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Gap-Filling of the CISG by the UNIDROIT Principles of International Commercial Contracts

Mgr. Juraj Kotrusz
December 2008

INTRODUCTION

The United Nations Convention on Contracts for the International Sale of Goods (hereinafter referred to as "CISG" or "Convention") presents the most successful project of worldwide unification of substantive law in international trade. Its application is inevitably connected to supplementing its provisions to resolve issues which are not expressly prescribed in its text. As it primarily lacks regulation of general issues of law of contracts, legal scholars suggest using The UNIDROIT Principles of International Commercial Contracts (hereinafter referred to as "UNIDROIT Principles" or "Principles") for such regulation. The relationship between the CISG and the UNIDROIT Principles has been a matter of discussion from the moment of issuing the Principles. Legal scholars present a variety of contradicting opinions, from supporting their joint usage in order to promote uniform solutions for international trade relationships to strict denial of such usage justified by their differences and by the lack of legal force in the case of the UNIDROIT Principles.

In this thesis, I will try to summarize these opinions, to justify their grounds and to present broad and complete viewpoint on these arguments. Since the most important argument against the joint usage of both instruments is a lack of legal justification of such usage, I will try to examine this statement precisely. For this purpose, we need to analyse both documents with respect to their basic legal nature.

As the Convention directly refers to usage of the applicable domestic law determined by rules of private international law, in order to investigate all possible forms of gap-filling, I will also analyse legal instruments forming private international law rules in Slovakia and their point of view to application of the UNIDROIT Principles for such usage. I believe that such an analysis can be useful for both legal theory and actual application of the Convention, as it intends to provide a complex viewpoint on these issues. Furthermore, it presents a situation of applying CISG in European private international law, as it is in effect also in the Slovak Republic.

I. GAP-FILLING OF THE CISG

1.1. Interpretation and Gap-Filling

Legal instruments do not constitute complete and exhaustive system of rules which prescribe behaviour of merchants. This means that it is not possible that all relationships of this kind will be governed solely by written legal rules. Legal rules are construed in order to create generalized and abstract models of behaviour. It is the only way to ensure effectiveness of law, since it is impossible to regulate every single situation by a special legal rule, as it would create an overcomplicated system of regulations, which would be absolutely inconceivable to a normal citizen and therefore a State could not require him to observe these regulations. What is more, even now, when legal rules have an abstract and general nature, it is questionable whether it is adequate to talk about general knowledge of law by citizens.[1]

Legal rules are construed in a general and abstract style to regulate as wide a range of social relationships as possible. It is clear that it is usually not possible to resolve all legal issues concerned in a particular situation only by referring to a particular legal rule and applying it mechanically to this situation. When the particular legal rule is found, it is necessary to ascertain the generally formulated provision and apply it with reference to special circumstances of the particular situation. It is also necessary to find the purpose of the legal rule in question, i.e., to observe the intent of the legislator when drafting the legal rule and to predict how he would resolve this particular situation. This process is generally called interpretation of law and is connected to legal hermeneutics. Professor Prusak [2] states:

"From the logical-semantic point of view, interpretation means granting a specific meaning to the general formulations. Interpretation of legal rules means process of ascertaining particular words and sentences in legal rules which bear certain normative meaning and substance - they prescribe that something is legal or illegal."

He afterwards concludes that "legal interpretation means ascertaining the meaning of legal rules." Interpretation of legal rules is an essential part of application of law to particular situations. Its value for law is inestimable, as it ascertains the meaning of legal rules, adapts them to changing social conditions and practically creates law in situations where written legal rules are formulated too ambiguously.

1.1.1 Methods of Interpretation

Because of the great importance of interpretation, it is necessary to create legally binding procedures of interpretation to reach the main goal of interpretation - to ascertain the meaning of existing legal rules, as opposed to creation of new rules which would extend the interpreted rules or would act contrary to them. Creation of these procedures, their systematization and development is the subject matter of legal hermeneutics - legal science about interpretation of legal rules. To name only the most important forms of interpretation:[3]

1.1.1.1 Linguistic (Grammatical) Method of Interpretation

This form of interpretation studies a legal text by analyzing its vocabulary and grammatical and semantic structure. It is created on a presumption that written formulation of a legal rule can most precisely express the intent of the legislator when creating law and the written text should therefore be an initial point of reference when trying to interpret the legal rule. Grammatical interpretation has a special feature in case it is used for international treaties which are usually formed in more equivalent (authentic) language versions that can be a source for grammatical interpretation. We can take an example of two authentic versions of the Convention on the Contract for the International Carriage of Goods by Road (CMR) of 1956, as it is stated in its article 51 or the six authentic versions of the CISG prescribed in its article 101. It is clear that if the legal instrument is created in more than one language, there is inevitably a risk that the various versions would contain different formulation of identical legal rules. These distinctions can emerge from the different system of each language, terminology and from the different meaning of legal concepts in various cultures and legal systems. Due to these distinctions, a controversial situation may occur when a grammatical interpretation of an identical legal rule set forth in two authentic language versions can lead to different solutions, or even to contradictory solutions. Since both such solutions would be equally relevant and legally binding, both solutions, though contradictory, would be equally applicable. In such situations, the grammatical interpretation cannot be a sole and exclusive source for finding a proper meaning of the applicable legal rule. It will be necessary to apply other forms of interpretation as well. This apparent risk of controversy over multiple authentic legal versions was probably the reason why the drafters of the Convention on International Carriage by Rail (COTIF) of 1984, created article 28 which stipulates that the only authentic version of the Convention is the French text and there are five more official (though not authentic) versions of the Convention. This formulation clearly improves the position for grammatical interpretation. On the other hand, some scholars suggest that it would be useful to examine the meaning of the problematic phrase in several, although not authentic, language versions in order to determine the most frequently used legal concept of this phrase.[4]

As it was already mentioned, in case of multiple authentic language versions of a legal instrument, there is always a risk of controversial outcomes of grammatical form of interpretation. Concerning the CISG, the legal science has proposed a solution that is also applicable to all other instruments of this type:

"If there is a need to consult the original language versions, then as a rule it will have to be assumed that in the case of discrepancies between the various language versions the English text (and occasionally the French text) express the intention of the Conference better than the other versions. That is because the negotiations were essentially carried out in those languages and English was the language used by the drafting committee."[5]

1.1.1.2 Logical Method of Interpretation

Logical interpretation differs from the grammatical one in its independence from any language version of an international convention. It does not examine particular vocabulary or sentences but is concentrated on the normative structure of propositions contained in legal rules. Legal logic created a system of interpretational techniques [6] that are used more or less identically in all legal cultures. Nevertheless, the value of such form of interpretation can be decreased by a poor translation of the legal text which does not respect structure of legal rules construed in the original text.

1.1.1.3 Systematic Method of Interpretation

Systematic interpretation presents a so called bird's eye view of the legal rules. It studies the relationship between the legal rule and the legal system to which it belongs. At first, it examines the position of this rule in the legal instrument, its categorization into a certain section and its relationship to other rules in this instrument, especially general rules and the definition of terms. Subsequently, it is necessary to investigate possible relationships with other legal instruments, i.e., to study the position of this legal instrument in the entire legal system.

When interpreting an international instrument containing uniform substantive law, it is clear that systematic interpretation will usually be restricted only to the position of the examined legal rule in the legal instrument, since uniform private law instruments do not create coherent systems and there are practically no connections between these instruments. This is caused by the fact that there is no sole legislator who creates these instruments (the range of Contracting States differs from one convention to another) which are often drafted in a specific historical and political situation. Systematic interpretation of uniform private law instruments is therefore generally based on their particularity and mutual independence.

1.1.1.4 Historical Method of Interpretation

Historical interpretation is a method of taking into consideration social, political and cultural conditions at the time of creation of the legal instrument and it should ascertain actual intent of the legislator when drafting the instrument. Travaux préparatoires, documents created in the process of drafting the instrument, are an essential part of this method of interpretation. In the case of a statute in Slovakia, such a document is called an explanatory report and is attached to the bill presented in the parliament. In the case of international conventions, the travaux préparatoires contain records of international conferences where the convention was being prepared, commentaries of the drafting States, reports from rapporteurs responsible for creation of particular parts, etc. This form of interpretation is frequently used in the continental legal system,[7] whereas common law states have historically applied this method only with regards to international conventions but not when interpreting the domestic law.[8]

The abovementioned methods of interpretation do not constitute a single system of classification of forms of interpretation. A different system of classification can be made according to the subject performing the interpretation. With regards to international conventions and particularly the CISG, it is necessary to point out several modifications. Legally binding interpretation is generally an interpretation performed by the authority which was expressly empowered in the legal instrument to perform it. This method of interpretation is therefore legally binding, e.g. the Constitutional Court of Slovak Republic being empowered by article 128 of the Constitution of the Slovak Republic to interpret its text. With regards to the CISG and practically all international instruments unifying private substantive law, there is no such body empowered to "legally" interpret them. For this reason, interpretation performed by domestic courts, legal scholars or the CISG Advisory Council can prove its force by their high legal quality, but nevertheless they will never gain a legally binding nature. Another form of interpretation, authentic interpretation, is performed by the body which drafted this legal instrument. It is therefore a kind of subsequent expression of the legislator's intent about the drafted instrument. Since international conventions are created at international conferences by a community of sovereign States, it is hard to imagine summoning a conference (for example a conference of CISG drafting States) in order to provide explanation for several ambiguous provisions of the Convention in the form of an authentic interpretation. In domestic legal systems, interpretation performed by a supreme court of the State [9] is often deemed to be legally binding, as it presents a viewpoint of the highest authority of the judicial system in that country. It is mostly the court of the last resort and its aim is to unify the legal doctrine created by the lower courts. The binding nature of such interpretation is derived from its hierarchic supremacy over all other courts of the country. As international conventions are applied and interpreted by courts of several sovereign countries, these countries have no interconnections between their judicial systems and therefore no court having supremacy over all courts of more jurisdictions which could unify the national jurisprudence of several countries. Therefore, the only practically possible way of interpreting an international convention, although being not legally binding, is the interpretation performed by the domestic courts and scholarly writings.

1.1.1.5 Interpretation under the Vienna Convention on the Law of Treaties

Although the CISG contains express rules on interpretation in its article 7, we have to take into consideration also the rules on interpretation prescribed generally for international conventions, as they laid down in the Vienna Convention on the Law of Treaties.[10] There is no doubt about the fact that CISG is a multilateral international treaty and it therefore falls under the scope of article 1 of the Vienna Convention. Vienna Convention expressly prescribes a procedure for interpretation of such treaties in articles 31 and 32 and a separate provision for treaties with more authentic language versions in article 33. The general rule on interpretation is prescribed in article 31:

"A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose."

Although this provision contains a single and integral rule on interpretation,[11] four basic directives can be derived from it:[12]

1. Take into consideration the ordinary meaning of the words

This element can be defined also as a grammatical method of interpretation, as it is analysed in chapter 1.1.1.1.

2. Analyse the words in the context of the entire text

Although the legal concepts used are usually strict enough to be ascertained properly from their written description, international uniform legal instruments have to face the problem of synthesising general concepts of various legal cultures. Therefore, the same "word" characterising a legal concept used in such uniform instrument can refer to different legal concepts in particular legal cultures or internal legal orders. The words themselves should therefore be analysed with reference to the entire text in order to ascertain their proper and identical meaning in all legal cultures and legal scholars and practitioners should perhaps focus on creating a thesaurus of legal concepts used in this instrument which would be independent from legal terminology used in particular domestic law.[13]

3. Treat the words used in the convention in the light of their object and purpose

This method is definitely the best way to achieve uniform interpretation of the convention, as it refrains from referring to a particular language version or domestic legal concepts and resorts to the very basic idea of the convention. This method is also established, though not expressly mentioned, in the CISG. The concept of gap-filling prescribed in article 7 part 2, as it will be analysed later, is based on taking into consideration "generaal principles upon which the Convention is based." These principles essentially present the basic conception of the CISG itself.

4. Recourse to travaux préparatoires as the last resort

This element is a part of the historical method of interpretation, as it was analysed in chapter 1.1.1.4. Common-law legal scholars tend to stress [14] that it is only "a supplementary and, one may add, very much subsidiary means of interpretation." Continental legal scholars [15] add, that the formulation of this element in article 32 of the Vienna Convention, as a "supplementary means of interpretation" reflects the basic concept of the interpretation of a text expressed in the Vienna Convention, which is to ascertain the meaning of the expressly prescribed text (where the starting point is the written text) rather than to search for the real intentions of the drafters which can be different from the actual written text (where the starting point is the travaux préparatoires).

With reference to the CISG, it is clear that this complex procedure of interpretation prescribed generally for all international treaties or conventions is in complete accordance with the procedure prescribed in article 7 CISG. Since the procedure prescribed in the Vienna Convention is much more detailed, the courts should use it whenever they find no proper solutions by using the article 7 CISG procedure, rather than to resort to the domestic methods of interpretation.

1.1.2 Interpretation and Gap-Filling of Legal Instruments

Before we move to a more detailed analysis of forms of interpretation of the CISG, it is necessary to define certain notions. The abovementioned definition of interpretation can be used both for methods used in article 7 part 1 CISG [16] and for supplementing CISG in article 7 part 2 CISG.[17] The latter approach, being a special form of interpretation, means ascertaining legal rules in matters which should have been regulated by the legislator in the Convention but the legislator failed to do so. It may seem problematic to arrange the gap-filling into the abovementioned classification of forms of interpretation used in continental legal theory. It could only be possible to qualify it as an extensive interpretation, which creates "legal solutions of a wider scope than the original (literal) meaning could have provided."[18] Nevertheless, since the procedure of gap-filling is expressly prescribed in article 7 part 2 CISG, it has to be treated as a legal and admissible form of interpretation also in the continental legal system, though it is not a classic form of interpretation in this system.

It is questionable how the traditional continental forms of interpretation could meet the requirements of uniform instruments such as the CISG. Since the Vienna Convention prescribes methods of its interpretation in article 7, these traditional forms can only be used in situations if these expressly prescribed forms do not provide sufficient solutions. Article 7 CISG prescribes two forms of ascertaining its legal provisions:

1. Interpretation of CISG provisions:

"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. " (art. 7 part 1 CISG)

2. Gap-filling of CISG provisions:

"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." (art. 7 part 2 CISG)

The fact that the CISG will not constitute an entire and exhaustive legal regulation of international sales contracts was obvious also to the drafters of the Convention and for this reason they created article 7. Nevertheless, it is not clear why the drafters, bearing in mind instances of impreciseness of its text, did not try to correct this impreciseness. Professor Bonell provides an explanation:[19]

"Yet the option in favour of uniform legislation inevitably restricted the drafters's room for manoeuvre. Due to the differences in legal tradition and at times, even more significantly, in the social and economic structure prevalent in the States participating in the negotiations, some issues had to be excluded at the outset from the scope of CISG, while with respect to a number of other items the conflicting views could only be overcome by compromise solutions leaving matters more or less undecided."

He continues by stating:

"In the provisions laying down not too convincing compromise solutions between conflicting views, some openly refer the definite answer to the applicable domestic law. Others use the technique of a main rule immediately followed by an equally broad exception, thereby leaving the question open as to which of the two alternatives will ultimately prevail in each single case. Others still hide the lack of any real consensus by an extremely vague and ambiguous language."[20]

This point of view mitigates the enormous enthusiasm of CISG proponents who consider it to be a successful unification of international sale of goods. To understand the position of the drafters, it is necessary to stress that the Convention is a result of long lasting negotiations of drafting States and it therefore has to be treated as a "maximum that could have been achieved by an international legislation."[21] Also for this reason, the question of interpretation and gap-filling is a crucial one for the Convention.

Article 7 part 2 CISG prescribes the manner of "settling questions concerning matters governed by this Convention which are not expressly settled in it." This situation is generally called gap-filling of the CISG. At first, it is necessary to distinguish between the aim of article 7 part 1 and of article 7 part 2 CISG. As was already mentioned, interpretation intends to ascertain the meaning of the text expressly prescribed in the legal instrument (black letter rules), this means that it works "inside" the instrument. Interpretation is used for clarifying the text of the Convention in borders of its express text and therefore it means a less serious intervention into the legal rules prescribed therein, as it cannot provide solutions which would be in controversy with the black letter rules, or it would exceed the express regulation prescribed in the Convention. On the other hand, the term "filling of the gaps present in legal instrument" presents that this procedure has much stronger effect on the Convention, as it creates regulation of matters that were omitted in the preparatory stage. Therefore, the gap-filling effects "outside" the Convention - it does not restrict itself to the matters already settled in the black letter rules, but it creates a broader regulation of sales contracts that was intended by the Convention, but was never completed in the text by its drafters. Because of these distinct effects of both procedures, article 7 part 2 CISG prescribes a special and separate procedure of gap-filling as opposed to interpretation:

  1. Gaps are to be settled in conformity with the general principles on which the Convention is based;

  2. In the absence of such principles, gaps are to be settled in conformity with the law applicable by virtue of the rules of private international law.

Despite this express autonomous regulation of both procedures, there are scholars who claim that there should be a single procedure for interpretation and gap-filling.[22] The reason for such suggestion is a shady borderline between interpretation and gap-filling. Another reason is a disparity of techniques that are prescribed by these methods - while the interpretation generally sets out a duty to use a uniform approach, independent from any state-law approaches of interpretation, gap-filling, though only as a last resort, turns to a particular State law applicable by virtue of the rules of private international law. In other words, if a particular matter is defined as an object of interpretation, it can lead to absolutely different solutions than in case of defining this matter as an object of gap-filling.

Scholars [23] are trying to reduce this clear controversy between the two above-mentioned procedures by suggesting a single basic principle for both procedures. This basic principle would stress the international nature of the Convention and would only permit courts to use principles of international trade as opposed to domestic law in order to avoid forum-shopping. The legal grounds for this approach would be article 31 part 1 of the Vienna Convention on the Law of Treaties.[24] Nevertheless, since the CISG expressly contains two separate and distinct regulations of these procedures in article 7 part 1 and part 2, any discussions about some common basic principle are rather academic.

1.2 Gaps in Legal Instruments

Before making any statements about filling the gaps in legal instruments, it is necessary to define the notion "gap" in its legal meaning. Bridge [25] defines a gap as a legal question, which is omitted partially or entirely in the regulation expressly settled in the text of a convention, though it falls into the scope of its regulation, as it is defined in this convention. Additionally, in order to use the gap-filling procedure, a partial regulation of a certain question has to be so ambiguous, that it would be impossible to settle it only by means of interpretation, as it is in case of art. 78 CISG.

After defining the gap in its legal meaning, it is necessary to categorize the gaps into groups according to their relationship to the express text of the legal instrument. Although various systems of gaps have already been presented by various scholars,[26] I will present my own system, as a combination of the abovementioned systems:

1.2.1 Gaps intra verba legis

Teichert defines gaps intra verba legis as a situation in which the legislator creates a general rule in the legal instrument and leaves its application to particular situations for the consideration of courts. It is therefore not a legal gap stricti sensu, as the court only ascertains meaning of the general rule for particular situations and does not create a new legal regulation of relationships. In my opinion, this process is rather a form of interpretation under article 7 part 1 CISG and forms a borderline between interpretation and gap-filling.

1.2.2 Internal Gaps

Internal gaps concern legal questions which fall into the scope of regulation of a particular legal instrument, but where this instrument does not expressly prescribe them. This is a type of gap that is clearly governed by article 7 part 2 CISG. It includes questions that were intended to be governed by a certain instrument, but drafters of this instrument for certain reasons omitted to expressly regulate them. The reason for such omission can be either impossibility to reach a consensus about certain questions or, on the other hand, impossibility to anticipate all legal issues that may arise in the course of application of this instrument. The scope of the issues that should have been prescribed in the convention emerges from the convention's scope as defined in its general provisions. Regarding the CISG, this scope is defined in article 4 which states, that "This Convention governs only the formation of the contract of sale and the rights and obligations of the seller and the buyer arising from such a contract." Examples of issues which fall within this scope are provided by legal theory [27] but it is not my intent to analyse them individually.

1.2.3 External Gaps

It is clear that the general scope of regulation prescribed in article 4 CISG contains also legal issues that the drafting States did not intend to regulate in a unified manner, but rather to leave them under direct influence of a sovereign State, i.e., in its national legislation. For this reason the Convention contains in provisions following after the rule on limits of its scope generally defined in article 1 part 1 which refer to:

a) parties to the international contract of sale in article 1 part 1 a) b);
b) subject-matter of the contract in article 2 a) to f);
c) legal issues emerging from the contract in article 4;
d) legal issues derived from the contract in article 5.

It is necessary to stress that this list of limits is exhaustive and the limits should be interpreted in a restrictive manner, in order to ensure uniform solutions in most elements of legal relationship emerging from the international sale of goods, as the drafters initially intended it.

It is therefore necessary before applying the CISG provisions to examine whether the case falls under the general rule in article 1 part 1 CISG and article 4 CISG and subsequently to study whether it is not covered by one of the abovementioned limits. After doing this test, we can more easily define whether a particular legal question is an internal gap according to article 7 part 2 CISG or an external gap, where the CISG has no direct effect. These so called external issues will usually be resolved by provisions of a certain domestic law chosen by the parties or applicable under provisions of private international law. Applying the CISG also to these external gaps would be contrary to the Convention, as the Convention itself restricts its effect in these situations.

1.3 Methods of gap-filling

After defining the forms of gaps and determining which of them are subject to the procedure of gap-filling, we should study the possible methods of gap-filling, which are provided by legal theory:

1.3.1 Application of general principles upon which the legal instrument is based

This is the so-called continental approach which is derived from code-law usual in European States. To fill gaps in a legal instrument, it is necessary to study the entire instrument and subsequently to derive from it some basic principles which are common to all legal rules contained in it. This stage is characterized by a method of abstraction - generalisation of legal rules to create its fundamental principles. Subsequently, we create the omitted legal rule by applying these fundamental principles to the particular situation and thereby we try to predict how the legislator would decide in this situation.

1.3.2 Filling of gaps by using legal rules contained in other legal instruments or other legal systems

This method is typical in situations where the interpreted legal instrument is connected with other legal instruments by a relationship of subsidiarity. It can be defined as a secondary source of legal rules which can be used if the primary legal instrument contains no solutions. We should always keep in mind that this method can only be used if the legal instrument being interpreted contains an express rule to use provisions of the secondary legal instrument in this manner. In domestic systems, codifications of general private law are often used in this manner.[28] With regards to international conventions, it is hard to find a legal instrument of such general nature, which could provide solutions for gap-filling of other international legal instruments. For this reason, this method is rarely, if ever, used in international legal area.

The other solution proposed by this method is a resort to a certain domestic system of law, usually to be found applicable by rules of private international law. Nevertheless, this concept is often criticized for providing non-uniform solutions, which are harmful to the very nature of uniform instruments as a subject of gap-filling.

1.3.3 Combination of the above two methods

This is the most complex approach ensuring that the integrity and independence of the international uniform legal instrument will be primarily observed and usage of domestic law will be always only a matter of last resort. This is also the method laid down in article 7 part 2 CISG.

1.3.4 Methods of legal argumentation [29]

The author of this notion defines it as a special method using logical methods of interpretation which are generally observed in Continental legal systems. A special position is reserved for analogy, which can be particularly useful in case of international conventions. Nevertheless, in my opinion the analogy is an integral part of the method prescribed in section 1.3.1.

Choosing a concrete method of gap-filling for a certain legal instrument is a task for its drafters. With regard to international unifications of private law, the most appropriate method should be the one described in section 1.3.1. It avoids any forum-shopping of parties to a dispute, as courts in all countries will have to apply the same general principles. On the other hand, this method can lead to legal uncertainty, as these principles are rarely expressly enumerated in the convention and their determination will depend on the consideration of the judge. There is also a reluctance of States to leave regulation of all legal issues that could emerge from an international relationship to a procedure independent of their own national concerns. Depending on the strength of the abovementioned arguments in each case, the drafters create different procedures of gap-filling based on these methods.

The ULIS [30] in article 17 expressly enacted the method described in section 1.3.1, i.e., gap-filling in accordance with general principles upon which the convention is based. Subsequently, article 2 ULIS expressly prohibited any application of domestic law for regulation of certain legal issues falling under the scope of ULIS and it thereby excluded methods prescribed in sections 1.3.2 and 1.3.3. This strict international approach was nevertheless criticized by States,[31] which were absolutely excluded from having any influence upon the regulation of international sales. This absolute exclusion can also be a reason why ULIS was not a very successful unification when taking into account the small number of its Contracting States.[32]

For this reason, although the drafters of CISG generally observed solutions provided by ULIS, and they did so also in case of gap-filling, the drafters of the CISG rejected the solution provided by article 17 ULIS and considered it to be too vague and insufficient, since the CISG itself did not expressly stipulate any general principles upon which it is based. As a result, the so-called Geneva Draft of 1976 contained article 13, which prescribed only a general intent to apply the Convention in a way which is in conformity with its international character. It is worth mentioning that this draft did not make any distinctions between interpretation and gap-filling. The New York Draft of 1978 also did not distinguish these two procedures and added in its article 6, beside a duty to respect the international character of the Convention, a duty to observe good faith in international trade. At the diplomatic conference, where the final text was created, this article was split into two separate parts. The article 6 of the New York Draft was practically in the same formulation included in article 7 part 1 CISG, but it was restricted only to issues of interpretation. Since the States present at this conference insisted on creating separate legal rule for filling the gaps in CISG, they drew proposals for such regulation at the conference. A Bulgarian proposal stating that gaps should be filled according to law of the country of the seller was rejected. Subsequently, Czechoslovakia proposed to leave the choice of applicable law to the rules of private international law, which would cause absolute diversion of procedures for interpretation and gap-filling and furthermore would cause the CISG to lose its independent international character and unifying aim. This proposal was therefore modified by Italy which proposed to initially use a procedure analogous to that of interpretation, i.e., to observe general principles upon which the Convention is based, and only in case of impossibility to fill the gaps in this way, one should resort to use the applicable law chosen by rules of private international law. This compromise was finally accepted by the States and included into article 7 part 2 CISG, whereby the CISG uses the method of gap-filling prescribed in section 1.1.3. Although this approach prevents the creation of a legal vacuum in all legal issues, it creates a tension between the uniform solutions proposed by the CISG and particular national solutions proposed by domestic legal systems, as it is up to the judge to decide whether an applicable general principle exists or whether it is necessary to resort to the rules of private international law in order to choose the applicable law. Looking to the practice, the second solution is an easier and therefore more popular way for the state court.

The final text of article 7 part 2 CISG prescribes the following procedure of gap-filling of the Convention:

"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."

1.4 Procedure of gap-filling of the CISG under article 7 part 2

As already mentioned, the procedure enacted in article 7 part 2 CISG consists of two stages which have to be applied gradually. If the first stage provides sufficient solution of a legal issue, the second stage will not be used in this case. It will only be used if the first stage provides an insufficient outcome, i.e., if there is no general principle according to which the gap should be filled.

1.4.1 Filling the Gaps by General Principles upon Which the Convention is based

The drafters of the CISG were aware of the fact that if they want the Convention to be a real unification of international sales law, it has to be an autonomous document independent from any domestic legal systems, although it becomes a part of them through the process of ratification. This independence should ensure that the Convention will be applied in the same manner in all Contracting States without any modifications made by them. Only by this form of application can we speak about real unification. Should the Contracting States have a chance to "adapt" the Convention to their national legal systems, the Convention would be applied differently in various States and this would absolutely destroy its international character. This different application of the Convention in different States would not only cause theoretical controversy but, what is more, would also lead to serious practical problems. At first, this "national" form of application of the CISG would absolutely destroy legal certainty of merchants in international trade. They would be unable to predict the effects of their international sales relationships in particular countries, as these relationships would not depend only on the uniform text of the Convention, but also on national particularities of various legal systems. This situation would make it impossible to achieve the primary aim of the Convention - to promote international trade by simplifying its legal aspects. Another negative effect would be forum-shopping - an unwanted phenomenon in private international law where the plaintiff chooses the State where he is going to sue depending on which law will be chosen as applicable by the local court and in which way it will be applied. It was the desire to avoid forum-shopping that led the CISG's legislators to create a uniform instrument that would be treated in a single way in all jurisdictions.

There is no doubt about the fact that the principle prescribed in article 7 part 1 CISG, i.e., to observe "its international character and ... the need to promote uniformity in its application and the observance of good faith in international trade" should be met also in case of gap-filling. There are several reasons for this conclusion. The first one emerges from the historical method of interpretation, whereby we find that the original draft of the Convention (New York Draft of 1978) governed both procedures of interpretation and gap-filling in one legal rule, which was based on the abovementioned principle. Although the States at the final conference created a special provision for gap-filling, they did not express any intention to exclude this general principle from the procedure of gap-filling. Another reason for this conclusion is the absence of a single highest judicial authority which would unify the jurisprudence on the CISG from all States. Therefore, the entire responsibility for uniform application is vested in national courts. Subsequently, since article 7 part 1 CISG creates a general duty for national courts to apply the Convention in a uniform manner, this duty is not restricted to any single form of application (interpretation, gap-filling or analogy). It is clear that the uniform application of the CISG by means of gap-filling can only be achieved by using the first stage of the procedure prescribed in article 7 part 2, i.e., to settle such legal issues in accordance with general principles upon which the Convention is based.

Although the abovementioned obligation of courts to apply the Convention in a uniform manner without any influence of domestic law has rational grounds and leads to beneficial outcomes, its practical realisation is problematic. The possibility of uniform resolution of conflicts by the CISG is hindered by the limited scope of the Convention. Matters expressly excluded from its regulation by articles 2, 4 and 5 CISG present important elements of legal relationships and their different solutions provided by particular national laws lead to different outcomes of disputes. Other reasons for non-uniformity are the reservations made by ratifying States, which are permitted by articles 92, 94, 95 and 96. A result of these reservations is that that the Convention has a different text in various States depending on the particular reservation. On the other hand, it is logical that these reservations and the limited scope of regulation made it possible for more States to become a party to this Convention. A third reason for non-uniform application is a vague and ambiguous formulation of certain provisions and a trend of leaving certain issues falling in the scope of the Convention unsettled in its text. This third reason is nevertheless different from the previous two, as it can be eliminated by a coordinated interpretation and gap-filling in case of application of the CISG performed by the courts. There are several ways in which to achieve this coordination. They can be divided into public and private ones, depending on whether they need an activity of Contracting States and international organisations or not.

1.4.1.1 Public Initiatives Promoting Uniform Application of the Convention

The first public effort to ensure uniform application of CISG is the common general rule for interpretation and gap-filling prescribed in article 7. This method was rarely used at the time of its enactment, the only time before by UNCITRAL in the UN Convention on the Limitation Period in the International Sale of Goods of 1974. Nevertheless, this provision alone is not sufficient to ensure such uniform application -the whole procedure is prescribed in a very general and vague manner which gives rise to several different conclusions and this method of gap-filling makes it possible for courts to use, although only as a last resort, domestic law applicable under rules of private international law. It is therefore clear, that this legislative approach alone could not ensure that the aims of the CISG would be accomplished. A suitable guide for courts could be an official commentary on the CISG, which would clarify its vague formulations and would either provide more precise technique of finding general principles or would expressly enumerate them. Good examples of such commentaries are provided in the following international conventions:

   -    The Brussels Convention on Jurisdiction and the Enforcement of Judgements in Civil and Commercial Matters of 1968;[33]
   -    The Lugano Convention on Jurisdiction and the Enforcement of Judgements in Civil and Commercial Matters of 1988;[34]
   -    The Rome Convention on the Law Applicable to Contractual Obligations of 1980;[35] and
   -    Council Regulation no. 2201/2003 of 27 November 2003 Concerning Jurisdiction and Enforcement of Judgements in Matrimonial Matters and the Matters of Parental Responsibility, repealing Regulation No 1347/2000.[36]

These commentaries are not legally binding, but they were recognized by drafters of these conventions as the best source of explanation of their provisions. Their persuasive force is supported by their publication in the Official Journal of the European Communities and these commentaries thereby acquired general publicity and a tacit consent of the European institutions. Such commentaries have played an important role in the initial period of operation of these conventions, since they substitute for a jurisprudence that has not yet developed and help ensure its development in a uniform and constant way. This kind of commentary in the case of the CISG does not exist. The only attempt to create one was a proposal of Professor Bonell in 1987 to create a Permanent Editorial Board for CISG,[37] but this proposal did not find sufficient support in UNCITRAL.

As was already stressed, the CISG is applied by a number of mutually independent courts all over the world [38] without any single court with a power to coordinate the jurisprudence and support its development. Many scholars suggest that a body entitled to gather the jurisprudence from Contracting States and to provide legally binding interpretation in problematic issues, would be the best way to ensure uniform application of CISG. Nevertheless, De Ly [39] correctly states that this proposal has several problematic points that would create difficulties. At first, this kind of court empowered to provide interpretations legally binding on domestic courts, could only be created by a decision of the CISG Contracting States. It is not clear whether these States would approve a decision that would restrict their sovereign jurisdiction in these matters. Other problems are connected with a real institutionalisation of such a body - its statute, composition and financing. Furthermore, this kind of court dealing with disputes arising from international contracts of sale, which are used daily by thousands of merchants all over the world could be overloaded by the amount of these cases and, in that event, would be ineffective. On the other hand, a good example for this conception is the European Court of Justice in Luxemburg. It is the main judicial authority for interpretation of the European law and plays a role of unifier of jurisprudence for some international conventions, for example, the abovementioned Rome Convention.[40] Nevertheless, it is important to point out that the ECJ is a judicial authority operating within a closely integrated international organisation and this model would probably not be sufficient for a worldwide environment with sovereign States. A more realistic approach would be a creation of a worldwide network of national courts where these courts would coordinate their decisions without any supreme international authority, as it is used in the European judicial network for civil and commercial matters.[41]

1.4.1.2 Private Initiatives Promoting Uniform Application of the Convention

As it was already pointed out in the previous chapter, the public efforts to ensure uniform application of the CISG are more or less still only a subject of theoretical discussion. One of the reasons for this situation is a reluctance of the Contracting States to create a form of binding system of decision-making that would restrict their national jurisdiction. This was also the reason why these efforts gradually moved to the private sector - to the international trade community and legal theory which try to promote informing of the general public about application of the CISG in the world and analyse problematic issues arising from the jurisprudence. It is worth mentioning that CISG itself, being drafted by a great number of most respected legal scholars and practitioners from all legal cultures, is sometimes deemed to be a product of legal theory or a global scholarly jurisconsultorium.[42]

The first group of these efforts consists of a large number of commentaries and theses dealing with issues concerning the CISG. A great many of these articles have been published on the Internet and are freely available to the general public. There are also specialized Internet websites which publish scholarly works on the CISG from all over the world. These commentaries form a doctrinal interpretation of the Convention which is undoubtedly of a great value. At first, these works often react to present tendencies in judgements and arbitral awards,[43] evaluate their quality and examine argumentation provided therein. In this way, legal scholars evaluate the decision-making process of judges and motivate judges to make decisions based on professional and in-depth reasoning. These commentaries promote precise and effective solutions for merchants and lawyers who can thereby better understand certain provisions of the CISG and use them in a proper way. Although these commentaries are not legally binding, since they elaborate effective solutions, there is no reason why courts should not observe them and get inspiration from them. Furthermore, using commentaries in this way gives them an attribute of legal force through incorporating them into jurisprudence.

Another popular way of how universities as centres of legal education and research contribute to the uniform application of the Convention, has been the creation of national and international databases of judicial and arbitral awards on the CISG. International scope of interest, permanent updating and a wide range of contributors from all over the world are provided by databases of the Pace University School of Law [44] and UNILEX,[45] which furthermore provides a database of decisions on the UNIDROIT Principles. There are also national databases gathering jurisprudence of their national courts, most of them forming the Autonomous Network of CISG Websites [46] supported by the Pace Database. These databases provide a great source of information for courts having to decide a case concerning application of the CISG, as they can easily search for analogous judgements from their own jurisdiction or other jurisdictions. These databases can also help to dismiss the most frequently used excuse for non-using of foreign precedents in legal reasoning - impossibility to find such precedents.[47]

However, as experienced by the legal practice, thus far courts have not paid much attention to decisions from other jurisdictions, even in cases when they are familiar with these decisions. Their usage is limited by a theory of jurisdictional sovereignty which treats national jurisdiction as absolutely independent from any powers within the State and even more from outside the State, including foreign courts. By paying attention to foreign judgements, the court would admit that it is not independent from other jurisdictions.[48] Therefore there is no legal obligation of the court to observe foreign judgements in analogous situations, although it is not restricted to do so. A good reason for the court to obtain inspiration from a foreign judgement could be its high legal quality which could facilitate the court's own decision-making process and legal reasoning.[49] Another reason is the prevention of forum-shopping in international litigation by promoting internationally uniform jurisprudence.[50]

The last but not least important way of promoting uniform application of the Convention is regard for international trade usages which provide uniform solutions especially by means of general contract law and thus complement the Convention's provisions governing particular issues of international sale of goods. Nevertheless, regard for international trade usages is exposed to problems of their publicity and constancy.

These disadvantages in the usages' nature can, however, be minimized by use of the UNIDROIT Principles, which present a body of general principles of international trade law and to a large extent represent actual international trade usages. The relationship between UNIDROIT Principles and the CISG will be analyzed in the next chapter.

1.4.2 Supplementing Gaps in the CISG by Provisions of Law Applicable by Virtue of the Rules of Private International Law

The history of the creation of article 7 governing interpretation of CISG provisions shows that resort to the rules of private international law as a method of gap-filling was added to the original text only at the final stage of its preparation at the request of a group of States present at the conference. These States tried to maintain at least a partial legislative control over the relationships emerging from international trade by involving domestic law in regulation of certain legal issues. These efforts tried to extend the scope of legal questions already expressly excluded from the Convention's influence in articles 2, 4 and 5 CISG, although in a less express way. Another reason for such demands of States was their scepticism about the method of gap-filling based solely on resort to the general principles of CISG. The States expressed doubts about the argument that courts should be able to supplement provisions of CISG solely on the basis of its general principles, which are not expressly mentioned in its text. Their effort to amend this method by referring to domestic law as a last resort emerged from the needs of judicial practice, where every single situation has to be governed by a certain legal rule.

This method nevertheless raises doubts about ensuring uniform application of the Convention. To what extent is the court obliged to search for the general principles? And when is it entitled to resort to domestic law? It is, however, clear that a State court will be more inclined to use domestic law applicable by virtue of private international law than to use an international instrument. Courts are more inclined to do so, if the rules of private international law find the court's own law to be applicable. To what extent can parties to the dispute demand that the court search for such general principles if the court declares that there are no general principles which could provide sufficient solutions for gap-filling and is prepared to use the domestic law?

It is always necessary to keep in mind that usage of domestic law for supplementing the gaps in the CISG is prescribed as an ultima ratio in article 7 part 2 which should only be used after detailed examination of general principles. A court is therefore always obliged to search for the general principles as a first step in as broad an extent as it is possible and with the assistance of parties to the dispute. In case the court nevertheless decides that no general principle is suitable for gap-filling, it is ought to provide detailed reasons for such decision in the final judgement.

II. UNIDROIT PRINCIPLES AS A TOOL FOR GAP-FILLING OF THE CISG

2.1 General Principles on Which the Convention is Based

In the previous chapter, I tried to describe possible methods of filling of gaps in the CISG. It was also pointed out that in order to achieve uniformity in the international sale of goods, it is necessary not only to apply its text but also to develop a complex legal grounds for qualification of all legal issues emerging from international sales relationships in a uniform way. Certain conditions for this are created by article 7 CISG but this provision alone is not sufficient to ensure it. As was already pointed out, there are several ways to support this approach, including the use of the UNIDROIT Principles. They can, however, only operate in the area created by article 7 part 2 CISG.

As was already mentioned, the Convention does not contain any express enumeration of the general principles as they are referred to in article 7 part 2 CISG. They can be derived from its express text by using the method of logical abstraction, as it is used by legal theory. Commentaries on the CISG have abstracted a number of such principles,[51] but only those principles expressly acknowledged by the jurisprudence of a certain State can be considered legally binding for other courts in that jurisdiction.

Furthermore, the text of the Convention alone does not provide all answers for resolving all matters involved in the application of the CISG. The text also contains several provisions which are vague or formulated in too general a way to regulate particular situations in international trade. We can take as an example article 78 CISG which contains the right of a creditor for a payment of interest in case of default of a debtor to pay a sum of money. Although this provision grants the right of interest to the creditor, it provides no method for calculating its rate in particular cases. We must therefore ask whether it is allowed to search for precise solutions when there are general principles expressly but not precisely enough prescribed in the text of CISG. Ferrari answers the question: yes,[52] but respecting certain conditions.

Respecting the general obligation prescribed in article 7 part 1 to observe the international character of the Convention and promote its uniform application, external sources of the CISG's general principles should necessarily have international uniform character. Furthermore, these "external principles" must be in complete conformity with the general principles expressly prescribed in the text of the Convention. Ferrari suggests general principles of international trade law as an example for such external principles, which correspond to the general part of the contract law in domestic law. These principles can be used for filling the gaps in the text of the CISG but only as long as they supplement and ascertain the general principles expressly vested in the text of the Convention. Ferrari specifically mentions the UNIDROIT Principles as a source of such general principles. Does it mean that principles included in the text of the UNIDROIT Principles do express the general principles of the CISG?

2.2 Relationship Between the General Principles of the CISG and the UNIDROIT Principles - Conflict or Harmony?

More scholars suggest that the UNIDROIT Principles contain several provisions which present general principles of the CISG. Professor Kritzer collected these opinions [53] and points out that several provisions of the UNIDROIT Principles could be of great use to help find general principles of the CISG. Because of their systematic composition, which very much resembles traditional European codes, the UNIDROIT Principles facilitate orientation on the general principles of CISG and provide a wider legal background of contract law or law of obligations for them. Therefore, when using the CISG and the UNIDROIT Principles together, one can create a complex regulation of contractual relationships in the international sale of goods. These two instruments are construed in a similar way, they often provide similar solutions to certain issues and, what is more, several provisions are formulated identically in both instruments. Is this conformity only a coincidence?

At first, one has to keep in mind that both instruments were drafted with the same intent - to unify international rules for international trade. They both synthesised particular models of domestic commercial law and tried to create a body of law which would be legally certain and nevertheless would not create tensions among different legal cultures. The less visible reason for this conformity is also the fact that both instruments were drafted to a large extent by the same group of experts. Therefore, these two instruments prove that different forms of legal regulation - a binding international convention and a non-binding set of principles - can lead to the same outcome. While the CISG was drafted as an international convention binding on States because of its ratification, the UNIDROIT Principles are generally non-binding and their legal force in a particular case is derived from their usage. This special character of the Principles is also usually a reason for critism of the Principles.[54]

Despite their difference in form, both instruments are closely related to each other. With reference to its date of creation, 1980 in case of the CISG and 1994 in case of the UNIDROIT Principles, it is clear that the CISG as an already existing document had a strong influence on the drafters of the UNIDROIT Principles. This influence has never been denied by these drafters. On the contrary, they state that the first edition of the UNIDROIT Principles of 1994 contained more precise regulation of issues which were only partially regulated by CISG. Professor Bonell states:[55]

"To the extent that the two instruments address the same issues, the rules laid down in the UNIDROIT Principles are normally taken either literally or at least in substance from the corresponding provisions of CISG; cases where the former depart from the latter are exceptional."

He afterwards gives an exhaustive list of these exceptional differences. With regards to the size of both instruments (the UNIDROIT Principles consisting of 185 articles and the CISG consisting of 101 articles) they present only a minor part of them. In many cases, both instruments are mutually compatible. What is more, in cases where they are compatible, provisions of the Principles provide more precise and comprehensible solutions. This is partly caused by the fact that the drafters of the Principles were not as much dependant on the will of States as the drafters of CISG. Since the drafters of the Principles were experts from various States and legal systems, acting as private persons, they were not bound by attitudes of their States and the Principles are therefore less influenced by the will to particularism, as it was in case of the CISG. The Principles therefore contain fewer so-called "blind solutions" - provisions created by a compromise of various positions which actually do not provide any solution of a certain legal issue.

On the other hand, critics point out the differences between the UNIDROIT Principles and the CISG. First, as was already mentioned, is their different legal form. They also differ in the scope of their regulation - while the CISG regulates only international sale of goods, the Principles intend to regulate all commercial contractual relationships in the area of international trade.

These two instruments also define differently the international aspect as a basic requirement for application [56] of the texts. The CISG defines an international sale of goods in article 1 part 1 as a contract of sale concluded between parties whose places of business are in different States. The international aspect is connected to the parties to the contract, but only with respect to their places of business, because the Convention expressly provides in article 1 part 3 that the nationality of the parties will not be taken into consideration when determining the application of this Convention. Furthermore, the nature of the sale of goods is also of no importance, so it does not matter whether the goods will be delivered across borders. This definition of international aspect is very narrow, as it does not cover sales contracts with international aspect having to do with the place of delivery of the goods, nationality of the parties, etc. On the contrary, the UNIDROIT Principles state in their Preamble that they set forth general rules for international commercial contracts. In the commentary to the Preamble, the notion of "international contract" is defined in a way that

"the concept of "international" contracts should be given the broadest possible interpretation, so as ultimately to exclude only those situations where no international element at all is involved, i.e., where all the relevant elements of the contract in question are connected with one country only."

This is the widest possible definition of the international aspect and it is clear that the UNIDROIT Principles will apply to a wider range of international sales contracts than the CISG.

Another difference between these instruments emerges from their structure. While the CISG is composed as a traditional international convention consisting of legal rules formulated in articles, the UNIDROIT Principles include beside this form of text (black letter rules) also an extensive commentary made by its drafters which is an important element of the integral version of the Principles and it thereby helps assure a better comprehensibility and legal certainty in its application.

The last important difference is in the degree of flexibility of the two instruments. The CISG was created in 1980 as an international convention which did not plan any future amendments and modifications. This naturally does not exclude a possibility of changing its text but it would necessarily need to follow the procedure prescribed in articles 40 and 41 of the Vienna Convention on the Law of Treaties. Article 40 part 2 prescribes that any proposal to amend the CISG must be notified to all of its Contracting States and these States would have to accept it. And once the amendment is passed, it will only be effective among the States which have ratified it. Contracting States of the initial Convention which had not ratified its amendment will still be bound by its initial version, as is prescribed in article 40 part 4 of the Vienna Convention. This procedure of amending bears a potential threat of creating dual legal regulation of international sales contracts - one for the Contracting States that ratified both the original convention and its amendment and another one for the States which ratified only the original convention but did not adopt the amendment. On the other hand, development of technology and economy promotes constant development of international trade. It is therefore presumable that the original text of the CISG created in 1980 does not precisely reflect the actual situation today in international trade. Although its change may therefore be needed, it is not highly probable that it will happen soon due to the complexity of this procedure and also the fact that the text of the Convention expresses the maximum consensus that could have been achieved in a form of a legally binding international instrument.

On the contrary, the UNIDROIT Principles present a document issued by an international organisation which is not directly dependant on activity of States in order to change it. The Governing Council of UNIDROIT approved its issuance in 1994 and also decided about initiating works on a new version which led to issuance of the 2004 version. The Foreword to this version expressly states [57] that the new version is not intended as a revision of the 1994 version. Only few changes were made to the already existing provisions.[58] The main purpose of the new edition was to cover additional topics of interest to the international legal and business communities. The preparatory works on the third extended version of the Principles have already been initiated and it is anticipated that they will be finished in 2010. Because of their non-binding and private character, the Principles have not had such problems with approval of these changes by States as in case of the CISG. This ensures greater flexibility and better response to development in social and economic environment. On the other hand, the contractual parties are free to choose any version of the Principles by expressly referring to that version. If they stay silent about determining a particular version, it is presumed that the actual (last published) version will be applied.

2.3 Admissibility of Supplementing the CISG by the UNIDROIT Principles

As was established in the previous chapter, there is no significant controversy between provisions of CISG and the UNIDROIT Principles that would disable their joint usage for regulation of international sale of goods. This fact is approved by a majority of legal scholars. Nevertheless, such form of their usage is frequently criticized for absence of legal admissibility of supplementing CISG by the UNIDROIT Principles. A legal ground for such procedure will always have to be in conformity with article 7 part 2 CISG, which prescribes the procedure of its gap-filling. As this procedure is composed of two stages, when examining the admissibility of using the UNIDROIT Principles in this way, one has to analyse each stage separately. Thereby, two separate issues are raised:

  1. Admissibility of using the UNIDROIT Principles as the general principles on which the CISG is based, to supplement the provisions of the Convention; and

  2. Admissibility of using the UNIDROIT Principles to supplement the provisions of the CISG, as the law applicable by virtue of the rules of private international law.

2.3.1 Admissibility of Using the UNIDROIT Principles as General Principles of the CISG

Since the general principles on which the CISG is based, as they are referred to in article 7 part 2 CISG, are not expressly enumerated in the text of the Convention, they have to be derived from it by methods of logical abstraction. This method nevertheless means that more persons (judges deciding particular cases) can achieve different results when using it - they can create a different list of these general principles. Equally, more persons can resolve a particular issue with different outcomes by referring to a single principle. As it was presented, the procedure prescribed in article 7 part 2 CISG should at first ensure a uniform application of the Convention in analogous situations. But the text of the Convention itself does not provide sufficient conditions for such uniformity when applying article 7 part 2 CISG. I have already proved that under certain circumstances that will be described in this chapter we can use external sources to find the general principles on which the CISG is based. It was also pointed out that the UNIDROIT Principles is an instrument which closely corresponds with the CISG. Can we therefore use them in this way?

The most frequently used justification for a denial of such usage [59] is the different character of the two instruments. At first, this refers to their mode of creation. While the CISG was drafted by UNCITRAL and subsequently ratified by the Contracting States, whereby it acquired its legal force, the UNIDROIT Principles were drafted by a group of experts who, though being citizens of various States from all major legal cultures, were not acting as representatives of their States and therefore their opinions cannot be identified with official viewpoints of States and the UNIDROIT Principles cannot be considered to be created by States, as is case with the CISG. Two questions emerge from this analysis:

  1. If we treat the UNIDROIT Principles as a source of law, did their drafters possess legislative power when creating it?

  2. Can this legal instrument be legally binding for States and can courts apply it, though it has never been approved by States and its text has never been incorporated into the legal order of these States through ratification?

2.3.1.1 Trade Usages and General Principles of Law

The first question requires at least a short excursus into legal theory. The source of law can be defined as a source where one can find general rules of behaviour and which has been approved by a State as having legal force, because of its internal integrity, normative quality and state-approved form. European legal tradition used to prefer the socalled etatist conception of legislation which considered the State to be the only legislator. This theory is based on the assumption that "the ability to prescribe behaviour of its society is a significant part of the authority of the State. For this reason, the legislation as well as jurisdiction is one of the most important features of sovereignty of a State."[60] When applying this doctrine to international law, we can conclude that the State is only bound by the international conventions that it has ratified and thereby incorporated them into its legal order. According to this strict positivistic doctrine, one can hardly qualify the UNIDROIT Principles as a source of law. We must nevertheless bear in mind that international law is independent of any particular State or legal culture and therefore this doctrine is not the only and common philosophy of legislation respected in all States and we therefore need not strictly observe it at all costs. On the other hand, the UNIDROIT Principles could comply with the definition of a source of law in common law systems [61] where the law is created by a society and should always respect just settlement of disputes. Interests of a state or policies are examined only by comparing these new rules with already existing law. In this manner, the UNIDROIT Principles could be treated as a source of law, once the court would find them as a binding source of regulation of a relationship. According to this concept, it seems that the Principles would be acknowledged as a legal source in common law countries but never in civil law countries. This is, however, not true.

The strict etatist doctrine was supported in the 19th and 20th century and cannot suffice the economic and social environment needs of the present age. A State is withdrawing from its traditional role of a sole and absolute legislator and starts to prescribe conditions under which it is prepared to accept external sources of law. A good example for this tendency is recognition and enforcement of trade usages both in domestic law [62] and even more in international law.[63] Other such external sources of law are general principles of international trade which are not created by any particular legislative activity but present a basis for such legislation. These principles create a unifying network for all sources of international trade law and ensure their consistent application.

Where does this normative force of such legal sources come from, if they are not created by the legislative power of a certain State? Trade usages can be generally defined as "practices or patterns of behaviour among merchants established by repetition which have in some degree acquired normative force."[64] They are created by a constant repeated behaviour of merchants in a certain way. The merchants nevertheless do not possess legislative power and, being aware of this, they observe the rules they created not because of their normative force but because these rules are helpful for them and for trade itself. The merchants therefore establish between themselves only rules of behaviour which are practical and profitable for both parties. The law protects these models of behaviour because it was proved by a long-term observation of these rules that they create just and fair solutions for certain situations and this thereby protects the legal certainty of merchants when conducting their business. This feature appears more important in international trade where States tend to admit that they could not be the sole and best legislator but confer these rights to create rules of behaviour on merchants, believing that long-term practice will always examine the rationale of these rules. The only limitation of this form of self-government of trade is a statutory framework which always has to be observed, as it is created by mandatory rules which seek to ensure that the basic interests of a State will always be ensured. Law respects and supports trade usages created not by a State with its legislative power but by merchants in a way that it protects and enforces these rules by a judicial power.

There is a similar situation in case of general principles of trade law, although no empirical research can be made to find them, as they are determined by a method of logical abstraction from existing trade usages and legal rules in international trade.

2.3.1.2 Relationship between the UNIDROIT Principles and Trade Usages and General Principles of International Trade Law

If we admit that international trade usages and general principles of international trade law can be a source of law also in civil law countries, what relevance does this statement have in relation to the UNIDROIT Principles? The UNIDROIT Principles are sometimes considered to be lex mercatoria, i.e., a collection of trade usages observed in international trade. Nevertheless, analyses show that although most of the provisions of the Principles reflect actual international trade usages, there are certain provisions which depart from these usages and suggest new solutions which could provide more just and practical results, known also as a better law approach. The first group of provisions that reflect international trade usages, can be deemed to be a collection of lex mercatoria made in a written, systematic and legally precise form. The other group of provisions, representing the so called "better law approach," is not yet a part of lex mercatoria, since these rules were created "outside" the market. They can nevertheless become a part of lex mercatoria in the future, when these provisions will be accepted by merchants who will use them as a directive to create new usages. If this happens (and the practice has so far proved that it will happen,[65]) in this way they will become trade usages and an integral part of the lex mercatoria, or even a foundation stone for a new, more precise, certain and publicly known lex mercatoria. In the present state, though, it is up to a particular judge to determine whether a certain provision of the UNIDROIT Principles actually reflects an existing international trade usage and if the judge will prove this, he has a right, or even a duty to apply this provision of the Principles to resolve a particular dispute referring to a normative force of an international trade usage.

Another possibility for the court to apply the UNIDROIT Principles as a source of law, is to qualify them as general principles of international trade law. The Principles were indeed created by a method of comparison of national commercial codes and international unified instruments, i.e., by analysis and synthesis of sources of international trade law and therefore express its general grounds. If a judge will try to determine such general principle of international trade law to resolve particular problem, he would have to undertake the same procedure as the drafters of the Principles did in order to determine them. Because this process requires an enormous amount of time and research, it is clearly more favourable for a judge to rely on such research already performed by the drafters of the UNIDROIT Principles. Does this favourability also justify admissibility of such usage? This problem will be analysed in the next chapter. At this moment, we can at least conclude that the Principles present an express written record of principles of international trade law, as they have been determined by a sophisticated, systematic and objective method. Clearly, a judge would not use any different or more precise method of determining the general principles, as the one used by the Working Groups on the Principles (the drafters of the Principles) and therefore he has no reason not to accept the outcome of this method as a legitimate source of legal principles. This acceptance can be construed as a rebuttable presumption where the judge would be bound to apply the UNIDROIT Principles as a source of the general principles of CISG, or more expressly a particular provision of the Principles, as long as he does not find out that this provision is in conflict with provisions of the CISG. Therefore, if the judge chooses not to use the UNIDROIT Principles for this purpose, he should provide the reasons why it is not possible to apply its particular provisions.

2.3.1.3 Non-State and Non-binding Nature of the UNIDROIT Principles?

Let us move back to the legal nature of the UNIDROIT Principles, since this feature seems to be a primary reason why not to apply these Principles as a source for gap-filling of the CISG. It was mentioned that the drafters of the Principles, being private persons, do not possess legislative power according to the etatist conception of law and the Principles as a legal instrument have not been ratified by the States and therefore it is not admissible to apply them as a source of law. At first, it is necessary to point out that the whole procedure of their creation was managed by UNIDROIT - an international organisation formed by sixty-one member States.[66] As is prescribed in article 1 of the Statute of UNIDROIT:

"The purposes of the International Institute for the Unification of Private Law are to examine ways of harmonising and coordinating the private law of States and of groups of States, and to prepare gradually for the adoption by the various States of uniform rules of private law."

Since the member States ratified this statute, they granted to the UNIDROIT the powers to accomplish these aims. Creation of the Principles clearly falls into the scope of article 1 of the Statute and it was therefore approved by the member States, thereby constituting not a purely private initiative, as it is often presented.

Another popular misconception is that the States did not take part in drafting of the Principles and did not approve its text, which cannot therefore be legally binding on them. The General Assembly of UNIDROIT consisting of representatives of all member States expressly approved the text of the Work Programme of 1971 which contained the intention to elaborate the UNIDROIT Principles. Member States thereby approved preparatory works on the text of the Principles. Furthermore, though the Working Groups consisted of experts independent from the will of their home countries, the member States were engaged in drafting of the Principles by filling of the forms sent to them together with several preparatory versions of the Principles and these States had also opportunities to comment on the final version of the Principles. UNIDROIT regularly informed the member States about the course of the preparatory works, organized international workshops and conferences, where the draft versions have been analysed by representatives of the member States.[67] The whole procedure of preparatory works was conducted in conformity with article 14 of the Statute which defines participation of member States in the creation of the UNIDROIT documents. For this reason, as Oser states,[68] the legal nature of the UNIDROIT Principles has quite a resemblance to classical international treaties regarding their method of creation and the participation of States. We can therefore conclude that at least the courts of the UNIDROIT member States should treat the Principles as a legitimate source of law which should be used whenever it is necessary or useful.

Another difference between the Principles and a traditional international source of law such as the CISG is their degree of binding force. If a court should apply the Principles for gap-filling of the CISG, it will surely analyse the fifth sentence of the Preamble to the Principles which states that they "may" be used to interpret or supplement international uniform law instruments. This provision prescribes a right, but not a duty to use the Principles for this purpose. This provision should nevertheless be interpreted in connection with relevant provisions of the CISG. As is prescribed in article 7 part 1 CISG, when the court is interpreting the Convention, it is obliged to observe its international character and to promote its uniform application. As was already mentioned, this obligation should be applied to the activity of courts under both article 7 part 1 and part 2 CISG, as both procedures are created for the same purpose - to ensure uniform solutions for international sales contracts. Since a court is obliged to achieve this aim in all methods of application of the CISG, it should primarily use uniform tools for such procedures, as they present the only tools to guarantee this aim. Only if these uniform tools do not provide solutions for a specific case and therefore it is not objectively possible to achieve the goal set in article 7 part 1 CISG, the court can resort to the use of internal law.

For this reason, a judge has to apply the fifth sentence of the Preamble of the Principles in connection with article 7 part 1 and part 2 CISG and he is obliged to use the UNIDROIT Principles in order to supplement the provisions of the CISG because if he will not do so, he will not only breach the "soft" obligation under the fifth sentence of the Principles' Preamble, but he will also breach the "strict" obligation under article 7 CISG which is undoubtedly a classical source of law which the court is always obliged to observe. For this reason, at least the courts of the UNIDROIT member States can be obliged to regard the UNIDROIT Principles as a means for determining the general principles of the CISG and thereby supplementing the provisions of CISG in conformity with article 7 part 2 CISG. We have thereby found the answer to the second question at the beginning of this chapter - whether the UNIDROIT Principles can be binding on the States and whether the courts should apply them, although they were neither created by States nor ratified by them and thereby transposed to their national legal systems.

How would this procedure be applied by a Slovak court? It would at first apply traditional methods of interpretation of text, i.e., it would search for the CISG's general principles by using a grammatical, logical, systematic and historical method of interpretation. In this context, it is necessary to note that the grammatical interpretation should be performed only with regard to one of the authentic versions prescribed in article 101 part 2 third sentence as Arabic, English, Chinese, French, Russian and Spanish. It is nevertheless clear, that a Slovak court would perform grammatical interpretation of the Slovak version, as it is published in the Slovak Collection of Acts as Notice of Minister of Foreign Affairs no. 160/1991 Coll. Though this procedure would seem to be practical and in accordance with Slovak internal law, it could be treated as conforming to the Convention only if the outcome would not contravene the outcome of grammatical interpretation of an authentic language version of the Convention.

With reference to the abovementioned, Slovak courts should also primarily use all methods of gap-filling in a uniform way. Since the Slovak Republic is a member State of UNIDROIT, the UNIDROIT Principles should be treated as a legal instrument created with assent of the Slovak Republic and there is therefore no reason why a Slovak court should not accept the Principles as a legitimate source for gap-filling of the CISG. Nevertheless, there is not yet any judgement dealing with the UNIDROIT Principles in Slovakia and we can therefore not predict how a Slovak judge would qualify and use them. But since a Slovak judge, when applying the CISG, is also bound to promote a uniform application and gap-filling of the Convention by all means, the Principles could be of a great help to him, particularly in case he is not very experienced in applying the Convention.

2.3.2 Admissibility of Using of the UNIDROIT Principles as an Applicable Law

While in the previous chapter we have analysed a possibility of using the UNIDROIT Principles as the general principles on which the CISG is based, this chapter will be dedicated to usage of the Principles in situations where the legal issue cannot be resolved by reference to the general principles of the CISG, since the Convention does not regulate this issue by any of its principles. To make it absolutely clear, a court can conclude that the general principles of the CISG do not regulate this specific legal issue also if it has used the UNIDROIT Principles for this purpose. The court can even find a provision of the Principles which regulates the issue concerned, but since the court found that this provision does not express any of the general principles on which the CISG is based it could not apply it by means of supplementing the CISG with reference to its general principles. We therefore reach a point of controversy where the court in accordance with article 7 CISG tried to determine the general principles of the CISG and found the provision of the UNIDROIT Principles which is suitable to resolve the legal issue in question, but it cannot use this provision with reference to the CISG's general principles, since the CISG does not contain any such general principle. Despite this controversy, a court can still use the UNIDROIT Principles to resolve this particular issue by supplementing the provisions of the CISG in accordance with article 7 part 2 CISG.

Beside the primary rule referring to the general principles of the CISG, Article 7 part 2 CISG prescribes a second rule granting a duty to resolve the legal issue in question by rules of an applicable law determined by virtue of private international law. It was already pointed out that this method provides insufficient outcomes, as it lacks uniformity, is often unpredictable and thereby restrains legal certainty of merchants. If the court nevertheless comes to this ultima ratio stage, is there a possibility that an applicable law determined by rules of private international law would ensure uniform application of the Convention? Yes, but only if the law determined as applicable would be a uniform legal instrument, as it is in case of the UNIDROIT Principles. There are basically three ways by which the Principles could be used under rules of private international law:

  1. The Principles as an applicable law chosen by the parties to an international contract of sale;

  2. The Principles as representative of the lex mercatoria which is determined as an applicable law; and

  3. The Principles as an applicable law under conflict-of-laws rules.

2.3.3 UNIDROIT Principles as an Applicable Law Chosen by Parties

Nowadays, most of the codifications of choice-of-law rules are based on absolute priority of lex electa in contractual matters, as it is in:

Sec. 9 of Slovak Act no. 97/1963 Coll. on private international and procedural law as amended (hereinafter referred to as "Act on PIL"); Article 3 of the Convention on Law Applicable to Contractual Obligations of 1980 (hereinafter referred to as "Convention Rome I."); and

Article 3 of the Regulation of European Parliament and Council no. 593/2008 OF 17 June 2008 (will be applied from 17 December 2009, when it will substitute Convention Rome I., hereinafter referred to as "Regulation Rome I.").

The legal theory of lex electa states that parties can choose any form of "law", including the law of a country, a single legal instrument or a set of rules not created by a State legislator. In international trade, there emerges a special need to ensure a fair arrangement of mutual rights and duties arising from the parties' contract and therefore to try to eliminate effects of any particular legal order on it. Parties try to refer in their contract to some basic principles of natural justice, international trade or to lex mercatoria. Parties to a contract may choose any document containing binding rules of behaviour which are precise and stable enough to be used by a court to resolve particular disputes. The UNIDROIT Principles possess these qualities and parties can choose them by any form of declaration of will that is determinable by the court.

The UNIDROIT Principles expressly prescribe in the second sentence of the Preamble that "they shall be applied when the parties have agreed that their contract be governed by them." It is the only manner of usage where the Principles prescribe a strict obligation to the court to apply them, if the parties have chosen this in their contract. The Principles themselves provide a formulation for such choice [69] but this formulation is not sufficient to regulate the situation that we analyse. One must remember that the law chosen by the parties to the contract shall not be used to govern the relationship created by an international contract of sale, but to supplement legal provisions of CISG already governing this relationship. Is the abovementioned formulation sufficient for this purpose? It depends on the conception of choice-of-law that is recognized by a certain legal system. If a court respects choice of law as an absolute method of determination of the applicable law, this choice-of-law clause causes that the sales relationship will be governed solely by the UNIDROIT Principles and all other legal rules, including CISG, will be excluded from its regulation. This conception is respected also by Bonell [70] and is often upheld by arbitrators who are not bound to apply certain domestic law and therefore they treat choice of law made by the contractual parties in its absolute nature.[71] On the contrary, the relative conception of the choice of law incorporates the UNIDROIT Principles into the text of the contract as a form of general commercial terms or interpretational rules and beside them it still applies the applicable law determined by choice of law rules and primarily CISG. This conception is enforced by the domestic courts.

Nevertheless, as it is prescribed in the first sentence of the UNIDOROIT Principles' Preamble, these Principles set out rules for international commercial contracts in general and contain no special rules for international sales contracts. For this reason their exclusive usage for regulation of international sales contracts would not provide expected benefits. Therefore, a special choice-of-law clause has been created in order to use jointly CISG and the UNIDROIT Principles, as it is included in article 14 of the Model Contract for the International Commercial Sale of Perishable Goods.[72] This clause can nevertheless be formulated also this way:

Article X
Choice of Law

      1.   Parties to the Contract have agreed that all matters emerging from this Contract and connected thereto will be governed by the CISG. Any matters governed by the CISG, which are not expressly settled therein, are to be settled in accordance with the UNIDROIT Principles of International Commercial Contracts (2004).

This clause unequivocally prescribes a primary usage of the CISG and secondary, supporting or subsidiary usage of the UNIDROIT Principles for filling the gaps in the text of the Convention. It nevertheless limits the usage of the UNIDROIT Principles only for filling of the internal gaps in the CISG, i.e., matters governed but not expressly prescribed in the Convention. Other matters expressly excluded from the regulation of the Convention would be regulated, with regards to this formulation, in accordance with the applicable law determined by the rules of private international law, most probably by particular domestic law. If our intention is to ensure application of the UNIDROIT Principles to all matters not expressly governed by CISG, even matters expressly excluded from regulation of the Convention, it would be necessary to add to the abovementioned section 1 also a section 2 with this formulation:

      2.   Parties to the Contract have agreed that all matters not included under Art. X sec. 1, i.e., matters excluded from the application of the CISG, will be governed by the UNIDROIT Principles of International Commercial Contracts (2004).

This form of choice of law precisely ensures exclusive application of the CISG and the UNIDROIT Principles without any interference of domestic law. There is also no need to be worried about a situation when neither the CISG nor the UNIDROIT Principles would provide a solution for a particular issue, since the UNIDROIT Principles in article 1.6 contain rules for interpretation and gap-filling of its provisions.

The procedure of determination of the applicable law in Slovakia is regulated by two legal instruments - the Slovak Act on PIL and the Convention Rome I which will be soon replaced by the Regulation Rome I. Since the Rome Convention and subsequently the Rome I Regulation contain a complex set of conflict-of-law provisions for contractual obligations, as is prescribed in article 1 part 1 of the Rome Convention and the Rome I Regulation, respectively, they will be always applied by courts of their member States when determining applicable law for contractual obligations, regardless of the domicile or place of business of the parties to the dispute.

Thereby the application of Slovak Act on PIL is absolutely restricted in these matters. The abovementioned European instruments are directly applicable and have priority over national statutes. What is the reason to analyse admissibility of application of the UNIDROIT Principles under the Act on PIL if there is no possibility to use it? We must take into consideration article 17 of the Rome Convention which states that its provisions "shall apply in a Contracting State to contracts made after the date on which this Convention has entered into force with respect to that State." With respect to the Slovak Republic, this date is 1 August 2006.[73] For all contracts concluded before this date, Slovak courts will have to apply section 9 and the next subsequent provisions of the Act on PIL regardless of when the judicial proceedings were initiated. Since many contracts which are still in operation were concluded before the abovementioned date, it is necessary to analyse also the provisions of the Act on PIL, even more if this analysis leads to conclusions different from ones achieved in case of the Rome Convention and Rome I Regulation.

2.3.3.1 Admissibility of Choice of the UNIDROIT Principles under Act on PIL

The Slovak Act on PIL contains regulation of determination of applicable law of contracts (as the CISG refers to it in art. 7 part 2 CISG) in sections 9 to 15 under the heading Law of Obligations. Sec. 9 part 1 prescribes a general right of the parties to the contract to "choose the law which will regulate their mutual proprietary matters." The only limitation of such right is included in sec. 9 part 3, but it only refers to consumers' protection and the CISG in its art. 2 letter a) expressly excludes such contracts from its scope of regulation. Sec. 9 part 1 creates a broad conception of the choice of law, as it respects choice of any form of "law" and not only the choice of State law. Furthermore, such choice has absolute priority over other forms of determining the applicable law, since sec. 10 of the Act prescribes that the choice-of-law rules contained in it can only be used if no choice of law was made by the parties. The express text of the Act on PIL therefore provides no restriction on the usage of the UNIDROIT Principles as an applicable law determined by the choice of law.

2.3.3.2 Admissibility of Choice of the UNIDROIT Principles under the Rome Convention and Rome I Regulation

The Rome Convention was created in 1980 in a traditional form of international convention which was ratified by all member States of the European Union. From its enactment, it was considered to be formed in a traditional line.[74] Its choice-of-law provisions mostly refer to the usage of the "law of the country."[75] It seems that there would be no place for using the UNIDROIT Principles under this Convention. However, we must analyse strictly article 3 of the Convention which regulates the choice of law in contractual relationships and which states:

"A contract shall be governed by the law chosen by the parties. The choice must be expressed or demonstrated with reasonable certainty by the terms of the contract or the circumstances of the case. By their choice the parties can select the law applicable to the whole or a part only of the contract."

It is clear that the Rome Convention does not use term "law of the country" with respect to choice of law, as it does so in case of determination of the applicable law in absence of such choice. Using the grammatical and systematical method of interpretation, we can conclude that the legislator did not restrict the right of the contractual parties to choose any form of law, because if he intended to do so, he would have used the same term when referring to the chosen law, as is done in case of other choice-of-law provisions.

This theory is nevertheless strongly opposed by a group of legal scholars [76] who argue that the Rome Convention does not in any form refer to usage of non-state legal instruments and, therefore, taking into consideration the Convention's traditional line, it did not even anticipate a hypothetical usage of non-State law for such purposes. There is also another group of legal scholars who claim that such absence of strict denial of using non-State law for these purposes (as its usage is not prescribed in one way or another) empowers contractual parties to choose such law.[77] Furthermore, it is clear that if the Rome Convention intends to present a viable legal rule governing determination of applicable law in contractual matter also 25 years after its enactment which would still be useful in changing social and economic circumstances, its interpretation has to be performed in conformity with actual concepts of law, rather than with the concepts valid at the time of its creation, in order to achieve at least a partial flexibility. As Oser states [78]

"Notably, the great codifications of private substantive law have survived the strain of time precisely because they have remained open to new developments and exigencies not yet existing at the time of their enactment. The same must be valid for codifications of private international law."

With reference to the abovementioned, the Rome Convention does not limit the freedom of the parties to use non-State law such as the UNIDROIT Principles as the applicable law of their contracts by means of choice of law.

Twenty eight years after enactment of the Rome Convention, on 17 June 2008 a new legal instrument for determining the law applicable to contractual matters was created as the Rome I Regulation. Though the major part of its provisions correspond to the existing provisions of the Rome Convention, including the controversial art. 3 part 1, the Regulation nevertheless provides a clearer answer to the problem of using non-State law as an applicable law chosen by the parties to the contract. The first argument in favour of such usage is that at the time of drafting of the Regulation, the legislators were aware of the discussions proceeding about the usage of term "the law" as opposed to "the law of a country." Despite knowing that this distinction is used as an argument for admitting usage of non-State law, the legislators did not change the wording of this article and thereby tacitly agreed with this argument. This intent of the legislators is supported by further express statements made in the initial recitals to the Regulation which states in paragraph 11:

"The parties' freedom to choose the applicable law should be one of the cornerstones of the system of conflict-of-law rules in matters of contractual obligations."

Furthermore, in paragraph 13 of the recitals it is written:

"This Regulation does not preclude parties from incorporating by reference into their contract a non-State body of law or an international convention."

This provision clearly facilitates usage of the UNIDROIT Principles or other form of non-State law for this purpose. The Regulation thereby casts away all doubts about admissibility of using such forms of law under this instrument.

2.3.4 UNIDROIT Principles as an Applicable Law Determined by Rules of Private International Law in Absence of Choice of Law

It is clear from the jurisprudence on international business that most of the sales contracts do not contain a special choice-of-law clause for gap-filling of the CISG, as this clause was suggested previously. On the contrary, contractual parties usually leave this issue unsettled and thereby rely on the rules of private international law, as they are mentioned in article 7 part 2 CISG.

2.3.4.1 UNIDROIT Principles as an Applicable Law Determined by the Act on PIL

Admissibility of using the UNIDROIT Principles for this purpose will depend on the formulation of the choice-of-law rules in a particular legal system. If we take an example of a broad conception of such rule, as it is formulated in section 10 part 1 of the Slovak Act on PIL, supplementing of gaps in CISG will be performed by "the body of law which assures reasonable solution of the case." Since the Act does not define the notion "body of law," it must be interpreted in a broad way and therefore it must include also the UNIDROIT Principles. We must also take into consideration the character of relationships emerging from an international contract of sale. These relationships have a different character in comparison with purely internal relationships and therefore they should not be automatically governed by domestic law which would be used to govern purely domestic relationships. As Oser states,[79] although it at first seems that a domestic statute provides sufficient solutions for international sales relationships, this statute is primarily created to govern internal relationships. This aim is visible from the legislator's purpose to react on social, economic and cultural circumstances of the particular country and to regulate relationships emerging from them. For this reason, there is no internal statute that would reflect particularities of international trade relationships and would be created for their regulation. On the other hand, the UNIDROIT Principles were deliberately created to reflect the needs of international trade and this aim influenced its entire creation and conception. If a law such as section 10 part 1 of the Slovak Act on PIL determines as a law applicable to international sale of goods, the law which "assures reasonable solution of the case," it could be the UNIDROIT Principles or another internationally unified body of law, rather than any domestic law. For this reason, even if the parties did not choose the UNIDROIT Principles to supplement provisions of the CISG, the Principles ought to be applied in this manner, if the lex fori prescribes such broad determination of the applicable law, as it is in case with section 10 part 1 of the Slovak Act on PIL.

The formulation prescribed in sec. 10 part 1 provides a broad autonomy to a judge when determining the applicable law. The judge is not bound by strictly formulated connecting factors but it is his duty to investigate the relationship in question in order to find out and prove which aspects of this relationship are the most important and which law can be the most suitable to provide solutions with respect to the character of this relationship. This method of determining the applicable law would in my opinion stand ground towards Anglo-American critics of the traditional civil-law conception of choice of law, which is said to be too narrow and not respecting particularities of each case.

2.3.4.2 UNIDROIT Principles as an Applicable Law Determined by the Rome Convention and the Rome I Regulation

As it was already mentioned, both the Rome Convention and the Rome I Regulation are construed in a traditional manner and refer solely to application of "the law of a country" (besides the abovementioned case of choice of law) and thereby follow the etatist conception. Article 4 part 1 of the Rome Convention clearly prescribes:

"To the extent that the law applicable to the contract has not been chosen in accordance with article 3, the contract shall be governed by the law of the country with which it is most closely connected."

Although this provision does grant to some extent discretion to choose the "proper law," this discretion is restricted to choosing of the law of one of the States. This provision clearly excludes any possibility of using non-State law as an applicable law and this fact is approved, though being criticized at the same time, by legal theory.[80] Such procedure of determining the applicable law does not respect the international character of legal relationships in question and categorizes them into one or another domestic law relationship.

Article 4 part 1 governing determination of the applicable law in case of absence of choice was changed substantially in the course of creating the Regulation. Instead of the general clause, separate choice-of-law clauses were created for particular types of contracts and with respect to a contract of sale the letter a) of this provision prescribes:

"a contract for the sale of goods shall be governed by the law of the country where the seller has his habitual residence."

At the same time, article 4 constrains the so-called escape clause in part 3 which states:

"Where it is clear from all the circumstances of the case that the contract is manifestly more closely connected with a country other than that indicated in paragraphs 1 or 2, the law of that other country shall apply."

Thereby, a kind of relic of the original general clause remained in the text of the Regulation but it still refers only to the law of a State. Also, the abovementioned provisions no. 11 and 13 of the Regulation recitals are of no effect here.

It is clear that in absence of the choice of the UNIDROIT Principles, it is impossible to determine them as an applicable law under the Rome Convention or the Rome I. Regulation. The only way to use them in such a case is to investigate their possible usage under the applicable domestic law as a form of interpretational rules or general contract terms.

2.3.5 Usefulness of the UNIDROIT Principles for Supplementing Gaps in the CISG

While in the entire previous text I tried to justify the admissibility of using the UNIDROIT Principles for filling gaps in the CISG, as it is a matter most criticized by the opponents of such usage, there is no substantial disagreement among the scholars with respect to the usefulness of such joint usage.[81] It is generally acknowledged that international trade law lacks written legal instruments regulating its relationships. The CISG itself is only a regulation of a specific type of contract - a sales contract - and lacks regulation of general legal issues which after all play an important role in each dispute. For this reason, the court is usually forced to search for abstract principles of international trade law that are not expressly enumerated in any existing instrument and it therefore often chooses the easier way to apply domestic law in order to regulate these issues, while in its most favourable situation it applies the lex fori. There is a tendency of judges all over the world [82] to apply lex fori in such cases, as they are most familiar with it, but this tendency is often criticized by legal scholars who point out that the CISG (as well as other international uniform rules) should be "free from any influences ... which are purely domestic."[83] Besides the criticism from legal theory, by applying lex fori to an inappropriate extent, the court risks breaching its duty prescribed in article 7 part 1 CISG because it clearly does not observe the international character of the Convention and the need for its uniform application. This duty is breached in such a way every time a general principle of CISG actually exists and therefore the provisions of the Convention could have been supplemented in this manner.

The UNIDROIT Principles, on the other hand, provide the court with an express formulation of such general principles of international trade law and can thereby facilitate a court's efforts to determine the general principles of CISG.[84] The Principles are construed in a form of civil law code, i.e., they form a systematic and comprehensible set of legal rules. By adding a commentary to these provisions the Principles facilitate the judge's orientation in the text and its application to particular issues.

The usage of the Principles is also profitable for the parties to the dispute as they are from different States and often from different legal cultures. The Principles intentionally use neutral legal terminology which provides no advantage for any legal culture but also make it possible to qualify these neutral legal terms under legal institutes existing in certain domestic law. This method helps the parties to understand legal issues concerned in their dispute. On the contrary, usage of particular domestic law provides advantage to one party in a dispute, particularly if this law is the party's "own" law. This inequality of experience is eliminated in case of using of the UNIDROIT Principles. Furthermore, its usage eliminates also the language barrier which is usual in disputes with international aspect. Domestic law is usually not available in other language forms than the official language of this country, which makes it harder for the "foreign" party to understand it. On the other hand, the Principles (more precisely its 2004 version) besides its official language versions (Italian, French, English, German and Spanish [85]) were also translated to other languages as Chinese, Farsi, Japanese, Korean, Romanian, Russian, Portuguese, Serbian, Turk and Vietnamese and the number of versions is gradually increasing.[86] Therefore the Principles are better adjusted for international usage than is the case with domestic law.

Furthermore, the majority of scholars underline the balance and fairness of the Principles: they do not provide a more favourable position to either of the contractual parties but provide equal protection to both sides. This is not the case in various domestic laws which, with regards to special social or political circumstances, favour one contractual party over another.[87]

Last but not least, the Principles, being systematic and precise in their formulation and accompanied by a comprehensive commentary, create a useful tool for the judge in application of the CISG, as they are compatible with the Convention. In this manner the Principles can be treated as advice from "wise men" to the court on how to interpret and apply the Convention.[88]

The most accurate review of usefulness of supplementing the CISG by the UNIDROIT Principles is provided by Bridge,[89] who states that if the resolution of particular issues is left unsettled in the CISG and the UNIDROIT Principles can help to settle such resolution, there is no reason why the UNIDROIT Principles could not promote development of the CISG at least to the same extent as legal theory and jurisprudence.

2.4 Tendency of State Courts to Directly Apply Domestic Law with Respect to the Practice of Courts in Slovakia

Despite my brave defending of a right or at some stages a duty to use the UNIDROIT Principles in order to supplement gaps in the CISG, it is clear that the actual situation of using of the Principles for this purpose is not as direct and simple as it should be according to the legal theory. Courts often insist on direct application of internal law right after getting through the express text of the Convention. They do not make any efforts to search for the general principles either by studying legal theory or worldwide jurisprudence. What are the reasons for such behaviour? Let us name a few:

   -    Insufficient experience of judges with application of the CISG;
 
   -    Insisting on the etatist conception of law - courts are ready to apply other than internal law only in case they are forced to do so by an international convention published in the Collection of Acts. Also in case of applying it, they apply only its express text and then, without any hesitation, turn to apply internal law;
 
   -    An effort to regulate international business relationships by their domestic law in as many cases as possible in order for the court to apply the domestic law, with which the court is most familiar.

In the case of Slovak jurisprudence, there is another, though less visible reason for such conduct. It is the character of the domestic law itself, where contracts of sale are regulated by sections 409 to 475 of the Slovak Commercial Code. The drafting of this regulation in 1991 was to a great extent influenced by the CISG and as it is stressed by legal theory [90] "legal regulation of the sales contract in the Commercial Code generally corresponds to the uniform regulation established by the CISG, enacted in Vienna in 1980." It is natural, that internal legal regulation prescribed in the Slovak Commercial Code, although derived from the CISG, is more precise and elaborated. For this reason, it seems to be profitable for the court to use the relevant provisions of the Slovak Commercial Code in order to supplement the provisions of the CISG. This procedure is even recommended by the Slovak legal theory,[91] which states: "In case of lack of regulation of certain issue in the CISG, the substantive law of the applicable domestic law will be decisive." It must be nevertheless noted that this procedure, though being frequently used, is harmful to the very nature of the Convention and is in conflict with provisions of art. 7 part 1 and part 2 CISG. Furthermore, the court thereby applies an incorrect legal rule which constitutes with regard to constant jurisprudence of the Slovak Constitutional Court [92] a serious defect of the court proceedings and causes a denial of the right to fair proceedings vested in article 46 of the Slovak Constitution. Such conduct is therefore not only harmful to international uniform instruments but also violates basic rights of people guaranteed by the Slovak Constitution.


BIBLIOGRAPHY

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6. BONELL, M. J.: An International Restatement of Contract Law, Transnational Publishers, New York 2005, p. 691, ISBN: 1-57105-347-6

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9. BONELL, M. J.: The UNIDROIT Principles of International Commercial Contracts and the Harmonisation of International Sales Law, p. 5 - 18, IN: Lefebvre, G.: Les Principes d' Unidroit et les contrats internationaux: Aspects pratiques, Les Éditions Thémis, Canada 2003, p. 220, ISBN: 2-89400-174-6

10. BONELL, M. J.: The UNIDROIT Principles of International Commercial Contracts and the Harmonisation of International Sales Law, IN: <http://www.themis.umontreal.ca/pdf/rjtvol36num2/bonell.pdf>

11. BONELL, M.J.: Zsady UNIDROIT a Viedensk dohovor - alternatvne alebo doplujce sa nstroje medzinrodného obchodu? IN: Právny obzor, Ústav štátu a práva SAV, 79, 1996, No. 4, p. 271-286

12. BONELL, M.J.: Zásady UNIDROIT a Zásady európskeho zmluvného práva - podobné pravidlá pre zhodné ciele? IN: Právny obzor, Ústav štátu a práva SAV, 80, 1997, No. 2, p. 109-128

13. BRIDGE, M.: The International Sale of Goods: Law and Practice, Oxford University Press 2007, ISBN: 0-19-927358-4

14. CEPELKA, C.: Právo mezinárodních smluv, Vdesk mluva o smluvnm prvu (1969) s komentem, Karolinum, Praha 1999, ISBN: 80-7184-970-7 p. 202

15. DE LY, F.: Uniform Interpretation: What is being done? Official Efforts, IN: Ferrari, F.: The 1980 Uniform Sales Law: Old Issues Revisited in the Light of Recent Experiences: Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 360, ISBN: 88-14-10366-6, p. 335 - 360

16. DOBIŠOVÁ, A.: Aplikácia Viedenského Dohovoru o zmluvách o medzinárodnej kúpe tovaru v medzinárodnom rozhodcovskom konan, Justin revue, 58, 2006, No. 8-9, p. 1266-1273

17. DRGONEC, J.: Ústava Slovenskej republiky - Komentár, Heuréka, Šamorín 2004, p. 811, ISBN: 80-89122-05-1

18. FAWCETT, J.; HARRIS, J.; BRIDGE, M.: International Sale of Goods in the Conflict of Laws, Oxford University Press 2005, p. 1458, ISBN: 0-19-924469-3

19. FERRARI, F.: General Principles and International Uniform Commercial Law Conventions: A Study of the 1980 Vienna Sales Convention and the 1988 UNIDROIT Conventions on International Factoring and Leasing and the UNIDROIT Principles, IN: European Journal of Law Reform, 1, 1999, No. 3, ISSN: 1875-8274, p. 217 - 241

20. FLECHTNER, H. M.: The CISG's Impact on International Unification Efforts: the UNIDROIT Principles of International Commercial Contracts and the Principles of European Contract Law, IN: Ferrari, F.: The 1980 Uniform Sales Law : Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 360, ISBN: 88-14-10366-6, p. 169 - 197

21. GARRO, A. M.: The Gap-filling Role of the UNIDROIT Principles in International Sales Law: Some Comments on the Interplay Between the Principles and the CISG, IN: Tulane Law Review, 69, 1995, No. 5, ISSN: 0041-3992, p. 1149 - 1190

22. GOODE, R.: Usage and its reception in transnational commercial law, IN: The international and comparative law quarterly, 46, 1997, No. 1, ISSN: 0020-5893, p. 1-36

23. HARTKAMP, A.: The UNIDROIT Principles For International Commercial Contracts and the United Nations Convention on Contracts for the International Sale of Goods,IN: Boele-Woelki; Grosheide; Hondius; Steenhoff: Comparability and Evaluation, Dordrecht, Boston, London 1994 IN: <http://tldb.uni-koeln.de/php/pub_show_content.php?page=pub_show_document.php&pubdocid=113100&pubwithtoc=ja&pubwithmeta=ja>

24. KANDA, A.: mluva OSN o smlouvch o mezinrodn koupi zbož jako soust našeho prvnho du, IN: Prvnk, 138, 1999, No. 1, p. 1-16

25. KANDA, A.: Zásady mezinárodních obchodních smluv, nový trend ve vývoji závazkového práva, IN: Právník, 138, 1999, No. 2, p. 105-124

26. KRITZER, A. H.: General observations on use of the UNIDROIT Principles to help interpret the CISG, IN:<http://www.cisg.law.pace.edu/cisg/text/matchup/general-observations.html>

27. KRONKE, H.: The UN Sales Convention, the UNIDROIT Contract Principles and the Way Beyond, IN: <http://www.uncitral.org/pdf/english/CISG25/Kronke.pdf>

28. LANDO, O.: CISG and Its Followers: A Proposal to Adopt Some International Principles of Contract Law, IN: American Journal of Comparative Law, 53, 2005, No. 2, ISSN: 0002-919X, p. 379 - 401

29. LANDO, O.: The CISG and the UNIDROIT Principles in a Global Commercial Code, IN: Mélanges Offerts Á Marcel Fontaine, De Boeck & Larcier 2003, p. 884, ISBN: 2-8044-1083-8, p. 451 - 472

30. LARIŠOV, M.; TOMAŠNOVÁ, J.: Zásady mezinárodních obchodních smluv UNIDROIT, CODEX Bohemia, Praha 1997, p. 348, ISBN:80-85963-29-9

31. MANN, F. A.: The Interpretation of Uniform Statutes, 62 Law Quarterly Review (1946) 278-291, IN:

<http://cisgw3.law.pace.edu/cisg/biblio/mann.html>

32. MANN, F. A.: Uniform Statutes in English Law, 94 Law Quarterly Review (1983) 376-406, IN: <http://cisgw3.law.pace.edu/cisg/biblio/mann1.html>

33. OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 184, ISBN: 978-90.04-16789-6

34. OVEKOV, O. a kol.: Obchodn zkonnk - komentr, Iura Edition, Bratislava 2005, p. 663, ISBN: 80-8078-027-7

35. POREDOŠ, F.; URIŠ, M.; LYSINA, P.: Zklady medzinrodného prva skromného, PF UK, Bratislava 2005, p. 244, ISBN: 80-7160-193-4

36. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 331, ISBN: 80-7160-094-6

37. ROZEHNALOV, N.: Aplikace unifikovaného hmotného prva upravujcho mezinrodn kupn smlouvu, IN: asopis pro prvn vdu a praxi, MU Brno, 11, 2003, No. 1, p. 22-29

38. SAF, C.: A Study of the Interplay between the Conventions Governing International Contracts of Sale, IN: <http://www.cisg.law.pace.edu/cisg/text/saf95.html>

39. SCHLECTHRIEM, P.; SCHWENTZER, I.: Commentary on the UN Convention on International Sale of Goods (CISG), Oxford University Press 2005, p. 1149, ISBN: 0-19-927518-1

40. STELEC, K.: Reflexe vztahu Zsad mezinrodnch obchodnch smluv UNIDROIT a Princip evropského smluvnho prva, IN: asopis pro prvn vdu a praxi, MU Brno, 11, 2003, No. 3, p. 253-257

41. ŠVIDRO. J.: Zsady medzinrodnch obchodnch zmlv, Iura Edition, Bratislava 1996, p. 324, ISBN: 80-88715-21-0

42. TEICHERT, U.: Lückenfüllung im CISG mittels UNIDROIT-Prinzipien: zugleich ein Betrag zur Wählbarkeit nichtstaatlichen Rechts, Lang, Frankfurt 2006, p. 300, ISBN: 3-631-55647-0

43. VENEZIANO, A.: Uniform Interpretation: What is being done? Unofficial Efforts and Their Impact, IN: Ferrari, F.: The 1980 Uniform Sales Law: Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 360, ISBN: 88-14-10366-6, p. 325 - 333


FOOTNOTES

1. As it is prescribed in sec. 2 of act no. 1/1993 Col. on Collection of Acts of the Slovak Republic as amended: "Everything that has been published in the Collection of Acts is presumed to be known to every person concerned from the moment of publication of the act. This presumption is irrefutable."

2. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 296.

3. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 296-297.

4. MANN, F. A.: The Interpretation of Uniform Statutes, 62 Law Quarterly Review (1946), p. 280

5. SCHLECHTRIEM, P.; SCHWENZER, I.: Commentary on the UN Convention on International Sale of Goods (CISG), Oxford University Press 2005, p. 101.

6. For futher information see PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 296-297

7. MANN, F. A.: The Interpretation of Uniform Statutes, 62 Law Quarterly Review (1946), p. 278

8. SCHLECHTRIEM, P.; SCHWENZER, I.: Commentary on the UN Convention on International Sale of Goods (CISG), Oxford University Press 2005, p. 102.

9. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 298.

10. Vienna Convention on the Law of Treaties signed on 3 May 1969 in Vienna

11. CEPELKA, C.: Prvo mezinrodnch smluv, Vdesk mluva o smluvnm prvu (1969) s komentem, Karolinum, Praha 1999, p. 55

12. MANN, F. A.: Uniform Statutes in English Law, 94 Law Quarterly Review (1983) p. 378

13. There have been several efforts to elaborate such thesaurus for CISG, see for example the project of Global Sales Law - Thesaurus at http://www.globalsaleslaw.org/index.cfm?pageID=11

14. MANN, F. A.: Uniform Statutes in English Law, 94 Law Quarterly Review (1983) p. 385

15. CEPELKA, C.: Právo mezinárodních smluv, Vídesk mluva o smluvnm prvu (1969) s komentem, Karolinum, Praha 1999, p. 57

16. Defined in the Convention as "interpretation of this Convention."

17. Defined in the Convention as "settling questions concerning matters governed by this Convention which are not expressly settled in it."

18. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 299.

19. BONELL, M. J.: The UNIDROIT Principles of International Commercial Contracts and the Harmonisation of International Sales Law, p. 340.

20. BONELL, M. J.: The UNIDROIT Principles of International Commercial Contracts and the Harmonisation of International Sales Law, p. 341, see footnotes of the text for examples of particular cathegories.

21. BOELE-WOELKI, K.: Terms of Co-Existence: the CISG and the Unidroit Principles, IN: International Contract Law 2003, Intersentia, Oxford 2004, p. 296.

22. See e.g.: BASEDOW, J.: The UNIDROIT Principles of International Commercial Contracts and German Law, p. 15.

23. See e.g. DE LY, F.: Uniform Interpretation: What is being done? Official Efforts, in: Ferrari, F.: The 1980 Uniform Sales Law : Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 341.

24. See also BASEDOW, J: The UNIDROIT Principles of International Commercial Contracts and German Law, p. 15.

25. BRIDGE, M.: The International Sale of Goods: Law and Practice, Oxford University Press 2007, p. 535.

26. See e.g.: FERRARI, F.: General Principles and International Uniform Commercial Law Conventions: A Study of the 1980 Vienna Sales Convention and the 1988 UNIDROIT Conventions on International Factoring and Leasing and the UNIDROIT Principles, in: European Journal of Law Reform, 1, 1999, no. 3, p. 221-223 or TEICHERT, U.: Lückenfüllung im CISG mittels UNIDROIT-Prinzipien: zugleich ein Betrag zur Wählbarkeit nichtstaatlichen Rechts, Lang, Frankfurt 2006, p. 108 - 109.

27. See SCHLECHTRIEM, P.; SCHWENZER, I.: Commentary on the UN Convention on International Sale of Goods (CISG), Oxford University Press 2005, p. 106-109 or BONELL, M. J.: The UNIDROIT Principles of International Commercial Contracts and the Harmonisation of International Sales Law, p. 340-341.

28. E. g. regulation of issues not expressly prescribed in the Slovak Commercial Code - under its sec. 1 part 4 these issues will be governed by the Slovak Civil Code.

29. See FERRARI, F.: General Principles and International Uniform Commercial Law Conventions: A Study of the 1980 Vienna Sales Convention and the 1988 UNIDROIT Conventions on International Factoring and Leasing and the UNIDROIT Principles, in: European Journal of Law Reform, 1, 1999, No. 3, p. 226.

30. Uniform Law on the International Sale of Goods OF 1964.

31. SCHLECHTRIEM, P.; SCHWENZER, I.: Commentary on the UN Convention on International Sale of Goods (CISG), Oxford University Press 2005, p. 93.

32. ULIS was in force only in nine states, see <http://www.unidroit.org/english/implement/i-64ulis.pdf>.

33. Jenard Report published in Official Journal on 05 March 1979, OJ, C 59.

34. Jenard/Mõller Report published in Official Journal on 28 July 1990, OJ, C 189.

35. Giuliano/Lagarde Report published in Official Journal on 31 October 1980, OJ, C 282.

36. Borras Report published in Official Journal on 16 July 1998, OJ, C 221.

37. See also DE LY, F.: Uniform Interpretation: What is being done? Official Efforts, in: Ferrari, F.: The 1980 Uniform Sales Law : Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 345-346 and footnotes no. 36, 37, 38.

38. ANDERSEN, C. B.: The Uniform International Sales Law and the Global Jurisconsultorium, 24 Journal of Law and Commerce (2005), p. 166

39. DE LY, F.: Uniform Interpretation: What is being done? Official Efforts, in: Ferrari, F.: The 1980 Uniform Sales Law : Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 347 - 348.

This unsuccessful project was to a large extent substituted by the CISG Advisory Council as a private initiative of leading legal scholars who analyse application of CISG and elaborate opinions on problematic issues. For further information see <http://www.cisgac.com/>.

40. This power was vested in the European Court of Justice by the First Protocol on the Interpretation of the Convention by the Court of Justice published in Official Journal, OJ C 027.

41. For further infromation see <http://ec.europa.eu/civiljustice/index_sk.htm>.

42. ANDERSEN, C. B.: The Uniform International Sales Law and the Global Jurisconsultorium, 24 Journal of Law and Commerce (2005), p. 159

43. E.g. ROZEHNALOV, N.: Aplikace unifikovaného hmotného prva upravujcho mezinrodn kupn smlouvu, IN: asopis pro prvn vdu a praxi, MU Brno, ro. 11, 2003, no. 1, p. 22-29 as a reaction to the resolution of the Superior Court in Olomouc, rec. no. 7 Cmo 587/2000-147.

44. <http://www.cisg.law.pace.edu/>.

45. <http://www.unilex.info/>.

46. <http://cisgw3.law.pace.edu/network.html>.

47. ANDERSEN, C. B.: The Uniform International Sales Law and the Global Jurisconsultorium, 24 Journal of Law and Commerce (2005), p. 177

48. ANDERSEN, C. B.: The Uniform International Sales Law and the Global Jurisconsultorium, 24 Journal of Law and Commerce (2005), p. 175

49. MANN, F. A.: Uniform Statutes in English Law, 94 Law Quarterly Review (1983) p. 383

50. ANDERSEN, C. B.: The Uniform International Sales Law and the Global Jurisconsultorium, 24 Journal of Law and Commerce (2005), p. 161

51. See SCHLECHTRIEM, P.; SCHWENZER, I.: Commentary on the UN Convention on International Sale of Goods (CISG), Oxford University Press 2005, p. 104-105; TEICHERT, U.: Lückenfüllung im CISG mittels UNIDROIT-Prinzipien: zugleich ein Betrag zur Wählbarkeit nichtstaatlichen Rechts, Lang, Frankfurt 2006, p. 194-200.

52. FERRARI, F.: General Principles and International Uniform Commercial Law Conventions: A Study of the 1980 Vienna Sales Convention and the 1988 UNIDROIT Conventions on International Factoring and Leasing and the UNIDROIT Principles, in: European Journal of Law Reform, 1, 1999, No. 3, p. 228.

53. KRITZER, A. H.: General observations on use of the UNIDROIT Principles to help interpret the CISG, p. 2-3.

54. BONELL, M. J.: An International Restatement of Contract Law, Transnational Publishers, New York 2005, p. 232.

55. BONELL, M. J.: An International Restatement of Contract Law, Transnational Publishers, New York 2005, p. 305-306.

56. Although the UNIDROIT Principles in the sixth sentence of the Preamble provide a possibility for using the Prinicples for interpretation of domestic law, this form of their usage is only occassional, as domestic law usually precisely prescribes issues of contract law.

57. Integral version of UNIDROIT Principles of International Commercial Contracts 2004, Introduction to the 2004 Edition, p. Vii.

58. Integral version 2004. Integral version of UNIDROIT Principles of International Commercial Contracts 2004, Introduction to the 2004 Edition, p. Viii.

59. FLECHTNER, H. M.: The CISG's Impact on International Unification Efforts: the UNIDROIT Principles of International Commercial Contracts and the Principles of European Contract Law, in: Ferrari, F.: The 1980 Uniform Sales Law : Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 197.

60. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 184.

61. PRUSÁK, J.: Teória práva, PF UK, Bratislava 1997, p. 180.

62. Sec. 264 of the Slovak Commercial Code.

63. Sec. 730 of the Slovak Commercial Code.

64. GOODE, R.: Usage and its reception in transnational commercial law, in: The international and comparative law quarterly, 46, 1997, 1 , p. 7.

65. For further information on the reaction of merchants to the UNIDROIT Principles see: BONELL, M. J.: The UNIDROIT Principles in Practice - the Experience of the First Two Years.

66. Valid on 21 August 2008, see list of states at: <http://www.unidroit.org/english/members/main.htm>.

67. For a detailed information about this procedure see OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 101-103.

68. OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 103.

69. as it is prescribed in a footnote to the second sentence of the Preamble "Parties wishing to provide that their agreemnet be governed by the Principles might use the following words, adding any desired exceptions or modifications: 'This contract shall be governed by the UNIDROIT Principles (2004) [except as to Articles ...]'."

70. BONELL, M. J.: An International Restatement of Contract Law, Transnational Publishers, New York 2005, s. 316.

71. See commentary to the Preamble of the Principles 4 a).

72. KRONKE, H.: The UN Sales Convention, the UNIDROIT Contract Principles and the Way Beyond, s. 453.

73. Slovak Republic acceded to the Convention together with other new EU member states by ratifying the Convention of Accession to the Convention that was published in the Collection of Acts as a notice of Ministry of Foreign Affairs no. 474/2006 Coll.).

74. BOELE-WOELKI, K.: Zásady UNIDROIT, Zásady európskeho zmluvného práva a medzinárodné súkromné právo II, IN: Právny obzor, Ústav štátu a práva SAV, 81, 1998, no. 2, p. 113.

75. See e.g. art. 4 part 1 of the Rome Convention.

76. E.g. BOELE-WOELKI, K.: Zásady UNIDROIT, Zásady európskeho zmluvného práva a medzinárodné súkromné právo II, in: Právny obzor, Ústav štátu a práva SAV, 81, 1998, no. 2, p. 113-114; BRIDGE, M.: The International Sale of Goods: Law and Practice, Oxford University Press 2007, p. 530.

77. BRIDGE, M.: The International Sale of Goods: Law and Practice, Oxford University Press 2007, p. 531; OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 125.

78. OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 125.

79. OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 86 - 87.

80. OSER, D.: The UNIDROIT Principles of International Commercial Contracts: A Governing Law?, Martinus Nijhoff Publishers, Netherlands 2008, p. 140.

81. See also: VENEZIANO, A.: Uniform Interpretation: What is being done? Unofficial Efforts and Their Impact, in: Ferrari, F.: The 1980 Uniform Sales Law : Old Issues Revisited in the Light of Recent Experiences : Verona Conference 2003, Sellier. European Law Publishers, Milano 2003, p. 332.

82. MANN, F. A.: The Interpretation of Uniform Statutes, 62 Law Quarterly Review (1946), p. 284 - 285

83. ANDERSEN, C. B.: The Uniform International Sales Law and the Global Jurisconsultorium, 24 Journal of Law and Commerce (2005), p. 163

84. See also BONELL, M. J.: The UNIDROIT Principles of International Commercial Contracts and the Harmonisation of International Sales Law, p. 348.

85. A choice of these official language versions is determined by procedural languages of UNIDROIT, enumerated in art. 10 of the Statute of UNIDROIT. The official language versions of the UNIDROIT Principles 2004 are available at <http://www.unidroit.org/english/principles/contracts/main.htm>.

86. The 1994 version of the UNIDROIT Principles was also translated to the Slovak language ŠVIDRO. J.: Zsady medzinrodnch obchodnch zmlv, Iura Edition, Bratislava 1996, p. 324, ISBN: 80-88715-21-0 and Czech - LARIŠOV, M.; TOMAŠNOV, J.: Zsady mezinrodnch obchodnch smluv UNIDROIT, CODEX Bohemia, Praha 1997, p. 348.

87. See e.g..: BOELE-WOELKI, K.: Terms of Co-Existence: the CISG and the Unidroit Principles, IN: International Contract Law 2003, Intersentia, Oxford 2004, p. 303; GARRO, A. M.: The Gap-filling Role of the UNIDROIT Principles in International Sales Law: Some Comments on the Interplay Between the Principles and the CISG, in: Tulane Law Review, 69, 1995, no. 5, p. 1153.

88. KRITZER, A. H.: General observations on use of the UNIDROIT Principles to help interpret the CISG, p. 1.

89. BRIDGE, M.: The International Sale of Goods: Law and Practice, Oxford University Press 2007, p. 539-540.

90. OVEKOV, O. a kol.: Obchodn zkonnk - komentr, Iura Edition, Bratislava 2005, p. 220.

91. OVEKOV, O. a kol.: Obchodn zkonnk - komentr, Iura Edition, Bratislava 2005, p. 221.

92. "Within the scope of the basic right to fair proceedings is also a right to decision under relevant legal rule emerging from the Slovak law or international conventions ratified by the Slovak Republic and published in accordance with law." Finding of the Constitutional Court of the Slovak Republic of 27 November 2002, rec. no. IV. US 77/02, art. II second paragraph.


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