English translation of case text and excerpts from case commentary by Claude Witz, Dalloz Sirey (1997) 377-340

Queen Mary Case Translation Programme

Key issue addressed

CISG Article 6 Implicit exclusion of the Convention: sufficiency of a governing law clause that identifies the law of a Contracting State where no other indication of the intent of the parties is made evident

Translated case text

See Articles 1603 and 1641 of the French Code civil and Article 35(2)(a) of the United Nations Convention on Contracts for the International Sale of Goods, signed in Vienna on 11 April 1980;

The unsuitability of goods for the use for which they were purchased is a lack of conformity of goods in the sense of the Vienna Convention. The Appellate Court of Colmar based its ruling, however, on Article 1641 of the Code civil.

Between June and August 1991, a French company (seller), delivered to an Irish company (buyer), ceramic baking dishes designed for use in ovens. Due to an inherent design defect the baking dishes were not resistant to an oven's heat. Learning of this following complaints from her customers and invoking the CISG, buyer filed suit to avoid the contract.

The parties' choice of law in the contract was French law. Without further explanation, the Appellate Court of Colmar set aside the application of the Vienna Convention for reasons deduced from the parties' choice of French law. Reasoning on the basis of the Code civil the court, referring to a lack of conformity of the goods, held in favor of the buyer, stating that because of an inherent design defect, the ceramic baking dishes were unfit to resist the heat of an oven.

Ruling that seller had breached the contract and supporting its conclusions by the above reasons, the Appellate Court of Colmar did not specify that it was not basing its conclusions on the Vienna Convention.

The case was remanded to be heard by the Appellate Court of Metz because the Appellate Court of Colmar did not give any legal basis for its decision.

Translated excerpts from case commentary: Claude Witz

The ratio decidendi of the ruling can enlighten the Vienna Convention.[1] It nourishes, in a paradoxical manner, the nascent jurisprudence of the Cour de Cassation regarding the uniform law of the international sale of goods.[2]

The facts as they appear in the ruling of the Court of Appeals of Colmar are as follows.[3] In May 1991 buyer ordered from seller an assortment of ceramic baking dishes for delivery between June and August 1991. The contract contained a clause stating that French law would govern any disputes that might arise. In October 1991 buyer informed seller of customer complaints that the ceramic baking dishes had little resistance to the heat of the oven causing the baking dishes to crack, break and even explode. Following unsuccessful attempts to obtain satisfaction from seller, buyer instituted court proceedings to avoid the contract and obtain damages for the loss incurred. Unsuccessful in its proceedings before the Tribunal de Grande Instance of Strasbourg, buyer filed an appeal with the Cour d'appel of Colmar, invoking the provisions of the UN Convention on Contracts for the International Sale of Goods.

The Colmar Appellate Court ruled on the basis of French domestic law, not the CISG, stating that while the sales contract clearly presents an international character, "it must however be submitted to French law, expressly chosen by the parties to resolve all disputes concerning the contract, and not the Vienna Convention invoked by [buyer]. Indeed, regarding the applicable law, the Vienna Convention is simply additional to the will of the parties, to which its Article 6 expressly refers."

The Colmar court declared the contract cancelled and awarded damages to the buyer. [Comments on the court's analysis of the French Code civil have not been translated.]

Seller appealed to the Cour de Cassation. The French Supreme Court quashed the Colmar Appellate Court decision for lack of legal basis and remanded the case for further Appellate Court consideration.

The ruling of the Cour de Cassation has a double interest: one concerns the French domestic law of sales (I); the other, the international sale of goods governed by the Vienna Convention (II).

I. The Scope of the Ruling with Regards to the French Domestic Law of Sales

[This portion of the commentary has not been translated.]

II. The Range of the Ruling in Regards to Uniform Law Governing the International Sale of Goods.

The Vienna Convention could most certainly have been applied to this case. The contract was concluded between the seller established in France and the buyer established in Ireland in May 1991. The Vienna Convention came into force in France on 1 January 1988. [15] Based on Article 1(1): "This Convention applies to contracts of sale of goods between parties whose places of business are in different States". The latter condition is evidently fulfilled in the case at hand. Moreover, the States where the buyer and the seller are established must be Contracting States, meaning they must both be parties to the Convention, or the rules of private international law must lead to the application of the law of a Contracting State (Article 1(1)(a) and (b)). Because Ireland was not a party to the Vienna Convention in May 1991,[16] the CISG could only be applied on the basis of the applicable rules of private international law. Assuredly, the implementation of the rules of conflict of laws led in this case to French law. ... There is thus reason to use French law, expressly chosen by the parties, for the resolution of this dispute. The Vienna Convention should be applied since the rules of private international law led to the application of French law, which is the law of a Contracting State.

The Court of Appeals of Colmar, however, set aside consideration of the Vienna Convention, sheltering itself behind the alleged will of the parties to set aside the Convention. It is unfortunate that the appellant did not criticize the court on this point, nor did the Cour de Cassation specifically censure the Colmar court for this.

However, the High Court did mark its distance from this reasoning …

We know that resort to the uniform law on the international sale of goods is not imperative. The parties to the contract can set it aside, totally or partially. Even though Article 6 of the Convention does not specifically so state, it is acknowledged that the exclusion can be tacit. The question to ask is whether the parties, by choosing to have their contract governed by the law of a State that has ratified the Convention, want to have the uniform law set aside. The Court of Appeals of Colmar interpreted the clause of the contract submitting all disputes to French law as a per se exclusion of the Vienna Convention -- without referring to any evidence other than the language of this clause. The casual character of this ruling is all the more surprising, considering that the buyer in her appeal had expressly invoked the application of the Vienna Convention.

The question of the effect of a governing law clause of the type chosen by the parties has been so extensively discussed in the doctrine and illustrated in the already abundant jurisprudence on this point that it is unnecessary to review it all here. [17] We simply point out:

• A clause designating the law of a Contracting State does tell one whether it constitutes a tacit exclusion of the Convention.

• States that have ratified the Convention now have two sets of rules to govern sales: those conceived for domestic sales and others conceived for international sales.

• It is the duty of the judiciary to determine the applicable norms.

• The Vienna Convention applies at the outset; its applicability is not subordinated to the will of the parties, express or tacit.

• The question is not whether the parties intended to apply the Convention, rather whether they intended to set it aside.

• An intent to set aside the Convention, although it can be implicit must nevertheless be certain.

• Referring only to the law of a Contracting State in a clause which identifies the law of that State is not sufficient.

The Cour de Cassation clearly marks its distance from the ruling of the Appellate Court of Colmar.[18] It announces without further explanations that the Appellate Court set aside the application of the Vienna Convention for reasons deduced from the parties' choice of French law. For the Supreme Court, other evidence would undoubtedly have been welcome. The Supreme Court indicates that the setting aside of the Convention is not criticized, but not adequately explained -- leaving it to be deduced that, if not further explained, the setting aside of the Convention by the Appellate Court would surely have been censured.

Even though the position taken by the Cour de Cassation is only implicit,[19] this ruling is worth adding to the long list of judicial decisions that refuse to see the selection of the law of a Contracting State in a governing law clause as a setting aside of the Vienna Convention. [20] On this issue, a dominant flow of judicial rulings is evident.

[The remaining portion of the commentary, dealing with the distinction between the warranty of hidden defects under the Code civil and the obligation to deliver conforming goods under the Convention, has not been translated.]

FOOTNOTES

1. The ruling of the commercial chamber was communicated to us by Mr. J. -P. Rémery, the advisor.

2. Cass. 1st civ., January 4, 1995, D. 1995, Jur. P. 289, note C. Witz; January 23, 1996, D. 1996, Jur. P. 334, note C. Witz; JCP 1996, II, no. 22734, note H. Muir Watt; JDI 1996, p. 670, note P. Kahn; Rev. crit. DIP 1996, p. 460, note D. Bureau.

3. The decision appealed was transmitted by Mrs. Goyet, president of the chamber of the Court of Appeals of Colmar.

[. . .]

16. See article 100 of the Convention setting forth the principle of the non-retroactivity; like Great-Britain, Ireland has not yet ratified the Convention as of this day.

17. See our chronicle, the exclusion of the UN Convention on Contracts for the International Sale of Goods, D. 1990, Chron. P. 107; see also B. Audit, op. cit., no. 43; J. -P. Rémery, The relations of the Rome Convention of June 19, 1980, on the applicable law to the contractual obligations with the other conventions, Gaz. Pal. 1992, 1, Doctr. P. 426, spec. p. 428.

18. See note J. -P. Rémery, counsel reporting in the case at hand, Rev. crit. DIP 1997, p. 72 s., spec. p. 75.

19. M. Rémery underlines, in the following note, that neither the Cassation on grounds of law automatically applied (article 620, line 2, NCPC), nor the rejection of the ruling by the substitution of a reason of law for an erroneous reason (article 620, line 1, NCPC) was not conceivable in this case. On the one hand, a possible misapplication of article 6 of the Vienna Convention was not in the nature of justifying the censure of the decision to conclude the sale, which constituted the criticized part of the ruling. On the other hand, a rejection of the appeal would have implied that the Cour de Cassation could have announced, according to the observations of the ruling, not only that the plates delivered did not conform, but that the defects constituted a fundamental breach of contract according to the Convention, which appeared in the Commercial Chamber as a question mixed with facts (J.-P Rémery, loc. Cit.). Thus, the Commercial Chamber of the Cour de Cassation refrained, and rightly so, from following the example of the first Civil Chamber of the Supreme Court that, in the comparable case of the chaptalized Italian wine, had proceeded to a substitution of reasons taken from the Vienna Convention, truncating the latter from a series of norms (notice of the defects by the buyer, resolution) for which the application should have been verified (see our observations, D 1996, Jur. p. 334 s., spec. p. 337 ad 338). Moreover, we can ask ourselves if, therefore, the application, without further thought, of the Vienna Convention would not have been a question mixed with facts: even if the meaning of the applicable law clause as to the intent of the parties to set aside the Vienna Convention was not doubtful, it still was worthy of interpretation in light of all the circumstances of the case; the trier of the facts would have been able to make the requisite interpretation.

[. . .]

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