Queen Mary Case Translation Programme
Landgericht Köln 30 November 1999
FACTS OF THE CASE
The [seller] demands payment of the purchase price for a delivery of facade stone.
On 5 November 1997, [seller's representative] sent the [buyer]'s employee an offer for the sale of facade stone, which reads "(...) below please find the desired proposal, subject to confirmation and in the name of my Italian supplier. The price is ex works (...)"
The [buyer] then ordered the offered slabs with the following stipulations:
[...]
Delivery was made in five installments (initially the [seller] only conceded four installments, now it agrees to the five installments). The [seller] then issued five invoices (the [buyer] initially spoke of only four invoices, but now concedes that it received five).
The [seller] submits that the [buyer] paid the first three invoices, leaving unpaid:
| invoice no. 224 of 4 June 1998 | 19,957,500 Lira |
| invoice no. 339 of 6 August 1998 | 3,424,000 Lira |
| In total | 23,381,500 Lira |
Before litigation, the [buyer] voiced several complaints concerning the goods, some of which the [seller] conceded. Regarding invoice no. 224, it now demands payment of (converted) roughly 20,000 DM [Deutsche Mark].
The [seller] submits that the United Nations Convention on Contracts for the International Sale of Goods (CISG) governs the contract. [Seller] further submits that the contract was formed between itself and the [buyer] upon procurement of [seller's representative]. In this regard it refers to the wording of the offer "in the name of my Italian supplier". Consequently, the [buyer] had also paid the first three invoices to the [seller].
[Seller] submits that it conceded to the [buyer]'s notices of non-conformity before litigation that 209 pieces of stone had been drilled incorrectly. Since the [buyer] had only been charged DM 2.00 for the drilling of each anchor hole, the [seller] acknowledged DM 2.00 for 209 incorrectly drilled holes and DM 2.00 for 209 newly drilled holes, that is two times DM 418.00. For this reason, the [seller] had already granted the [buyer] a reduction in the amount of DM 3,283.31 by not requesting settlement of an unjustified discount for cash that the [buyer] had been given. According to the [seller], all other notices of non-conformity by the [buyer] had been unjustified. The goods had not been defective and all stones had been manufactured according to the [buyer]'s instructions. The parties had not agreed on stainless steel for the gluing of the corners.
[Seller] further submits that none of [buyer]'s notices of non-conformity were given within reasonable time as required under the CISG.
The [seller] demands interest at the rate of 10% under Art. 74 CISG in connection with Art. 1183, 1284 cc [*].
The [seller] requests the Court to order the [buyer] to pay it DM 20,000.- with interest of 10% from 4 June 1998.
On 18 June 1999, the Court declared a judgment by default in accordance with [seller]'s pleading, against which the [buyer] declared its objection by fax of 5 July 1999 and a following brief which the Court received on 7 July 1999.
The [seller] requests the Court to uphold the judgment by default. The [buyer] requests the Court to reverse the judgment by default and dismiss the claim.
[...]
The [buyer] submits that German law applies to the contract. The contract over the facade stone was formed between [buyer] and [seller's representative] in Germany, while Germany was also the place of performance. The [buyer] requests that a jurisprudent expertise be obtained, which would prove that the [seller]'s claim was also unfounded under the CISG or Italian law. The [buyer] bases its opinion that the contract was concluded between its and [seller's representative] upon the fact that [the representative] had been the one who made the offer. [Buyer] further submits that the claims made by the [seller] are not due, as [buyer] was not presented with a final invoice.
The [buyer] moreover relies on the following defects:
With respect to the first delivery:
The first delivery consisted of 22 pallets which had not been marked according to the schedule of items. The [seller] had been aware of the schedule of items. In a different section of its brief, the [buyer] maintains that the stones were not marked according to the schedule of items. The [buyer] explains that an exact marking of the stones was necessary and customary, as the measurements of the various pieces sometimes deviated by only millimeters and a subsequent measuring by hand was too difficult and costly, seeing that there were roughly 200 different sizes.
With respect to 209 stones, the anchor holes were non-existent, not deep enough or drilled at the wrong spot. The delivered window sills did not possessed a length of 1.55 m as required, but only of 1.25 m. Some of the stones had not been cut correctly and the measurements did not correspond to the ones ordered. The majority of the so-called gluing were also non-conforming, consisting of silicone and wire instead of stainless steel. These stones had to be dismantled, cleaned of the gluing and glued again.
The [buyer] maintains that it gave the [seller] adequate notice of the non-conformities. Immediately after it had received the defective delivery, it called the [seller's representative] and queried each defect. In addition, one of its Italian speaking employees called the [seller] and gave notice of the non-conformity. All defects were furthermore complained of in writing to both the [seller] and [its representative].
With respect to the second delivery:
The [buyer] submits that the second delivery contained the same defects as the first. Again, it gave immediate notice of the non-conformity in both verbal and written form to the [seller] and [its representative]. Some of the complaints were translated into English by [seller's representative] and brought to the attention of the [seller]. The [seller] then demanded return of the goods, which the [buyer] refused because of the delay. Instead, the [buyer] requested that the [seller] drill and glue the stones again at the construction site. Upon the [seller]'s refusal, the [buyer] announced that it would do the drilling and gluing itself, and followed suit. Following the [buyer]'s complaint, the [seller's representative] visited the construction site and confirmed and acknowledged the defects.
With respect to deliveries three and four:
The [buyer] submits that these deliveries contained the same defects as the first two installments, that is:
- no marking on the pallets
- a lacking numbering of the slabs according to the schedule of items
- lacking or incorrectly drilled anchor holes
- wrong gluing
- incorrect cuttings of individual stones
- incomplete delivery.
[Buyer] claims that it immediately gave notice of the defects to the [seller] and [seller's representative] both by phone and in writing.
With respect to its costs, the [buyer] submits that a total of 380 items in the four installments were defective. Each of these defects had to be individually inspected and followed-up. The [buyer] suffered considerable damage firstly, through the delay and secondly, through the substantial defects of each delivery. [Buyer]'s overall costs amounted to DM 22,306.47. As an alternative relief the [buyer] declares set-off with this claim against the [seller]'s demands.
[...]
GROUNDS FOR THE DECISION
[...]
The [buyer]'s objection is unsuccessful. The Court affirms the judgment by default.
I. The United Nations Convention on Contracts for the International Sale of Goods (CISG) applies to the legal relations between the parties.
The contract was formed between the Italian [seller] and the German [buyer]. Both Italy and Germany have ratified the Convention. There is no need to obtain an expertise as desired by the [buyer], for the CISG constitutes German law.
II. The contract was concluded between the parties with [seller's representative] acting as a representative. The offer of 5 November 1997 states:
" (...) attached please find the desired offer, non-binding and in the name of my Italian supplier".
The remark "in the name of my Italian supplier" clearly indicates the intent of [seller's representative] to act not in its own interest, but with authority of the [seller]. This is further supported by the fact that - according to the undisputed submission of the [seller] - the [buyer] effected those payments that it did make to the [seller].
III. The [buyer]'s submission that it is not obliged to pay the purchase price as the [seller] has not yet provided [buyer] with a final invoice is incorrect. The individual invoices were sufficient. The CISG does not provide for a "final invoice" as a prerequisite for the maturity of the purchase price.
IV. The [buyer] is not entitled to rely on any non-conformity of the goods. [Buyer] is in particular not entitled to claim damages under Art. 74 and following CISG provisions.
The [buyer] failed to show that it specified the nature of the non-conformity within reasonable time as required under Arts. 38, 39 CISG.
However, it is not clear to which extent the [seller] is supposed to have breached its corresponding duty and whether the [buyer]'s complaint regarding the breach was specified enough. This does not follow from the submission in [buyer]'s brief. It can also not be inferred from the fax sent by the [seller's representative] on 5 May 1998. The fax solely notes (in English) that "many of the plates" had not been sufficiently marked. This notice again leaves open which parts lacked satisfactionary markings to which extent.
The recipient of a notice of non-conformity is not expressly settled in the CISG. The question thus has to be settled according to national law.
It was explained above that [seller's representative] acted as an representative for the [seller]. In the opinion of the Court, the [seller] therefore has to account for notices of non-conformity given to [its representative] (it would be different had [seller's representative] solely acted as an agent, cf. Baumbach, 29th ed., § 377 HGB [*] n. 28).
However, [buyer]'s submission does not show whether the notice given to [seller's representative] was given within reasonable time as required under Art. 39(1) CISG.
Even if the Court followed the [buyer]'s argument that not all defects of the delivery could have been discovered immediately after receipt and that it was impossible or unacceptable to unpack all the goods at the same time, the [buyer]'s submission was insufficient. At a minimum, it was held to specify at what time it discovered or could reasonably have discovered the defective parts, naming the extent of the non-conformity and the installment in which those parts had been delivered. [Buyer] would furthermore have needed to submit specifically with respect to which of these defective parts it gave a notice of non-conformity to the [seller's representative].
According to the [buyer]'s submission, these deliveries contained the same defects as the first two deliveries. The Court refers to the explanations above under 1. The submission does not show that the [buyer] gave a sufficiently specific notice of non-conformity to the [seller] and [his representative]. As regards the [buyer]'s contention that it gave immediate written and oral notices of non-conformity, it is again unclear whether it examined the goods within the short period of Art. 38(1) CISG and gave notice within reasonable time as required by Art. 39(1) CISG.
[...]
FOOTNOTES
* All translations should be verified by cross-checking against the original text. For purposes of this translation, the Plaintiff of Italy is referred to as [seller]; the Defendant of Germany is referred to as [buyer]. Amounts in German currency (Deutsche Mark) are indicated as [DM].
Translator's note on other abbreviations: cc = Codice Civile [Italian Civil Code]; HGB = Handelsgesetzbuch [German Commercial Code].
** Ruth M. Janal, LL.M (UNSW) is a PhD candidate at Albert-Ludwigs-Universität Freiburg.
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Institute of International Commercial Law - Last updated December 7, 2006
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