国际商法英文版：5 ch10 Sales.doc

Chapter 10 Outline
Chapter 10 - Sales
A. UNITED NATIONS CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS (CISG)
1. In Effect since January 1, 1988
2. Current State Parties: 71, including the United States
B. TRANSACTIONS COVERED IN CISG
1. CISG Applies to Contracts for the International Sale of Goods
a. The sale must be international.
1) The buyer and seller must have their places of business in different states.
2) Additionally, either:
a) Both of the states must be contracting parties to the convention, or
b) The rules of private international law must lead to the application of the law of a Contracting State.
1] Note: CISG may apply even if the buyer’s and seller’s places of business are not in a contracting state.
2] Exception: The final provisions of the Convention allow a ratifying state, if it wishes, to declare that it will apply the CISG only when the buyer and seller are both from contracting states.
2. Opting In and Out
a. The parties to a contract may exclude or modify the CISG’s application by a “choice of law” clause.
b. Whether parties can exclude a domestic law and adopt the CISG in its place depends on the rules of the state where the case is heard.
Case 10-1. Asante Technologies, Inc. v. PMC-Sierra, Inc.
3. Sale Defined
a. CISG does not directly define a sale.
b. Implied definition: The delivery of the goods and their supporting documentation by the seller and the payment of their price by the buyer.
1) Compare the US UCC: the passing of title from the seller to the buyer for a price.
4. Goods Defined
a. CISG does not directly define goods.
1) The drafters assumed that the CISG only applies to goods that are movable and tangible.
a) This is in accord with international usage.
b. CISG list the sales and goods that are excluded from its coverage.
1) Sales transactions that are excluded:
a) Goods bought for personal, family or household use.
1] This exclusion does not apply unless the seller knew or ought to have known that the goods were bought for personal use or consumption.
b) Auction sales.
c) Sales on execution or otherwise by authority of law.
2) Goods that are excluded:
a) Stocks, shares, investment securities, negotiable instruments or money.
1] Note: Many similar goods are not excluded (e.g., patents, copyrights, and trademarks).
b) Ships, vessels, hovercraft or aircraft.
c) Electricity.
5. Mixed Sales
a. Mixed sales and services contracts are treated by the CISG as sales of goods, unless “the preponderant part of the obligations” of the seller “consists in the supply of labor or other services.”
1) Preponderant probably means more than half.
2) Whether this is measured by the cost, the sale price, or by some other basis is not clear.
b. Contracts for goods to be manufactured are sales unless the buyer undertakes to supply a substantial part of the materials.
1) Substantial is probably less than half.
C. CONTRACTUAL ISSUES EXCLUDED FROM THE COVERAGE OF THE CONVENTION
1. The CISG Only Deals With:
a. The formation of contracts.
b. The remedies available to the buyer and seller.
2. The CISG Specifically Excludes Questions About:
a. The legality of the contract.
b. The competency of the parties.
c. The rights of third parties.
d. Liability for death or personal injury.
3. Preemption: When the CISG applies, domestic law is preempted.
a. Reason: the CISG’s basic function is to establish uniform rules for international sales contracts.
b. Scope of the CISG.
1) CISG applies to contractual issues.
a) CISG preempts the local law even if the local law gives a different name to a particular remedy.
b) CISG preempts the local law even if the local law adds additional elements to a matter that is contractual in nature.
D. INTERPRETING THE CONVENTION
1. Interpreting the Provisions of the CISG
a. Apply the following basic principle: The goal of the CISG is the creation of a uniform body of international commercial sales law.
b. Consider the following sources, in the following order:
1) The Convention.
2) The general principles on which the Convention is based.
3) The rules of private international law.
2. Interpreting the CISG
a. To interpret the words of the CISG itself, consider:
1) The international character of the Convention.
2) The need to promote uniformity in the Convention’s application.
3) The obligation to observe good faith.
b. Rules of interpretation.
1) “Plain meaning”: Look at the words of Convention itself.
2) Travaux preparatoires: Look to the CISG’s legislative history to determine its intent.
3) Precedent: Use case law to interpret the CISG.
3. General Principles
a. The CISG calls for courts to look to the general principles on which the Convention is based when interpreting its provisions.
1) The CISG gives no list of general principles.
a) Suggested principles (that appear, in varying forms, throughout the convention):
1] Each party must communicate information needed by the other party.
2] Parties have the obligation to mitigate damages resulting from a breach.
2) The CISG requires that general principles be derived only from rules given within the Convention itself.
4. Rules of Private International Law
a. Rules of private international law may be used only when:
1) The Convention itself does not directly settle a matter.
2) The matter cannot be resolved by the application of a general principle derived from the Convention itself.
b. Private international law rules vary from country to country.
1) Some states have enacted private international law codes.
2) Some states rely on case law.
c. The reason for allowing courts to turn to the rules of private international law: the Convention avoids the possibility that courts will adopt interpretive aids on an entirely ad hoc basis.
E. INTERPRETING THE SALES CONTRACT
1. Statements and Conduct of the Parties
a. Varying approaches in domestic law.
1) The subjective approach: Look at what was in the minds of the contracting parties at the time they made their contract.
a) Rule in many civil law countries.
2) The objective approach: Look only at the circumstances as they would seem to an impartial bystander.
a) Rule in the common law countries.
b. The CISG’s approach:
1) Use the subjective intent of a speaker.
a) Only do so if “the other party knew or could not have been unaware” of the speaker’s intent.
2) When a speaker’s intent is not clear look at “objective” intent.
a) The party’s statements and other conduct “are to be interpreted according to the understanding that a reasonable person of the same kind as the other party would have had in the same circumstances.”
2. Negotiations
a. CISG Art. 8(3) directs courts interpreting contracts to give “due consideration … to all relevant circumstances,” including:
1) The negotiations leading up to the contract.
2) The practices the parties have established between themselves.
3) The parties’ conduct after they agree to the contract.
b. Purpose of Art. 8(3): to do away with the technical rules that domestic courts sometimes use to interpret contracts.
1) Example: the common law’s parol evidence rule.
2) Caveat: The CISG allows parties to “derogate from or vary the effect of” any of the provisions of the Convention.
a) If the parties include a contract term (often called an “integration clause”) directing a court to ignore all prior or contemporaneous agreements, the court will have to give effect to that term.

3. Practices and Usages
a. CISG states that parties are bound by “any practices which they have established between themselves” including:
1) Usages the parties agree to.
2) Usages the parties knew or ought to have known and which, in international trade, are widely known to, and regularly observed by, parties of contracts of the type involved in the particular trade concerned.
Case 10-2. Treibacher Industrie, A.G. v. Allegheny Technologies, Inc.
4. Form
a. Most delegates at the CISG Convention felt that a writing requirement is inconsistent with modern commercial practice.
1) The Soviet delegates insisted that a writing requirement is important for protecting their country’s longtime pattern of making foreign trade contracts.
b. The CISG compromise.
1) Art. 11: No writing is required.
2) Art. 96: Unless the contracting state of one of the parties to a contract made a declaration at the time of ratification requiring that the contract be in writing.
F. FORMATION OF THE CONTRACT
1. A Contract is Formed when an offer to buy or sell a good is accepted
2. The Offer
a. Defined: A proposal addressed to specific persons indicating an intention by the offeror to be bound to the sale or purchase of particular goods for a price.
1) For a communication to be an offer:
a) The offeror must communicate an intention to be bound.
b) The proposal must be definite.
1] A proposal is sufficiently definite if it:
a] Describes the goods, and
b] States or provides a means for determining the quantity.
2] A proposal should also state or provide a means for determining the price.
a] Otherwise the price will be: The price generally charged at the time of the contract for like goods sold under comparable circumstances in the trade concerned.
c) The proposal must be addressed to one or more specific persons.
1] Proposals made to the public are invitations to negotiate, unless the contrary is clearly indicated.
b. Effectiveness of an Offer.
1) An offer becomes effective only after it reaches the offeree.
a) Offers may be withdrawn any time before they reach the offeree.
1] Offers that promise that they are irrevocable can be withdrawn prior to their reaching the offeree.
2) Revocation.
a) Offers that do not state that they are irrevocable.
1] Can be revoked anytime before the offeree dispatches an acceptance.
a] Similar to the English common law’s “post box” rule
b) Firm Offers.
1] The CISG rule: An offeror’s promise to keep an offer open for a fixed period is enforceable.
a] Requirements:
(1) The offeror must expressly state the offer is irrevocable, or
(2) The offeror’s conduct must imply that the offer is firm.
b] The promise of irrevocability:
(1) Does not have to be signed.
(2) Does not have to be in writing.
c] There is no time limitation.
3. The Acceptance
a. A contract comes into existence at the point in time when an offer is accepted.
b. Acceptance is a statement or conduct by the offeree indicating assent that is communicated to the offeror.
1) The form or mode in which an offeree must express assent: Any form or mode is allowed.
2) The offeree must communicate his assent to the offeror.
c. Silence.
1) Generally, silence or inactivity does not, in and of itself, constitute acceptance.
2) Exception: Where a party voluntarily assumes the duty to respond, silence will constitute acceptance.
d. Time of Acceptance: Acceptance must be received by the offeror within the time period specified in the offer.
1) If no time period is given: Acceptance must be received within a “reasonable” time.
a) If the offer is oral, acceptance must be made immediately unless the circumstances indicate otherwise.
Case 10-3. United Technologies International, Inc. v. Magyar Légi Közlekedési Vállalat
e. Responsibility for Delays in Communicating Acceptance.
1) CISG uses the “receipt rule”: The offeree is responsible for insuring that the acceptance gets to the offeror.
a) Reason for using this rule: Because it is the offeree who chooses the medium through which to send a response, it is the offeree who is better able to avoid the risk of loss or delay.
f. Assent by Performance of an Act: If the offeror asks for performance of an act rather than the indication of acceptance, the acceptance is effective at the moment the act is performed.
1) Caveat: An act does not constitute acceptance if the offeree is required to notify the offeror first.
a) The notification requirement may be:
1] In the offer.
2] A trade usage.
3] The practice of the parties.
g. Withdrawal: An offeree may withdraw his acceptance anytime before or simultaneous with its receipt.
h. Rejection.
1) A rejection becomes effective when it reaches the offeror.
a) If an offeree dispatches both a rejection and an acceptance at the same time, the one which reaches the offeror first will be the one given effect.
4. Acceptance with Modifications
a. A would-be acceptance that contains material differences from the offer is a counter-offer.
1) Terms relating to the following constitute material differences:
a) Price.
b) Payment.
c) Quality of the goods.
d) Place or time of delivery.
e) The extent of one party’s liability to the other.
f) The manner of settling disputes.
b. Additions that are not material are proposals for addition that will become part of the contract unless the offeror promptly objects.
Case 10-4. Filanto, SpA v. Chilewich International Corp.
G. GENERAL STANDARDS FOR PERFORMANCE
1. Fundamental Breach
a. Defined: When one party substantially fails to deliver what the other reasonably anticipated receiving.
2. Avoidance
a. Defined: The right to be excused from having to perform any obligation required by the contract.
1) Requirements:
a) The other party must have committed a fundamental breach.
b) The injured party must notify the other party.
c) The injured party must be able to return any goods he has already received.
2) Effect of avoidance:
a) Only the obligation to perform is set aside.
b) Avoidance does not affect any provision in the contract concerning:
1] The settlement of disputes (such as arbitration, choice of law, or choice of forum clauses), or
2] Any other provisions governing the rights and duties of the parties “consequent upon the avoidance of the contract.”
3. Requests for Specific Performance
a. An injured party make ask a court “to require performance” if the other party fails to carry out its obligations.
b. A court is not obliged to order specific performance unless the court can do so under its own domestic rules.
H. SELLER’S OBLIGATIONS
1. The Seller’s Basic Obligations are:
a. To deliver the goods.
b. To hand over any documents relating to the goods.
c. To insure that the goods conform to the contract.
2. If the Contract Fails to Specify How the Seller is to Perform the CISG provides rules to fill in the gaps.
3. Place for Delivery
a. The place agreed in the contract, otherwise:
1) The first carrier’s place of business if the contract involves the carriage of goods, or
2) The place where the parties knew the goods were:
a) Located, or
b) Were to be manufactured or produced.
4. Time for Delivery
a. The date fixed in the contract, otherwise:
1) Within a reasonable time after the making of the contract.
b. If a time period is provided, the seller may deliver at any time within that period, unless the contract expressly says that the buyer is to choose the time.
5. The Turning over of Documents
a. At the