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Published in J. Herbots editor / R. Blanpain general editor, International Encyclopaedia of Laws - Contracts, Suppl. 29 (December 2000) 1-192. Reproduced with permission of the publisher Kluwer Law International, The Hague.

[For more current case annotated texts by this author, see Bernstein & Lookofsky, Understanding the CISG in Europe, 2d ed. (2003) and Lookofsky, Understanding the CISG in the USA, 2d ed. (2004).]

excerpt from

The 1980 United Nations Convention on Contracts
for the International Sale of Goods

Joseph Lookofsky

Article 45
Remedies for Breach of Contract by the Seller

  1. Introduction
  2. Performance, Avoidance and Damages for Breach
  3. No-Fault Liability Based on Breach
  4. Relationship Among Remedies
  5. No Grace Period in CISG Context

A. Introduction

208. Section III of Chapter II (Articles 45-52) is entitled 'Remedies for Breach of Contract by the Seller.'

These remedial rules form the core of the Convention regime. For every breach by the seller of an enforceable CISG sales contract, there must be some remedy.[1] Article 45(1) summarizes the remedies which the Convention makes available to the buyer for seller's breach: [page 114]

'If the seller fails to perform any of his obligations under the contract or this Convention, the buyer may:
a) exercise the rights provided in articles 46 to 52;
b) claim damages as provided in articles 74 to 77.'

1. See the Overview, supra No. 40 et seq. See also generally Lookofsky, J., 'Remedies for Breach under the CISG,' Ch. 43 in Commercial Damages (New York, 2000).

B. Performance, Avoidance and Damages for Breach

209. The buyer's remedial rights, which are referred to in subparagraph (a) of Article 45(1), and more carefully detailed in Articles 46 to 52, concern the right to require specific performance and the right to avoid.

Subparagraph (b) of Article 45(1) refers to the rules in Chapter V of CISG Part III (Provisions Common to the Obligations of the Seller and of the Buyer) which concern the extent and measurement of damages for breach.

Whether a given breach entitles a buyer to relief within one or more of these three fundamental remedial categories will always depend both on the particular circumstances and on the applicable CISG rule(s).

C. No-Fault Liability Based on Breach

210. On the other hand, it should be emphasized that Article 45 does not merely provide a 'catalogue' of the buyer's various CISG remedies for seller's breach. In particular, Article 45(1) constitutes the very source of the buyer's right to claim damages for breach.[1] According to Article 45(I)(b): 'If the seller fails to perform any of his obligations under the contract or this Convention, the buyer may ... claim damages as provided in articles 74 to 77.'

Since the buyer may thus claim damages for any breach (failure to perform), and since (as will be seen) Articles 74-77 concern only the extent and measurement of damages, Article 45(1) clearly represents a no-fault liability rule: i.e., assuming that the injured party has suffered some loss, the basis of Convention liability in damages is the breach itself, without more. (The limited 'exemptions' made available to the seller under Article 79 do not water Article 45(1)(b) down to a rule of liability based on culpa or fault).[2]

1. See A/CONF./97/5, para. I of the Secretariat's Commentary to Article 41 of the 1978 Draft Convention.
2. See Lookofsky, J., 'Fault and No-Fault in Danish, American and International Sales Law. The Reception of the 1980 United Nations Sales Convention', 27 Scandinavian Studies in Law 109 (1983) [available at <http://www.cisg.law.pace.edu/cisg/biblio/lookofsky4.html>]. The fears previously expressed by Nicholas, B. ('Force Majeure, and Frustration', 27 Am. J. Comp. 1. 231, 1979) [available at <http://www.cisg.law.pace.edu/cisg/biblio/nicholas.html>] have thus proved unfounded: regarding the developing case law under Article 79 see infra No. 298 et seq. [page 115]

D. Relationship Among Remedies

211. As indicated previously,[1] the right to demand specific performance (require that the seller perform) is not compatible with the right to avoid (demand an end to the obligations of both parties),[2] but there is no mutual exclusivity as between the right to demand either specific performance or termination (on the one hand) and the right to demand damages (on the other). Article 45(2) confirms the point: 'The buyer is not deprived of any rights he may have to claim damages by exercising his right to other remedies.'

1. Supra No. 43.
2. By definition, a party who 'terminates' a contract puts an end to both parties' right to demand specific relief.

E. No Grace Period in CISG Context

212. Under some domestic legal systems, a (serious) delay in delivery does not necessarily give the buyer the right to avoid the contract, in that the seller may apply to a court for a delay of grace (délai de grâce) which - if granted - effectively establishes a new delivery date.[1] Under the Convention, however, the buyer's right to avoid for fundamental breach cannot be defeated by such a délai de grâce.[2] Indeed, Article 45(3) expressly provides that no period of grace may be granted to the seller by a court or arbitral tribunal when the buyer resorts to any remedy for breach of contract.

1. Regarding, e.g. the French domestic rules, see Treitel, G., Remedies for Breach of Contract (Oxford 1988), p. 323.
2. Regarding Article 49(1)(a), see infra No. 225 et seq. Regarding the Nachfrist-type warning system under Article 49(1)(b), see No. 228 et seq. [page 116]

Pace Law School Institute of International Commercial Law - Last updated April 5, 2005
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