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The right to cure

Where a breach has occurred, the CISG encourages the Seller to keep his contractual promises by offering him the express right to cure his own mistakes (Articles 37, 48). In contrast to English law, this right may even be exercised after the time for performance has expired, as long as this would not cause the Buyer unreasonable inconvenience or uncertainty of reimbursement by the Seller of expenses advanced by the Buyer (Article 48). If the Seller wishes to exercise this right he must request the Buyer to make known whether he will accept performance within a time specified by the Buyer. If the Buyer does not answer within a reasonable time, the Seller has the right to perform and the Buyer has an obligation to accept performance within the time indicated in the Seller's request. Nevertheless, the exercise of this right to cure is subject to the Buyer's right to avoid the contract for fundamental breach (Article 49(1)) and the existence of these two rights can cause friction. On the one hand, the Buyer should not lose his right to avoid the contract if a fundamental breach has occurred and this remedy will always take priority over the Seller's right to cure. However in some cases the fundamentality of the breach may depend on whether the Seller could cure the breach or not, without causing the Buyer unreasonable inconvenience.[111] At the Diplomatic Conference the example was given of a defective machine which could be repaired. The majority concluded that in this case the breach was not initially fundamental, although the right to avoid may still arise immediately if the Seller was unwilling or unable to repair[112] . Therefore, the present view is that the fundamental nature of a breach must be decided, by looking not only at the consequences of the breach for the Buyer but also by the conduct of the Seller and his willingness and capacity to remedy the breach. And yet this is not the same as saying that the Seller's right to cure will still exist where there has been a fundamental breach of contract[113] .

Finally, the right to cure also exists in respect of defective documents.[114] This is especially controversial, since Honnold argues that the language of Article 48 means that the Seller may have right to cure defective documents even after the time for delivery.[115] However, as suggested above, there is no real fear that established trade practices such as those developed by documentary sales will not be upheld in a contract that is otherwise governed by the CISG. Moreover, this is a matter which has not yet been settled under domestic law and on the authority of Borrowman Phillips & Co v. Free & Hollis[116] it is arguable that the right to re-tender defective documents also exists in English law, at least up until the time for delivery has expired.

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FOOTNOTES

* Many thanks to Robert Bradgate of the University of Sheffield, Paul Lennon of DTI - Department of Trade and Industry, Georges Racine of McCarthy Tétrault, David Pullen of Richards Butler, Stuart Miller of Osborrne Clarke, Jonathan Guest of Eversheds, Brian Burgess of Beauvoisin & Burgess, Richard Wynn Jones of Burges Salmon, and Nicholas Joyce of Linklaters for their assistance and advice during the writing of this article

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111. In one case the Buyer notified the Seller that the acrylic blankets that he had delivered did not conform to the contract. The Seller offered to remedy the non-conformity, but the Buyer rejected this offer and declared avoidance of the contract. Held: the Seller's offer to cure made the breach not fundamental. GER. OLG Koblenz, 2U31/96, 31-01-1997.

112. O.R., p. 341, No: 38.

113. For further discussion on this issue see: Schlechtriem, P., 1998, Commentary on the UN Convention on the International Sale of Goods (CISG), 1^st ed., Oxford: Clarendon Press, p. 408.

114. Article 34.

115. Honnold, J.O., 1999, Uniform Law for International Sales, 3^rd ed., Kluwer Law International, at p. 296.

116. (1878) 4 QB 500, CA.

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Pace Law School Institute of International Commercial Law - Last updated December 5, 2000

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