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CISG CASE PRESENTATION

Denmark 10 November 1999 Western Appellate Court (Christmas tree case) [translation available]
[Cite as: http://cisgw3.law.pace.edu/cases/991110d1.html]

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

Case Table of Contents


Case identification

DATE OF DECISION: 19991110 (10 November 1999)

JURISDICTION: Denmark

TRIBUNAL: Vestre Landsret [Western High Court]

JUDGE(S): Chr. Bache, Stig Glent-Madsen, Jens P. Christensen

CASE NUMBER/DOCKET NUMBER: B-29-1998

CASE NAME: Unavailable

CASE HISTORY: 1st instance Randers Byret 4 November 1998

SELLER'S COUNTRY: Denmark (plaintiff)

BUYER'S COUNTRY: France (defendant)

GOODS INVOLVED: Christmas trees


Classification of issues present

APPLICATION OF CISG: Yes

APPLICABLE CISG PROVISIONS AND ISSUES

Key CISG provisions at issue: Articles 25 ; 35(1) ; 39(1) ; 49(2) ; 50 [Also cited: Articles 74 ; 75 ; 76 ; 77 ]

Classification of issues using UNCITRAL classification code numbers:

25A [Effect of a fundamental breach];

35A [Conformity of goods to contract: quality, quantity and description required by contract];

39A [Buyer must notify seller within reasonable time specifying nature of non-conformity];

49B [Buyer's loss of right to declare avoidance after delivery: failure to avoid within periods specified in art. 49(2)]

50A [Buyer's right to reduce price for non-conforming goods]

Descriptors: Avoidance ; Fundamental breach ; Conformity of goods ; Lack of conformity notice, timeliness ; Lack of conformity notice, specificity ; Reduction of price, remedy of

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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=760&step=Abstract>

CITATIONS TO TEXT OF DECISION

Original language (Danish): CISG Nordic website <http://www.cisgnordic.net/991110DK.shtml>; Unilex database <http://www.unilex.info/case.cfm?pid=1&do=case&id=760&step=FullText>

Translation (English): Text presented below; see also CISG Nordic website <http://www.cisgnordic.net/991110DK.shtml>

CITATIONS TO COMMENTS ON DECISION

Danish: Morton M. Fogt, Rettidig reclamation og ophæveise af købeaftale efter CISG, Ugeskrift for Retsvæsen (UfR) [2002] B.129-136

English: Bernstein & Lookofsky, Understanding the CISG in Europe, 2d ed., Kluwer (2003) §: 4-8 n.98; §: 4-9 n.126; CISG-AC advisory opinion on Examination of the Goods and Notice of Non-Conformity [7 June 2004] (this case and related cases cited in addendum to opinion); [2005] Schlechtriem & Schwenzer ed., Commentary on UN Convention on International Sale of Goods, 2d (English) ed., Oxford University Press, Art. 39 para. 16 Art. 49 para. 32; Henschel, The Conformity of Goods in International Sales, Forlaget Thomson (2005) 157; Spaic, Analysis of Fundamental Breach under the CISG (December 2006) n.296

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Case text (English translation)

Reproduced with permission of CISG-Denmark website

Judgment of the Western Division of the Danish High Court,
chamber no. 9, of 10 November 1999

Case No. B-29-1998

AA (Bourgogne, France) v. II (Randers, Denmark)

The Randers District Court, chamber no. 4, delivered its judgment on 4 November 1998 (case no. BS 9700016-4)

Facts

In November/December 1996 the Danish seller delivered 1,245 Christmas trees to the French buyer. The buyer subsequently gave notice that the goods did not conform with the contract and the seller arranged an examination of the goods, resulting in an ex gratia reduction of the price. The seller claimed payment of the reduced price, and the buyer declared the contract avoided on the grounds that the goods did not conform with the quality and height as required by the contract.

Issues

The issues of the proceedings were whether the goods conformed to the contract, whether the buyer was entitled to declare the contract avoided, and whether there was a basis for claiming damages or a proportional reduction of the price.

Ruling

The district court ordered the buyer to pay the price less 42,000 Danish kroner, i.e. a total amount of 82,500 Danish kroner, plus interest. The buyer was also ordered to pay the costs, i.e. 20,000 Danish kroner.

Judgment of the Western Division of the Danish High Court of 10 November 1999

In the proceedings before the High Court, the appellant buyer and the respondent seller, and the witness NN, relied on the claims and testimony made and given before the court of first instance.

In addition to his testimony before the district court, NN has explained that the buyer usually places his orders for Christmas trees in September and October. However, in November 1996 the buyer specifically wanted to buy tall trees. He contacted his usual suppliers, but they were unable to supply tall trees. GG established a contact between the buyer and the seller. The buyer telephoned the seller, who said that he was able to supply trees in the range of 170cm to 220 cm and that there was an even distribution of height. The buyer was only interested in trees taller than 170 cm, which he specifically told the seller. When the buyer’s agent, BB, examined the trees on arrival in Paris, he noted, inter alia, that it was unrealistic to carry so many trees of a height of 170 cm in a single truck. On 2 December BB informed the witness that the height and the quality of  the trees were wrong. However, it was not until 4 December that it became apparent that the quality of the goods was unacceptable. The buyer has suffered a loss exceeding 25,000 Danish kroner, because the non-conforming goods have resulted in a loss of customers and an alternative purchase of expensive trees. For 1 to 1½ months the trees were stored at the market stall, where they were surrounded by a 250 cm tall fence. The buyer paid 1,567.80 French francs for renting the fence and an additional 2,577.10 French francs for renting the market stall. Subsequently the buyer paid 7,055.10 French francs for handling, carrying and storing the trees. If the trees had conformed with the contract, the buyer would have earned a gross profit of 30% to 40%, but instead he lost about 50 Danish kroner on each tree. The witness does not know UU, but is familiar with Dansk Skovforening, Pyntegrøntsektionen (the Danish Forest Association, decorative greenery section). HH, surveyor, and UU examined the trees delivered by the seller. The declaration of destruction was prepared by RR to protect the public control of the sale of products from the market place. It does not entail an actual destruction but is merely a declaration stating that the trees are unmarketable. The buyer normally has a couple of thousand trees that are unmarketable and subsequently destroyed. On 5 December the buyer offered to buy the trees at a price of 65 Danish kroner each, because it was now necessary to act quickly. He was still of the opinion that the trees were owned by the seller and that the trees were at the market place at the seller’s risk. None of the trees delivered by the seller was sold.

The seller has explained that he deals in Christmas trees commercially, and that he has several employees during the season.  A substantial number of the trees are exported. He buys trees from the producers of Christmas trees; he labels some of the tree himself whereas others are labelled by the producers. He only buys first and second grade trees. The consignment in question consisted of approximately 5,000 trees and part of this consignment was sold to the buyer. The rest of the consignment was sold to other customers, including Swedish buyers, and none of these has given notice of lack of conformity. It is customary for the buyers to examine the trees before they place their orders. The consignment was a mix consisting of first and second grade trees, whose quality had been improved by pruning and shearing during growth. The height of the trees ranged from 160 cm to 210 cm. For the purpose of concluding the contract he only knew NN by name. The contact between NN and the seller had been established by GG. At the end of November they had a telephone conversation during which they agreed on the terms of business and the price. On 29 November he received an order confirmation, and at that time, he only noticed the description specifying that the goods concerned first and second grade trees. He bought the trees felled and loaded by OO and he therefore did not take part in the loading. A truck can hold more than 1,000 trees, depending on how they are packed and how they are loaded. On 2 December NN phoned him and gave notice of lack of conformity. At NN’s request, the seller contacted TT, president of the relevant Danish trade association – the seller is not a member of the association, however. The seller knew that TT sold Christmas trees to France. On 3 December TT examined the trees and subsequently made a report. A few trees were between 150 cm and 170 cm, and therefore the seller agreed to reduce the price. After TT’s report had been made the buyer complained about the quality and in that connection offered to pay 65 Danish kroner for each tree. The buyer said nothing about avoiding the contract. The seller had paid 90 Danish kroner for each tree to OO. He has not given notice of lack of conformity to OO, as there is no basis for such a notice. Each tree had a red label with consecutive numbers.

In his testimony, UU has further explained that the Christmas trees are usually numbered consecutively according to a screening guide. The trees he examined in France were not marked according to the screening guide, but all had red labels with consecutive numbers. There were no other labels on the trees. He estimated that the number of trees presented to him corresponded to the number sold, but he is not completely sure that the trees examined had been delivered by the seller. 110 trees were unwrapped in order to examine the quality and the height. In his opinion this was a representative selection. His examination included the measurement of the distance between the first and the second whirl of branches.

Only NN and BB were present during the examination by UU. Approximately half of the trees above 170 cm lacked in fullness and were therefore of poor quality. The trees below 170 cm were of good quality.

During the proceedings before the High Court, the parties have generally relied on the claims and allegation submitted before the court of first instance.

Grounds of the Judgment

As for the time at which the buyer declared the contract avoided, the Court notes that it appears from the letter of 10 December from the buyer’s lawyer that the buyer intended his fax of 9 December 1996 to contain a declaration of avoidance.

Having regard to the contents of the buyer’s fax of 5 December 1996, which was sent after the goods had been examined and which concerns a notice that the trees did not conform to the height and quality as required by the contract, and for the reasons given by the district court in this respect, the Court finds that the buyer was not entitled to declare the contract avoided.

On those grounds and for the reasons given by the district court in its judgment, the Court dismisses the appeal.

Because the appeal was made after the expiry of the period allowed for appeal and because the seller has paid for translation of the documents and their authentication prior to the High Court’s grant of a stay of execution, these expenses are taken into consideration when determining the costs of the proceedings before the High Court.

On those grounds the Court hereby rules:

APPEAL DISMISSED.

The buyer is ordered to pay the costs of the proceedings before the High Court, i.e. 21,000 Danish kroner, to the seller.

The buyer is ordered to pay the above costs within two weeks.

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Pace Law School Institute of International Commercial Law - Last updated October 1, 2013
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