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CISG CASE PRESENTATION

Germany 29 October 2009 District Court Stuttgart (Artificial turf case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/091029g1.html]

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

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Case identification

DATE OF DECISION: 20091029 (29 October 2009)

JURISDICTION: Germany

TRIBUNAL: LG Stuttgart [LG = Landgericht = District Court]

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 25 O 99/09

CASE NAME: German case citations do not identify parties to proceedings

CASE HISTORY: 1st instance AG Berlin Schönefeld (08-1117107-0-9) 29 December 2008

SELLER'S COUNTRY: Belgium (plaintiff)

BUYER'S COUNTRY: Germany (defendant)

GOODS INVOLVED: Artificial turf


Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 4 ; 50 ; 74 ; 77 ; 78 [Also cited: Articles 45 ; 53 ]

Classification of issues using UNCITRAL classification code numbers:

4A [Scope of Convention (issues covered): set-off where based on the same legal relationship];

50A [Buyer's right to reduce price for non-conforming goods];

74A [General rules for measuring damages: loss suffered as consequence of breach];

77A [Obligation to take reasonable steps to mitigate damages: although court did not cite art. 77, court disallowed recovery of collection costs regarding them in this case as an unnecessary expense];

78B [Rate of interest]

Descriptors: Reduction of price, remedy of ; Damages ; Scope of Convention ; Set-off ; Collection costs ; Mitigation of loss ; Interest

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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 (German): Click here for German 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

District Court (Landgericht) Stuttgart

29 October 2009 [25 O 99/09]

Translation [*] by Institut für auslndisches und internationales
Privat- und Wirtschaftsrecht der Universitt Heidelberg
Daniel Nagel [**]

JUDGMENT

1.    The enforceable default summons of the Court of the summary proceedings, file reference number 08-1117107-0-9 of 29 December 2008, is upheld on condition that the Defendant [a German firm] (hereinafter, "[Buyer]") has to pay to Plaintiff [a Belgian firm] (hereinafter "[Seller]") EUR 5,850.40 plus 8% interest above the base interest rate since 11 March 2007.
 
2.    The [Seller] has to bear the costs of the examination of Witness B in advance. For the remainder, the [Seller] has to bear 27% and the [Buyer] 73% of the costs of the proceedings
 
3.    The [Seller]'s residuary claim [for collection costs and other matters] is dismissed. The enforceable default summons of the Court of the summary proceedings, file reference number 08-1117107-0-9 is revoked in this respect.
 
4.    The judgment is provisionally enforceable against payment of a security deposit of 115% of the amount to be enforced.

FACTS

The [Seller] seeks payment of the purchase price for the delivery of artificial turf.

The [Seller] sold artificial turf to the [Buyer]. The latter used the turf to equip an indoor golf course for its customer. The [Seller] was aware of the fact that the artificial turf would be used for this purpose. The artificial turf was delivered to the premises of the [Buyer]'s customer and laid. The [Seller] invoiced the agreed purchase price of EUR 8,050.40 on 8 February 2007.

The Court of the summary proceedings allowed the [Seller]'s request for an enforceable default summons on 29 December 2008 in respect to the purchase price plus 8% interest above the base interest rate since 10 July 2007 and, in respect to collection costs, in the amount of EUR 825.27. The enforceable default summons was served on 7 January 2009. On 2 February 2009 [Translators note: typing error ("2 January 2009") in the original text] a belated objection was filed.

POSITION OF THE PARTIES

The [Seller] alleges that it had delivered the artificial turf in conformity with the contract and would hence be entitled to the purchase price in full plus collection costs (which [Seller] requested in a reduced amount) and interest. Even if the artificial turf had been defective, [Seller] alleged that potential claims of the [Buyer] had been settled by a delivery free of charge at a later date and that this had been agreed on between an employee of the [Seller] and an employee of the [Buyer].

The [Seller] requests that the enforceable default summons of the Court of the summary proceedings, file reference number 08-1117107-0-9, of 29 December 2008 be upheld, however, in respect to the collection costs, [Seller] seeks only the amount of EUR 718.40.

The [Buyer] requests that the enforceable default summons of the Court of the summary proceedings be revoked and that the [Seller]'s claim be dismissed.

The [Buyer] alleges that the artificial turf had been defective, as it had been marked with a white line, comparable to a hockey playing field. Thus, on the one hand, [Buyer] would be entitled to a price reduction. On the other hand, [Buyer] would be entitled to a set-off against a claim for damages. [Buyer] had incurred considerable additional expenditure as its employees had to cut out the white line, which entailed a considerable additional expenditure as regards time. Furthermore, the laying had not been possible as planned. The lengths of turf had to be recalculated as well as partially split and fixed.

A hearing of several witnesses has taken place as regards the quality of the delivered artificial turf and of Witness B as regards the agreement on the delivery of the artificial turf.

For the remainder, reference is made to the submissions of the parties and the protocols of the oral hearings of 14 May 2009 and 1 October 2009.

After the oral hearings had been closed, the [Buyer] additionally alleged costs for overnight stays in the amount of EUR 699.16.

REASONING OF THE COURT

The [Buyer]'s objection is admissible and partially justified, as the [Buyer] is entitled to a reduction in price and to a set-off against a claim for damages.

1. The CISG (Convention on Contracts for the International Sale of Goods of 11 April 1980) has to be applied to the contract. The Defendant [Buyer] is seated in Germany. The application of the CISG is not excluded according to Article 1(2) CISG. It can be seen from the invoice of 8 February 2007 that the Plaintiff [Seller] is seated in Belgium. It is undisputed that the parties had a business relationship prior to the present delivery. There are no clues that previous invoices did not contain the respective hint.

2. The [Buyer] is generally obliged to pay the undisputed purchase price of EUR 8,050.40 according to Article 53 CISG.

3. However, the [Buyer] is entitled to a reduction of the agreed purchase price in the amount of EUR 800.00 due to the fact that the delivered turf has not been in conformity with the contractual stipulations as regards quality. The taking of evidence showed that the artificial turf was covered with white lines in respect to most parts. This has not only been confirmed by the witnesses named by the [Buyer] who had laid the turf, but also by an employee of the [Seller], Witness B. The latter explained that he had been aware of the fact that the turf had been marked with white lines. This had been the reason why he had received a call from the warehouse. Furthermore, Witness B confirmed that he had been aware of the fact that the turf was intended for an indoor golf course. According to common usage, a golf course does not have white lines. Thus, the turf has not been in conformity with the contract, wherefore the [Buyer] is entitled to reduce the price.

The court estimates the reduction at 10% of the purchase price. This is based on the assumption that even though the line had been cut out, all employees that have laid the turf and that have been heard as witnesses confirmed that this led to the result that the material length had no longer been sufficient which, in turn, entailed additional edges. As it has been impossible to fully conceal the edges, wherefore the course of the golf ball could be disturbed, a considerable decrease in value can be assumed as regards the delivered turf.

The allegation of the [Seller], that there had been an agreement that there would be a subsequent delivery free of charge to compensate for the delivery of the turf with white lines could not be proven. Even the testimony of [Seller]'s Witness B does not confirm this allegation. Witness B stated that he had promised to deliver a roll of turf free of charge to [Buyer]'s Witness C during a telephone call. Upon inquiry of the Court whether it had been discussed that this delivery should constitute a compensation in order to fully settle the issue, Witness B explained that this could be taken for granted. Hence, Witness B has just not expressly stated that the delivery should constitute a compensation in order to fully settle the issue, wherefore the content of the telephone call could be interpreted by the employee of the [Buyer] as an ex gratia delivery by the [Seller] on the basis of the good relationship between the parties and due to the delivery which had not been in conformity with the contract without the necessity to assume that this would constitute a full compensation for any claims of the [Buyer].

4. Furthermore, the [Seller]'s claim for payment of the purchase price has become invalid in the amount of EUR 1,400.00 due to a set-off against a claim for damages by the [Buyer].

According to Article 45(2) CISG, the buyer is not deprived of any right he may have to claim damages by exercising his right to other remedies. A breach of contract by the [Seller] according to Article 74 CISG is present, as it has delivered turf with white lines despite the fact that [Seller]'s Employee B had been aware of the fact that the turf was intended for a golf course.

A set-off is at least admissible in the field of application of the CISG without an express provision as long as the counterclaim is based on the same legal relationship (Schlechtriem/Schwenzer-Hornung / Fontoulakis, Kommentar zum einheitlichen UN-Kaufrecht - CISG - Art. 81, margin number 21).

The Court estimates the damages the [Buyer] has incurred due to the additional expenditure as its employees had to cut out the white line according to § 287 ZPO [*] at EUR 1,400.00.

This is based on the following assumption:

All employees of the [Buyer] who have been involved in the laying of the turf have stated that the white line has led to a considerable additional expenditure. The latter has been unanimously explained as the result of the necessity to cut out the white line and the redistribution of the lengths of turf thereby caused. In particular, the additional seams had caused a considerable additional expenditure as these had to be done very diligently. There are different statements of the witnesses as regards the extent of the additional expenditure. This is obvious, as the work which has been additionally caused has not arisen separately, but had to be done in the course of the laying of the turf.

Witness C stated that two to two-and-a-half days of additional work had been caused for each of the four employees of the [Buyer]. Witness D stated that at least more than half a day of additional work had been caused. Witness A estimated that two to three days of additional work had been caused, which affected mainly two but as a special exception three employees. The Court considers these estimations as plausible; Witness C, who has been responsible for the laying, obviously made a somewhat generous estimation, while Witness D's estimation was all-in-all lower than the estimations of the remaining employees. In addition, it had to be taken into account that the working days varied between ten and fourteen hours. The witnesses stated their wages as EUR 25.00 and EUR 28.00.

The Court based its estimation on eighteen additional hours multiplied by three employees and EUR 26.50. This amounts to approximately EUR 1,400.00.

The additionally alleged costs for overnight stays do not have to be considered according to § 296a ZPO [*].

The purchase price was due on 11 March 2007 according to the invoice, wherefore interest can only be requested since 11 March 2007 according to Article 78 CISG. The CISG does not contain rules on the interest rate. Thus, the applicable domestic law has to be applied (Schlechtriem / Schwenzer, loco citato, Article 78 margin number 27 with further references). The applicable domestic law is German law in the present case, as all of the negotiations took place in Germany. Thus § 286(2) BGB [*] has to be applied.

The [Seller] is not entitled to request collection costs as causal damages. It has been aware from the very beginning that the [Buyer] raised objections against the delivery. Hence, the involvement of a debt collection agency has not been suited to solve the problem. In contrast, the [Seller] should have tried to find an agreement with the [Buyer] in respect to the delivery which had not been in conformity with the contract. It is unintelligible why the [Seller] had his counsel submit in the course of the proceedings that there had not been a white line despite the fact that it had included a respective hint in the invoice itself.

In respect to the costs, the [Seller] has to bear the costs of Witness B according to § 96 ZPO [*] in advance. The allegation of the [Seller] that there had been an agreement as regards a settlement, could not be verified. The costs of Witness B, which are considerably higher than the costs caused by the other witnesses due to the longer distance he had to travel, have only accrued due to this unsuccessful submission. For the remainder, the decision on costs is based on § 92(1) ZPO [*].

The decision on the provisional enforceability is based on § 709 ZPO [*].


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Belgium is referred to as [Seller] and Defendant of Germany is referred to as [Buyer]. Amounts in the uniform European currency (Euro) are indicated as [EUR].

Translator's note on other abbreviations: BGB = Bürgerliches Gesetzbuch [German Civil Code]; ZPO = Zivilprozessordnung [German Code on Civil Procedure].

** Ph.D. candidate Daniel Nagel has studied law at the University of Heidelberg and at the University of Leeds.

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Pace Law School Institute of International Commercial Law - Last updated March 8, 2010
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