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

excerpts from

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

Franco Ferrari [*]

(. . .)

[Implied exclusion of the CISG and choice of the applicable law]
[Article 6]

Party autonomy also played a very important role under the ULIS. [602] A comparison of Article 6 CISG and its "direct predecessor," [603] Article 3 ULIS, could even lead to the conclusion that under ULIS party autonomy was more widely recognized, [604] since the ULIS expressly stated that its exclusion could also be made implicitly. [605] However, this provision was later criticized. [606] Therefore, the express reference to the possibility of an implicit exclusion was not retained by the CISG, [607] even though at the Vienna Conference a proposal to reintroduce that express reference was made. [608] However, this does not mean that under the CISG the exclusion always has to be made expressly. [609] This is evidenced, inter alia, [610] by the fact that "the majority of delegations was . . . opposed to the proposal according to which a total or partial exclusion of the Convention could only be made 'expressly.'" [611] Consequently, the lack of express reference to the possibility of an implicit exclusion must not be regarded as precluding such possibility. Rather it has a different meaning: "to discourage courts from too easily inferring an 'implied' exclusion or derogation.'' [613] Therefore, an implicit exclusion must be regarded as possible, but there must be clear indications that such an exclusion is really wanted, [614] that is, there must be a real -- as opposed to a theoretical, fictitious or hypothetical -- agreement of exclusion, [615] not unlike under the ULIS. [616]

This is not a merely theoretical problem, as evidenced by the variety of implicit exclusions used in international commerce. A typical [617] form of implicit exclusion is represented by the parties' choice of the applicable national law. [618] There is no doubt that such a choice must be considered as being an effective exclusion of the CISG, at least where the applicable law chosen by the parties is the law of a non-Contracting State. [619] This was true under the ULIS as well. [620]

The choice of the law of a Contracting State as the law to govern the contract poses more difficult problems. [621] For instance, is the Vienna Sales Convention applicable when the parties agree upon American law being the proper law of their contract? In similar situations, it has been suggested by legal writers as well as in a recent Italian arbitral award [Ad hoc Arbitral Tribunal, Florence 19 April 1994], [622] that the indication of the law of a Contracting State ought to amount to an (implicit) exclusion of the Convention's application, because otherwise the indication of the parties would have no practical meaning. [623] However, under the CISG, not unlike under the ULIS, [624] this solution is not tenable. [625] The indication of the law of a Contracting State, if made without particular reference to the domestic law of that State, [626] does not exclude the Convention's application, [627] as recently confirmed by several German court decisions [OLG Köln 22 February 1994; OLG Koblenz 17 September 1993; OLG Düsseldorf 8 January 1993]. [628] And this is true even where the law of a Contracting reservatory State is chosen as the applicable law. [629]

The application of the Convention does not make the national law irrelevant, as suggested; the indication of the law of a Contracting State must be interpreted as both making the CISG applicable (as part of the chosen law) and as determining the law applicable to the issues not governed by the Convention itself, such as the validity issues, [630] thus avoiding resort to the complex rules of private international law in order to determine the law applicable to the issues not governed by the CISG. [631]

Nevertheless, if under the 1964 Hague Conventions the parties have established practices between themselves according to which the reference to the law of a Contracting State had to be interpreted as an exclusion of the Uniform Sales Law, the parties' reference to a Contracting State of the 1980 Vienna Sales Convention can also be interpreted as an implicit exclusion of the foregoing Convention. [632]

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Go to entire text of Ferrari commentary


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.

(. . .)

602. For a similar statement, see Rolf Herber, Art. 3, in KOMMENTAR ZUM EINHEITLICHEN KAUFRECHT, supra note 166, 19 at 19; Hoyer, supra note 199, at 41.

603. Bonell, supra note 593, at 17.

604. This has already been pointed out by Carbone & Luzzatto, supra note 123, at 132.

605. See supra note 590 for the text of Article 3 ULIS.

606. See Ferrari, supra note 159, at 112.

607. See Samson, supra note 323, at 931.

608. The representatives of both England and Belgium made proposals to reintroduce a reference to the possibility of implicitly excluding the Convention's application; for a reference to these proposals, see Herber, supra note 590, at 83-84; OFFICIAL RECORDS OF THE UNITED NATIONS CONFERENCE, supra note 21, at 85-86 & 249-250; Schlechtriem, supra note 187, at 22 n.98.

609. This conclusion, admissibility of an implicit exclusion, is favored by most legal scholars; see, e.g., Audit, supra note 38, at 38; Carbone & Luzzatto, supra note 123, at 132; Czerwenka, supra note 194, at 170; Samuel K. Date-Bah, The United Nations Convention on Contracts for the International Sale of Goods, 1980: Overview and Selective Commentary, 11 REV. GHANA L. 50, 54 (1979); Ferrari, supra note 159, at 113; Garro & Zuppi, supra note 389, at 98; Herber & Czerwenka, supra note 43, at 42; Hoyer, supra note 199, at 41; Lacasse, supra note 389, at 37; Magnus, supra note 647, at 126; Barry Nicholas, The Vienna Convention on International Sales Law, 105 LAW Q. REV. 201, 208 (1989); Reinhart, supra note 139, at 27; Richards, Note, supra note 147, at 237; Schlechtriem, supra note 187, at 21; Winship, supra note 122, at 1.35; Witz, supra note 592, at 108.

See Rosett, supra note 99, at 281, where the author criticizes the draftsmen who, although they foresaw the problems which the lack of an express reference to the possibility of implicitly excluding the Convention would cause, "chose to provide little guidance." Id.

610. In support of the thesis that maintains that the Vienna Sales Convention can also be excluded implicitly, it can be argued that the recognition of such possibility corresponds to a general trend in international conventions. Article 7(1) of the 1985 Hague Convention on the Law Applicable to Contracts for the International Sale of Goods (reprinted in 24 INT'L LEGAL MAT. 1573 (1985)), for instance, lays down the rule according to which the Convention can be implicitly excluded. The same is true as far as the 1980 EEC Convention on the Law Applicable to Contractual Obligations is concerned; for a reference to these conventions in discussing the issue de quo, see also Honnold, supra note 25, at 128.

611. Bonell, supra note 590, at 52.

For the proposal mentioned in the text, see OFFICIAL RECORDS OF THE UNITED NATIONS CONFERENCE, supra note 27, at 86 & 249-250.

612. However, several authors have argued that in order to be effective, the exclusion of the Convention's application must be explicit; see, e.g., Isaak Dore & James E. Defranco, A Comparison of the Non-Substantive Provisions of the UNCITRAL Convention on the International Sale of Goods and the Uniform Commercial Code, 23 HARV. INT'L L.J. 49, 53 (1982), stating that "unlike the U.C.C. . . . the Convention does not seem to recognize implied agreements which exclude the application of the Convention. The Convention may therefore govern contracts which the parties by their implied agreement might have assumed to be governed by domestic law."

For a similar conclusion, see also Dore, supra note 215, at 532; Caroline D. Klepper, The Convention for the International Sale of Goods: A Practical Guide for the State of Maryland and Its Trade Community, 15 MD. J. INT'L LAW & TRADE 235, 238 (1991); Note, supra note 471, at 728; Robert S. Rendell, The New U.N. Convention on International Sales Contracts: An Overview, 15 BROOK. J. OF INT'L LAW 23, 25 (1989).

613. Bonell, supra note 590, at 55.

For a similar justification of the lack of reference to the possibility of implicitly excluding the application of the Convention, see also OFFICIAL RECORDS OF THE UNITED NATIONS CONFERENCE, supra note 27, at 17 (stating that "[t]he second sentence of the ULIS, article 3, providing that 'such exclusion may be express or implied' has been eliminated lest the special reference to 'implied' exclusion might encourage courts to conclude, on insufficient grounds, that the Convention has been wholly excluded"); Schlechtriem, supra note 92, at 35 (stating that "[i]n contrast to Article 3 sentence 2 of ULIS, the Convention does not mention the possibility of an 'implied' exclusion, but this does not mean that a tacit exclusion is impossible. The intent behind deleting the word 'implied' was to prevent the courts from being too quick to impute exclusion of the Convention"). For similar statements, see also Ferrari, supra note 159, at 114-115; Magnus, supra note 156, at 104; Witz, supra note 68, at 144.

614. For a similar affirmation, see Michael J. Bonell, La nouvelle Convention des Nations-Unies sur les contrats de vente internationale de marchandises, DROIT ET PRATIQUE DU COMMERCE INTERNATIONAL 7, 13 (1981) (stating that a "tacit exception may only be admitted if there are valid indications showing the parties 'true' intention"); Enderlein & Maskow, supra note 58, at 48 (suggesting that there must be clear indications that an implicit exclusion is wanted); Rovelli, supra note 146, at 105 (stating that "of course, the determination of the applicable law can result from an implicit choice of the parties, but it must be 'certain': this means that the intention of implicitly excluding the Convention must be real, not hypothetical").

615. For a similar statement, see Honnold, supra note 25, at 128 (stating that "although an agreement to exclude the Convention need not be 'express', the agreement may only be implied from facts pointing to real -- as opposed to theoretical or fictitious -- agreement"). For similar statements, see also Magnus, supra note 156, at 105.

Note, however, that according to Note, supra note 471, at 749, the possibility of implicitly excluding the Convention's application contrasts with the need for certainty of law.

616. See BGH, December 4, 1985, published in RECHT DER INTERNATIONALEN WIRTSCHAFT 214 (1986).

617. For this evaluation, see also Magnus, supra note 156, at 105.

618. As far as the validity of the choice of law is concerned, it must be evaluated on the ground of law applicable to this issue. According to Article 2 of the 1955 Hague Convention on the Law Applicable to Contracts for the International Sale of Goods, the electio iuris is governed by the law chosen by the parties; the same is true according to Article 3(4) and 8 of the 1980 EEC Convention on the Law Applicable to Contractual Obligations. For further reference to this problem, see Ferrari, supra note 159, at 115-116.

619. For similar statements, see, e.g., Bonell, supra note 590, at 56 (stating that there is an "[implicit] indication of the parties' intention to exclude the application of the Convention, either entirely or partially, whenever they have chosen as the proper law of their contract the law of a non-Contracting State . . ."); Carbone & Luzzatto, supra note 123, at 132 (stating the same); Audit, supra note 38, at 39; Enderlein et al., supra note 48, at 58 (stating the same); Garro & Zuppi, supra note 389, at 95 (stating the same); Rudiger Holthausen, Vertraglicher Ausschluß des UN-Übereinkommens über internationale Warenkaufverträge, RECHT DER INTERNATIONALEN WIRTSCHAFT 513, 515 (1993) (stating the same); Magnus, supra note 156, at 105; Piltz, supra note 21, at 48 (stating the same); Sacerdoti, supra note 107, at 746 (stating the same).

But according to Honnold, supra note 25, at 129. "[w]hen the places of business of the seller and buyer are in different Contracting States, the applicability of the Convention mandated by Article 1(1)(a) is not undercut when the rules of private international law point to a non-Contracting State."

620. See Herber, supra note 602, at 20.

621. For an overview of this issue, see Magnus, supra note 156, at 105-106.

622. See Arbitral Award, April 19, 1994, published in DIRITTO DEL COMMERCIO INTERNAZIONALE 861 (1994).

For a comment on this award, see Jacopo Cappuccio, La deroga implicita nella Convenzione di Vienna del 1980, DIRITTO DEL COMMERCIO INTERNAZIONALE 867 (1994), agreeing with the arbitral award which excluded the applicability of the Vienna Sales Convention to a contract containing a choice of law clause which made applicable the law of a Contracting State (Italy).

623. This solution has been favored, for instance, by Franz Bydlinski, Diskussionsbeitrag, in DAS UNCITRAL-KAUFRECHT IM VERGLEICH ZUM ÖSTERRECHISCHEN RECHT, supra note 119, 48 at 48; Karollus, supra note 226, at 381; Karollus, supra note 59, at 38-39; F.A. Mann, Anmerkung zu BGH, Urteil vom 4.12.1985, JURISTENZEITUNG 647, 647 (1986); Walter A. Stoffel, Ein neues Recht des internationalen Warenkaufes in der Schweiz, SCHWEIZERISCHE JURISTENZEITUNG 169, 173 (1990); Lajos Vekas, Zum persönlichen und räumlichen Anwendungsbereich des UN-Einheitskaufrechts, RECHT DER INTERNATIONALEN WIRTSCHAFT 342, 346 (1987).

624. This view was predominant under the 1964 Hague Conventions; for a reference to this view in legal writing, see, e.g., Enderlein & Maskow, supra note 58, at 49; Herber, supra note 602, at 21; Gert Reinhart, Dix ans de jurisprudence de la République Fédérale d'Allemagne à propos de la loi uniforme sur la vente internationale d'objets mobiliers corporels, UNIFORM L. REV. 424 (1984); Witz, supra note 592, at 110.

625. This view was also expressed on the occasion of the Vienna Conference, when a large number of delegations rejected proposals by Canada and Belgium (for these proposals, see OFFICIAL RECORDS OF THE UNITED NATIONS CONFERENCE, supra note 27, at 250) according to which the domestic sales law, and not the Vienna Sales Convention, would have to be applied whenever the parties indicated the law of a Contracting State as the proper law for their contract.

For a reference to the rejection of the foregoing proposals as argument in favor of the view expressed in the text, see Bonell, supra note 590, at 56; Magnus, supra note 156, at 106.

626. There is no doubt that the Uniform Sales Law's application is excluded where the parties refer merely to domestic law; for a similar conclusion, see Bonell, supra note 593, at 18; Ferrari, supra note 159, at 117; Schlechtriem, supra note 92, at 35. Consequently, where the parties state, for instance, that "the contract is governed by American law as laid down in the U.C.C.," the Convention's application should be considered as being excluded.

For further examples of clauses that successfully exclude the Convention's application, see B. Blair Crawford, Drafting Considerations under the 1980 United Nations Convention on Contracts for the International Sale of Goods, 8 J.L. & COM. 187, 193 (1988); E. Allan Farnsworth, Review of Standard Forms or Terms under the Vienna Convention, 21 CORNELL INT'L L.J. 439, 442 (1988); Herber, supra note 590, at 87; Holthausen, supra note 619, at 515; David L. Perrott, The Vienna Convention 1980 on Contracts for the International Sale of Goods, INT'L CONTRACT LAW & FINANCE REV. 577, 580 (1980).

627. This view is shared by the majority; see, e.g., Audit, supra note 38, at 39; Bonell, supra note 590, at 56; Farnsworth, supra note 626, at 442; Ferrari, supra note 159, at 117; Herber, supra note 274, at 104; Herber & Czerwenka, supra note 43, at 44; Kritzer, supra note 56, at 100-101; Plantard, supra note 299, at 321; Schlechtriem, supra note 187, at 22; Pierre Thieffry, Les nouvelles règles de la vente internationale, DROIT ET PRATIQUE DU COMMERCE INTERNATIONAL 369, 373 (1989); Peter Winship, International Sales Contracts under the 1980 Vienna Convention, 17 UCC L.J. 55, 65 (1984).

628. See OLG Köln, February 22, 1994, published in RECHT DER INTERNATIONALEN WIRTSCHAFT 972 (1994); OLG Koblenz, September 17, 1993, reported in RECHT DER INTERNATIONALEN WIRTSCHAFT 934 (1993); OLG Düsseldorf, January 8, 1993, published in PRAXIS DES INTERNATIONALEN PRIVAT- UND VERFAHRENSRECHTS 412 (1993).

629. For this solution, see also Herrmann, supra note 290, at 95; Magnus, supra note 156, at 106.

Contra, in the sense that in this line of cases the CISG should not apply, Audit, supra note 38, at 39 n.3.

630. See Article 4 of the CISG,

"This Convention governs only the formation of the contract of the sale and the rights and obligations of the seller and the buyer arising from such a contract. In particular, except as otherwise expressly provided for in this Convention, it is not concerned with:

(a) the validity of the contract or of any of its provisions or of any usage;

(b) the effect which the contract may have on the property in the goods sold."

631. For a similar conclusion in respect of the consequences of the parties' choice of the law of a Contracting State as the proper law for their contract, see Enderlein & Maskow, supra note 58, at 49, stating that

"When a state participates in the Convention, CISG can be assumed to be part of its domestic law so that additional reference to it could be considered as superfluous and, for the reference to make sense, as an exclusion of the CISG. But the application of the Convention does in no way make the application of the other parts of the national law irrelevant. . . . Therefore, it must be recommended to the parties to determine the national law that is applicable in addition to the Convention . . . so that they can avoid the uncertainties involved in determining that law, using the conflict-of-law norms."

632. For this solution, see Ferrari, supra note 159, at 118; Holthausen, supra note 619, at 516.


Pace Law School Institute of International Commercial Law - Last updated May 18, 1999
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