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Reproduced with permission of 22 Journal of Law and Commerce (Spring 2003) 77-98

Schmitz-Werke & Co. v. Rockland Industries Inc. and the
United Nations Convention on Contracts for the
International Sale of Goods (CISG): Diffidence
and developing International Legal Norms

Jeffrey R. Hartwig

I. The United Nations Convention on Contracts for the International Sale of Goods: Background
A. The Self-Executing Nature of the CISG
B. CISG Framework for Interpretation
II. U.S. CISG Jurisprudence
III. Schmitz-Werke GmbH & Co. v. Rockland Industries, Inc.


After fifteen years as a part of U.S. law governing international sales contracts,[1] it appears that the United Nations Convention on Contracts for the International Sale of Goods ("CISG" or "Convention") is still regarded by U.S. courts as somewhat of an interloper. Most U.S. judges since its 1988 ratification have either applied the Convention superficially [2] or ignored it outright.[3] Though some courts have engaged in valiant efforts to interpret the Convention autonomously, most have been coy with its pesky mandates, merely flirting with generally accepted methods of CISG interpretation only to make ultimate decisions through the lens of domestic law.[4] A recent circuit court decision construing the CISG exemplifies this hesitancy. [page 77]

In a per curiam opinion, Schmitz-Werke GmbH & Co. v. Rockland Industries Inc.,[5] the Fourth Circuit acknowledged the Convention's controlling status yet resisted a thorough analysis pursuant to the Convention's general provisions. The court appeared to follow the approach of the much-criticized Second Circuit opinion, Delchi Carrier S.p.A. v. Rotorex Corporation,[6] a case in which domestic law interpretive precepts were the first resort instead of the last. The use of this methodology is unfortunate, for Schmitz-Werke indicates a regression in the evolution of U.S. Convention jurisprudence. As such, it is a missed opportunity to contribute positively to the growing international body of case law applying the CISG.

Still, notwithstanding the court's rather facile attempt at CISG interpretation, Schmitz-Werke may prove to be a proverbial "canary in the coal mine" with respect to the Convention's future in the United States. To this effect, what does Schmitz-Werke reveal? First, the cursory nature of the court's CISG analysis underscores the ongoing difficulties domestic tribunals are having with implementation of uniform international law. The diffidence given to customary Convention analysis invites questions as to whether U.S. judges are simply balancing the interests of justice and judicial economy, or are just uninformed. Second, the Schmitz-Werke court's citing of Delchi Carrier is regrettable; apparently superfluous, it contributes little to the court's rationale or holding. Commentators have noted that Delchi Carrier's assertion -- that Uniform Commercial Code ("UCC") case law may be used to interpret the Convention -- is problematic, primarily because the Delchi Carrier court offered little analysis on which to base the proposition. This pronouncement has led U.S. courts in CISG cases to apply UCC case law as a gap-filler before employing primary sources of CISG interpretation. Sequentially, this is contrary to the mandates found in Article 7, the Convention provision that addresses interpretation.[7] As a result, Delchi Carrier has become questionable precedent on which to rely.[8] Schmitz-Werke's use of this precedent appears only to perpetuate a flawed interpretive principle. [page 78]

Finally, Schmitz-Werke reveals an appalling lack of evolution in U.S. interpretive techniques regarding the Convention. United States courts have often cited the paucity of case law interpreting the CISG as the reason for slow development of U.S. CISG jurisprudence.[9] Nevertheless, the blame for the lack of precedential value of U.S. CISG cases lies squarely with U.S. judges. With the exception of a few select instances noted herein, most U.S. courts have abstained from making even a cursory analysis using foreign case law, CISG legislative history, or general principles on which the Convention is based. To the world community, this communicates either a lack of analytical sophistication with international law or a certain parochialism that could, given the U.S. role in global trade, threaten the workability of the Convention itself.

Schmitz-Werke highlights how completely ineffectual U.S. courts can be in the realm of CISG interpretation. Nonetheless, its failings may be redeemed if they precipitate hard questions regarding the workability of uniform law in general and the Convention in particular. This Note will explore how Schmitz-Werke's limitations hasten some of these questions. Part I will provide historical background of the CISG as well as explore problems raised by the Convention's self-executing nature. The section will also suggest an outline of the generally accepted Article 7 interpretive framework. Part II will examine U.S. judicial efforts thus far with respect to CISG interpretation. Finally, Part III will offer instances where Schmitz fails and how these failures reveal fundamental difficulties for implementation of uniform international law by U.S. courts.

I. The United Nations Convention on Contracts for the International Sale of Goods: Background

Recognizing that harmonization of international sales law would lead to greater and more efficient international trade, nations began formulating ideas for a uniform international sales regime in the 1920s. By the end of the decade, the International Institute for the Unification of Private Law ("UNIDROIT") began work on a treaty that would codify these ideas. The work would continue for almost thirty years. Finally, in 1964, a UNIDROIT conference at The Hague adopted two uniform sales laws -- the Uniform Law of the International Sale of Goods ("ULIS") and the Uniform Law on the [page 79] Formation of Contracts for the International Sale of Goods ("ULF"). These laws came into effect in 1972. However, their impact beyond Europe was limited, in part because they were substantially "influenced by the civil law traditions of Western Europe, to the neglect of the common law and other world legal traditions."[10] In response to the failure of these instruments to gain worldwide acceptance, the United Nations Commission on International Trade ("UNCITRAL") formed the Working Group on the International Sale of Goods ("Group") in 1969. The Group's objective: to draft an international treaty for the sale of goods that would be more universally accepted. In 1978, after revisions to the ULF and the ULIS as well as solicitation of public comments from United Nations members and other international organizations, UNCITRAL adopted the Draft Convention on Contracts for the International Sale of Goods. Two years later, the United Nations organized a conference in Vienna to consider adopting a formal treaty based on the 1978 Draft. After a month of negotiations, the sixty-two participating countries unanimously approved the final version of the CISG. The Senate of the United States approved the treaty and deposited its ratification with the United Nations in 1986. The Convention became effective as U.S. law on January 1, 1988. Currently, sixty-two nations [11] have ratified the Convention, making the CISG the law governing international sales in countries accounting for over two-thirds of international trade.[12] Without doubt, it is the most significant international sales treaty ever enacted.[13]

A. The Self-Executing Nature of the CISG

The CISG is a self-executing treaty in that it does not require separate parallel legislation to create binding effect.[14] It has been recognized as such by U.S. courts and commentators.[15] Under U.S. law, a self-executing treaty becomes binding upon ratification by the Senate.[16] In comparison, approval of a non-self-executing treaty requires passage in both the House and the Senate, with final endorsement by the President. CISG legislative history shows that the negotiating parties to the UNCITRAL Working Group [page 80] purposely drafted this self-executing nature into the Convention's provisions.[17] The goal was to make CISG provisions applicable to sales transactions without the need for further domestic legislation.[18] This would in turn speed the implementation and acceptance of the instrument.[19]

Because a self-executing treaty is not enumerated in the U.S. Code in the same way as a non-self-executing treaty, commentators have argued that the CISG's self-executing nature is a factor contributing to U.S. judges' and lawyers' unawareness of the Convention.[20] Also, it is very difficult to find the text of the Convention unless a party is already aware of it because it is not included in the Code's various indices.[21] Moreover, assuming attorneys and judges do locate the CISG in the U.S. Code, it is not apparent that the treaty is self-executing and thus already controlling federal law. U.S. courts have at times mistakenly construed the CISG as foreign law.[22] Indeed, "as a treaty, the Convention is the legal equivalent to federal legislation."[23] Therefore, where international sales contracts are covered by the Convention,[24] the CISG preempts state law and supplants the UCC altogether.[25]

The Convention's less than ideal placement in the U.S. Code may also result in legislation that runs contrary to Convention provisions. Due to the Convention's status outside the Code's regular sequencing, it is highly probable that Congress may be unaware of CISG provisions when passing new legislation.[26] If this new legislation conflicts with the Convention, the "last in time" doctrine will cause it to supplant that portion of the treaty with which [page 81] it conflicts.[27] As a result, the Convention in U.S. jurisdictions may take on a patchwork character, both compromising the CISG's goal of uniformity [28] and contributing to inconsistent analysis by U.S. courts.

B. CISG Framework for Interpretation

What is the proper analysis to apply in CISG cases? Article 7 of the Convention delineates a broad interpretive framework to be utilized by domestic tribunals. Article 7 states:

"(1) In the interpretation of this Convention, regard is to be had to its international character and to the need to promote uniformity in its application and the observance of good faith in international trade.

"(2) Questions concerning matters governed by this Convention which are not expressly settled in it are to be settled in conformity with the general principles on which it is based or, in the absence of such principles, in conformity with the law applicable by virtue of the rules of private international law."[29]

Although the language is vague, commentary regarding interpretation has suggested at least an outline for courts to follow.[30] Implicit in the provision is a hierarchy of interpretation: first, the interpreter should look to the four-corners of the Convention. This reflects the drafters' desire that the Convention should be viewed autonomously in order to promote the "uniformity of its application."[31] This autonomous model does not make reference "to the meaning one generally attributes to certain expressions within the ambit of a determined system"[32] (i.e., one's own domestic law). If the text of the provision does not expressly address the issue, then an attempt must be made initially to settle the issue "by means of an analogical application of specific provisions."[33] Second, if no answer is found within the Convention's four-corners, the interpreter is to look for guidance in the [page 82] unstated general principles.[34] This reliance on general principles is an approach often utilized by code-based civil law systems.[35] General principles can be found in the Convention itself; for example, the principle of "good faith" referred to in Article 7 or the principle of "party autonomy" implied in Article 6. They may also be derived from CISG legislative history or reflected in the UNIDROIT Principles of International Commercial Contracts. Finally, if no answer can be discerned from the general principles upon which the Convention is based, then a court may resort to rules of domestic law (i.e., those "in conformity with the law applicable by virtue of the rules of private international law."[36]).

Undoubtedly, Article 7's vague language has made application of the Convention difficult. U.S. courts seem particularly challenged when interpreting the CISG to effect its "international character." In part, this difficulty may stem from the common law tradition. U.S. judges are trained to regard case law as binding precedent. Where case law in the English-U.S. tradition applies, U.S. judges are comfortable using it as a basis for their holdings. The same cannot be said for case law outside of this axis, where precedent would be considered persuasive at best. In interpreting the CISG, domestic tribunals are urged to examine foreign case law in order to better affect the Convention's "international character." However, U.S. judges may find it difficult to base a decision on precedent that has no binding authority, as this would be tantamount to abdication of their public duty. Moreover, heavy reliance on foreign case law may lead domestic courts to "take their eyes off the [general] principles and engage in distinguishing, overruling and even manipulating precedents."[37] This would contribute little to uniform interpretation of the Convention and perhaps, since they are derived from a plethora of legal traditions and customs, lead to precedents that "may well fly in the face of some domestic law."[38] Commentators have noted that while it is important for judges to consider Convention interpretations from other jurisdictions, it must be "[recognized] that giving an international interpretation does not mean merely choosing a domestic interpretation from another country."[39] Not surprisingly, either to avoid opening a Pandora's box [page 83] of conflicting precedent or to dodge the inherent difficulty in locating and understanding case law written in different languages, U.S. judges have virtually ignored foreign case law in their CISG opinions.[40] Although this reluctance may simply be a result of "inertia of habit" on the part of U.S. judges,[41] it is nevertheless a valid concern that underscores the challenge of applying international law locally.

Notwithstanding their justifiable unease with foreign precedent, most U.S. courts are loath to go beyond even a four-corners reading of express CISG provisions. No court has engaged in "analogical application"[42] of CISG provisions nor has any court opined greatly about the "general principles"[43] on which the Convention is based. Instead, U.S. Courts have usually summarily concluded that, where a CISG provision does not expressly apply, they can immediately turn to the familiar confines of domestic law to make ultimate determinations. Given the vague nature of Article 7's unstated general principles, this is understandable. The drafters of the Convention were ambivalent about reference to general principles that they knew might be interpreted ethnocentrically, since "merely the existence of different legal traditions will inevitably lead to differences in the interpretation of these general principles."[44] Arguably, U.S. courts' reliance on domestic case law may actually be a good faith attempt to interpret general principles in the manner mandated by Article 7. This attempt, however, reveals a decidedly ethnocentric reasoning, as U.S. methodology with respect to general principles is far different from the code-based tradition on which the CISG is based. In the U.S. legal tradition, the general principles of the common law control "unless the 'particular provisions' of the U.C.C. [the code] displace those principles."[45] On the other hand, with respect to the CISG, the code controls. General principles are to be derived from the Convention's own provisions and use of domestic law must be a last resort. This is completely contrary to [page 84] the analytical tradition of most U.S. judges, at least as it relates to contract interpretation.

Commentators have insisted that U.S. courts must understand that the CISG necessitates a different methodology.[46] For CISG cases, analysis must begin with the language, then proceed to general principles contained within the document, and finally to analogous domestic law if CISG legislative history fails to illuminate further general principles. Although this sequence might seem backward to U.S. courts, its interpretive technique is not completely alien to our legal tradition. If U.S. judges were to approach the Convention in the way originalists [47] or interpretivists [48] construe the U.S. Constitution, then judges would likely be more aligned with the customary sequence of CISG interpretation. They would certainly come closer to achieving the truly autonomous interpretation desired by the Convention's drafters. Using this model in a CISG case, a U.S. judge might look first to the Convention's text. In the event of a textual gap, a judge might then examine either the express or implied intent of the Convention's drafters, or look to the Convention's structure for interpretive guidance. Though not completely analogous, application of U.S. Constitutional interpretive theories would be a constructive and comprehensible starting point for U.S. CISG interpretation. At the very least it would effectuate an autonomous interpretation of the document as well as divine general principles in line with the Convention's "international character." Thus far, courts have not approached the Convention in a originalist/interpretivist manner or otherwise.

II. U.S. CISG Jurisprudence

Given the time since CISG enactment and the amount of international transactions in which the U.S. is engaged, it is surprising that there are only a handful of U.S. decisions that discuss the Convention at any length. Reasons for this scarcity have been offered. One explanation is that overcrowded dockets lead U.S. judges and attorneys to avoid the protracted delay and expense that Convention interpretation would inevitably entail.[49] Consequently, many CISG cases either settle before trial or are expedited in [page 85] the manner that the court believes is most efficient (i.e., without CISG interpretation). Additionally, many international transactional disputes are resolved through arbitration. Although there exist published arbitral decisions interpreting the Convention, most of these originate from European arbitral panels. With the exception of Medical Marketing Int'l, Inc. v. Internazionale Medico Scientifica, S.r.l [50] (noted supra), there has been little available interpretive guidance emanating from U.S. arbitration. Another suggested reason for the dearth of U.S. CISG litigation (as compared to Europe) is that European courts and arbitral panels have had over a decade of experience with the Convention's predecessors, the ULF and the ULIS (see supra, p. 80).[51]1 By the time of CISG ratification, most European judges and arbitrators were already comfortable applying uniform law to international sales transactions. The advent of the CISG only accelerated the process. Thus, given almost forty years experience implementing uniform law, it is unsurprising that the amount of European CISG case law dwarfs that of the United States. The U.S. CISG case law that does exist reveals a process that, at best, can be characterized as moving in fits and starts. U.S. judges have done little to build upon the insights of other jurisdictions. As a result, we have reached a sort of "zero-sum" CISG jurisprudence that does little to contribute to the overall development of uniform international law in general or the CISG in particular.

The first U.S. district court interpretation of the CISG was Filanto, S.p.A. v. Chilewich Int'l Corp.[52] In Filanto, a contract dispute between an Italian shoe manufacturer and a New York import/export company, the court acknowledged the Convention's significance as both the "federal law of contracts" and state law,[53] stating "[a]lthough there is as yet virtually no U.S. case law interpreting the Sale of Goods Convention, it may safely be predicted that this will change."[54] The court then looked to Article 1 to see if the Convention applied to the parties at bar. Concluding that it did, the court decided it would interpret the parties written agreement in light of "the substantive international law of contracts embodied in the Sale of Goods Convention."[55] In doing so, the court seemed to grudgingly concede that Convention provisions would sometimes run contrary to those of the UCC. [page 86] Addressing whether a reply that changes contract terms is an acceptance with a material modification (as per UCC, 2-207) or a counter-offer (as per CISG, Article 19), the court stated "the Uniform Commercial Code, as previously noted, does not apply to this case, because the State Department undertook to fix something that was not broken by helping to create the Sale of Goods Convention which varies from the Uniform Commercial Code in many significant ways"[56] -- hardly a ringing endorsement of controlling U.S. law. The Filanto court limited its CISG analysis to applying express Convention provisions (Articles 1, 8, 18, and 19) to the facts at bar. The court did not have to engage in the difficult process of divining CISG general principles to fill gaps. Ultimately, Filanto is significant because it was the first U.S. decision to recognize the CISG's controlling nature for U.S. parties vis-à-vis international sales contracts. Not all jurisdictions would accept this notion.

A year after Filanto, the Fifth Circuit, in Beijing Metals & Minerals v. American Business Center, Inc.,[57] rejected the controlling nature of the CISG, not on the basis of a cogent argument but on an almost extreme ethnocentric bias. In Beijing Metals, a Chinese manufacturer ("Beijing") entered into a contract with an American company ("ABC") to supply exercise equipment. When ABC failed to pay, Beijing brought suit. ABC asserted that the presence of prior oral agreements constituted a defense to the claim of breach. The Fifth Circuit applied the Texas parol evidence rule and thus precluded the defense. ABC argued that, since Beijing's claim was governed by the CISG, parol evidence was appropriate pursuant to Article 8(3) (to determine intent of the parties "due consideration" may be given to negations or practices between the parties (i.e., parol evidence)). In a footnote, the court concluded that it was unnecessary to engage in choice of law analysis to determine whether Texas or CISG law applied since this was beyond the scope of its inquiry.[58] The court merely held that the transaction at issue was not a sale of goods; therefore, it did not implicate the CISG and its "intent of the parties" mandate.[59] In addition, the Fifth circuit made the incredible suggestion that the parol evidence rule would apply even if the Convention controlled. Not surprisingly, given this strong prejudice against parol evidence, the court applied the Texas parol evidence rule. In making its determination, the Fifth circuit cited Filanto but ignored the substantive thrust of Filanto's assertion.[60] [page 87] As the Eleventh Circuit later opined in MCC-Marble Ceramic Center, Inc. v. Ceramica Nuova D'Agostino, S.p.A.,[61] "[t]he [Beijing] opinion does not acknowledge Filanto's more applicable dictum that the parol evidence rule does not apply to CISG cases nor does it conduct any analysis of the Convention to support its conclusion. As persuasive authority for this court, the Beijing Metals opinion is not particularly persuasive on this point."

Despite its negative treatment, Beijing Metals introduced at least two methods by which to avoid CISG interpretation. These methods have crept into subsequent U.S. CISG opinions. First is the tendency to cite other U.S. CISG cases for narrow propositions that have little or no effect on the case at bar. The MCC-Marble court noted this tendency regarding Beijing Metals' citation of Filanto. This inclination was also apparent in the citations to Delchi Carrier by the Schmitz-Werke court as well as Delchi Carrier's citation to Orbisphere Corp. v. United States.[62] Second, the Beijing Metals court blurred the issue of what constituted a sales transaction just enough to avoid applying the Convention altogether. If a court can characterize a matter as something other than a sale of goods, then it can avoid the reach of the CISG.[63] This method of avoidance was later exploited by the Southern District Court of New York in Helen Kaminsky Pty. Ltd. v. Marketing Australian Products, Inc.[64] Fortunately, most courts have not been inclined to the "wild assertion[s]" of Beijing Metals.[65] Still, an examination of U.S. CISG jurisprudence reveals a ready supply of faulty interpretive rationales.

In 1995, the Second Circuit, in Delchi Carrier S.p.A. v. Rotorex Corp., offered its own controversial premise. In what seemed to be a promising start, the court began its analysis by acknowledging that the Convention governed, thus implicitly accepting Article 7's mandate "that its interpretation be informed by its international character and the need to promote uniformity in its application."[66] Ultimately, however, the court approached the Convention in the same way it would approach the UCC or any other domestic statute.[67] [page 88] As a result, commentators regard the Delchi Carrier opinion as "an excellent example of the errors that result from the failure to interpret and apply the Convention as an international, rather than a domestic, body of law."[68]

Delchi Carrier involved a warranty dispute between a U.S. seller of compressors ("Rotorex") and an Italian manufacturer of air conditioners ("Delchi"). When Rotorex failed to deliver compressors that conformed to Delchi's needs, Delchi brought suit for breach of contract. The district court held in favor of Delchi, awarding almost $ 2 million dollars for lost profits and other consequential damages. The court also awarded interest pursuant to CISG Article 78. On appeal, Rotorex argued it did not breach the agreement and that Delchi was not entitled to lost profits based on the district court's method of calculation. Delchi cross-appealed claiming that the district court's award did not go far enough in compensating for additional expenses and lost profits.

The Second Circuit confirmed (with agreement of the parties) the district court's determination that the CISG was controlling law in the matter. The court continued by acknowledging Article 7's directive to interpret the CISG so as to affect its "international character" and to promote "uniformity in its application."[69] Noting that there was "virtually no case law under the Convention"[70] (the court failed to point out that it was referring exclusively to U.S. case law since there was at the time over 200 readily accessible foreign jurisdiction decisions with respect to the Convention),[71] the court recognized that its interpretation would have to be guided by the Convention's language and "general principles."[72] At this point, apparently equating the principles embodied in the UCC with CISG general principles, the court made the unsupported assertion that "[c]ase law interpreting analogous provisions of Article 2 of the Uniform Commercial Code ("UCC"), may also inform a court where the language of the relevant CISG provision tracks that of the UCC."[73] This sort of if the language is similar premise for wedding Convention general principles with those of U.S. common law would eventually be the basis for the court's holding on damages.[74] Commentators have suggested that this [page 89] approach is inherently flawed -- "[a]lthough the UCC has greatly influenced the CISG, it is impossible and even perilous to assert that the aforementioned sets of rules are similar in content or, even worse, that they are 'sufficiently compatible to support claims of overall consistency.'"[75] Undoubtedly the Delchi Carrier court's approach runs contrary to that intended by the Convention's drafters.[76] Indeed, if every jurisdiction were to begin their analysis by relying upon analogies to their own domestic law, the uniform character of the Convention would be decimated. Delchi Carrier's infirmities spring from three sources: (1) its inclination to draw from domestic sources first, thus falling prey to legal ethnocentric bias [77] or what other commentators term "the homeward trend";[78] (2) its simplistic assumption that similar language communicates the same principle; and finally, (3) its abstention from revealing the rationale behind its assertions. These shortcomings have not been confined to Delchi Carrier alone. In fact, despite its obvious flaws, both the Delchi Carrier style of CISG interpretation and its "similar language" premise have swayed subsequent courts.[79]

The Eleventh Circuit's 1998 opinion, MCC-Marble Ceramic Center, Inc. v. Ceramica Nuova d'Agostino,[80] seemed to represent a maturation of U.S. CISG jurisprudence. The Marble court provided more detailed CISG analysis and for the most part did not make the ethnocentric presumptions seen in Delchi Carrier. As such, the opinion is well regarded and considered the standard for U.S. CISG jurisprudence.[81]

The case involved a Florida corporation ("MCC") purchasing ceramic tiles from an Italian manufacturer ("Ceramica"). The contract for purchase was negotiated at a trade show with the help of an interpreter and was executed on the seller's pre- printed order forms. Over the course of several [page 90] orders, MCC felt the goods were non-conforming and stopped payment. MCC brought suit claiming non-conforming goods. Ceramica counter-sued for nonpayment. The district court granted summary judgment for Ceramica based on the preprinted language on the back of the order form stipulating that the buyer should give notice of non-conforming goods within ten (10) days. Since MCC failed to give notice, its non-payment constituted a breach of contract. MCC offered affidavits to show the existence of an oral agreement between the president of MCC and the representative of Ceramica, affidavits stating that the order-form provisions would bind neither party. MCC argued that, since the CISG applied, the fact finder was obligated to look to the parties' subjective intent, which, pursuant to Article 8(1), can be discerned from parol evidence. This evidence of a prior oral agreement was probative with respect to breach. The Eleventh Circuit court agreed, holding that the presence of the oral agreement raises an issue of material fact that precludes summary judgment. The district court was reversed and the case remanded.[82]

MCC-Marble is significant because it is the first U.S. CISG decision that looks to sources beyond domestic law upon which to base its analysis. While still citing U.S. case law, the Marble court relied heavily on CISG academic commentary, including citations of scholars outside the common law tradition.[83] Moreover, the Marble court looked to foreign case law for guidance. Although foreign cases were not integral to the holding, the Marble court's recognition that foreign case law may be highly persuasive in U.S. CISG adjudications serves as valuable precedent.[84] Ultimately, the opinion represents a good faith attempt to interpret the Convention with "regard to its international character."[85] As such, "the decision forms a solid foundation upon which U.S. courts can build the kind of international legal methodology demanded by the CISG."[86]

Subsequent opinions seemed inclined to build upon Marble's methodology and analysis. In Mitchell Aircraft Spares, Inc. v. European Aircraft Service AB,[87] the District Court for the Northern District of Illinois reaffirmed Marble's holding and rationale, and considered parol evidence in determining parties' subjective intent. In an important U.S. arbitration case, [page 91] Medical Marketing Int'l, Inc. v. Internazionale Medico Scientifica, S.r.l,[88] the panel became the first to cite foreign case law in interpreting CISG provisions. The arbitrators looked to a German Supreme Court decision for guidance in interpreting Article 35 of the Convention. Interestingly, the panel was directed to the German case by counsel for the defendant, perhaps suggesting that practitioners are becoming more comfortable with CISG arguments and methodology. Finally, in a recent CISG opinion, Geneva Pharmaceuticals v. Barr Labs,[89] the District Court for the Southern District of New York utilized scholarly commentary as well as official CISG commentary to interpret issues of contract formation under the Convention. For the most part, opinions since MCC-Marble, while not completely abandoning common law predilections, have sought to expand their interpretive palette by looking at foreign case law and commentary as well as attempting to engage a more thorough analysis of CISG provisions.[90] Given this overall progress, the Fourth Circuit's opinion in Schmitz-Werke is disappointing. By holding the CISG at arms length, the Schmitz-Werke court seems to draw its methodology from Delchi Carrier, thus repudiating the apparent progress made since MCC-Marble.

III. Schmitz-Werke GmbH & Co. v. Rockland Industries, Inc.

Schmitz-Werke v. Rockland involved a contract dispute over non-conforming goods. Schmitz, a German manufacturer of decorative fabrics, sought to buy drapery-lining fabric from Rockland, a Maryland corporation who manufactured a special fabric called "Trevira Blackout." Over the course of negotiations, Rockland representatives made claims that the fabric was "particularly suited to be a printing base for transfer printing."[91] Schmitz placed an order of 200 meters and shipped the fabric to Schmitz's transfer printing contractor for testing. After being notified as to the results, Schmitz contacted Rockland to point out several problems with the fabric; in general, however, Schmitz was satisfied. Schmitz placed an initial order for 15,000 meters. After receiving shipment, Schmitz made note of additional problems but proceeded with the transfer printing process anyway. During the printing process, it became apparent that the problems were inherent in the fabric. [page 93] Schmitz offered Rockland a chance to inspect the fabric and make corrections. Rockland urged Schmitz to continue printing, arguing that the lower quality fabric (fabric not fit for transfer printing solid colors) could instead be utilized for transfer printing patterns. After this meeting, Schmitz ordered another 60,000 meters. Over the course of the next six months, it became apparent that there were continuing problems with the Trevira fabric. An independent inspection confirmed this, finding that post-printing averages of lower-grade (non-conforming fabric) material were running 15% to 20%. After contacting Rockland regarding this unacceptable lower-grade percentage, Schmitz shipped 8,000 meters of fabric back to Maryland. Schmitz then filed a complaint in the District Court of Maryland claiming that Rockland had breached its implied warranty of fitness under the CISG. The district court established that the CISG governed the transaction and found, pursuant to Article 35(2)(b), that Rockland had provided to Schmitz a warranty of fitness for particular purpose (transfer printing). The court held that, since the goods did not conform to the warranty and since Schmitz had met his burden of proving the defect existed at the time the goods were shipped, it was unnecessary to prove the exact mechanism of defect. Thus, Rockland had breached the implied warranty of fitness under Article 35. Schmitz was awarded damages based on the exchange rate at the time Schmitz discovered the defect. On appeal the Fourth Circuit affirmed.

In affirming the district court's determination that the CISG applied, the Fourth Circuit addressed the scope of the Convention under Article 1 and carefully laid the foundation for analysis pursuant to Article 7. Regarding this foundation, the Schmitz-Werke court, citing Delchi Carrier v. Rotorex, stated "[c]ourts should look to the language of the CISG and to the general principles on which the Convention is based."[92] The court recognized that its interpretation must be informed by the "international character and . . . the need to promote uniformity in application"[93] of the Convention. However, immediately following this endorsement, the court cited the much-maligned assertion of Delchi Carrier that "[c]ase law interpreting provisions of Article 2 of the Uniform Commercial Code that are similar to provisions in the CISG can also be helpful in interpreting the convention."[94] It is unclear why the Schmitz court included this proposition at all, since nowhere in the opinion is UCC case law used to interpret Convention articles. In light of its [page 93] previous recognition that interpretation should be "international" in character, it is curious that the court would apparently contradict itself by stating the value of domestic law. Surely, if the court wanted to preserve the chance to interpret CISG provisions via UCC case law, it should have cited the Delchi proposition relative to the argument that domestic law could apply once all other CISG interpretive methods had been exhausted. Rockland argued that Maryland law should apply to this case as well. While the court accepted this argument, it also stressed that pursuant to Article 7(2) "a court should reach private international law if the CISG's text, interpreted in conformity with the general principles on which the CISG is based, does not settle the issue at hand."[95] Notwithstanding the arguable "similar language" premise on which it is based, this would be the more logical place to make the Delchi assertion. It should not have been made concomitant with the court's appreciation of the need to interpret the Convention vis-a-vis its "international character."

After acknowledging that the CISG controlled and laying the foundation for CISG interpretation, the court addresses three issues: causation, reliance, and exchange rate (specifically, the date for calculating damages). Because they provide the clearest examples of court's interpretive approach, only causation and exchange rate will be examined herein.

With respect to causation, the court asks whether the CISG requires that Schmitz establish, through expert testimony, the exact nature of the defect. Schmitz argued that under Article 35(2)(b) it was unnecessary to show exactly how or why the goods were unfit if it can be shown that the transfer printing process (for which the goods were warranted) was done in a competent manner.[96] The Fourth Circuit concluded that the "text of the CISG is silent on this matter."[97] Apparently neglecting its previous recognition that issues not expressly (textually) settled by CISG provisions should be "settled in conformity with the general principles on which it is based,"[98] the court immediately leapt to domestic law to frame its argument, citing a Maryland Appeals Court decision, Virgil v. "Kash 'n' Karry" Service Group Corporation [99] (holding that expert testimony was unnecessary unless the subject was technically beyond reach of laymen). The court concluded that, under either the CISG or Maryland law, Schmitz was only required to show that the product, as Rockland had expressly warranted, was not fit for transfer [page 94] printing.[100] Hence, there was no need to specify the "why or how"[101] of the defect, only that the defect existed.

This "either/or" conclusion is curious given that the court had previously determined that the CISG did not address the issue. If it is true that under the CISG Schmitz "may prevail on the claim,"[102] then why did the court omit its CISG analysis? One reason perhaps is that the court had neither the time nor the inclination to engage in proper CISG jurisprudence. The court likely viewed the Virgil opinion as dispositive, suggesting that a full docket and an easy way to expedite the issue may conspire against full-blown CISG interpretation. Unless the issue has been fully briefed by attorneys using CISG methodology, it is unlikely the court will have the resources to engage in proper CISG analysis on its own. Even if the court knows where to locate the appropriate CISG commentary, principles, and foreign case law, it is doubtful that it will expend the effort when a domestic case is already decidedly on point. Commentators appear to recognize this fact, questioning "whether it is yet practicable for the average practitioner, with limited resources and time, to achieve the international perspective needed to implement a truly global international commercial law system."[103] It is simply easier to circumvent the CISG (by finding that it does not expressly apply) than to sift through foreign judgments and principles with which most U.S. judges have little experience.

Furthermore, much to the chagrin of many CISG commentators, not all judges may feel duty bound to engage in thorough CISG jurisprudence. Granted, the Convention is federal law and judges must interpret the law that applies (whether they want to or not). However, the Convention has provided domestic tribunals a loophole through which they can apply domestic law ("matters . . . not expressly settled in it are to be settled in conformity with the general principles on which it is based or, in the absence of such principles, in conformity with . . . rules of private international law"[104]). Thus, given the opportunity to circumvent CISG analysis by noting the absence of on-point express language or general principles, it is not surprising that judges often [page 95] rely on domestic law to frame their decisions, even after admitting that the CISG controls.

The Schmitz court uses this loophole when discussing the time at which the exchange rate should be calculated to award damages. The court stated that the general rule was to calculate the exchange rate on the date of the award. However, it also observed that other jurisdictions calculate on the basis of the "breach date rule" (where the exchange rate is calculated on the date the contract was breached). The Schmitz court looked to CISG provisions for guidance and found that none expressly applied, stating "[t]he CISG is silent on this issue, and it is proper for courts to resort to private international law in such situations."[105] The court cited a law review article as support for this conclusion.[106] In the article, Professor Darkey writes, "there is no provision in the CISG which addresses the proper date for currency conversion. A court may engage in gap-filling, according to the procedures of Article 7(2), only when a matter is governed by the Convention."[107] (Emphasis added). Thus, since the exchange rate date was not strictly speaking "a matter governed by the Convention," the court was free to apply domestic law. However, the Schmitz-Werke court must have neglected to completely read the article; for in the next paragraph, Professor Darkey suggests that a court might find that the date of conversion is a matter governed by the CISG. For instance, if a court seeks to protect the expectation interest of the non- breaching party and the "breach date rule" does not protect that interest, then the court may analogize from other CISG principles or draw conclusions from the "general principles" on which the Convention is based. Professor Darkey summarizes the issue by stating, "the date of conversion is one area in which CISG may afford a court more flexibility and discretion."[108] Professor Darkey appears to offer two rationales with respect to the date of conversion issue -- one avoids the CISG and the other utilizes it. Evidently, the Schmitz-Werke court preferred the former, holding that Maryland substantive law should apply.[109] Again, just as with the causation issue, the [page 96] court provided little analysis to justify its reliance on domestic law over CISG general principles.

Schmitz-Werke, like Delchi Carrier, acknowledged that CISG was controlling law and was cognizant that a special interpretive framework was mandated. Yet, in each case, the framework was quickly abandoned for the familiar confines of domestic law. The Schmitz-Werke court did not venture into analysis of the general principles on which the CISG is based nor did it analogize to other provisions in the Convention. Moreover, it made no reference to any foreign sources whatsoever, either cases or commentary. Although by all accounts the court ultimately reached a fair decision, it did not do so based on the mandates of the Convention. It can be argued whether this is really such a bad result, after all isn't a judge's first obligation to render a fair and legally sound judgment? Still, notwithstanding the correct outcome, the Schmitz-Werke decision does nothing to advance the implementation of uniform law. At best, it shows us how far U.S. jurisprudence has to go.


So, does Schmitz-Werke say anything about the current state of the CISG in the U.S.? Clearly, U.S. courts are not comfortable applying the analytical framework suggested by commentators. Though many would argue the U.S. legal parochialism is an extension of U.S. parochialism in general, this cannot be attributed simply to ignorance of the Convention or its accepted interpretive framework. Both the CISG and commentary can be found in easily accessible databases,[110] and it is likely that many law clerks, while not experts, are peripherally aware of its existence. In fact, a simple LEXIS search reveals almost all U.S. CISG jurisprudence. The more realistic explanation is that U.S. judges, absent a roadmap provided by counsel, will look to domestic law first because it allows for efficient administration of justice and because it creates binding precedent. Ultimately, it may be too much to ask domestic tribunals to contribute to international jurisprudence when their first obligation is to their locality. Another explanation may be problems inherent in the Convention itself. Article 7 couches its mandates in vague language like "international character" and "general principles." Without official Convention commentary (i.e., something akin to the U.S. Restatements of Law), it is difficult for judges outside the Convention's code-based tradition to even begin to discern a workable idea of CISG "general [page 97] principles." On the other hand, the malleable character of the Convention (as evidenced by Professor Darkey's seemingly contradictory analysis) is perhaps the Convention's greatest asset. It was conceived to be flexible enough to fit all legal systems. Nevertheless, as cases like Schmitz-Werke and Delchi show, the Convention's lack of rigidity often allows domestic tribunals to wiggle out of its mandates. Unless amendments are made to its language so as to limit the flight to domestic law, the Convention, at least in the U.S. will forever be working against the tendency of each jurist to apply the law with which he or she is most familiar.

Nevertheless, the CISG is an important element in harmonizing international transactions. Certainly, more affirmative U.S. CISG jurisprudence will ensure its continued development. An active U.S. jurisprudence will assure that the U.S. perspective is maintained throughout this development. United States courts can no longer excuse themselves from thoughtful CISG interpretation based on the scarcity of case law or the Convention's novelty. Given the time since enactment and the amount of available commentary and cases (both domestic and foreign) these excuses ring hollow. Cases like MCC-Marvle, Mitchell Aircraft Spares, and the recent Zapata Hermanos Sucesores, S.A. v. Hearthside Baking Co.[111] offer a glimpse of how effectively U.S. judges can interpret CISG provisions to affect its "international character." By attempting to reach beyond their ethnocentric legal bias to reach a truly international determination, the courts contribute positively the CISG development and provide valuable precedent for uniform international application. In contrast, Schmitz-Werke v. Rockland seems content to stand idly by, offering arguments neither for nor against the CISG. As such, it reveals a judiciary that is deeply ambivalent about the CISG's stature in American jurisprudence - a judiciary that seems willing to avoid the Convention's difficult mandates. In light of the Convention's widespread acceptance as the governing law of contracts for international trade, we can hardly afford to let this avoidance carry the day.


1. Filanto, S.p.A. v. Chilewhich Intl. Corp., 789 F. Supp. 1229, 1237 (S.D.N.Y. 1992).

2. See Delchi Carrier S.p.A. v. Rotorex, 71 F.3d 1024 (2d Cir. 1995) (for an example of cursory analysis).

3. See Beijing Metal & Minerals Imp./Exp. Corp. v. American Bus. Ctr., Inc., 993 F.2d 1178 (5th Cir. 1993) (rejecting buyer's argument that CISG applied).

4. Susanne Cook, The U.N. Convention on Contracts for the International Sale of Goods: A Mandate to Abandon Legal Ethnocentricity, 16 J.L. & Com. 257, 260-61 (1997) (Criticizing Delchi Carrier, Ms. Cook writes, "in its approach, no international trace . . . can be found anywhere.").

5. 37 Fed. Appx. 687; 2002 U.S. App. LEXIS 12336 (4th Cir. 2002) (per curiam).

6. 71 F.3d 1024 (2d Cir. 1995).

7. Bruno Zeller, The U.N. Convention on Contracts for the International Sale of Goods-A Leap Forward Towards Unified International Sales Laws, 12 Pace Int'l L. Rev. 79, 88 (2000).

8. James E. Bailey, Facing the Truth: Seeing the Convention on Contracts for the International Sale of Goods as an Obstacle to a Uniform Law of International Sales, 32 Cornell Int'l L.J. 273, 275 (1998).

9. See Calzaturifico Claudia S.n.c. v. Olivieri Footwear, Ltd., 96 Civ. 8052, 1998 U.S. Dist. LEXIS 4586, at *13 (S.D.N.Y. 1998).

10. Philip Hackney, Is the United Nations Convention on the International Sale of Goods Achieving Uniformity?, 61 La. L. Rev. 473, 473 (2001).

11. See generally <http://www.unilex.info> (listing contracting countries).

12. Bailey, supra note 8, at 279.

13. Id.

14. Id. at 281.

15. Id.

16. Bailey, supra note 8, at 282.

17. Id. at 281-82.

18. Id. at 281.

19. Id. at 281-82.

20. Id. at 282.

21. Id. at 282-83 ("Essentially, the CISG was simply dumped, without introduction or comment, into the Appendix to Title 15 of the U.S. Code. The effect is that one cannot find the CISG in the U.S. Code unless one already knows it exists and where it is located. Further, since none of the provisions of the CISG are contained in the indices . . . the individual subjects regulated by the CISG cannot be discovered through traditional legal research methods.").

22. See Attorney's Trust v. Videotape Computer Products Inc., 94 F.3d 650 (9th Cir. 1996) (In an unpublished opinion the Ninth Circuit rejected defendant's claim that CISG applied. The basis of this determination was that Federal Rule of Civil Procedure 44.1 precluded raising the issue of foreign law on appeals.).

23. Bailey, supra note 8, at 284.

24. See Unilex, <http://www.unilex.info>, on C.I.S.G., supra note 11 (citing text of instrument) C.I.S.G., art. I. ("(1) This Convention applies to contracts of sale of goods between parties whose places of business are in different states: (a) when the States are Contracting States; or (b) when the rules of private international law lead to the application of the law of the Contracting State.").

25. Bailey, supra note 8, at 284.

26. Id.

27. Id. at 285.

28. Id.

29. See U.N. Conference on Contracts for the International Sale of Goods, Final Act (Apr. 10, 1980), U.N. Doc. A/Conf. 97/18, reprinted in S. Treaty Doc. 98-9, 98th Cong., 1st Sess. 22 (1983) and 15 U.S.C. app. 52, art. 7 (West 1997) [hereinafter CISG].

30. Cook, supra note 4, at 260.

31. CISG, art. 7(1).

32. Zeller, supra note 7, at 82 (quoting Phanesh Koneru, The International Interpretation of the U.N. Convention on the Contracts for the International Sale of Goods: An approach based on General Principles, 6 Minn. J. Global Trade 105, 187 (1997)).

33. M.J. Bonnell, Commentary on the International Sales Law: The 1980 Vienna Sales Convention 80 (C.M. Bianca & M.J. Bonnell eds., Milan 1987)).

34. CISG, art. 7(2).

35. Bailey, supra note 8, at 298.

36. CISG, art. 7(2).

37. Zeller, supra note 7, at 90 (quoting Hillman, Cross Reference and Editorial Analysis, art. 7, see <http://www.cisg.law.pace.edu/cisg/text/hillman.html>).

38. Monica Kilian, CISG and the Problem with Common Law Jurisdictions, 10 J. Transnat'l L. & Pol'y 217, 240 (2001).

39. Koneru, supra note 32, at 105, 108.

40. To contrast, an Italian court recently cited forty foreign decisions. This is especially notable given Italy's historic reluctance to engage in deep CISG analysis. See Rheinland Versicherungen v. S.r.l. Atlarez and Allianz Subalpina SpA [Tribunale d Vigevano] (Italy 2000), at <http://www.uncitral.org/english/clout>, CLOUT case No. 378.

41. Kilian, supra note 38, at 233 (citing, David Frisch, Commercial Common Law, the United Nations Convention on the International Sale of Goods, and the Inertia of Habit, 74 Tul. L. Rev. 495 (1999)).

42. Bonnell, supra note 30, at 78.

43. CISG, art. 7.

44. Bailey, supra note 8, at 298.

45. Id. at 297.

46. Id.

47. See generally Daniel A. Farber, William N. Eskridge Jr. & Philip P. Frickey, Constitutional Law: Themes for the Constitution's Third Century 86-88 (2d ed. 1998).

48. Richard H. Fallon Jr., A Constructivist Coherence Theory of Constitutional Interpretation, 100 Harv. L. Rev. 1189, 1209-1218 (1987).

49. Hackney, supra note 10, at 481.

50. Medical Marketing Int'l, Inc. v. Internazionale Medico Scientifico, S.r.l., No. 99-0380, 1999 U.S. Dist. LEXIS 7380 (E.D. La. 1999).

51. Id. at *4.

52. 789 F. Supp. 1229 (S.D.N.Y. 1992).

53. Id. at 1237.

54. Id.

55. Id.

56. Id. at 1238.

57. 993 F.2d 1178 (5th Cir. 1993).

58. Id. at 1183 n.9.

59. Id. at 1183 n.10.

60. Id. at 1183 n.9 (citing Filanto, supra note 1, "there is as yet virtually no U.S. case law interpreting the Sale of Goods Convention").

61. 144 F.3d 1384, 1390 (11th Cir. 1998).

62. 726 F. Supp. 1344, 1355, quoting Orbisphere Corp. v. U.S., 726 F. Supp. 1344, 1355 (Ct. Int'l Trade 1989) that UCC case law "is not per se applicable." The Delchi Court appeared to take this statement out of context.

63. CISG, arts. 1-3 prescribe the Convention's sphere of application.

64. No. M-47 (DLC), 1997 U.S. Dist. LEXIS 10630, at *3 (S.D.N.Y. July 23, 1997) (holding the CISG did not apply because a distributor agreement was not a contract for the sale of goods).

65. Hackney, supra note 10, at 482.

66. Delchi Carrier, 71 F.3d at 1028.

67. Cook, supra note 4, at 260.

68. Bailey, supra note 8, at 288.

69. Delchi Carrier, 71 F.3d at 1028.

70. Id. This more a statement of fact than recognition of assertions in Filanto or Beijing Metals.

71. Bailey, supra note 8, at 288.

72. Delchi Carrier, 71 F.3d at 1028.

73. Id.

74. Id. at 1029 (equating the "principle of foreseeability" of Article 74 of the CISG with the common law formulation of "foreseeability" established in Hadley v. Baxendale, 156 Eng. Rep. 145 (1854). The court held that Delchi was entitled to incidental and consequential damages sought in the cross-appeal.).

75. Bailey, supra note 8, at 289 (quoting Franco Ferrari, Is the OCC Dead or Alive and Well? International Perspective: The Relationship between the UCC and the CISG and the Construction of Uniform Law, 29 Loy. L.A. L. Rev. 1021, 1023 (1996)).

76. Id.

77. See generally Cook, supra note 4, at 262.

78. John Honnold, The Sales Convention in Action- Uniform International Words: Uniform Application?, 8 J.L. & Com. 207 (1988).

79. See Schmitz-Werke GmbH & Co. v. Rockland Indus., Inc., 37 Fed. Appx. 687; 2002 U.S. App. LEXIS 12336 at *8-9 (4th Cir. June 21, 2002); Kahn Lucas Lancaster, Inc. v. Lark Ltd. Inc., No. 95 CIV. 10506 (DLC), U.S. Dist. LEXIS 11916, at *16 n.8 (S.D.N.Y. Aug. 11, 1997).

80. 144 F.3d 1384 (11th Cir. 1998).

81. Harry M. Flechtner, The U.N. Sales Convention (CISG) and MCC-Marble Ceramic Center, Inc. v. Ceramica Nuova D'Agostino, S.p.A.: The Eleventh Circuit Weighs in on Interpretation, Subjective Intent, Procedural Limits to the Convention's Scope, and the Parol Evidence Rule, 18. J.L. & Com. 259, 287 (1999).

82. MCC-Marble, supra note 61, at 1393.

83. Flechtner, supra note 81, at 270.

84. Id. at 271.

85. CISG, art. 7(1).

86. Flechtner, supra note 81, at 272-78.

87. Mitchell Aircraft Spares, Inc. v. European Aircraft Serv. AB, 23 F. Supp. 2d 915 (N.D. Ill. 1998).

88. Marketing Int'l Inc. v. Internazionale Medico Scientifica, S.r.l., No. CIV A 99-0380, 1999 WL 311945 (E.D. La. May 17, 1999).

89. Geneva Pharm. Tech. Corp. v. Barr Labs, 201 F. Supp. 2d 236, 281 (S.D.N.Y. 2002).

90. For an example of recent case law, see generally Zapata Hermanos Sucesores, S.A. v. Hearthside Baking Co., Inc., 313 F.3d 385 (7th Cir. 2002) (exemplifying a more thorough CISG analysis).

91. Schmitz-Werke, supra note 79, at 689.

92. Id. at 691.

93. Id. (citing Delchi Carrier quoting Article 7(1) of the CISG).

94. Id.

95. Id.

96. Id. at 692.

97. Id.

98. Id. at 691 n.2.

99. See Virgil v. "Kash 'n' Karry" Serv. Corp., 484 A.2d 652, 656 (Md. Ct. Spec. App. 1984).

100. Schmitz-Werke, supra note 79, at 692.

101. Id.

102. Id.

103. Harry M. Flechtner, Recovering Attorney's Fees as Damages under the U.N. Sales Convention: A Case Study on the New International Commercial Practice and the Role of Foreign Case Law in CISG Jurisprudence, with a Post-Script on Zapata Hermanos Sucesores, S.A. v. Hearthside Baking Co., 22 N.W. J. Int'l L. & Bus. (forthcoming 2002), at <http://www.cisg.law.pace.edu>) (highlighting the "real world" differences between the time and resources afforded to a practitioner and a law professor).

104. CISG, art. 7(2).

105. Schmitz-Werke, supra note 79, at 693.

106. Id. (citing generally Joanne M. Darkey, Recent Development: CISG: A U.S. Court's Interpretation of Damage Provisions Under The U.N. Convention on Contracts for the International Sale of Goods: A Preliminary Step Towards and International Jurisprudence of CISG or a Missed Opportunity?, 15 J.L. & Com. 139 (1995)).

107. Darkey, supra note 106, at 150.

108. Id. at 151.

109. Ultimately, the court could find no clear Maryland law to resolve the issue. Accordingly, they did not disturb the district court's determination that the exchange rate should be calculated at the time Schmitz discovered the defects.

110. See <http://www.cisg.law.pace.edu/cisg/text/hillman.html>.

111. Zapata Hermanos Sucesores, S.A. v. Hearthside Baking Co., 313 F.3d 385 (7th Cir. 2002).

Pace Law School Institute of International Commercial Law - Last updated February 17, 2004
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