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CISG CASE PRESENTATION

France 3 February 2009 Supreme Court (Société Novodec / Société Sigmakalon v. Soctiétés Mobacc et Sam 7) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/090203f1.html]

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

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Case identification

DATE OF DECISION: 20090203 (3 February 2009)

JURISDICTION: France

TRIBUNAL: Cour de cassation [Supreme Court]

JUDGE(S): Mme. Favre (president)

CASE NUMBER/DOCKET NUMBER: Pourvoi no. 07-21827

CASE NAME: Société Novodec / Société Sigmakalon v. Sociétés Mobacc et Sam 7

CASE HISTORY: 1st instance Tribunal de commerce d'Amiens 7 November 1997; 2d instance Cour d’appel d’Amiens 27 September 2007

SELLER'S COUNTRY: Netherlands (defendant)

BUYER'S COUNTRY: France (plaintiff)

GOODS INVOLVED: Aerosol paints


UNCITRAL case abstract

FRANCE: Court of Cassation, First Civil Division (Société Novodec / Société Sigmakalon v. Soctiétés Mobacc et Sam 7) 3 February 2009

Case law on UNCITRAL texts [A/CN.9/SER.C/ABSTRACTS/104],
CLOUT abstract no. 1027

Reproduced with permission of UNCITRAL

Abstract prepared by Claude Witz and Stephan Pache

The defendant, a company based in the Netherlands, had sold the plaintiff, a company based in France, some spray paints for sale to the general public. The caps of the spray paints had been found to be defective and the French company sued the Dutch exporter. The Amiens Appeal Court had dismissed the plaintiff's appeal on the grounds that it had failed to take action within two years, as required under CISG, article 39, paragraph 2.

The Court of Cassation overturned the judgement of the Amiens Appeal Court based on a breach of CISG, article 39, ruling that the two-year time limit laid down in article 39 was "a time limit for a complaint of lack of conformity and not a time limit for action".

The lesson of the ruling by the Court of Cassation is clear: care must be taken not to confuse the time limit set out in CISG, article 39, paragraph 2, with the time limit applicable to the action brought by the buyer against the seller.

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Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 39(2) [Also cited: Article 40 ]

Classification of issues using UNCITRAL classification code numbers:

39B [Requirement to notify seller of lack of conformity: cut-off period of two years]

Descriptors: Lack of conformity notice, timelness

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Editorial remarks

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Citations to other abstracts, case texts and commentaries

CITATIONS TO OTHER ABSTRACTS OF DECISION

English: Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=1455&step=Abstract>

CITATIONS TO TEXT OF DECISION

Original language (French): CISG-France database <http://www.cisg-france.org/decisions/100904v.htm>; Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=1455&step=FullText>

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

Cour de cassation [Supreme Court], Commercial Chamber
Novodec / Sigmakalon [1] v. Mobacc [2] and Sam 7 [3]

3 February 2009 [07-21827]

Translation [*] by Nathalie Hofmann [**]

[...]

REPUBLIC OF FRANCE

IN THE NAME OF THE FRENCH PEOPLE

[1. FACTS]

According to the appellate decision, the Dutch [Seller] sold aerosol paints to [Buyer] through its intermediary in France, [Seller's commercial agent]. The paints were intended for the shops AUCHAN and CONTINENT. After [Buyer] had stipulated that the sealing caps had to be non-breakable, the non-breakability was guaranteed by letter of 26 November 1991. After difficulties arose between the parties, [Buyer], who had been removed from Continent's list of suppliers, sued [Seller] and [Seller's commercial agent].

[2. RULING]

ON THE SECOND GROUND OF APPEAL:

This ground of appeal is not of a nature to admit the appeal.

ON THE FIRST GROUND OF APPEAL, FIRST SUBMISSION:

Concerning the time period in Art. 39 CISG: In order to declare [Buyer]'s claim precluded, the appellate decision maintained that [Buyer] did not sue [Seller] before March 1995, that Art. 39 CISG contained a strict preclusion period, that those deliveries that took place more than two years before the commencement of action could not be contested anymore, that the claim with regards to the non-breakability of the sealing caps only concerned the deliveries until February 1992 and that consequently [Buyer]'s claims were precluded.

By ruling this way, although the two year period in Art. 39 CISG is a time limit to give notice of non-conformity and not a time limit to sue, the Court of Appeal did not respect the mentioned provision.

ON THESE GROUNDS, without the need to rule on the second submission of the first ground of Appeal:

   -    REVERSES AND ANNULS the decision of the Court of Appeal of Amiens rendered on 27 September 2007, but only insofar as it declares [Buyer]'s claim against [Seller] precluded in application of Art. 39 CISG. On this point, the case will be referred back to the Court of Appeal of Amiens in other composition.
 
   -    Orders [Seller] to bear the costs.
 
   -    Rejects the claims based on Art. 700 New Code of Civil Procedure.

The Advocate-General of the Supreme Court is requested to transmit this decision for the purpose of transcribing it at the margin or at the bottom of the appellate decision partially reversed.

So held and decided by the Supreme Court, Commercial, Financial and Economic Chamber, and pronounced by the president at the public hearing of third February two thousand and nine.

[3. BUYER'S GROUNDS OF APPEAL]

GROUNDS OF APPEAL ATTACHED TO THE DECISION:

SCP Delaporte, Briard and Trichet, attorneys of [Buyer] made the following submissions:

FIRST GROUND OF APPEAL:

[Buyer] submits that the challenged appeal wrongly declared [Buyer]'s claim against [Seller] precluded in application of Art. 39 CISG, which decision was explained by the Court of Appeal as follows: [4]

"Art. 39 CISG provides: 'The buyer loses the right to rely on a lack of conformity of the goods if he does not give notice to the seller specifying the nature of the lack of conformity within a reasonable time after he has discovered it or ought to have discovered it. In any event, the buyer loses the right to rely on a lack of conformity of the goods if he does not give the seller notice thereof at the latest within a period of two years from the date on which the goods were actually handed over to the buyer, unless this time-limit is inconsistent with a contractual period of guarantee.' The sales took place over several years. Since the preclusion period begins with the delivery, it starts to run with each delivery in a case of successive contracts of sale. The first reclamation with regards to the sealing caps, for which it is not contestable that their non-breakability has been stipulated in the contract of 26 November 1991, is dated 19 January 1994, concerns the supermarket CONTINENT and mentions two sealing systems: 'non-breakable' and 'screw top'. On 29 June 1994, [Buyer] returned the products with sealing caps of the first generation to [Seller]; in this regard it is of little importance that [Buyer] accepted the exchange of the sealing caps since [Buyer] had asked for that exchange and since the sealing caps of the second generation respected the contractual requirement of non-breakability according to several experts. Although [Buyer] had ceased to order from [Seller] in October 1994, [Buyer] did not sue [Seller] before March 1995, after the end of the commercial relations between Continent and [Buyer] in January 1995. Continent's letter concerning the commercial break up mentions delivery failures and deteriorations in quality; however, it is impossible to deduce whether these are imputable to [Seller] or to [Buyer], who also furnished its own paints.

"The time limit in Art. 39 CISG is a strict preclusion period; therefore those deliveries that took place more than two years before the commencement of action cannot be contested anymore. The non-conformity claim with regards to the non-breakability of the caps of the paints only concerns the sealing caps of the first generation, meaning those that are not color-imbued. Moreover, according to the expert report of Mr. Kleniewski these were delivered before February 1992 while [Buyer] commenced the action in March 1995. According to Mr. Deriquehem's expert report, all loads supplied after 1991 satisfactorily met the requirement of non-breakability. Referring to the product return on 29 June 1994 the expert Kleniewski indicated that 'two and a half years after the last deliveries of paints with sealing caps of the first generation, [Buyer] asked [Seller] to replace the old caps by new caps'... 'obviously, [Buyer] wanted to get rid of its old unsold stock by getting reimbursed or by having the old stock rejuvenated'. Consequently, [Buyer]'s claims are precluded; this is not inconsistent with any contractual period of guarantee." (cf. the decision of the Court of Appeal, pages 6 and 7) [5]

First, the two year period in Art. 39 CISG is a time limit to give notice of non-conformity, not a time limit to sue. Therefore, the Court of Appeal did not respect the provision by ruling that although a first reclamation demand had been made by letter of 19 January 1994, the deliveries of February 1992 could not be contested anymore, because the action was not commenced before March 1995 and that Art. 39 CISG would contain a strict preclusion period of two years.

Second, by virtue of Art. 40 CISG, the seller is not entitled to rely on Art. 39 CISG if the lack of conformity relates to facts of which he knew or could not have been unaware and which he did not disclose to the buyer. [Buyer] asserted that [Seller] could not have been unaware of the fact that the sealing caps delivered did not meet the requirements agreed with [Buyer] and that [Seller] could therefore not rely on Art. 39 CISG on account of Art. 40 CISG. When the Court of Appeal rendered its decision it had not researched whether [Seller] knew or could not have been unaware of the non-conformity in dispute and thus deprived its decision of a legal basis with regards to Art. 39 and 40 CISG.

SECOND GROUND OF APPEAL:

[Buyer] submits that the challenged appeal wrongly rejected [Buyer]'s non-conformity claim against [Seller] based on the French law applicable to delivered goods, the decision having been motivated by the Court of Appeal as follows: [6]

"[Buyer]'s other pleas which based on the rules regarding labeling, packaging and containment have only been brought up before this court and the documents provided do not prove any shortcoming on behalf of [Seller], even less any dissimulation of the alleged defects. [Buyer] refers to European and French regulations in order to infer therefrom that [Seller] did not meet its obligations. [Buyer], when importing the goods in dispute before reselling them to the supermarket groups CONTINENT and AUCHAN, had to make sure that they are conforming to the regulation applicable in France which does not impose non-breakability but simply solid and firm packaging. Mr. DERIQUEHEM observed that [Buyer] neither provided any element of evidence for its claims, nor did [Buyer] undertake any examination of the products sent by [Seller] before delivering them to the supermarkets. Mr. KLENIEWSKI was said to be surprised that the former expert of [Buyer] only conserved three of the paints in dispute, that the alleged difficulties could not be established by a bailiff or an expert and that there was no reclamation by the group AUCHAN. Concerning the late deliveries, the evidence produced is not significant: except for a few punctuality problems mentioned, [Buyer]'s letters from 1 February to 5 April 1994 are contradictory and refer to a period of time when [Buyer] did not pay the bills anymore (February 1994), had returned several year old products (June 1994), and had stopped ordering (October 1994). Hence, the order volume originally agreed by the parties had not been respected by [Buyer].

"Furthermore, Mr. TUBIANA, expert, found out that the revenue produced through [Seller]'s products represented less than 1% of the revenue generated by [Buyer] through its business with the group CONTINENT between 1991 and 1994; in that regard, the portion of [Seller]'s products was insignificant. Given that the circumstances of [Buyer]'s removal from CONTINENT's list of supplier are not clearly established by the evidence produced, [Buyer]'s claim is rejected. Moreover, this non-conformity claim is delayed because of the notion of reasonable time and the preclusion already evoked."

First, Art. 4 of the decree of 10 October 1983 [7] stipulates that the packaging and containers of aerosol paints must be "solid and firm in order to exclude any leakage and in order to reliably cope with normal handling". Moreover, the decree of 16 January 1992 [8] requires that the packaging has to be childproof. When disregarding those texts by reasoning that they do not impose the non-breakability of the packaging but only solidness and firmness, without examining, as [Buyer] had requested, whether the leakage of some aerosol would not prove that the packaging was neither solid nor firm, the Court of Appeal deprived its decision of a legal basis with regards to the mentioned texts and Art. 6 Civil Code.

Second, by virtue of the decree of 20 December 1991,[9] the manufacturer is responsible for selling the products that he brought into France, thereby he is bound to respect French law with regards to labeling and packaging. By refraining from examining, as it had been requested, whether [Seller] delivered [Buyer] products which were inadequately labeled with regards to French law, the Court of Appeal deprived its decision of a legal basis with regards to the mentioned decree and Art. 6 Civil Code.


FOOTNOTES

* All translations should be verified by cross-checking against the original text.

** Nathalie Hofmann is a law student at Humboldt University Berlin. She studied at the University of Geneva during the academic year 2007-2008 and obtained the "Certificat du droit transnational". She participated in the 15th Willem C. Vis International Commercial Arbitration Moot as a member of the Geneva team. In 2008, she won the Clive M Schmitthoff Essay Competition.

Translator's notes:

1. In the following, Company Novodec, now Sigmakalon, of France is referred to as [Buyer].

2. In the following, Company Mobacc of the Netherlands is referred to as [Seller].

3. In the following, Company Sam 7 of France is referred to as [Seller's commercial agent].

4. [Buyer] fully cites the part of the Court of Appeal's decision on the preclusion period in Art. 39 CISG in the original. For the purpose of this translation, the corresponding part of translated decision, which differs stylistically from the original, is cited.

5. Cf. part. 4 b of the translation of the Court of Appeal of Amiens decision of 27 September 2007.

6. [Buyer] fully cites this part of the Court of Appeal's decision in the original. For the purpose of this translation, the corresponding part of translated decision, which differs stylistically from the original, is cited.

7. Full French name of the decree: "Arrêté du 10 octobre 1983 fixant la liste et les conditions d'étiquetage et d'emballage de substances dangereuses" = Decree of 10 October 1983 setting up requirements with regards to the classification, labeling and packaging of dangerous substances.

8. Full French name of the decree: "Arrêté du 16 janvier 1992 modifiant et complétant l'arrêté du 10 octobre 1983 fixant la liste et les conditions d'étiquetage et d'emballage de substances dangereuses" = Decree of 16 January 1992 modifying and completing the decree of 10 October 1983 setting up requirements with regards to the classification, labeling and packaging of dangerous substances.

9. Full French name of the decree: "Arrêté du 20 décembre 1991 relatif à certains générateurs d'aérosols contenant des composants inflammables" = Decree of 20 December 1991 with regards to certain aerosol dispensers containing inflammable components.

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