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Report to the Uniform Law Conference of Canada on Convention on Contracts for the International Sale of Goods

Professor Jacob S. Ziegel, University of Toronto
July 1981

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Article 50

If the goods do not conform with the contract and whether or not the price has already been paid, the buyer may reduce the price in the same proportion as the value that the goods actually delivered had at the time of the delivery bears to the value that conforming goods would have had at that time. However, if the seller remedies any failure to perform his obligations in accordance with article 37 or article 48 or if the buyer refuses to accept performance by the seller in accordance with those articles, the buyer may not reduce the price.

COMMENT

1. Art. 50 confers on the buyer a right to reduce the price of non-conforming goods in lieu of claiming damages (assuming there is a right to damages). Art. 50 was amended at Vienna by substituting, in line 3, the value of the goods at the time at delivery for their imputed value at the time of the conclusion of the contract as the basis for determining the reduction in price. The provincial Acts contain no comparable provision and art. 50 must not be confused with the right to set-off recognized in OSGA 51 and its other provincial counterparts. Art. 50 is based on the notion that it is unjust to require the buyer to pay the full price for non-conforming goods, and the right to claim a price reduction must be carefully distinguished from the right to claim damages. The difference is carefully explained in the [Secretariat] Commentary, p. 127. See also E.E. Bergsten and A.J. Miller, "The Remedy of Reduction of Price" (1979) 27 A.J.C.L. 255.

2. The principle of art. 50 is implicit in OSGA 29, and I see no objections to it.

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Pace Law School Institute of International Commercial Law - Last updated April 23, 1999
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