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CISG CASE PRESENTATION

Germany 10 June 1980 District Court Essen [ULIS precedent] [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/800610g1.html]

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

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Case identification

DATE OF DECISION: 19800610 (10 June 1980)

JURISDICTION: Germany

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

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 45 O 237/79

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

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Germany (plaintiff)

BUYER'S COUNTRY: Netherlands (defendant)

GOODS INVOLVED: Goods


Classification of issues present

APPLICATION OF CISG: No, however, ULIS issue is present that is also relevant to the CISG

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Article 74 can be said to be at issue because analysis of ULIS Article 82 is relevant to interpretation of CISG Article 74

Classification of issues using UNCITRAL classification code numbers:

74B [General rules for measuring damages]

Descriptors: Damages ; Collection costs

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Editorial remarks

EDITOR: Albert H. Kritzer

The parallel language of ULIS Article 82 and CISG Article 74. ULIS Article 82 states that "damages shall not exceed the loss which the party in breach ought to have foreseen at the time of the conclusion of the contract in the light of the facts and matters which then were known or ought to have been known to him, as a possible consequence of the breach of the contract."

CISG Article 74 states that "damages may not exceed the loss which the party in breach foresaw or ought to have foreseen at the time of the conclusion of the contract in the light of the facts and matters of which he then knew or ought to have known, as a possible consequence of the breach of contract."

Use of ULIS jurisprudence as an aid to interpreting the CISG. Citing century old precedent to the effect that where a term is used in one statute, a subsequent statute that incorporates the same term in a similar context must be construed so that the term is interpreted according to the meaning that has been previously assigned to it, Mann adds: "It is simply common sense that if the Convention adopts a phrase which appears to have been taken from . . . where it is used in a specified sense, the international legislators are likely to have had that sense in mind and to intend its introduction into the Convention." F.A. Mann, Uniform Statutes in English Law, 99 Law Quarterly Review (1983) 382-383 [citations omitted]. In the same vein, Audit states: "The international character of the Convention should encourage courts to refer to the Convention's legislative history and prior instruments (i.e., the ULIS . . .) in order to ascertain the most likely intent underlying the wording of a given provision." Bernard Audit, The Vienna Sales Convention and the Lex Mercatoria, in: Thomas E. Carbonneau ed., rev. ed., Lex Mercatoria and Arbitration (Juris Publishing 1998) 188.

For examples of other case law interpretations of ULIS Article 82, go to the Match-up of ULIS Article 82 with CISG Article 74 and the section of that presentation entitled, ULIS case precedents aiding in interpretation of CISG Article 74. The ULIS citations presented are taken from the chapter on CISG Article 74 by Hans Stoll in Peter Schlechtriem ed., Commentary on the UN Convention on the International Sale of Goods (Clarendon Press: Oxford 1998) 552-572.

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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): Schlechtriem/Magnus, Internationale Rechtsprechung zu EKG und EAG [International case law on ULIS and ULF], Baden-Baden: Nomos (1987) Art. 82 EKG No. 16, 425; Monatsschrift für Deutsches Recht (1981) 148 et seq.

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

English: Saidov, Damages under the CISG (December 2001) n.26; [2005] Schlechtriem & Schwenzer ed., Commentary on UN Convention on International Sale of Goods, 2d (English) ed., Oxford University Press, Art. 74 para. 20

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Case text (English translation)

Queen Mary Case Translation Programme

Landgericht Essen 10 June 1980, 45 O 237/79

Translation by Jarno Vanto [*]
University of Turku, Finland

Translation edited by Ruth M. Janal [**]
University of Freiburg, Germany

The Dutch [seller] sold goods to the German [buyer] . The [buyer] paid only in part and too late. In its statement of claims the [seller] demanded payment of the unpaid sale price and compensation for expenses accrued in employing a collection agency.

The Court granted the [seller]'s claim. Regarding the employment of a collection agency, the Court held:

“The [seller] is also entitled to compensation for collection expenses based on Article 82. According to this provision the [seller]'s loss resulting from the breach of contract is to be compensated. The principle of full compensation is applicable. This includes indirect losses. Expenses accrued in collecting an outstanding debt constitute such indirect damages, insofar as delay in payment was the reason for collection. This is the case in the present dispute.

"However, the extent of the collection expenses requires further examination. Such expenses are limited to damages that the party in breach ought to have foreseen at the time of the conclusion of the contract. The [buyer] could have foreseen at the time of the conclusion of the contract that non-payment would prompt the [seller] to seek collection of outstanding debts. Commissioning a Dutch collection agency suggested itself. In the present dispute, it did not constitute a failure to mitigate damages on the part of the [seller] to employ a collection agency at its place of business. Consequently, the Court only needs to ascertain the amount of the collection costs.

"The Court does not follow the [buyer’s] opinion that the German national principle regarding collection fees should be applied. Under this principle, the compensable amount for employing a collection agency is limited by the official attorney fee for a request for payment. These judge-made German rules cannot automatically be applied to the determination of damages under Art. 82 ULIS, both for reasons of private international and material law. The idea behind them is that it constitutes a failure to mitigate damages if a domestic creditor, instead of employing a domestic attorney, employs a collection agency, whose fees exceed the attorney fees. The situation of a foreign creditor is not similar to this. A foreign creditor cannot automatically be required to choose the means of collection solely via a German attorney, because this is possibly less expensive for the debtor. It does not have to start out by employing a Dutch or German attorney. In the case of default of payment, it is instead entitled to chose between an attorney and a collection agency at its own will. The debtor cannot, by failing to pay the outstanding amounts, force it to chose one or the other.”


FOOTNOTES

* Jarno Vanto is an LL.M student at the University of Turku, Finland. He is currently working on his thesis on damages under the CISG.

** Ruth M. Janal, LL.M. (UNSW) is a Phd candidate at Albert-Ludwigs-Universität Freiburg.

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

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Pace Law School Institute of International Commercial Law - Last updated September 14, 2006
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