CISG Article 77 ULIS Article 88
A party who relies on a breach The party who relies on
of contract must take such a breach of the contract
measures as are reasonable shall adopt all reasonable
in the circumstances to mitigate measures to mitigate the
the loss, including loss of profit,loss resulting from the
resulting from the breach. If he breach. If he fails to
fails to take such measures, the adopt such measures, the
party in breach may claim a party in breach may claim
reduction in the damages in a reduction in the damages.
the amount by which the
loss should have been mitigated.
SEE ALSO:
ULIS Article 25. The buyer shall not be entitled to require
performance of the contract by the seller, if it is in conformity
with usage and reasonably possible for the buyer to purchase
goods to replace those to which the contract relates. In this
case the contract shall be ipso facto avoided as from the
time when such purchase should be effected.
ULIS Article 61(2). The seller shall not be entitled to
require payment of the price by the buyer if it is in
conformity with usage and reasonably possible for the
seller to resell the goods. In that case the contract shall
be ipso facto avoided as from the time when such resale
should be effected.
"Article 77 adopts the same principle as Article 88 ULIS, but clarifies certain matters. First of all, it makes clear that the aggrieved party’s duty to mitigate loss includes not only loss of assets (damnum emergens) but also loss of profit (lucrum cessans). The phrase ‘loss resulting from the breach’ appears in the English versions of both the CISG and ULIS. However, a change in the wording of the French versions (‘la perte . . . resultant de la contravention) (CISG) instead of (‘la perte subie) (ULIS) is intended to indicate that the aggrieved party is obliged not only to take reasonable measures to mitigate loss which has already occurred, but also to counteract imminent loss. Article 77, second sentence, clearly lays down that damages cannot be claimed in respect of loss which could have been mitigated by the aggrieved party, while Article 88 ULIS leaves open the extent to which damages are to be reduced in the event of a failure to observe the requirement to mitigate loss. . . ." Stoll in Commentary on the UN Convention on the International Sale of Goods, Peter Schlechtriem ed. (Oxford 1998) 585 [citations omitted].
Pace Law School Institute of
International Commercial Law
- Last updated July 30, 1999