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Reproduced with permission from the author and 15 Journal of Law and Commerce (1995) 1-126

excerpt from

Specific Topics of the CISG in the Light of Judicial Application and Scholarly Writing

Franco Ferrari [*]

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[Definition of "goods"]

The Vienna Sales Convention governs only international sales contracts (or other international contracts which the CISG considers sales contracts) [424] concerning moveable goods. [425] As far as the concept of "moveable goods" under the CISG is concerned, it essentially corresponds to the one of the ULIS and the ULF, [426] even though the expressions used by the different laws partially differ from each other. [427] Indeed, while all the English texts use the expression "goods," the official French version of the CISG uses the expression "marchandises" as opposed to the expression "objets mobiliers corporels" employed by the 1964 Hague Conventions. [428] However, this innovation is considered to be merely a terminological innovation, not a substantial one. [429] Therefore, only corporeal moveable goods are considered goods under the CISG, [430] as recently confirmed by a German court decision [OLG Köln 26 August 1994]. [431] Consequently, the sale of immovable property, [432] or of intangible goods, [433] such as industrial property rights, [434] is excluded from the sphere of application of the CISG, [435] and this is why it surprises that a court has decided that the sale of a logo is governed by the CISG [OLG Koblenz (Germany) 17 September 1993]. [436]

By virtue of this definition of "goods," the sale of "know how," as well, is to be excluded from the sphere of application, [437] even though it has been argued otherwise. [438] On the contrary, the sale of software different from custom-made software and standard software that is extensively modified to fit the purposes of the buyer is governed by the CISG, [439] however, not on the grounds that in several legal systems the sale of software is considered a sale, [440] but because in this line of cases (not unlike cases where books or discs are to be sold) the result of the intellectual activity is generally incorporated in corporeal goods. [441] This view was recently confirmed in an obiter dictum of a German court, which expressly stated that the sale of standard software can be considered a sale of goods in the sense of the CISG [OLG Köln 26 August 1994], [442] whereas the sale of custom-made software cannot be considered a sale of "goods" under the CISG. [443] The same court decision pointed out, however, that although it is intended to be incorporated in a document, a market study does not constitute a "good" in the sense of the CISG. [444]

Furthermore, even though the sale of immovable property is excluded from the sphere of application of the CISG, [445] the sale of a mobile building, even where it is intended to be permanently affixed to immovable property, falls within the CISG's field of application. [446] The same is true for the sale of corporeal goods to be extracted or severed from land. [447]

Furthermore, a Hungarian court recently stated that a contract for the acquisition of part of an enterprise cannot be considered a sale of goods under the CISG [Arbitral Award of Hungarian Chamber of Commerce 20 December 1993]. [448]

From what has been said thus far, one conclusion can be drawn: a uniform definition of the concept of "goods" does not yet exist. [449] However, this should not lead to resorting to domestic definitions in order to solve interpretive problems concerning the concept of "goods" in the sense of the CISG: [450] in order to achieve uniformity in the CISG's application, one must, as pointed out earlier, interpret the expressions "goods," "marchandises," "mercaderias" (not unlike all the other expressions used in the CISG) in an autonomous way, that is, not in light of the concept of one's own domestic legal system.

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FOOTNOTES

* Professor of Comparative Private Law, Katholieke Universiteit Brabant, Tilburg, the Netherlands; J.D. (Honors), University of Bologna, Italy; LL.M., University of Augsburg, Germany. Copyright, Franco Ferrari.

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424. See supra the text accompanying notes 339-423.

425. In order for the CISG to be applicable, it is not necessary that the goods be moveable at the moment the contract is concluded; it is sufficient that they be moveable at the moment their delivery has to take place, as can be derived from Article 30 CISG.

For a similar conclusion, see Herber & Czerwenka, supra note 43, at 16-17 (stating that "the goods must be moveable at the time of delivery, not necessarily at the moment the contract is concluded"); Magnus, supra note 156, at 36; Peter Schlechtriem, Das Wiener Kaufrechtsübereinkommen von 1980 (Convention on the International Sale of Goods), PRAXIS DES INTERNATIONALEN PRIVAT- UND VERFAHRENSRECHTS 277, 278-279 (1990) (stating the same).

426. For this conclusion, see Ferrari, supra note 159, at 51; for a detailed discussion of the concept de quo under the 1964 Hague Conventions, see Herber, supra note 166, at 9.

427. For this conclusion, see also Czerwenka, supra note 194, at 147; Herber, supra note 120, at 50; Heuzé, supra note 177, at 6.

428. This has already been pointed out by several authors; see, e.g., Frank Diedrich, Anwendbarkeit des Wiener Kaufrechts auf Softwareüberlassungsverträge, RECHT DER INTERNATIONALEN WIRTSCHAFT 442, 446 (1993); Ferrari, supra note 85, at 930-931; Herber, supra note 120, at 50.

429. For this conclusion, see also Herber & Czerwenka, supra note 43, at 16; Philippe Kahn, La Convention de Vienne du 11 avril 1980 sur les contrats de vente internationale de marchandises, REVUE INTERNATIONAL DE DROIT COMPARÉ 951, 956 (1981); Magnus, supra note 156, at 35.

430. See also Bernardini, supra note 21, at 85 (stating that "goods" in the sense of the CISG are only "corporeal moveable goods"); Enderlein et al., supra note 48, at 42 (stating the same); Endler & Daub, supra note 330, at 602 (stating the same); Herber, supra note 120, at 50 (stating the same); Hoyer, supra note 199, at 38 (stating the same); Hans Hoyer, Der Anwendungsbereich des UNCITRAL-Einheitskaufrechts, WIRTSCHAFTSRECHTLICHE BLÄTTER 70, 71 (1988) (stating the same); Samson, supra note 323, at 927.

431. See OLG Köln, August 26, 1994, published in NEUE JURISTISCHE WOCHENSCHRIFT RECHTSPRECHUNGS-REPORT 245, 246 (1995), expressly stating that "goods" in the sense of the CISG are only "corporeal moveable goods."

432. See Honnold, supra note 25, at 101, stating that "[m]any provisions of the Convention also make clear that the term 'goods' (French: marchandises; Spanish: mercaderias) refers to moveable tangible assets. A sale of land is excluded. Any possible doubt on this point is foreclosed by numerous provisions that are incompatible with transactions in land -- e.g., quality and packaging (Art. 35), replacement or repair of defective parts (Art. 46), shipment and damage during transit (Art. 46), delivery by instalments (Art. 73), preservation and warehousing to prevent loss or deterioration (Art. 85-88)."

The rationale behind the exclusion of the international sale of immoveable property from the sphere of application of the CISG is the potential refusal to ratify the CISG by most States which would not have accepted a uniform law derogating their domestic law in a field controlled by public policy considerations. For a similar reasoning, see Memmo, supra note 6, at 193-194.

433. See Honnold, supra note 25, at 100, stating that " 'goods' governed by the Convention must be tangible, corporeal things, and not intangible rights. . . ."

For this conclusion, see also Burghard Piltz, UN-Kaufrecht, in HANDBUCH DES KAUFVERTRAGSRECHTS IN DEN EG-STAATEN EINSCHLIEßLICH OSTERREICH, SCHWEIZ UND UN-KAUFRECHT 1, 10 (Friedrich Graf von Westphalen ed., Cologne 1993).

434. See also Enderlein & Maskow, supra note 58, at 29, stating that "[t]he goods referred to [in the CISG] are conceived as moveable assets. . . . Hence, sales of immovable property and legal assets (e.g., sales of industrial property rights) are not covered by the Convention."

See also Honnold, supra note 25, at 101, asserting that "[the] conclusion that 'goods' refers to tangible, corporeal things means that sales of patent rights, copyrights, trademarks. . .are not governed by the Convention."

435. For this conclusion, see also Ferrari, supra note 159, at 51; Magnus, supra note 156, at 37; Burghard Piltz, Der Anwendungsbereich des UN-Kaufrechts, ANWALTSBLATT 57, 59 (1991).

436. See OLG Koblenz, September 17, 1993, published in RECHT DER INTERNATIONALEN WIRTSCHAFT 934, 936 (1993).

437. For this conclusion, see Ferrari, supra note 159, at 52; Honnold, supra note 25, at 101; Peter Schlechtriem, Einheitliches Kaufrecht. Erfahrungen mit den Haager Kaufgesetzen -- Folgerungen für das Wiener UN-Kaufrecht, RECHT DER WIRTSCHAFT 41, 43 (1989).

438. See, e.g., De Nova, supra note 343, at 752; Piltz, supra note 21, at 30.

439. This view is held, for instance, by Czerwenka, supra note 194, at 148; Diedrich, supra note 428, at 441-442; Arthur Fakes, The Application of the United Nations Convention on Contracts for the International Sale of Goods to Computer Software and Database Transactions, 3 SOFTWARE L.J. 559, 582-584 (1990); Ferrari, supra note 159, at 52; Herber & Czerwenka, supra note 43, at 17; Herrmann, supra note 290, at 92; Karollus, supra note 226, at 380; Magnus, supra note 156, at 35; Piltz, supra note 21, at 30; Scott L. Primak, Computer Software: Should the U.N. Convention on Contracts for the International Sale of Goods Apply? A Contextual Approach to the Question, 11 COMPUTER L.J. 197, 214 & 217 (1991).

440. This is true, for instance, in Germany (see Matthias Brandi-Dohrn, Die gewährleistungsrechtliche Einordnung des Software-Überlassungsvertrags, COMPUTER UND RECHT 63, 66 (1986); Nikolaos Tellis, Gewährleistungsansprüche bei Sachmängeln von Anwendersoftware, BETRIEBS-BERATER 501, 501 (1990)) and the USA (see, e.g., Horovitz, Note, Computer Software as a Good under the Uniform Commercial Code, 65 B.U. L. REV. 129, 138 & 151 (1985); Meza, Note, Is Custom Designed Software a "Good" under Article 2 of the Uniform Commercial Code?, 3 SOFTWARE L.J. 543, 550 (1989)).

441. For this line of argument, see also Diedrich, supra note 428, at 449; Endler & Daub, supra note 330, at 603; Ferrari, supra note 85, at 931-932; Piltz, supra note 21, at 30.

442. OLG Köln, August 26, 1994, published in NEUE JURISTISCHE WOCHENSCHRIFT RECHTSPRECHUNGS-REPORT 245, 247 (1995).

443. Id.

444. Id.

445. See, apart from the authors quoted in note 432, Ferrari, supra note 159, at 54; Karollus, supra note 59, at 380.

446. For this conclusion, see, e.g., Honnold, supra note 25, at 102, stating that "the Convention would apply to an international sale of a mobile building even though the buyer might decide to affix it permanently to his land."

For similar statements, see also Magnus, supra note 156, at 36; Memmo, supra note 6, at 194.

447. See Herber, supra note 120, at 51; Herber & Czerwenka, supra note 43, at 17; Karollus, supra note 59, at 21; Magnus, supra note 156, at 36.

448. See Arbitral Award of the Hungarian Chamber of Commerce, December 20, 1993, reported in Witz, supra note 68, at 33. For a comment on this award, see Aleksander Vida, Keine Anwendung des Kaufrechtsübereinkommens bei Ubertragung des Geschaftsanteils einer GmbH, PRAXIS DES INTERNATIONALEN PRIVAT- UND VERFAHRENSRECHTS 52 (1995).

For a detailed discussion of the question whether the international sale of an enterprise is governed by the CISG, see Hanno Merkt, Internationaler Unternehmenskauf und Einheitskaufrecht, ZEITSCHRIFT FÜR VERGLEICHENDE RECHTSWISSENSCHAFT 353 (1994).

449. For this affirmation, see also Diedrich, supra note 428, at 443 & 446.

450. This view is also held by Kahn, supra note 19, at 692.

But see Garro & Zuppi, supra note 389, at 78-79, favoring the recourse to domestic definitions to determine what must be considered "goods" in the sense of the CISG.

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Pace Law School Institute of International Commercial Law - Last updated June 21, 1999
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