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CISG
number


LEGISLATIVE HISTORY
1980 Vienna Diplomatic Conference

G. Report of the First Committee
[Outline of committee proceedings]
Document A/CONF.97/11 [Original: English 7 April 1980]

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25
Article 23 [became CISG article 25 ]

A. UNCITRAL text [1978 draft]
B. Amendments
C. Proceedings in the First Committee
D. Subsequent proceedings
E. Overview comments

A. UNCITRAL text

1. The text of the [1978 draft of the ] United Nations Commission on International Trade Law provided as follows:

"Article 23 [became CISG article 25 ]

"A breach committed by one of the parties is fundamental if it results in substantial detriment to the other party unless the party in breach did not foresee and had no reason to foresee such result."

[Go to Secretariat Commentary on the above text]

[See also pre-Conference observations and proposals by Governments and International Organizations]

B. Amendments

2. Amendments were submitted to article 23 [became CISG article 25 ] by the Federal Republic of Germany (A/CONF.97/C.1/L.63), Czechoslovakia (A/CONF.97/C.1/L.81), Pakistan (A/CONF.97/C.1/L.99), the United Kingdom (A/CONF.97/C.1/L.104), Egypt (A/CONF.97/C.1/L.106), Turkey (A/CONF.97/C.1/L.121) and India (A/CONF.97/C.1/L.126;).

3. These amendments were to the following effect:

(i) Federal Republic of Germany (A/CONF.97/C.1/L.63):

Article 23 [became CISG article 25 ] should be phrased as follows:

"A breach committed by one of the parties is fundamental if, having regard to all express and implied terms of the contract, the breach results in substantial detriment to the other party unless the party in breach did not foresee and had no reason to foresee such result. "

[Referred to ad hoc working group: see Consideration, 5, below.]

(ii) Czechoslovakia (A/CONF.97/C.l/L.81):

Replace the existing text by the following:

"A breach of contract is fundamental if the party in breach knew or ought to have known, in the light of the reasons for the conclusion of the contract, or any information disclosed at any time before or at the conclusion of the contract, that the other party would not be interested in performance in case of such a breach."

[Rejected: see Consideration, 5, below.]

(iii) Pakistan (A/CONF.97/C.1/L.99):

The words "if it results in substantial detriment to the other party" may be replaced by the words "if it results in such detriment to the other party as would basically change the terms of the transaction".

[Referred to ad hoc working group: see Consideration, 5, below.]

(iv) United Kingdom (A/CONF.97/C.1/L.104):

Revise article 23 [became CISG article 25 ] to read as follows:

"A breach committed by one of the parties is fundamental if it results in substantial detriment to the other party unless at the time when the contract was concluded the party in breach did not foresee and had no reason to foresee such a result. A breach does not result in substantial detriment to the other party if damages would be an adequate remedy for him."

[Withdrawn: see Consideration, 6, below.]

(v) Egypt (A/CONF.97/C.1/L.106):

Amend article 23 [became CISG article 25 ] to read as follows:

"A breach committed by one of the parties is fundamental if it results in substantial detriment to the other party unless the party in breach proves that he did not foresee such a result and that a reasonable person of the same kind in the same circumstances would not have foreseen it."

[Adopted as orally amended: see Consideration, 5, below.]

(vi) Turkey (A/CONF.97/C.1/L.121):

Insert after the words "A breach" the words "of the contract".

[Referred to the Drafting Committee: see Consideration, 6, below.]

(vii) India (A/CONF.97/C.1/L.126):

Insert after the words "had no reason" in the third line of article 23 [became CISG article 25 ] the words "as a reasonable person".

[Referred to the Drafting Committee: see Consideration, 6, below.]

C. Proceedings in the First Committee

(i) Meetings

4. The First Committee considered the article at its [12th meeting, 13th meeting and 18th meeting] on 19 and 21 March 1980 [see also 36th meeting of First Committee].

(ii) Consideration

5. At the 12th meeting, the amendment by Czechoslovakia (A/CONF.97/C.1/L.81) was rejected by 9 votes in favour and 24 against. The amendment by Egypt (A/CONF.97/C.1/L.106), as orally amended by the deletion of the words "proves that he", was adopted by 26 votes in favour and 14 against, and referred to the Drafting Committee. The amendments by the Federal Republic of Germany (A/CONF.97/C.1/L.63) and Pakistan (A/CONF.97/C.1/L.99) were referred to an ad hoc working group consisting of the representatives of Argentina, Czechoslovakia, Germany, Federal Republic of, Ghana, Hungary, Norway, Pakistan, Romania and Spain for the purpose of drafting a text reflecting the ideas contained in these amendments.

6. At the 13th meeting, the amendment by the United Kingdom (A/CONF.97/C.1/L.104) was withdrawn, and the amendments by Turkey (A/CONF.97/C.1/L.121) and India (A/CONF.97/C.1/L.126) were referred to the Drafting Committee.

7. At the 18th meeting, the ad hoc working group, with the exception of Hungary, submitted the following text (A/CONF.97/C.1/L.176).

"A breach of contract committed by one of the parties is fundamental if it results in such detriment to the other party as will substantially impair his expectations under the contract, unless the party in breach did not foresee and had no reason to foresee such a result."

8. The text of the ad hoc working group was adopted by 22 votes in favour and 18 against, and together with the amendment by Egypt (A/CONF.97/C.1/L.106) as orally amended, referred to the Drafting Committee.

[D. Subsequent Proceedings]

[For subsequent Conference material on the development/approval of the final text of CISG article 25, go to Plenary Conference 7th meeting]

[E. Overview Comments]

[English translation of report on the significance of the deliberations on this article at the Diplomatic Conference: prepared by Peter Schlechtriem, based on notes taken at the conference and published shortly thereafter]

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Pace Law School Institute of International Commercial Law - Last updated September 8, 2000
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