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CISG number

Arts. 74, 75, 76

Relationship between Articles 55, 56 and 57

470. Prior to examining the provisions on damages, the Committee considered the relationship between articles 55, 56 and 57.

471. It was generally agreed that articles 56 and 57 were illustrations of the operation of article 55 in particular circumstances. Article 56 dealt with the case where the buyer had, bought goods in replacement or the seller had resold the goods. In these situations the measure of damages would be the difference between the contract price and the price in the substitute; transaction plus any additional damages, including loss of profit, as might be allowed under article 55. However, if there had not been a substitute transaction and if there was a current price for the goods, the measure of damages would be the difference between the contract price and the current price on the date that the contract was avoided plus any addition damages, including loss of profit, as might be allowed under article 55. In other cases, damages would be calculated according to the general formula in article 55. [page 58]

472. Furthermore, the Committee was agreed that a party who had in fact arranged a substitute transaction of the nature described in article 56 should not be allowed to claim damages under article 57 where that article would provide for a higher measure of damages.

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CISG number

Art. 75

480. The text of article 56, as adopted by the Working Group on the International Sale of Goods, is as follows:

481. As noted in paragraph 471 above, the Committee decided that article 56 was an illustration of the general rule of damages set out in article 55. It considered several ways in which this article might be redrafted in order to make this relationship clear.

482. The Committee referred to the Drafting Group a proposal that paragraph (2) be redrafted so as to delete any direct reference to loss of profit since, in the first place it was already referred to in article 55, where it was stated that damages were understood to cover loss of profit, and, in the second place, in such a situation it would be difficult to imagine a loss of profit over and above the difference in prices.

Decision

483. The Committee, therefore, recommends that the Commission should adopt the following text, now renumbered as article 57:

"Article 57

"If the contract is avoided and if, in a reasonable manner and within a reasonable time after avoidance, the buyer has bought goods in replacement or the seller has resold the goods, the party claiming damages may recover the difference between the contract price and the price in the substitute transaction and any further damages recoverable under the provisions of article 56." [page 59]

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