Reproduced with permission of Horn & Schmitthoff, ed., The Transnational Law of International Commercial Transactions: Studies in Transnational Economic Law, Deventer: Kluwer (1982) vol. 2, 161-171
John Honnold [*]
This paper will examine and compare two approaches towards solving problems that arise in international commercial transactions. In a broad sense, we shall compare the approaches of legislation and of contract, but the area under investigation will be much more specific. Legislation will be represented by the 1980 United Nations Convention on Contracts for the International Sale of Goods, while contract will be represented by the ICC's Incoterms 1980. To narrow the field even further, we shall compare the way these two legal tools handle a single issue -- the transfer of risk of loss from the seller to the buyer.
Casualty to the goods (e.g. theft or fire) may occur in various settings -- while the seller holds the goods before delivering them to a carrier or to the buyer; while the goods are in transit: while the buyer is examining the goods; while the buyer holds the goods after rejecting them. Usually, the loss will be covered by insurance. In determining whether the seller or the buyer bears the risk, the following considerations should be taken into account. Which party is in a better position to evaluate the loss and press a claim against the insurer and to salvage or dispose of damaged goods? Who can insure the goods at the least cost'? Who is more likely to carry insurance under standard commercial practice? What rules on risk will minimise litigation over negligence in the care and custody of the goods?
This study will examine the rules of the Convention and of the Incoterms in two settings: (1) the contract requires the seller to dispatch the goods by carrier; (2) the contract requires the buyer to come for the goods. Then we shall consider whether the handling of these specific problems provides a basis for general observations comparing the approach of uniform law and of standard trade terms.
II. CASUALTY DURING TRANSPORT
Even within the field of transport, the factual variations are a kaleidoscope that reflects a wide variety of modes of transport and varying degrees of participation by the parties. In recent decades transport arrangements have been profoundly modified by the 'container revolution' and multimodal transport: a container may be loaded and scaled at an inland point and carried to (or near) the buyer by a series of different modes of transport such as truck, rail and ship. On the other hand, even in international sales it is sometimes possible to use simple one-stage transport by trucks operated by the seller, by the buyer or by an independent carrier. Bulk goods (e.g. grain, ores, oil) often move from port to port in ships chartered by one of the parties. Even when there is an international carrier, local transport often [page 162] will be needed to take the goods from the seller's warehouse to a rail terminal or to an ocean carrier's warehouse or dock, and similar local transport may also be needed when the goods reach a point near the buyer. This local transport may he handled by the trucks operated by the seller or the buyer or by transport companies engaged by one of the parties or by the international carrier. This diversity presents a challenge for the preparation of uniform rules of law.
A. The Convention's Rules on Transit Risk
Article 67, the Convention's general rule on risk in transit, is as follows:
"(1) If the contract of sale involves carriage of the goods and the seller is not bound to hand them over at a particular place, the risk passes to the buyer when the goods are handed over to the first carrier for transmission to the buyer in accordance with the contract of sale. If the seller is bound to hand the good, over to a carrier at a particular place, the risk does not pass to the buyer until the goods are handed over to the carrier at that place. The fact that the seller is authorized to retain documents controlling the disposition of the goods does not affect the passage of the risk.
"(2) Nevertheless, the risk does not pass to the buyer until the goods are clearly identified to the contract, whether by markings on the goods, by shipping documents, by notice given to the buyer or otherwise."
The heart of the Convention's rule on transit risk is encompassed in these few words: 'risk passes when the goods are handed over to the first carrier for transmission to the buyer ...' Such brevity in a convention dealing with a complex and variegated field is feasible only because of the overriding effect that the Convention gives to the contract (Art. 6), supplemented by the parties' practices and by trade usage (Art. 9).
1. The Convention and Domestic Law
The approach to transit risk in the Convention is similar to that of the United States Uniform Commercial Code, Section 2-509, Risk of Loss in the Absence of Breach:
"(1) Where the contract requires or authorizes the seller to ship the goods by carrier
"(a) if it does not require him to deliver them at a particular destination, the risk of loss passes to the buyer when the goods are duly delivered to the carrier even though the shipment is under reservation (Section 2-505): ..."
In legal systems based on the United Kingdom Sale of Goods Acts ('SGA') 1893 and 1979, the basic promise (s. 20) is that risk to the goods passes 'when the property therein is transferred to the buyer'. When (as is [page 163] usual) the contract calls for 'the sale of unascertained or future goods by description', the transfer of 'property' is tied to the 'appropriation' of goods to the contract. This leads on to the rule that is relevant here: the seller 'is deemed to have unconditionally appropriated the goods to the contract' when he 'delivers the goods ... to a carrier ... for the purpose of transmission to the buyer ...' (s.18, rule 5(2)). In short, as under the Convention, when the contract is silent, transit risks are in general borne by the buyer -- an approach that has been reinforced by case law applicable to international sales. Rules in other legal systems also operate from the baseline that, unless the parties agree to the contrary, transit risks fall on the buyer.
2. Commercial Considerations
There are practical considerations that support these norms. Damage during carriage usually is discovered only when the goods reach the buyer. In international transactions the seller is likely to be far from the damaged goods; the buyer is in a better position to assess the damage and to make a claim against the carrier or the insurer. In many transactions, before the seller ships the goods the buyer will arrange for the issue or confirmation of a letter of credit by a bank near the seller. The seller, in exchange for the payment, will surrender a negotiable bill of lading and an insurance policy which the bank will forward to the buyer. The buyer will have these documentsin hand when he examines the goods and discovers the damage -- facts that make it particularly efficient for the buyer to deal with the damage claim.
B. Incoterms and Transit Risk
Incoterms states no general rule on risk in transit. Instead, Incoterms states rules for 14 'trade terms' -- 'Ex-works', 'FOR/FOT', 'FAS', 'FOB', 'C&F', 'CIF', 'Ex-ship', 'Ex-quay', 'Free Carrier', etc. These rules apply only when the parties agree that the Incoterms is a part of their contract and, in addition, use one of the terms that Incoterms defines. These definitions, [page 164] in spite of their variety and particularity, suggest a pattern that is consistent with the Convention's brief rule that places transit risk on the buyer. True, one cannot draw this inference from the fact that transit risks fall on the buyer under terms 'FOR/FOT', 'FAS', 'FOB', and 'Free Carrier' ('FRC'), for under these terms the buyer agrees to pay for cost of the carriage -- a fact that suggests that the seller has performed his part of the contract before the goods are delivered to the carrier. It is, however, significant that Incoterms carries forward the well-established commercial understanding that the buyer bears transit risk under quotations 'C&F' and 'CIF' even though the seller undertakes to bear the costs of transportation. (Incoterms, 'CIF', A6, B3; 'C&F', A4, B3).
This pattern is reinforced by the more modern terms 'Freight/Carriage Paid to ... ' (Incoterms, A3, B2) and 'Freight/Carriage and Insurance paid to ...' (Incoterms, A3, B2). The only quotations under which the seller bears some or all of the transit risk are 'Ex-ship', 'Ex-Quay', 'Delivered Duty Paid ...' (named place of destination in the country of importation), and 'Delivered at Frontier' (A5).
C. Delivery to Carrier v. Loading; the Convention and Incoterms
We noted (subsection A, supra) that the Convention transfers risk to the buyer 'when the goods are handed over' to the carrier. The traditional trade terms, as defined in Incoterms, reflect a different approach. 'FOB ... named port of shipment', (A4, B2); 'C&F', (A-5, B-3) and 'CIF' (A6, B3), all hold risk on the seller until the goods 'have effectively passed the ship's rail at the ... port of shipment'.
The Convention's approach responds to needs and practices that have developed from containerisation and multimodal transport. This same approach is evident in the modern terms recently added to Incoterms. Under Incoterms 'Freight/Carriage Paid to ...', risk passes when the goods are 'delivered into the custody of the first carrier' (Incoterms 'DCP', A3; B2). (The same rule is stated for the similar term ('CIP') when the seller must also provide insurance.) Similarly, the important modern quotation, 'Free Carrier ... (named point)' makes risk pass when the goods are delivered 'into the charge of the carrier' (Incoterms, FRC A2, B4).
These modern additions to Incoterms evidence a new approach. The reasons underlying these changes are summarised in the ICC Guide to Incoterms, prepared by Professor Jan Ramberg. The Guide (p. 8) states:
"The trend towards integrated (door to door) and multimodal transport -- accelerated by the advent of the container -- has made certain traditional practices virtually obsolete. In today's traffic system, the ship's rail -- once the traditional 'critical point' under the FOB, C&F and CIF terms - no longer makes much sense as a point for the division of functions, costs and risks between the contracting parties.
In addition, since a key function of the transport document is to evidence the good order and condition of the goods, it should be issued at a point where the carrier has reasonable means of conducting a check. In modern transport operations, this point has [page 165] shifted from the ship's rail to seaport or inland terminals, where the goods are frequently stowed in containers or trailers, or on flats or pallets."
In short, both the Convention and the modern definitions of Incoterms have rejected the 'ship's rail' test and have moved the transfer of risk to an earlier point -- delivery into the custody of the carrier.
Carload and Less than Carload (LCL) Shipments
The Incoterms rules on 'Free on Rail/Free on [Railway] Truck ... (named departure point)' ('FOR') at A2 include the following:
"A. The seller must ...
"2. In the case of goods constituting either a wagonload (carload, truckload) lot or a sufficient weight to obtain quantity rates for wagon loading, order in due time a wagon (car, truck) of suitable type and dimensions, equipped, where necessary, with tarpaulins, and load it at his own expense at the date or within the period fixed, the ordering of the wagon (car, truck) and the loading being carried out in accordance with the regulations of the dispatching station."
In such carload shipments, this set of rules (at A4) articulates the established practice that the seller bears the risk until the wagon on which the goods are loaded is 'delivered into the custody of the railway ...'. On the other hand, in less than carload (LCL) shipments, risk passes when the goods are delivered 'into the custody of the railway'.
The Convention does not include such a distinction between carload and less than carload shipments. However, the brief, general rule of Article 67(1), quoted above, leads to the same result. While the seller is loading a railroad car (whether on a siding by the seller's factory or in the freight yards) the seller has not yet 'handed over [the goods] to the ... carrier' Art. 67(1)). Thus, at this stage the seller could remove any of the goods from the car without complaint or legal objection from the carrier, On the other hand, in the language of Incoterms, when the loaded car is 'delivered into the custody of the railway' (normally for sealing and locking before dispatch) the goods are 'handed over to the ... carrier'; at this point risk passes to the buyer under the Convention, as under the Incoterms.
D. Preliminary Transport in Seller's Vehicles
1. The Convention
Under Article 67(1), when the contract 'involves carriage', risk passes when the goods are 'handed over to the first carrier for transmission to the buyer'. Suppose that the contract requires the seller to deliver the goods to the buyer by the sellers own trucks: is this a contract that 'involves carriage'? Does risk pass to the buyer when the seller loads the goods in his own trucks?
The answer to both questions is No. Article 67 transfers risk only when the goods are 'handed over' to a 'carrier'; this transfer of possession does [page 166] not occur when the seller employs his own means of transport. There are practical reasons for holding risk on the seller when he is also the transporter, for damage at this stage is likely to generate a claim that the seller failed to exercise due care; litigation and related transaction costs are reduced by the Convention's rule that the seller does not perform his contractual obligation to deliver conforming goods (Arts. 31(a),35, 36(1)) until he has completed his own duties with respect to the goods.
This result is supported by a further provision in Article 67. The rule of Article 67(1) (first sentence) transferring risk to the buyer is, by its terms, inapplicable when the seller is 'bound to hand [the goods] over at a particular place'. In the Convention 'hand over' refers to the physical act of transferring possession. In the case under discussion, this physical transfer from the seller to the buyer does not occur before the seller's trucks reach the buyer.
The above discussion of the concept of 'carrier' is consistent with the approach of Incoterms 1980. As was noted supra at subsection C, the important modern trade term 'Free Carrier ... (named point)' ('FRC') transfers risk to the buyer when the goods are delivered 'into the charge of the carrier' which is defined as follows: ' "Carrier" means any person by whom or in whose name a contract of a carriage by road, rail, air, sea or a combination of modes has been made.' The emphasized language referring to a 'contract of carriage' of course excludes carriage in the seller's own transport facilities. The Guide notes that a 'carrier' would include an enterprise (including a freight forwarder) that docs not own or operate transport equipment if the enterprise 'undertakes a liability for the transport as a so-called contract carrier'. However, risk would not pass to the buyer when the seller delivers the goods to, e.g., a trucking concern whom the seller engages to take the goods from the seller's factory to a long-haul 'carrier' who receives the goods in the city or locality named in the contract.
The Incoterms Guide at pp. 8-9, 16, 76 also stresses the problems of proof that result from transferring risk at an intermediate point of the transit. These practical considerations show that only the clearest of intent expressed by the parties should transfer risk before the goods are handed over to a carrier who has contracted to effect the carriage; the same degree of clarity should be required to transfer risk at an intermediate point of the transit. [page 167]
III. DELIVERY AT SELLER'S PLACE OF BUSINESS; 'EX-WORKS'
Although most international sales call for the dispatch of goods by 'carrier', when the parties are sufficiently near each other to permit transport by truck they may arrange for the buyer to come for the goods. In this setting there is a small but interesting difference between the rules on risk in the Convention and in the Incoterms.
A. The Convention
The above situation is governed by Article 69(1):
"(1) In cases not within articles 67 and 68, the risk passes to the buyer when he takes over the goods or, if he does not do so in due time, from the time when the goods are placed at his disposal and he commits a breach of contract by railing to take delivery."
The scope and effect of this provision can be shown by two examples:
Example A. A contract called for the seller to produce and pack goods by May 1 and hold them at his place of business for the buyer to take away, by his own transport, at any time during the month of May. On May 1, the seller had the goods packed and ready for delivery. On May 10 the goods were destroyed by a fire in the seller's warehouse.
Since the contract permitted the buyer to lake the goods at any time during May, the buyer had not committed a 'breach of contract by failing to take delivery'. In such cases, under Article 69(1) risk passes to the buyer 'when he takes over the goods'. In this case, the seller was still in possession of the goods at the time of the fire and bears the risk of loss.
Example B. The facts are the same as in Example A except that the buyer failed to take the goods during May, and the fire destroyed the goods on June 2.
In this case (unlike Example A) the buyer bears the risk since his breach of contract in failing to take the goods during May left the goods with the seller at the time of the fire.
Some of the policies relevant to the allocation of risk were mentioned under II, above. The Convention responds to the view that the risk of casualty (in the absence of breach of contract or an applicable agreement) should be allocated to the party who is in the better position to care for the goods and to cover the risk by insurance.
In Example A, the seller, pursuant to the agreement, had possession and control of the goods. If the seller asks the buyer to pay for goods that burned while they were held by the seller, the buyer is likely to claim that the loss was a result of the seller's failure to exercise due care; settling or litigating such claims involves expense and uncertainty for both parties. Moreover, [page 168] cost-efficient insurance rating calls for information as to the conditions of storage -- e.g., whether the building is made of metal or wood and whether it is equipped with an automatic sprinkler. Consequently, it is customary to carry insurance for 'building and contents'; the policy usually covers goods that await delivery since the seller cannot be sure he will be paid, particularly if the goods are destroyed.
The Convention and Domestic Law
These policies on the allocation of risk are reflected in the United States Uniform Commercial Code. In non-shipment cases, like Example A, when the seller is a merchant (as in that example) risk passes to the buyer 'on his receipt of the goods' (UCC, 2-509(3)); the result is the same as that of the Convention. When the buyer is in breach, as in Example B, the UCC gives weight to both the breach and to the availability of insurance: 'the seller may to the extent of the deficiency in his effective insurance coverage treat the risk of loss as resting on the buyer for a commercially reasonable period' (UCC, 2-510(3)).
The Convention's approach to the problem of risk is more direct and clear-cut than those domestic rules (like the United Kingdom SGA 1893) that call for attention to concepts such as 'property' and 'appropriation'.
Cases like Examples A and B, where the buyer is to come for the goods, would be governed by the Incoterms only if the contract incorporates the Incoterms and also states that the sale is 'Ex-works'. In this event, the Incoterms provides (A6, B1) that risk passes to the buyer 'as soon as they are placed at his disposal'. In Example A, we have seen that, under the Convention, the seller has the risk during a period while the buyer is permitted, but not required, to take the goods; under the Incoterms the buyer has the risk since the goods were 'at his disposal' at the time of the fire.
The Convention's rule seems preferable. In most cases the difference will not be important, for any prudent seller will have effective insurance as part of his 'building and contents' coverage. (The buyer cannot so readily insure goods on another's premises, and is not likely to take out special insurance for his contract of purchase.) Nor would a seller who has insurance outrage his customer by demanding payment for goods he cannot deliver. Indeed, in [page 169] the United States it has been held that in such a case the buyer can require the seller to claim under the policy for the buyer's benefit. If the seller under-insures or fails to make any insurance provision for goods in his factory or warehouse, the loss from such imprudence should fall on the seller rather than on a customer who is not in breach of contract.
IV. COMPARISON OF SCOPE AND APPROACH
The specific risk problems discussed in Sections II and III, supra, illustrate the approaches employed in the Convention and in the Incoterms. The Convention is cast in general language so it can cover any type of transaction that may arise; Incoterms is detailed and specific, but is of very limited scope.
A. Trade Terms and the Convention
Should the 1980 Sales Convention have included definitions of trade terms? In connection with the 1964 Hague Conference the present writer had to face this issue because of proposals inspired by the detailed definitions of trade terms in the Sales Article of the Uniform Commercial Code §§2-319-2-324). For reasons explored in an article cited below, it was concluded that any such attempt would be a mistake. One difficulty is the need to modernise and revise detailed trade terms more frequently than the life-span one may expect from a basic international convention. A second is the hazard posed by an attempt to cope with the technical details of commercial practice at a diplomatic conference.
There is, I believe, a more fundamental difficulty in defining trade terms by statute. The plans and understandings that underlie a contract need to be gathered from the language and setting of that very contract. To be sure, those who draft legislation may define the terms they use, but a law cannot reliably establish the meanings of the words used by hurried merchants in the dynamic and variegated world of commerce. Fortunately, the proposal to put definitions of trade terms into uniform law has not been pressed in recent years and the roles of uniform legislation and standard definitions of trade terms remain complementary and distinct.
B. Incoterms as a Tool to Facilitate Agreement
In routine transactions, drafting specific contract terms on risk would delay the making and consummation of the contract. Detailed terms may be included in the parties' sale and purchase forms, but the terms in the two forms often fail to coincide, and generate the intractable problems of the [page 170] 'battle of the forms'. The use of Incoterms can speed agreement and avoid the hazard of divergent contract provisions.
C. Trade Terms as a Substitute for Uniform Law
Does a reference to Incoterms dispense with the need for uniform law? The question forces us to look more closely at the scope of Incoterms, Quite appropriately, Incoterms addresses the question that is in the forefront of the mind of the merchant: 'What should I do?' However, Incoterms does not address the question that concerns the merchant's lawyer: 'What happens when something goes wrong?'
This basic difference can be illustrated by surveying some of the questions that fall outside the scope of Incoterms, What happens when the parties have not observed a requirement of domestic law that the contract be in writing and signed? (See the Convention, Art. 11.) May a party who gave a 'firm' offer revoke the offer on the ground that there was no 'consideration' for the promise? (Art. 16), What happens when an acceptance by post or by wire is delayed or lost? (Arts. 18, 21). When performance by one party deviates in some minor respect from the contract, may the other party reject or cancel or (in the Convention's language) 'avoid' the contract? May the party in default 'cure' the defect? (Arts. 25-26, 47-49, 63-64). If the contract states that it may only be modified in writing, what is the effect of an oral agreement on which both parties have relied'? (Art. 29). When goods fail to conform, what is the consequence of the buyer's failure to notify the seller? (Arts. 39, 40, 44). What happens if a third person claims that he owns the goods or that buyer's use infringes a trademark or patent'? (Arts. 41-43). What is the effect of a minor deviation in the goods, or in the manner of shipment, on the transfer of risk? (Art. 70). May one party suspend his performance if the other party's performance' is threatened by insolvency or some other difficulty'? (Arts. 71-72). Must a party whose performance is prevented by an impediment pay damages to the other party? (Art. 79). If rejected goods are in danger of loss or spoilage, does a party near the goods have a duty to protect them? (Arts. 85-88).
Incoterms does not face any of the forgoing problems, whereas all of them are addressed by the 1980 Sales Convention.
Incoterms and the Convention play very different roles -- roles that support each other. Incoterms, properly invoked, can he very useful to define precisely some of the central steps that the parties should take, the Convention (as in the case of risk of loss) gives general but useful answers to questions that the parties have not answered by contract provisions or by incorporating Incoterms. In addition, the Convention provides a way to avoid or resolve disputes in a wide range of situations, not mentioned in Incoterms, when a party fails to perform his duties under the contract. [page 171]
* William A. Schnader Professor of Commercial Law, University of Pennsylvania: Arthur Goodhart Professor of the Science of Law (1982-83). University of Cambridge.
1. The 1980 Sales Convention is Annex I to the Final Act of the United Nations Conference on Contracts for the International Sale of Goods (A/Conf. 97/18). Incoterms 1980. International Chamber of Commerce Publication No. 350. Reference will also be made to ICC Guide to Incoterms (2nd ed., 1980).
2. See Sale of Goods Act (hereinafter "SGA") 1893, s. 32(1): Delivery to a carrier 'is prima facie deemed to be a delivery of the goods to the buyer'. SGA 1983, ss 18 (Rule 5(2)) and 19, state rules on the effect of the seller's reserving 'the right of disposal' that is rejected by the last sentence of Art. 67(1) of the Convention. See Atiyah. The Sale of Goods (6th ed., 1980), pp. 270-271; Benjamin's Sale of Goods (Guest. Ed., 1974), §§383-388, 1403-1408, 1696-1704. The Ontario Law Reform Commission criticizes the 'property-appropriation' approach of the Sale of Goods Act, and recommends a direct statement on transit risk that is similar to that of the Convention (Art. 67) and the UCC; Ontario Law Reform Commission, Report on Sale of Goods (3 Vols., 1979), pp. 259-262, 269-270.
3. According to Swedish law, risk passes on 'delivery' which occurs when the goods are 'taken in hand by someone who has undertaken to carry them ...'; where the goods are sent by ship, 'delivery' occurs 'when they have passed the ship's rail'; Swedish Act of June 20, 1905, relating to the Purchase and Exchange of Goods, §10. According to Israeli law, risk passes when goods are 'delivered to carrier'; Israeli Sales Law, 5728-1968, 22 Laws of State of Israel, §22(b). According to the law of East Germany, 'delivery is complete on dispatch: GDR International Commercial Contracts Act of 1976, §51(2). For West German provisions, see Civil Code (BGB) §§446(1). 447(1). But see CMEA General Conditions of Delivery of Goods between Organizations of the Member Countries of the Council for Mutual Economic Assistance, §§5-9 (1968) (varying rules for rail, road, water, air and post). See also Honnold (Ed.), Unification of the Law Governing International Sales of Goods (I.A.L.S. Colloquium, N.Y. 1964) (1966), pp. 18-20 (Honnold), 141-167 (Ionasco & Nestor), 169-99 (Schmitthoff).
4. See Roth, 'The Passing of Risk', 27 Am. J. Comp. L. 291, 196 (1979); Honnold, 'ULIS: The Hague Convention of 1969' (1965) 30 L. & Contemp. Probs. 326, 338.
5. Standard definitions of trade terms, although not explicitly incorporated into a contract, may also be a useful guide for interpreting trade terms in the contract. This question, however, cannot be explored here.
6. See Huber, 'Der UNCITRAL-Entwurf eines Übereinkommens über internationale Warenkaufverträge' (1979) 43 RabelsZ 413, 454: accord as to the ULILS: Dolle, et al., Kommentar zum Einheitlichen Kaufrecht (1976). Art. 97 at p. 15, Art. 19 at pp. 85, 87 and 88; Mertens and Rehbinder, Internationales Kaufrecht (1975). Art. 19 at p. 10.
7. This definition is closely based on the 1978 United Nations Convention on the Carriage of Goods by Sea ('Hamburg Rules'), Art. 1(1), see Incoterms Guide, supra note 1, at p. 30.
8. See Report of the Secretary-General of the United Nations, paras. 70-88. V UNCITRAL, Yearbook 90-93; Roth, supra, note 4, at pp. 299-300; Honnold, 'A Uniform Law for International Sales', 107 U. Pa. L. Rev. 319 (1959); Honnold, Cases and Materials on the Law of Sales and Sales Financing (4th ed., 1976) pp. 167-169 (includes extracts from standard policies of insurance).
9. See Atiyah, supra, note 2, at pp. 203-208; Benjamin's Sale of Goods, supra, note 2, and §404. Ontario Law Reform Commission Report, supra, note 2, at pp. 265-269; Sealy '"Risk" in the Law of Sale' (1972) 31 C.I.J. 225.
10. Exton & Co. v. Home Fire & Marine Ins. Co., 249 N.Y. 258, 164 N.E. 43 (1928).
11. See Honnold, supra, note 4, at pp. 340-341.