Go to Database Directory || Go to CISG Table of Contents || Go to Case Search Form || Go to Bibliography

CISG CASE PRESENTATION

Russia 2 October 1998 Arbitration proceeding 113/1997 [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/981002r1.html]

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

Case Table of Contents


Case identification

DATE OF DECISION: 19981002 (2 October 1998)

JURISDICTION: Arbitration ; Russian Federation

TRIBUNAL: Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 113/1997

CASE NAME: Unavailable

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Russian Federation (claimant)

BUYER'S COUNTRY: People's Republic of China (respondent)

GOODS INVOLVED: Goods


Classification of issues present

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

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 53 ; 78 ; 90

Classification of issues using UNCITRAL classification code numbers:

Unavailable

Descriptors: Unavailable

Go to Case Table of Contents


Editorial remarks

Go to Case Table of Contents


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 (Russian): Rozenberg, Practika of Mejdunarodnogo Commercheskogo Arbitrajnogo Syda: Haychno-Practicheskiy Commentariy [Practice of the International Commercial Arbitration Court: Scientific - Practical Comments] Moscow (1998) No. 51 [171-172]

Translation (English): Text presented below

CITATIONS TO COMMENTS ON DECISION

English: Djakhongir Saidov, 7 Vindobona Journal of International Commercial Law and Arbitration (1/2003) 1-62 at n.157

Go to Case Table of Contents

Case text (English translation)

Queen Mary Case Translation Programme

Russian Federation arbitration proceeding 113/1997 of 2 October 1998

Translation [*] by Antonida Alibekova [**]

Translation edited by Mykhaylo Danylko [***]

1. SUMMARY OF RULING

     1.1 The General Terms of Delivery USSR - People's Republic of China [hereinafter GTD] and the Vienna Convention 1980 [UN Convention on Contracts for the International Sale of Goods (1980), hereinafter CISG] were recognized as applicable to the relations of parties to contracts concluded between a Russian company and a Chinese company, providing priority to GTD provisions on questions concerning matters governed by the said Convention.

     1.2 The Tribunal of International Commercial Arbitration at the Chamber of Commerce and Industry of the Russian Federation [hereinafter Tribunal] has recognized that it has the necessary competence to arbitrate the present dispute on the basis of arbitration clause of the contract.

     1.3 Whereas the annual interest rate claimed by the [seller] for delay of the buyer's pecuniary obligations under the contract is lower than the rate stipulated by GTD ( 55), thus, the Tribunal has recognized that claim as reasonable.

2. FACTS AND PLEADINGS

The action was brought by [seller], a Russian company, against [buyer], a Chinese company, in connection with default in payment for goods delivered under the contract concluded between the parties in September 1995. The buyer confirmed receipt of the goods, for which [buyer] was obliged to pay within 90 days from the date of receipt in accordance with provisions of the contract.

     2.1 [Seller's position]

The seller claimed recovery of the sum of debt with annual interest calculated at the LIBOR (London Interbank Offered Rate) rate.

     2.2 [Buyer's position]

The buyer did not provide any explanations as to the action and did not appear at the hearing of the Tribunal.

3. TRIBUNAL'S REASONING

The ruling of the Tribunal contained the following main points:

      3.1 [Applicable law]

Having considered the question of the law applicable to the relations between the parties under the given contract, the Tribunal has found that GTD is applicable to these relations. As the parties to the dispute are located in Contracting States to the CISG, the provisions of this Convention are applicable to the relations of the parties by virtue of Article 1(1)(a) CISG, providing for priority of the provisions of GTD concerning the matters governed by the CISG (Art. 90 CISG).

     3.2 [Jurisdiction competence of the Tribunal]

Clause 11 of the contract provides for the resolution of disputes arising from or in connection with the given contract by the Arbitration Tribunal at the Chamber of Commerce and Industry of the Russian Federation in accordance with Rules of the Tribunal. Taking into account that by decree of the Supreme Soviet of the Russian Federation of 7 July 1993, the Arbitration Tribunal at the Chamber of Commerce and Industry of the Russian Federation was renamed the Tribunal of International Commercial Arbitration at the Chamber of Commerce and Industry of the Russian Federation, the Tribunal reached the conclusion that the parties in clause 11 of the contract had in mind specifically this Tribunal as the relevant authority to arbitrate the arisen disputes.

     3.3 [Absence of buyer at the hearing]

In connection with the absence of the buyer at the hearing of the Tribunal, the Tribunal stated that there were no demurrers, preliminary motions or petitions of the [buyer] barring commencement of hearing of the case. According to 23 of the Rules of Tribunal, the [buyer] was properly informed by summons of 3 June 1998 of the time and place of the hearing and, therefore, in accordance with 28(2) of the Rules of Tribunal, the case could be heard in the absence of the [buyer].

     3.4 [The merits of the case]

Considering the merits of the [seller]'s action, the Tribunal stated that the case materials, and [buyer] himself by fax of 6 June 1996, confirmed the shipment of goods to the [buyer] for the price indicated in the statement of action. It follows from the fax of 6 June 1996, that [buyer] has not paid for the goods delivered, therefore the Tribunal has reached the conclusion that on the basis of Article 53 CISG that amount should be recovered from the [buyer].

     3.5 [Interest]

The Tribunal has found that in case of delay of payment, 55 of GTD provides for the payment of interest at the annual rate of 6%. Since the [seller] claimed the recovery of interest at the LIBOR annual rate of 5.4207%, which was less than 6% per annum, the Tribunal concluded that [seller]'s claim was reasonable.

According to clause 4 of the contract, the [buyer] should make payment for the goods within 90 days from the date of receipt. The [buyer] with the fax of 6 June 1996 has confirmed the receipt of the last deliveries of goods on 15 February 1996. Therefore, the initial date for the calculation of annual interest is 15 May 1996. Thus, the [seller]'s claim to recover interest at the rate of 5.4207% per annum charged on the principal amount of the claim since 15 May 1996 till the day of payment is granted.


FOOTNOTES

* This is a translation of data on the award in Proceeding 113/1997, dated 2 October 1998, of the Tribunal of International Commercial Arbitration at the Russian Federation Chamber of Commerce and Industry, reported in: Rozenberg ed. Arb. Praktika 1998, No. 51 [171-172]. All translations should be verified by cross-checking against the original text. For purposes of this translation, Claimant of the Russian Federation is referred to as [seller]; Respondent of the People's Republic of China is referred to as [buyer].

** Antonida S. Alibekova, teacher of Law at Mari State University (Russia), studied at the School of Law of Mari State University, School of Law of Manchester Metropolitan University (Great Britain), Legal Studies Department of the Central European University (Budapest, Hungary), School of Law of Wayne State University (Detroit, Michigan, the USA). Winner of Russia's National Round of Telders Moot Court Competition (member of the winning team) (2000), Russia's National Round of Jessup Moot Court Competition (2002). Finalist of the International W.C. Vis Moot Court Competition, Vienna, Austria (2002), semi-finalist of the Central and Eastern European Moot Court Competition, Ljubljana, Slovenia (2002). Participant in International Telders Moot Court Competition, Hague, Netherlands (2000), International F. Jessup Moot Court Competition, Washington, USA (2002). The second-iteration redaction of this translation was by Dr. John Felemegas of Australia.

*** Mykhaylo Danylko is a Partner with the law firm Danylko, Kushnir, Soltys & Yakymyak, Attorneys & Counselors at Law, Kiev, Ukraine <http://www.dksylaw.com>. He holds a Masters of Laws (European Studies Program) from the Law School of International Science and Technology University, Kiev, Ukraine (July 2000); a Master of Management in Business of the Business School of International Science and Technology University (June 2002); and has received his LL.M. in International and Comparative Law at the Pace University School of Law.

Go to Case Table of Contents
Pace Law School Institute of International Commercial Law - Last updated July 30, 2004
Comments/Contributions
Go to Database Directory || Go to CISG Table of Contents || Go to Case Search Form || Go to Bibliography