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CISG CASE PRESENTATION

ICC Arbitration Case No. 9574 of August 1998 (Equipment and spare parts case) [English text]
[Cite as: http://cisgw3.law.pace.edu/cases/989574i1.html]

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

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Case identification

DATE OF DECISION: 19980800 (August 1998)

JURISDICTION: Arbitration ; ICC

TRIBUNAL: Court of Arbitration of the International Chamber of Commerce

JUDGE(S): Unavailable

CASE NUMBER/DOCKET NUMBER: 9574 of August 1998

CASE NAME: Unavailable

CASE HISTORY: Unavailable

SELLER'S COUNTRY: Unavailable (claimant)

BUYER'S COUNTRY: Unavailable (respondent)

GOODS INVOLVED: Equipment, spare parts and services


Classification of issues present

APPLICATION OF CISG: Not resolved by tribunal as same result under otherwise applicable domestic law

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 53 ; 78 ; 85

Classification of issues using UNCITRAL classification code numbers:

53A [Buyer's obligations: obligation to pay price of goods];

78A [Interest on delay in receiving price]

85A ; 85C [Seller's duty to preserve goods when buyer delays taking delivery or making concurrent price payment; Right to retain goods until reimbursed for expense]

Descriptors: Price ; Retention of title ; Interest ; Storage of goods

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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

English: Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=527&step=Abstract>

CITATIONS TO TEXT OF DECISION

Original language (English): ICC International Court of Arbitration Bulletin [ICAB], Vol. 11/No. 2 (Fall 2000) 107-108; Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=527&step=FullText>

Translation: Unavailable

CITATIONS TO COMMENTS ON DECISION

English: van Houtte, ICAB (Fall 2000) 28 n.52 [delivery], 31 n.76 [interest]

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Case digest

ICC Arbitration Case No. 9574 of August 1998
[Digest of presentation at ICAB, Vol. 11/No. 2 (Fall 2000) 107-108]

Digest by Amanda Waters

Facts

Claimant [seller] contracted with Respondent [buyer] to sell equipment, spare parts and services. The parties mutually agreed to increase the price that was originally established and change the payment conditions. Due to financial difficulties, [buyer] was unable to finance the purchase and sought cancellation of the contract. [Seller] refused to cancel the contract and claimed damages for non-fulfillment of the contractual obligations. [Buyer] would not accept delivery of the goods, which were then stored at [seller's] expense. [Seller] attempted to resell the goods, but was unsuccessful.

Applicable law

The contract was silent on substantive law, but provided that "any dispute, controversy or claim that cannot be settled by the parties shall be submitted to arbitration in accordance with the Rules of Arbitration of the International Chamber of Commerce in Paris."

"[T]he question of whether the United Nations Convention on the International Sale of Goods ("UN-Sales Convention") applies in the present case need not be addressed because the result reached by the Arbitrator would be [the] same if the UN Sales Convention applied." [page 107]

[Seller's] claim for damages

According to the contract, [buyer] was to pay [seller] 20% of the total contract value in advance and 80% by bank transfer within 10 days from the date of receipt of shipping documents. [Buyer] paid the advance payment and [seller] submitted to [buyer] the shipping documents. However, [buyer] failed to pay the balance. Thus, [seller] has a contractual claim for payment of the remaining purchase price.

[Seller] is also entitled to claim interest on the remaining purchase price, and storage and transportation costs for the goods.

[Buyer's] counter-arguments

[Buyer] argued that [seller] could not demand payment of the purchase price and transfer ownership of the goods to [buyer], because [seller] retained title for himself. The contract provides "that the equipment will remain the exclusive property of [seller] until payment has been received by [seller] and title to the equipment stored at the freight forwarder will pass to [buyer] upon receipt of payment by [seller] on his account. [Seller] was still the owner of the goods because he had not yet received payment from [buyer]; thus, the issue is whether the [seller] is entitled to claim the contract value.

"The retention of title is a means of securing payment of the purchase price. Should the buyer default with the payment then the seller can either rescind the contract and take possession of the contract goods or the seller can stick to the contract and demand payment of the purchase price. (Koziol/Welser, Grundri des Burgerlichen Rechts II 152; Aicher in Rummel, ABGB 1063 Rz et seq.; see also Articles 62 to 65 UN Sales Convention and Schlechtriem, Internationales UN-Kaufrecht 132 et seq.)."

In this case, [seller] stuck to the contract and demanded payment. Therefore, [buyer] was obligated under the contract to take delivery and pay the purchase price. The fact that [seller] retained title in the goods does not usurp him of his claim for the purchase price. [page 108]

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Pace Law School Institute of International Commercial Law - Last updated February 15, 2007
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