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CISG CASE PRESENTATION

Germany 11 December 1996 Supreme Court (Marzipan case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/961211g1.html]

Primary source(s) for case presentation: Case text


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Case identification

DATE OF DECISION: 19961211 (11 December 1996)

JURISDICTION: Germany

TRIBUNAL: Bundesgerichtshof [Supreme Court]

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: VIII ZR 145/95

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

CASE HISTORY: 1st instance LG Lübeck 17 August 1993; 2d instance OLG Schleswig 27 April 1995 [reversed]

SELLER'S COUNTRY: France [defendant]

BUYER'S COUNTRY: Germany [plaintiff]

GOODS INVOLVED: Marzipan


Case abstract

GERMANY: Bundesgerichtshof 11 December 1996

Case law on UNCITRAL texts (CLOUT) abstract no. 268

Reproduced with permission from UNCITRAL

A German seller, plaintiff, delivered almond paste to a French buyer, defendant. The seller sought from the German court a declaration of non-obligation to pay damages and, thereafter, the buyer brought an action for damages in a French court. One of the issues for determination was whether the German court had jurisdiction.

The appellate court had stated that, under article 5(1) of the European Communities Convention on Jurisdiction and Enforcement of Judgements in Civil and Commercial Matters, jurisdiction is based on the place of performance of the contract. Since both Germany and France were Contracting States to the CISG, it was applicable to determine the place of performance (article 1(1)(a) CISG), according to which the place of performance would have been at the seller's place of business in Germany (article 31 CISG). At issue was whether the parties had derogated from this general principle by various communiques in which the price had been quoted, "duty unpaid, untaxed, delivery being free to the door of the place of the buyer's business".

The appellate court had held that these descriptive statements, which had been made by the parties in conjunction with the price, could have been understood as related to transportation costs and allocation of risk and, having regard to the need for interpretation in accordance with the view and comprehension of the recipients, had not been intended by the parties to alter the place of performance (article 8(1) CISG). This ruling was upheld by the Supreme Court.

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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: Articles 8(1) and 8(3) ; 31 [Also relevant: Article 45 ]

Classification of issues using UNCITRAL classification code numbers:

8A ; 8C [Intent of party making statement or engaging in conduct; Interpretation in light of surrounding circumstances];

31B [Place for delivery: contracts not involving carriage and parties knew location of goods]

Descriptors: Delivery ; Jurisdiction or venue ; Intent

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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=290&step=Abstract>

German: [1997] Der Betrieb (DB) 572; [1997] Entscheidungen zum Wirtschaftsrecht (EWiR) 455; [1997] Familie und Recht 122; [1997] Neue Juristische Wochenschrift (NJW) - Rechtsprechungsreport 636; Schweizerische Zeitschrift für Internationales und Europäisches Recht (SZIER)/Revue suisse de droit international et de droit européen, 1998, 87-88

CITATIONS TO TEXT OF DECISION

Original language (German): cisg-online.ch <http://www.cisg-online.ch/cisg/urteile/225.htm>; 134 Entscheidungen des Bundesgerichtshofes in Zivilsachen 201-212; [1997] Europäisches Wirtschafts- und Steuerrecht (EWS) 105-108; [1997] Praxis des Internationalen Privat- und Wirtschaft (IPRax) 348-350; [1997] Juristenzeitung (JZ) 797-799; [1997] Neue Juristische Wochenschrift (NJW) 870-873; Monatsschrift für Deutsches Recht (MDR) 387; [1997] Recht der Internationalen Wirtschaft (RIW) 421-423; [1997] Wertpapier-Mitteilungen (WM) 985-988; Zeitschrift für Wirtschaftsrecht (ZIP) 1997, 519-522; Lindenmaier/Möhring, Nachschlagewerk des Bundesgerichtshofs (LM) 5/987 256 ZPO No. 195; [1996] Die deutsche Rechtsprechung auf dem Gebiete des internationalen Privatrechts im Jahre (IPRspr) No. 171 [406-409]; [1997] Wirtschaftsrechtliche Beratung (WiB) 329-330; [1997] 2 Forum des Internationalen Rechts/The International Legal Forum 40-43; Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=290&step=FullText>

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

English: [1997] T.S. [Simons] 2 Forum des International Rechts/The International Legal Forum (English language edition) 42-45; Larry A. DiMatteo et al., 34 Northwestern Journal of International Law & Business (Winter 2004) 299-440 at 388-389; [2005] Schlechtriem & Schwenzer ed., Commentary on UN Convention on International Sale of Goods, 2d (English) ed., Oxford University Press, Art. 8 paras. 22, 40, 45, 47, 60 Art. 31 para. 78, 91, 92, 94

German: Geimer, [1997] Entscheidungen zum Wirtschaftsrecht (EWiR) 455; Hess/Vollkommer, Entscheidungssammlung zum Wirtschafts- und Bankrecht VII B, Art 21 EuGVÜ 1.97; Huber, [1997] Juristenzeitung (JZ) 799; Kronke, [1997] Praxis des Internationalen Privat-und Verfahrensrechts (IPRax) 350; Piltz, [1999] Transportrecht, Beilage "Internationales Handelsrecht" (TranspR-IHR) 13 [15]; T.S. [Simons], [1997] 2 Forum des International Rechts 43-45

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Case text (English translation) [second draft]

Queen Mary Case Translation Programme

Supreme Court (Bundesgerichtshof) of Germany

11 December 1996 [VIII ZR 154/95]

Translation [*] by Thorsten Tepasse [**]

Plaintiff, almond paste manufacturer N. [hereafter referred to as Seller], domiciled in Lübeck, Germany,

vs.

Defendant, chocolate producer in S., France [hereafter referred to as Buyer].

1. CASE

Seller operates a factory for marzipan products in Lübeck, Germany. Buyer produces chocolate products in a branch among others in S., France. The business relationship between the parties started in October 1990. By fax of 20 December 1990, Seller confirmed Buyer's order of marzipan. The fax stated among other things: "The price is carriage paid to B., duty unpaid and untaxed".

This fax did not contain any mention of Seller's general terms and conditions. On 14 February 1991, Seller offered further almond paste to Buyer and noted: "The prices above are prices free S."

After Buyer's order by telephone, Seller sent a form signed over with "closing certificate", stating on its recto: "We hereby confirm in thanks, to have made business with you under the overleaf delivery and payment conditions".

Seller's terms and conditions contained a clause stating, that Lübeck should be the place of performance and venue. On 6 and 24 September 1991, Seller sent three more "closing certificates" of the same kind to Buyer, with the following addition on the recto: "Delivery: carriage paid to B., duty unpaid".

In parts of the almond paste that Seller delivered, Buyer detected yeast "impassibly against osmotic pressure" and communicated that to Seller, who rejected any responsibility for this defect. Thereupon, Buyer announced an intent to lodge warranty and damages claims. In an expedited procedure commenced by Buyer in 1991, the Tribunal de Grand Instance [TGI (French district court)] of Strasbourg recorded an objection to jurisdiction filed by Seller and, with an interim injunction of 21 January 1992, ordered an expert's report. The request by Buyer, to order Seller to pay an installment of 5,000,000.00 French francs [Ff] on the claim for damages was rejected.

In a proceeding for declaratory judgment determining the non-existence of a right, submitted to the Landgericht [LG (German district court] of Lübeck on 30 December 1991 and forwarded to Buyer on 17 March 1992, Seller seeks to have the court declare that Buyer does not have any claim arising from the supply contracts of 21 February 1991, as well as the contracts of 6 and 24 September 1991. The Buyer had filed a claim for damages in the amount of primarily 5,100,000.00 Ff at the TGI de Strasbourg on 12 May 1992. Buyer challenges the international jurisdiction of German courts. Buyer holds that, since a claim was filed in Strasbourg, France, Seller's action for declaratory judgment in Germany determining the non-existence of a right would lack legitimate interest to take legal action.

In an interim judgment, the LG Lübeck affirmed the admissibility of the Seller's claim. However, in the German appeal filed by Buyer, the appellate court [OLG Schleswig] rejected the Seller's claim as inadmissible. This appeal to the Federal Supreme Court of Germany, lodged by Seller, leads to reestablishment of the district court's interim judgment.

2. REASONING AND DECISION

      2.1. The OLG Schleswig (German appellate court) held:

            2.1.1. The German court of first instance (LG Lübeck) rightfully assumed international jurisdiction of the German courts on the basis of Art. 5 (No. 1) of the European Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters of 27 September 1968 (EuGVÜ). Pursuant to this convention, the French Buyer could be sued at the place of performance. According to Art. 31 of the Convention for the International Sale of Goods of 11 April 1980 (CISG), which is applicable to this dispute, the place of performance would be the seller's branch, namely Lübeck, Germany. By using the provisions "price free S." and "carriage paid to B., duty unpaid", the parties neither intended to agree upon an obligation of the Seller to provide the goods nor that the branch of Buyer [in Germany] would be the place of performance. In fact, a mail order purchase would be on hand, by virtue of which Seller should pay the transport costs of the goods from Lübeck to S. (France).

            2.1.2. However, Seller's interest in an action for declaratory judgment determining the non-existence of the claim for damages had become obsolete, since Buyer meanwhile filed its suit for performance at the court in Strasbourg, France The suit for performance of the same claim would have priority from the time when a unilateral withdrawal of action was not possible anymore, even though the claim was raised before a court in a third country. This would be the case with regard to the claim lodged in Strasbourg.

Moreover, the priority of the suit for performance would not require raising the claim before the authorized court. The appellate court, in any event, could not hand down a binding decision on the authority of the French court where Buyer initiated its proceeding. Further, Art. 21 EuGVÜ would not oppose the precedence of the suit for performance. If courts of different Contracting States were called upon for the same claim, the provision would only govern the proceeding of the subsequent court and not the question of how the first court should act from a procedural point of view. This would only be subject to the national procedural body of laws.

      2.2. This reasoning, denying an interest in an action for declaratory judgment, does not withstand further examination.

            2.2.1. The appellate court rightfully assumed international jurisdiction of the German courts - which has to be considered ex officio by this court (BGHZ [*] 44, pp. 48) - by laying down the provisions of the EuGVÜ, in the version of the accession agreement of 25 October 1982 (BGH [*] ZIP [*] 1995, p. 947; BGH WM [*] 1995, p. 1124 (item II 5). In principle a legal entity, as Buyer, that has its seat in a country which is party to the convention, has to be sued before a court of that State pursuant to Arts. 2, 53 EuGVÜ. However, the proceeding can be initiated before a court of another Contracting State if one of the exceptions, as provided for in the EuGVÜ, is at hand.

                  a) Contrary to the writ of appeal to this court, the international jurisdiction of German courts according to Art. 2(1) EuGVÜ, does not derive from the fact that Buyer would have had to claim for damages before the court in Lübeck, which is Seller's regular place of venue. The EuGVÜ does not aim at the status of Plaintiff and Buyer under substantive law, but solely at the formal role of a party (Kropholler, Europäisches Zivilprozeßrecht, 5th ed., Art. 2 EuGVÜ para. 1; Huber, JZ [*] 1995, pp. 603, 606).

                  b) Art. 5 (No. 1) EuGVÜ is, as the appellate court assumed, the basis for international jurisdiction of German courts. Pursuant to that provision, in case of contractual remedies the place of venue is the place where the obligation was fulfilled or ought to have been fulfilled. The crucial fact is the primary performance which is the subject of the claim, in casu Seller's obligation to deliver the goods (BGH EuZW [*] 1992, p. 518; BGH NJW [*] 1996, p. 1819 (see (2)(c)); also: Mankowski in EWiR [*] 1996, p. 739). Secondary obligations for compensation of damages, arising from a breach of contract, are not separately tied up (EuGH [*] NJW 1987, p. 1131; Zöller/Geimer, ZPO [*], 19th ed., Art. 5 EuGVÜ para. 2).

The question of the place of performance is in general governed by the substantive law through its principles of conflict of laws which rules the dispute and binds the deciding court (EuGH NJW 1977, pp. 491; BGH EuZW 1992, p. 518). Exceptionally, the question does not depend on the forum's international private law, if substantive uniform law defines its scope of application without interposition of conflict law, e.g., Art. 1(1)(a) CISG (Wierzorek/Schütze/Hausmann, ZPO, 3rd ed., Art. 5 EuGVÜ para. 22; see also BGH EuZW 1992, p. 514 and Schlechtriem in EWiR 1995, p. 55).

The appellate court rightfully assumed that the prerequisites of Art. 1(1)(a) CISG, which entered into force on 1 January 1988 in France and on 1 January 1991 in Germany, are met. The parties are arguing about claims from a contract for the sale of goods and they have their seats in different countries. Pursuant to Art. 31 CISG, the place of performance for the obligation to deliver is the Seller's domicile, since the parties did not agree otherwise. No such agreement otherwise can be seen in the provisions used by Seller ("price free S." and "carriage paid to B., duty unpaid").

                         aa) The answer to the appeal alleges, that the appellate court unlawfully applied the German understanding of "free-clauses". The French Buyer, whose point of view is decisive, as it is the addressee of the declaration, was allowed to interpret the clauses according to the understanding in France, i.e., that Seller was obliged to bear the transport costs and thus the place of delivery and performance was supposed to be S. That assumption has to be rejected.

Pursuant to Art. 8(1) CISG it is true, that the view and understanding of the addressee is crucial when construing declarations of intent (Schlechtriem/Junge, CISG, 2nd ed., Art. 8 para. 4; Staudinger/Magnus, BGB [*], 13th ed., Art. 8 CISG para. 11). According to Art. 8(3) CISG, all relevant circumstances have to be considered, namely negotiations between the parties and practices established between themselves.

The appellate court also followed this rule. It saw the faxes of 20 December 1990 and 14 February 1991 as the basis for the parties' contractual relationship. The conclusion drawn from their content, that the parties only intended to govern the question of transport costs and possibly the passing of risk but not the place of performance for Seller's obligation, remains justifiably in the scope for judgment evaluation. Thus, the objection raised is unsuccessful, since the appellate court took all essential aspects into account.

The appellate court's contemplation, that the word "free" in the faxes would only be used in combination with the price, not with the place of performance for Seller's duty to deliver and thus the clauses must be understood as provisions ruling the transport costs, is not objectionable for legal reasons. Further, the appellate court held that Buyer, as the declarations' addressee, did not understand the clauses differently and that the parties did not speak about the place of performance before, at the time and after conclusion of the contract. Since that statement was found free from any error in law, it is not decisive that the provision "free designated location" has no typical, unique definition in international trade (cf. BGH WM 1983, p. 1237; Palandt/Heinrichs, BGB, 55th ed., 269 para. 9). It is just as little essential, if the provision is, as Buyer alludes, at least in France understood as the Incoterm "DDU" (DDU = Delivered Duty Unpaid), under which the place of delivery and performance is a labeled location in the country of importation. Facing the cognizable and concurrent intention of the parties (Art. 8(1) CISG) regarding the comprehension of the "free-clauses" used by Seller, particularly when considering the reference made to the prices, the place of performance for Seller's obligation remains, according to Art. 31 CISG, its branch in Lübeck, Germany.

                         bb) Even the fact that Seller used the wording "Delivery: carriage paid to B., duty unpaid" in the closing certificates of 6 and 24 September 1991 does not change the defensibleness of the contested judgment. The closing certificate of 21 February 1991 did not contain such formulation. The appellate court rightfully held that the assumption, that the parties intended to change their contractual relationship based on the faxes and the certificate of 21 February 1991 would lack any founded basis.

                  c) It is not necessary to determine whether, pursuant to Art. 17 EUGVÜ, international jurisdiction of German courts can also result from a jurisdictional clause, which can be deduced from Seller's general terms and conditions and Buyer's subsequent silence after receipt (cf. BGH, WM 1995, p. 859 item II 4, see also Mankowski in EWiR 1995, p. 577 and BGH EuZW 1992, p. 514).

            2.2.2. However, the appellate court wrongly infers that the suit for declaratory judgment determining the non-existence of the claim would lack considerable interest, since Buyer filed a claim for performance in Strasbourg.

[...]


FOOTNOTES

* All translations should be verified by cross-checking against the original text. For purposes of this translation, Plaintiff of Germany is referred to as [Seller]; Defendant of France is referred to as [Buyer]. Amounts in former French currency (French francs) are indicated as [Ff].

Translator's note on other abbreviations: BGB = Bürgerliches Gesetzbuch [German Civil Code]; BGH = Bundesgerichtshof [German Supreme Court]; BGHZ = Entscheidungssammlung des Bundesgerichtshofs in Zivilsachen [official collection of decisions of the German Supreme Court]; EuGH = Europäischer Gerichtshof [Court of Justice of the European Communities]; EuZW = Europäische Zeitschrift für Wirtschaftsrecht [German Law Journal]; EWiR = Entscheidungen zum Wirtschaftsrecht [German Law Journal]; JZ = Juristenzeitung [German Law Journal]; LG = Landgericht [German district court]; NJW = Neue Juristische Wochenschrift [German Law Journal]; OLG Oberlandesgericht [German appellate court]; TGI = Tribunal de Grande Instance [French district court]; WM = Wertpapier-Mitteilungen [German Law Journal]; ZIP = Zeitschrift für Wirtschaftsrecht; ZPO = Zivilprozessordnung [German Civil Procedure Code].

** Thorsten Tepasse is a law student at the University of Osnabrück, Germany and participated in the 12th Willem C. Vis Moot with the team of the University of Osnabrück.

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Pace Law School Institute of International Commercial Law - Last updated November 17, 2005
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