factual element was shown. In particular, the fact that A. agreed to proceed with the loading does not indicate that he was in a contractual relationship with EPFL. It was not accepted that he as a caretaker had the right to conclude contracts of that type on behalf of the latter [Plaintiff EPFL], nor that he had explicitly or implicitly declared that he was acting for EPFL.

Furthermore, the court did not accept the argument that the EPFL had explicitly or implicitly ratified such a contract; moreover, even if EPFL had known that its caretaker performs such services sometimes to the businesses operating within its site, that mere fact does not allow a conclusion that EPFL tacitly ratified a contract that establishes its responsibility without any counter-obligation, and which, thus, served the interest of the other party only.

      3.2. There is an implied-in-fact contract if the performing party, possibly with the help of other persons, manages the affairs of others (the principal) without authorization (cf. Art. 419 CO [*]), that is, performs an activity for the principal that belongs to the principal's sphere of interest, without any relating contractual obligation between the performing party and the principal, any legal obligation or official order (cf. Héritier Lachat, in Commentaire romand, Code des obligations I, 2003, no. 11 et seq. on Art. 419 CO; Schmid, Zürcher Kommentar, 3rd ed. 1993, no. 63 et seq. on Art. 419 CO). Implied-in-fact contracts must be distinguished from acts of pure good will ["actes de pure complaisance"] which do not invoke any contractual liability in case of defective performance or non-performance. The distinction [between the two institutions] depends on the exact circumstances of the case, namely on the type of performance, on its basis and purpose, its economic and judicial importance, the circumstances under which the performance took place, as well as the interests of each party (ATF 116 II 695, para 2b/bb p. 697 et seq.). In particular, it must be examined whether the act was objectively requested for the principal's purposes, i.e., because he could not perform it himself, or whether it was merely a useful measure which the principal could perform himself or could have it executed and the performing party's action was purely complimentary (cf. ATF 95 II 93, para II/2; Weber, in Basler Kommentar, Obligationenrecht I, 4th ed., 2007, n 10 on art. 419 CO).

This case involved loading the machines on a truck in order to deliver them to the clients. This operation, being integral to the sale of the machines, could be planned and organized by the Defendant Y S.A. in advance without any further. The Plaintiff EPFL, which performed a gratuitous act, did not have any specific interest in it, the royalties Y S.A. owed to it after the transfer of the intellectual property rights are clearly not reduced if Y S.A. must bear the expenses of loading the goods either himself or with the assistance of third parties. On the other hand, considering the value of the machines, EPFL encountered significant financial risk if any of its agents causes damage by negligence or recklessness. EPFL did not contest the fact that its caretaker, A. gave assistance to the businesses on the site from time to time, but EPFL did not request such performance from A. In such circumstances, the finding of the cantonal court that the EPFL did not perform any complimentary act does not constitute violation of federal law.

      3.3. Plaintiff EPFL's arguments in the counterclaim were rejected as time-barred. Contrary to the arguments presented in its appeal, the statute of limitations is not ten years. The Defendant Y S.A. did not present any other arguments why the claim would not be time-barred. Consequently, the appeal is unfounded and is rejected.

4. The Plaintiff EPFL contests the Defendant Y S.A.'s damages claims. EPFL stated that at the time of the accident, the risk had already passed to the Taiwanese buyer pursuant to Art. 185 CO.

Pursuant to Art. 185(1) CO, the benefits and risks associated with the goods pass to the buyer at the time of conclusion of the sales contract ("periculum est emptoris"), except in special circumstances or in case of specific contractual agreements. If the goods perish through no fault of the seller between contract conclusion and performance, the buyer remains, in principle, obliged to pay the purchase price. Concerning more than one issue, this solution does not go well with the general principles of Swiss contract law. Accordingly, jurisprudence and theory both recommend restrictive application of the rule and expansive interpretation of the exceptions to the rule (ATF 128 III 370, para 4 a, p. 372).

The provisions of the contracts concluded by the Defendant Y S.A. and the Taiwanese client are not relevant to the judgment appealed. According to the Plaintiff EPFL, the parties did not choose the applicable law and did not include a provision on the passing of risk.

The contracting parties have their places of business in different States. As a result of their failure to choose the applicable law, Swiss law applies because the characteristic performance was undertaken by the seller, Defendant Y S.A., whose place of business is in Switzerland (cf. Art. 117 LDIP [*]). The UN Convention on Contracts for the International Sale of Goods adopted in Vienna on 11 April 1980 (CISG; RS 0.221.211.1) is part of Swiss law. It is applicable in this case because the contract involved a machine not for personal, family or household use, and the buyer did not furnish any material necessary for manufacturing the goods (cf. Art. 1(1)(b), Art. 2(a) and Art. 3(1) CISG). The CISG provides for the passing of risk (cf. Art. 66 et seq. CISG); if the contract involves carriage of goods, the risk passes to the buyer when the goods are handed over to the first carrier for transmission to the buyer (cf. Art. 67 CISG). This stage was not reached in this case.

There would be no difference if the CISG did not apply. The machine involved in the accident was ordered under an offer with options in January 2000, and should have been delivered in January 2002, two years later. Therefore, the case does not involve a machine that was in stock but it was specifically manufactured to fulfill the order. Consequently, the contract cannot be qualified as a contract for the sale of goods in the future but a contract for manufacturing and delivering goods, which is governed by the rules on supply contracts (cf. ATF 72 II 347; Gauch, Le contrat d'entreprise, adaptation française par Carron, 1999, p. 39 et seq. , no. 126 et seq.) If the goods are destroyed before delivery, unlike the seller, the supplier cannot demand payment of the purchase price (cf. 376 al. 1 CO).

Pursuant to the legal provisions listed below, the risk was still on the Defendant Y S.A. when the accident occurred. As the Plaintiff EPFL itself admitted that the contract does not contain selection of a foreign law or a clause that would exclude the application of Swiss law, there is no need to examine this issue any further. Y S.A. definitely suffered damage.

5. The EPFL contests that its liability as employer arose as stated in Art. 55 CO. EPFL stated that its caretaker, A. did not act within the scope of his employment, that it was not established that his conduct caused that the machine fell, and finally, that EPFL submitted evidence in its own favor.

      5.1. Pursuant to Art. 55(1) CO, an employer is liable for damages caused by its employees or other agents during performance of their work. Concerning the latter, a simple connection in time and place is not sufficient. A direct and ongoing relationship is needed between the activity for which the employer employed the agent and the conduct that caused the damage. Such a relationship is not present, in particular, when the wrongful act did not take place within the scope of employment but in the course of the employment (Werro, in Commentaire romand, Code des obligations I, 2003, n 14 on art. 55 CO). The employer's liability is not immediately excluded if the agent proposes a measure or expands his usual scope of activities, as long as it is connected to his work; this applies, in particular, if the employer knows about such activity by the agent and does not intervene (cf. Werro, op. cit., n 16 on art. 55 CO; Brehm, Berner Kommentar, 2nd ed., 1998, no. 24 on art. 55 CO; Oftinger/ Stark, Schweizerisches Haftpflichtrecht, vol. II/1, 4th ed., 1987, p. 319 no. 93).

In this case, A.'s work description included a number of activities concerning unloading the trucks with a fork lift. This clause certainly does not imply an activity for the benefit of the Plaintiff EPFL, but it was the caretaker who understood his duties broader than what they included. According to him, his scope of duties included gratuitously helping the businesses located on the site to load or unload goods, and EPFL, being aware of this, let him provide such assistance in its effort to improve its relations with those businesses. The Defendant Y S.A. had its premises in the area which caretaker A. was in charge of; A. performed his acts during his working hours with EPFL's fork lift placed at his disposal for carrying out his duties. In such circumstances, the fact that the cantonal court found that the caretaker acted within his scope of employment does not constitute a violation of federal law.

      5.2. An employer's liability for damages caused by its agents requires causation: the employer is liable for the damage even if the employer or its agent was not in default (ATF 110 II 456, para 2, p. 460). However, the employer is exempted from such liability if he proves that his diligence would not have prevented the damage from occurring (cf. Art. 55(1) CO); according to the general rule of causation, it is not liable for the damage if another cause played a primary role and is solely determinative in the incident (cf. ATF 131 III 115, para 3.1.). Unless the law provides otherwise, this must be proved by the employer; jurisprudence sets a strict burden of proof (ATF 131 III 115, para 3.3., p. 120).

In this case, the Plaintiff EPFL alleges that the reason why the machine fell was not established and the poor distribution of the load on the pallet holding the machine seems to be the most plausible reason. Even if it is so, that is not sufficient. EPFL must show that the machine was placed on the pallet inappropriately, and that it was the primary and most determinative cause of the fall. However, EPFL did not provide such evidence.

      5.3. The employer may not be liable if it proves that it acted with due care in the circumstances in order to prevent a damage like the one that occurred (Art. 55(1) CO), i.e., that the employer gave the necessary instructions to the agent. The necessity and scope of the instructions to be given depend mostly on the employee's skills and the difficulty of the work to be done (Werro, op. cit., n 22 on art. 55 CO; cf. also ATF 110 II 456 para 2b). On the one hand, no particular instructions need to be given to an experienced agent concerning simple tasks or inherently dangerous tasks (cf. ATF 77 II 308, para 3 p. 313); on the other hand, even experienced persons with a specific skill must be given specific instructions concerning specifically difficult and dangerous tasks (cf. Werro, op. cit., no. 22 on Art. 55 CO; cf. also ATF 96 II 27, para 4). The expectations towards employers are high; however, such expectations must remain reasonable within the daily operations of the business (cf. Oftinger/Stark, op. cit., p. 339, no. 138).

In this case, the cantonal court found that A. was a competent caretaker who was regularly supervised by his superiors, and therefore, [his employer] did not act without diligence in his selection and supervision. However, the court ruled that the Plaintiff EPFL did not show that it had communicated to its agent either the instructions and warnings necessary for performance of his work or the precautions to be taken; EPFL knew that from time to time [A.] gave assistance with loading the shipments, which are furthermore precision machines; therefore, it was EPFL's duty to give its employee specific instructions on handling, because the fact that he completed a special training on operating a mobile lifting device was not sufficient; therefore, as EPFL failed to give instructions on how to handle with a fork lift pallets that are heavily loaded with particularly sensitive equipment concerning how to lift the forks and approach a turn taking into account the centrifugal force, EPFL cannot be released from its liability.

This Court found that the caretaker cannot be held liable after more than ten years of employment with the Plaintiff EPFL and having received special training in fork lift operation; and that EPFL had not given him any specific instructions concerning general use of his fork lift. However, at the time of his intervention for benefit of the Defendant Y S.A., the caretaker had to lift and move a pallet holding a large, fragile machine weighing approximately one ton; and during this operation difficulties arose because the caretaker was afraid that the pallet would break under the weight of the machine. EPFL failed to show that moving such loads with the fork lift was within the scope of the regular duties of its caretaker or that the caretaker received relating training; therefore, these statements were not proved. From the moment EPFL knew that [the caretaker] helped the Y S.A. with loading, EPFL should have given appropriate instructions; the fact that no incidents occurred during a few previous loadings is irrelevant. In such circumstances, the cantonal court did not violate federal law in holding that the Plaintiff EPFL did not meet the burden of proof to exonerate its liability. Ultimately, EPFL's appeal is rejected in its entirety.

6. As the payment requests are CHF 200,000 and CHF 304,089.45, respectively, it is justified to split the attorney's fees equaling CHF 12,500 by ordering the Plaintiff EPFL to pay two-fifths and the Defendant Y S.A. to pay three-fifths of the latter amount (Art. 66(1) LTF). The same splitting method applies to court fees equaling CHF 14,500, so after all charges are paid, the Y S.A. must pay EPFL CHF 2,900 (Art. 68(1) LTF).

[JUDGMENT]

For the above reasons, the Federal Supreme Court rules as follows:

   1.    Both appeals are rejected.
 
   2.    Attorney's fees equaling CHF 12,500 are split: CHF 5,000 must be paid by Ecole Polytechnique Fédérale de Lausanne and CHF 7,500 must be paid by Y. S.A.
 
   3.    Y. S.A. must pay CHF 2,900 to the Ecole Polytechnique Fédérale de Lausanne as costs.
 
   4.    This judgment is communicated to the representatives of the parties and the Civil Court of the Cantonal Tribunal of Canton Vaud.

Lausanne, 16 December 2008

On behalf of the First Civil Court
of the Swiss Federal Supreme Court
President: Corboz
Clerk: Cornaz


FOOTNOTES

* All translations should be cross-checked against the original text. For purposes of this translation, amounts in Swiss currency (Swiss francs) are indicated as [CHF].

Translator's note on other abbreviations: ATF = Arrêt du Tribunal Fédéral [Judgment of the Federal Supreme Court]; CC = Code Civil Suisse [Swiss Civil Code]; CO = Code des Obligations Suisse [Swiss Code of Contracts]; CPC/VD = Code de Procédure Civile du Canton de Vaud [Code of Civil Procedure of Canton Vaud]; JT = Journal des Tribunaux [Official Judicial Journal]; LDIP = Loi Fédérale Suisse surle Droit International Privé [Swiss Federal Act on Private International Law]; LTF = Loi sur le Tribunal Fédérale [Act on the Supreme Court]; OJ = organization judiciare [judicial system]; PCF = Loi fédérale de Procédure Civile Fédérale [Federal Act on Federal Civil Procedure]; RS = Recueil Systématique [Official Legislative Records]; RSV = Recueil Systématique de la législation vaudoise [Official Legislative Records of the legislation of Canton Vaud].

** Andrea Vincze is a Fellow of the Institute of International Commercial Law of the Pace University School of Law. She received her law degree from the University of Miskolc, Hungary, and her LL.M. at Pace Law School. She is working on her Ph.D. on ICSID arbitration, and is researching international commercial law and ADR.

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