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Article 41. Third-party Claims to Goods

TEXT OF ARTICLE 41

The seller must deliver goods which are free from any right or claim of a third party, unless the buyer agreed to take the goods subject to that right or claim. However, if such right or claim is based on industrial property or other intellectual property, the seller's obligation is governed by article 42.


OUTLINE OF ISSUES

Reproduced with permission of UNCITRAL

41A Seller's obligation to deliver goods free from any third-party right or claim (e.g., T claims ownership or security interest in goods S sold to B)

41A1 Seller contends that third-party claim is erroneous

41A11 Buyer's rights and remedies

41B Buyer agreed to take goods subject to third-party right or claims

41C Other issues concerning third-party claims

41D Problems concerning intellectual property (see article 42)


DESCRIPTORS

Property in the goods ; Intellectual property


CASE ANNOTATIONS: UNCITRAL DIGEST CASES PLUS ADDED CASES

UNCITRAL has identified relevant cases in Digests containing case annotations for each article of the CISG. For Art. 41, the UNCITRAL Digests cites two cases: a 1995 ICC arbitration award and a 1996 Austrian court decision.

Presented below is a composite list of Art. 41 cases reporting these UNCITRAL Digest cases (identified in the following schedule by asterisk) and other Art. 41 cases. All cases are listed in chronological sequence, commencing with the most recent. Cases are coded to the UNCITRAL Thesaurus.

English texts and full-text English translations of cases are provided as indicated. In most instances researchers can also access UNCITRAL abstracts and link to Unilex abstracts and full-text original-language case texts sourced from Internet websites and other data, including commentaries by scholars to the extent available.
 

Germany 21 March 2007 Oberlandesgericht [Appellate Court] Dresden (Stolen automobile case) 41A [translation available]
 

Germany 11 January 2006 Bundesgerichtshof [Supreme Court] (Automobile case) 41A [translation available]
 

United States 18 June 2004 Court of International Trade (Valkia v. U.S. et al.)
 

Germany 22 August 2002 Landgericht [District Court] Freiburg 41A [translation available]

Russia 6 August 2002 Arbitration Court [Appellate Court] for Western Siberia Region (Case No. F04/2712-494/A03-2002) 41B [translation available]

China 5 March 2002 Guangxi Beihai Maritime Court 41A [translation available]
 

Germany 15 November 1998 Landgericht [District Court] Karlsruhe

Russia 21 January 1998 Arbitration award 99/1997 41A [translation available]
 

Austria 10 December 1997 Vienna Arbitration award S 2/97 [translation available]
 

* Austria 6 February 1996 Oberster Gerichtshof [Supreme Court] [translation available]
 

* ICC 1995 International Court of Arbitration, Case 8204
 

China 1 September 1990 Zuigao Renmin Fayuan [Supreme Court]


UNCITRAL CASE DIGEST

The UNCITRAL Digest of case law on the United
Nations Convention on the International Sale of Goods
[*]

A/CN.9/SER.C/DIGEST/CISG/41 [8 June 2004]. Reproduced with the permission of UNCITRAL.

ARTICLE 41

The seller must deliver goods which are free from any right or claim of a third party, unless the buyer agreed to take the goods subject to that right or claim. However, if such right or claim is based on industrial property or other intellectual property, the sellerís obligation is governed by article 42.

DIGEST†OF†ARTICLE 41 CASE LAW

In general

1. Article 41 governs the sellerís duty to deliver goods of which the buyer will enjoy undisturbed possession and ownership. Although under article 4(b) questions concerning "the effect which the contract may have on the property in the goods sold" is beyond the scope of the CISG, article 41 makes it clear that the sellerís obligation to give the buyer clear property rights in the goods, so that the buyer is free from third party rights or claims, is a matter governed by the Convention, and that the seller will be in breach of its duties if it does not meet the requirements imposed by article 41. The basic statement of the sellerís obligation is found in the first sentence of article 41: the seller must deliver goods that "are free from any right or claim of a third party ... ". An exception to this obligation arises, however, if the buyer "agreed to take the goods subject to that right or claim". The second sentence of article 41 mandates a distinction between third party rights or claims based on "industrial or other intellectual property" and other rights or claims of third parties. Only the latter are within the scope of article 41, whereas the former are governed by article 42 of the Convention.

Application of Article 41

2. There have been relatively few decisions applying article 41; they have tended to focus on what constitutes a breach of the sellerís obligations under the provision. In one, the court stated that a seller would violate article 41 if it delivered goods subject to a restriction, imposed by the sellerís own supplier, on the countries in which the buyer could resell the goods, unless the buyer had previously consented to the restriction.[1] In another, an arbitration panel indicated that article 41 required a seller to arrange for its wholly-owned subsidiary, which had obtained a court order putting under arrest the vessel in which the goods were loaded, to avoid or lift the effects of the order.[2]


FOOTNOTES

* The present text was prepared using the full text of the decisions cited in the Case Law on UNCITRAL Texts (CLOUT) abstracts and other citations listed in the footnotes. The abstracts are intended to serve only as summaries of the underlying decisions and may not reflect all the points made in the digest. Readers are advised to consult the full texts of the listed court and arbitral decisions rather than relying solely on the CLOUT abstracts.

[Citations to cisgw3 case presentations have been substituted [in brackets] for the case citations provided in the UNCITRAL Digest. This substitution has been made to facilitate online access to CLOUT abstracts, original texts of court and arbitral decisions, and full text English translations of these texts (available in most but not all cases). For citations UNCITRAL had used, go to <http://www.uncitral.org/english/clout/digest_cisg_e.htm>.]

1. CLOUT case No. 176 [AUSTRIA Oberster Gerichtshof [Supreme Court] 6 February 1996, available online at <http://cisgw3.law.pace.edu/cases/960206a3.html>] (see full text of the decision).

2. [ICC Court of Arbitration, case No. 8204 of 1995, available online at <http://cisgw3.law.pace.edu/cases/958204i1.html>].


Pace Law School Institute of International Commercial Law - Last updated September 3, 2008
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