| See also: | UNCITRAL Digest cases plus added cases Above plus annotations and added material |
The UNCITRAL Digest of case law on the United
Nations Convention on the International Sale of Goods [*]
A/CN.9/SER.C/DIGEST/CISG/26 [8 June 2004]
Reproduced with the permission of UNCITRAL
| ARTICLE 26
A declaration of avoidance of the contract is effective only if made by notice to the other party. |
DIGEST OF ARTICLE 26 CASE LAW
1. The article provides that any avoidance must be declared by the party who intends to terminate the contract and that the declaration must be effected by notice to the other party. The CISG does not acknowledge an automatic termination of contract.[1]
2. The purpose of the notice requirement is to ensure that the other party becomes aware of the status of the contract.
3. The notice need not be given in a particular form (see also art. 11). It therefore can be made in writing or even orally.[2] Also, a notice in the statement of claim filed with the court suffices.[3]
4. Article 26 does not mention the possibility of an implicit notice. Several courts have had to deal with this issue. One court found that the mere purchase by the buyer of substitute goods does not constitute a valid (implicit) notice of declaration of avoidance;[4] another court decided that the fact that the buyer sends back the delivered goods without further explanation does not amount to a valid notice of declaration of avoidance.[5]
5. The notice must express with sufficient clarity that the party will not be bound by the contract any longer and considers the contract terminated.[6] Therefore, any announcement that the contract will be terminated in future if the other party does not react [7] or a letter demanding either price reduction or taking the delivered goods back [8] or the mere sending back of the goods [9] does not constitute a valid notice because it does not state in unequivocal terms that the party wanting to terminate the contract believes that the contract is terminated. The same is true if a party requests damages.[10] However, the term “(declaration of) avoidance” need not be used nor need the relevant provision of the Convention be cited.[11] The use similar terms is sufficient. Thus, one court found that the buyer effectively gave notice by declaring that it could not use the defective goods and that it placed them at the disposal of the seller.[12] The same has been ruled with respect to a letter in which the buyer stated that no further business with the seller would be conducted.[13] Notice of non-conformity of the goods and notice of avoidance can be combined and expressed in one declaration.[14]
6. The notice must be directed to the other party, normally the other party to the original contract or its authorised agent. If the contractual rights have been assigned to a third party the declaration must be addressed to this new party.[15]
7. Generally notice of avoidance need not be given within a specified time. Articles 49(2) and 64(2), however, prescribe that notice must be communicated within a reasonable time. Concerning article 49 it has been held that notice after several months is clearly not reasonable.[16] To meet any time limit dispatch of the notice within the period is sufficient (see art. 27).
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. See 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); CLOUT case No. 294 [GERMANY Oberlandesgericht [Appellate Court] Bamberg 13 January 1999, available online at <http://cisgw3.law.pace.edu/cases/990113g1.html>]; [ICC Court of Arbitration, case No. 9887 of August 1999, available online at <http://cisgw3.law.pace.edu/cases/999887i1.html>].
2. CLOUT case No. 176 [AUSTRIA Oberster Gerichtshof [Supreme Court] 6 February 1996, available online at <http://cisgw3.law.pace.edu/cases/960206a3.html>].
3. CLOUT case No. 308 [AUSTRALIA Roder v. Rosedown [Federal Court] Adelaide 28 April 1995, available online at <http://cisgw3.law.pace.edu/cases/950428a2.html>].
4. CLOUT case No. 294 [GERMANY Oberlandesgericht [Appellate Court] Bamberg 13 January 1999, available online at <http://cisgw3.law.pace.edu/cases/990113g1.html>].
5. CLOUT case No. 6 [GERMANY Landgericht [District Court] Frankfurt 16 September 1991, available online at <http://cisgw3.law.pace.edu/cases/910916g1.html>].
6. Id.
7. [GERMANY Landgericht [Lower Court] Zweibrücken 14 October 1992, available online at <http://cisgw3.law.pace.edu/cases/921014g1.html>].
8. [GERMANY Oberlandesgericht [Appellate Court] München 2 March 1994, available online at <http://cisgw3.law.pace.edu/cases/940302g1.html>].
9. CLOUT case No. 6 [GERMANY Landgericht [District Court] Frankfurt 16 September 1991, available online at <http://cisgw3.law.pace.edu/cases/910916g1.html>].
10. CLOUT case No. 176 [AUSTRIA Oberster Gerichtshof [Supreme Court] 6 February 1996, available online at <http://cisgw3.law.pace.edu/cases/960206a3.html>].
11. CLOUT case No. 6 [GERMANY Landgericht [District Court] Frankfurt 16 September 1991, available online at <http://cisgw3.law.pace.edu/cases/910916g1.html>] (see full text of the decision).
12. CLOUT case No. 235 [GERMANY Bundesgerichtshof [Supreme Court] 25 June 1997, available online at <http://cisgw3.law.pace.edu/cases/970625g2.html>].
13. CLOUT case No. 293 [GERMANY Arbitration award [Arbitral Tribunal] Hamburg 29 December 1998, available online at <http://cisgw3.law.pace.edu/cases/981229g1.html>].
14. CLOUT case No. 235 [GERMANY Bundesgerichtshof [Supreme Court] 25 June 1997, available online at <http://cisgw3.law.pace.edu/cases/970625g2.html>].
15. CLOUT case No. 6 [GERMANY Landgericht [District Court] Frankfurt 16 September 1991, available online at <http://cisgw3.law.pace.edu/cases/910916g1.html>] (see full text of the decision).
16. See CLOUT case No. 124 [GERMANY Bundesgerichtshof [Supreme Court] 15 February 1995, available online at <http://cisgw3.law.pace.edu/cases/950215g1.html>] (notice after 5 months: too late); CLOUT case No. 84 [GERMANY Oberlandesgericht [Appellate Court] Frankfurt 20 April 1994, available online at <http://cisgw3.law.pace.edu/cases/940420g1.html>] (2 months: too late); CLOUT case No. 83 [GERMANY Oberlandesgericht [Appellate Court] München 2 March 1994, available online at <http://cisgw3.law.pace.edu/cases/940302g1.html>] (4 months: too late); CLOUT case No. 6 [GERMANY Landgericht [District Court] Frankfurt 16 September 1991, available online at <http://cisgw3.law.pace.edu/cases/910916g1.html>] (1 day: in time) (see full text of the decision).
Pace Law School Institute of International Commercial Law - Last updated July 21, 2005