CISG CASE PRESENTATION

Case identification

DATE OF DECISION: 19900000 (1990)

JURISDICTION: Arbitration ; ICC

TRIBUNAL: Court of Arbitration of the International Chamber of Commerce

JUDGE(S): Case report does not identify presiding arbitrator(s)

CASE NUMBER/DOCKET NUMBER: 6149 of 1990

CASE NAME: Daewoo v. Farhat

CASE HISTORY: Cf. Cour de Cassation (France) 6 March 1996, Revue de l'arbitrage (1997) [Arnaldez 70-75]

SELLER'S COUNTRY: Republic of Korea (claimant)

BUYER'S COUNTRY: Jordan (defendant)

GOODS INVOLVED: Clothing

Editorial remarks

EDITOR: Albert H. Kritzer

CISG issues ruled upon:

Lex mercatoria. The CISG was not by its terms applicable to this contract. The tribunal rejected seller's contention that it should nevertheless be applied as "lex mercatoria". The tribunal stated:

"Apart from the fact that it is highly disputed whether such theory is viable and whether it would withstand the scrutiny of a state court eventually reviewing this interim award, the application of the so-called lex mercatoria would not solve all conflict of law problems possibly arising in the present arbitration proceedings. [Seller] points out that the application of the lex mercatoria would be tantamount to the application of the Vienna Convention, i.e., the United Nations Convention on Contracts for the International Sale of Goods of 11 April 1980. This is certainly true. But it might be that the arbitral tribunal, in the present arbitration proceedings, would have to decide on claims based upon an unjust enrichment of the buyer and/or upon the limitation of any claim introduced by [seller] into this arbitration."

Scope of CISG/Statute of limitations/prescription periods/Unjust enrichment. "There are no provisions in the Vienna Convention covering claims for the restitution of an unjust enrichment or the limitation of claims. In order to be able to decide on these issues, the arbitral tribunal therefore would have to recur to the determination, by another rule of conflict of laws, of a national law as the proper law of contract and the arbitral tribunal would have to apply insofar such national law to the subject-matter of the present arbitration. If the arbitral tribunal therefore would follow [seller's] argument and decide that the lex mercatoria would be the proper law of the three sales contracts, probably only one part of its arbitral duties would have been accomplished. The arbitral tribunal still would eventually have to determine the law by which a claim for the restitution of an unjust enrichment and the limitation of claims would be governed.

"In the preceding section of this interim award, the arbitral tribunal has decided that all claims introduced into the present arbitration proceedings are governed by one and the same proper law of contract and that a concurrent application of different national laws does not take place. It is therefore consequential for the arbitral tribunal to discard the lex mercatoria (besides Korean law) as the proper law of contract. The Vienna Convention could only become the proper law of the sales contract if the parties, by an agreement, would stipulate its application (while Korean substantive law would govern the issues not covered by the Convention). Such agreement has not come about."

Citations to case abstracts, texts, and commentaries

(a) UNCITRAL abstract: Unavailable

(b) Other abstracts

Unavailable

CITATIONS TO TEXT OF DECISION

Original language (English): Yearbook Commercial Arbitration XX (1995), 41-57 [CISG at 56-57] = ICC Coll III, 315-331

Translation: Unavailable

CITATIONS TO COMMENTS ON DECISION

Unavailable