Slovak Republic 15 January 2009 District Court in Nitra [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/090115k1.html]
DATE OF DECISION:
CASE NUMBER/DOCKET NUMBER: 27Cb/101/2007
CASE HISTORY: Unavailable
SELLER'S COUNTRY: Czech Republic (plaintiff)
BUYER'S COUNTRY: Slovak Republic (defendant)
GOODS INVOLVED: [-]
APPLICATION OF CISG: Yes
APPLICABLE CISG PROVISIONS AND ISSUES
Key CISG provisions at issue:
Classification of issues using UNCITRAL classification code numbers:
4A [Issues covered]; 78A [Interest on delay in receiving price or any other sum in arrears]
4A [Issues covered];
78A [Interest on delay in receiving price or any other sum in arrears]
CITATIONS TO ABSTRACTS OF DECISION
(a) UNCITRAL abstract: Unavailable
(b) Other abstracts
CITATIONS TO TEXT OF DECISION
Original language (Slovak): Unavailable
Translation (English): Text presented below
CITATIONS TO COMMENTS ON DECISION
UnavailableGo to Case Table of Contents
Case text (English translation) [second draft]
Queen Mary Case Translation Programme
15 January 2009 [27Cb/101/2007]
Translation [*] by Juraj Kotrusz [**]
IN THE NAME OF THE SLOVAK REPUBLIC
The District Court in Nitra, deciding by a single judge, Mgr. Bozena Csibranyiova, in the case of Plaintiff T.I., S.r.o. [Plaintiff], with its registered office in N.P., Czech Republic, represented by attorney JUDr. M.J., versus Defendant Ing. D.A., sole entrepreneur [Buyer], with its place of business in Š. ___, N. [Slovak Republic], regarding payment of 40,000.- Czech koruna [Kc] and appurtenances
h a s d e c i d e d a s f o l l o w s:
Czech corporation T.L., a.s., [Seller], with its registered office in H. X___, T, Czech Republic, claimed in the proceedings by its action filed with the court on 25 January 2007 its right to payment of 40,000.- Kc and default interest from the sum of 65,567.- Kc for the period from 20 May 2006 until payment. The interest rate was based on the repo rate set by the Czech National Bank increased by 7%, which will change for each calendar half-year depending on the actual interest rate applicable on the first day of the particular half-year.
[Seller] has its registered office in the Czech Republic. [Buyer] has its registered office in Slovakia. This constitutes a relationship with an international aspect. The court therefore at first had to qualify jurisdiction of Slovak courts and the law applicable to the relationship.
Under sec. 1 of act no. 97/1963 Coll. on international private and procedural law as amended, this act prescribes which law is applicable to civil, commercial, labor and other relationships with international aspect, prescribes legal status of foreigners and prescribes the Slovak judicial authorities' procedure for regulating and deciding these relationships and thereby promoting international cooperation.
Under sec. 9 part 1 of act no. 97/1963 Coll. on international private and procedural law as amended, parties to a contract may choose the law which will govern their mutual proprietary matters; even without express declaration, if there is no doubt about the will of the parties.
Under sec. 10 part 3 of this act, contractual relationships, if not otherwise prescribed in another legal instrument, will be governed by the law of the state where both parties have their places of business; if there is no such state and the contract is concluded in the presence of both parties, the contract will be governed by the law of the state where the contract was concluded; if the contract was not concluded in the presence of both parties, it will be governed by the law of the place of business of the party which accepted a proposal for concluding a contract.
Under sec. 37 of this act, if not otherwise stipulated in subsequent provisions, and if the action is filed against a person who is domiciled or has a place of business in Slovakia, or who has property in Slovakia if the action is concerning proprietary matters, then Slovak courts have jurisdiction to try and decide the case.
Under sec. 37a letter d) of this act, Slovak courts may also have jurisdiction to try and decide the case if it concerns types of contracts where the goods were delivered or the services were provided in Slovakia, or if the place of performance of the contract was in Slovakia.
With reference to the abovementioned sections 37 and 37a of the act no. 99/1963 Coll. on international private and procedural law, the courts of the Slovak Republic have jurisdiction to try the case.
Under sec. 48 of this act, Slovak courts try the case in accordance with Slovak procedural law and all parties to the dispute are equal in the proceedings.
Under sec. 84 of the Slovak Civil Procedure Code (hereinafter referred to as "CPC"), the universal court of the defendant has jurisdiction to try the case.
Under sec. 85 part 4 of the CPC, the universal court of the defendant in commercial matters is the court where the defendant has its registered office, or if there is no such court, where the defendant has its place of business. If the defendant has no such place of business, the universal court of the defendant is the court where the defendant has its residence.
[Buyer] has its registered office in Slovakia, in the circuit of the District Court in Nitra. Therefore, the case shall be tried and decided by the District Court in Nitra.
After the proceedings began, a petition of bankruptcy was filed against [Seller] by a resolution of the Regional Court in Hradec Kralove, Czech Republic, rec. no. 42 K 12/2007-209 from 15 March 2007 and the court appointed Mgr. S.K. as its receiver in bankruptcy.
Under sec. 14 part 1 letter c) of act no. 328/91 Coll. on bankruptcy and repayment, judicial and other proceedings which are dealing with property forming assets in bankruptcy or with claims referring to these assets, the receiver in bankruptcy can file or initiate such proceedings, or proceedings can be initiated against the receiver and in case of claims specified in sec. 20, these proceedings can also be initiated in accordance with sec. 23 and 24.
Under sec. 14 part 1 letter g) of act no. 328/91 Coll. on bankruptcy and repayment, all claims and obligations concerning assets in bankruptcy become due at the time of filing of the petition of bankruptcy.
With reference to the abovementioned, the court considered Mgr. S.K., [Seller]'s receiver in bankruptcy, to be acting as the plaintiff, since the receiver asked to continue in the proceedings by his motion from 19 December 2007.
The court replaced Mgr. S.K., [Seller]'s receiver in bankruptcy [Plaintiff], with its registered office in N. P., ___, P. - N.M., Czech Republic, … [Seller] in a position of plaintiff by its resolution from 16 January 2008, rec. no. 27 Cb 101/2007-64 which came into force on 25 March 2008.
[Plaintiff] therefore claims the sum with appurtenances, on the basis of assignment of the claim from [Seller], whereby [Plaintiff] entered into the legal position of a seller in the contract.
The court duly summoned the parties to the hearing, ordered on 15 January 2009, but neither [Plaintiff], nor its legal counsel, nor [Buyer] appeared before the court. [Buyer] did not excuse his absence and did not ask for adjournment of the proceedings. [Plaintiff] apologized for its absence at the court proceedings via its legal counsel in a letter dated 7 January 2009 and did not ask for adjournment of the proceedings. The court with reference to sec. 101 part 2 of the CPC therefore tried and decided the case in the absence of the parties.
Under sec. 101 part 2 of the CPC the court may continue the proceedings in the case of inactivity of parties to the dispute. If the party duly summoned to the proceedings does not appear before the court and did not ask for adjournment for serious reasons, the court can try and decide the case in absence of the parties, taking court records and gathered evidence into consideration.
The court gathered evidence by reading submitted documents provided by [Seller] and thereby investigated this factual situation and qualified it under applicable legal provisions.
[Seller], the initial plaintiff, claimed its right to payment of the purchase price under oral contract of sale, where it delivered goods to [Buyer]. As already mentioned, [Plaintiff] succeeded into the rights and obligations of [Seller]. From the gathered evidence, the court determined that [Seller] fulfilled its duties under the contract of sale and delivered the goods to [Buyer]. It claimed the right for payment of the purchase price in amount of 65,567.- Kc by invoice no. 50619022 due on 19 May 2005, which was not yet partially by [Buyer] in the sum of 40,000.- Kc. [Buyer] never opposed the fact that the goods were actually delivered to it. The court found no evidence that [Buyer] fulfilled its obligation to pay the purchase price in its entirety. [Buyer] partially paid the invoice in amount of 25,567.- Kc.
Under sec. 9 part 1 of act no. 97/1963 Coll. on international private and procedural law as amended, parties to a contract may choose the law that will govern their mutual proprietary matters; even without express declaration, if there is no doubt about the will of the parties.
Under sec. 11 of this act, the applicable law chosen by the parties also governs changes and securing of obligations and effects of non-performance, unless another solution emerges from the character of the parties or subject-matter of the relationship.
A contract of sale both in domestic and international trade presents the most important and most frequently used type of contract used by merchants. Under this contract, the goods are transferred for money.
The legal regulation of sales contracts prescribed in the Slovak Commercial Code is analogous to provisions of the UN Convention on Contracts for the International Sale of Goods, created at the diplomatic conference in Vienna in 1980 (hereinafter referred to as "Vienna Convention" published as Notice of Ministry of Foreign Affairs no. 160/1991 Coll.) Both Slovakia and Czech Republic are parties to this Convention.
Under article 1(1) of the Vienna Convention, this Convention applies to contracts of sale of goods between parties whose places of business are in different States: (a) when the States are Contracting States; or (b) when the rules of private international law lead to the application of the law of a Contracting State.
The parties to the contract may exclude the application of the Vienna Convention to their mutual relationship. If they intend such exclusion, it is recommended to expressly prescribe that they exclude application of the Vienna Convention or its particular provisions.
With reference to the evidence gathered, the court found no sign of the parties' intent to exclude the provisions of the Vienna Convention. The court therefore qualified this contract under the Vienna Convention.
|-||Under article 4 of the Vienna Convention, this Convention governs only the formation of the
contract of sale and the rights and obligations of the seller and the buyer arising from such a contract.
|-||Under article 78 of the Vienna Convention, if a party fails to pay the price or any other sum that is in arrears, the other party is entitled to interest on it, without prejudice to any claim for damages recoverable under article 74.|
As it was already stated, the parties concluded a contract of sale under the Vienna Convention. The initial plaintiff, [Seller], acting as a seller delivered to [Buyer] the goods ordered and [Buyer] was obliged under article 55 of the Vienna Convention to pay the purchase price in accordance with the contract, but it failed to do so. The court therefore upheld [Seller]'s claim as being justified. The court also found that [Plaintiff] replaced the initial plaintiff, [Seller], in the proceedings. The court therefore upheld [Plaintiff]'s claim.
In the action, [Seller] also claimed its right to interest.
The abovementioned Vienna Convention regulates the right to interest only with respect to its existence and does not specify its amount. The court therefore qualified this legal issue under act no. 97/1963 Coll. on international private and procedural law, as amended.
Under sec. 10 part 1 of this act, if the parties have not made a choice of law, their contractual relationships will be governed by the law which assures their reasonable solution.
Under sec. 10 part 2 a) of this act, unless a special legal instrument stipulates otherwise, contracts of sale will be usually governed by the law of the country of seller's registered office (domicile) at the time of concluding of a contract.
Under sec. 369 part 1 of the Commercial Code of the Czech Republic if a debtor is in default of fulfillment of a monetary obligation or its part, and no rate for paying interest on the sum has been agreed upon, the debtor is obliged to pay interest on the sum specified in the contract or if no such provision is in the contract, at an interest rate prescribed by the rules of civil law.
Under sec. 1 of the ordinance of the Czech Republic government no. 163/2005 Coll. which amends ordinance no. 142/1994 Coll. prescribing interest rates and interest charges in default under Czech Civil Code, the interest rate shall be the repo rate announced by the Czech National Bank increased by 7 percent. This interest rate in effect on the first day of a calendar half-year is in force for the whole half-year.
Since [Buyer] is in default of payment of the purchase price, the court granted [Plaintiff] right to payment of interest in the amount prescribed by the abovementioned legal provisions, which are notorious to the court from its previous jurisprudence.
The court decided the reimbursement of the costs of judicial proceedings under sec. 142 part 1 of the CPC and granted a full reimbursement of the costs to [Seller], since [Seller] was successful in its entire claim. [Seller] was granted the right for reimbursement of court fees for the action in amount of 3,012.- Sk and reimbursement of legal aid in amount of 4,680.- Sk…
Instruction: An appeal against this judgment must be filed with the Regional Court in Nitra via this court within fifteen days of its receipt.
District Court in Nitra, 15 January 2009
Mgr. Bozena Csibranyiova, Judge
* All translations should be verified by cross-checking against the original text. For purposes of this translation, the initial 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 Czech Republic (Czech koruna) are indicated as [Kc]; amounts in the currency of the Slovak Republic (Slovak koruna) are indicated as [Sk].
** 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 also the founder of the CISG Slovakia database.Go to Case Table of Contents