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Seller’s right to cure under the United Nations Convention for the International Sale of Goods (CISG)

Permats, Christoffer LU (2012) JURM02 20121
Department of Law
Abstract (Swedish)
Förenta nationernas konvention angående avtal om internationella köp av varor är till antalet länder som ratificerat densamma en av de mest lyckade internationella regelverk mellan stater hittills. 62 deltagande länder i den förberedande processen, varav många från olika juridiska system, medförde att kompromisser angående innehållet i regelverket var oundvikliga. Som ett resultat av detta kan tvetydigheter och kontroverser uppstå kring tolkningen av bestämmelser i regelverket. Avsikten med detta examensarbete är att belysa ett av de kontroversiella ämnen som debatterades under förberedelsen av konventionen, nämligen avvägningen mellan å ena sidan säljarens rätt att avhjälpa fel i vara enligt artikel 48 och å andra sidan köparens rätt att... (More)
Förenta nationernas konvention angående avtal om internationella köp av varor är till antalet länder som ratificerat densamma en av de mest lyckade internationella regelverk mellan stater hittills. 62 deltagande länder i den förberedande processen, varav många från olika juridiska system, medförde att kompromisser angående innehållet i regelverket var oundvikliga. Som ett resultat av detta kan tvetydigheter och kontroverser uppstå kring tolkningen av bestämmelser i regelverket. Avsikten med detta examensarbete är att belysa ett av de kontroversiella ämnen som debatterades under förberedelsen av konventionen, nämligen avvägningen mellan å ena sidan säljarens rätt att avhjälpa fel i vara enligt artikel 48 och å andra sidan köparens rätt att häva köp enligt artikel 49.

Den huvudsakliga fråga som behandlas i uppsatsen är huruvida en säljare är berättigad till att avhjälpa fel i en vara då densamma har begått ett väsentligt avtalsbrott, när köparen avser att häva avtalet dem emellan. Således är de frågor som avses att bli besvarade i examensarbetet huruvida köparens rätt att häva avtal på grund av säljares väsentliga avtalsbrott enligt artikel 49 har prioritet över säljares rätt att avhjälpa fel i vara enligt artikel 48 oavkortat eller om väsentligheten i säljarens avtalsbrott ska avgöras med hänsyn till säljarens villighet att avhjälpa fel i varan.

Dessa frågor kan få betydelse för säljaren då hävning av ett avtal av köparen kan innebära inte bara en förlust av köpeskillingen utan även föra med sig stora lagrings- och transportkostnader för att returnera godset. Rätten att häva ett avtal är också av stor betydelse för en köpare då detta kan vara att föredra framför en avhjälpning av felet i ett förhållande där köparen tappat förtroendet för säljaren eller i en situation där hävning av avtalet skulle innebära en mindre förlust än att avhjälpa felet i kombination med ett skadeståndsanspråk, t.ex. förlust av kontrakt med andra parter. Frågan kan även vara aktuell för köpare vid fluktuerande marknadspriser, vilket kan utgöra skäl för att undersöka möjligheter att dra sig ur avtal för mer lönsamma sådana.

För att besvara de ovanstående frågorna har olika metoder för att tolka konventionen granskats. Således har artikel 7 CISG analyserats då bestämmelsen föreskriver de principer enligt, vilka konventionen ska tolkas. I denna mening har det konstaterats att artikel 7 föreskriver att konventionen ska tolkas autonomt, fritt från principer och koncept utvecklade i nationell rätt, samt att bestämmelsen innehåller en ”godtrosprincip” som gäller mellan parter vars avtal regleras av konventionen. Därtill, har det konstaterats att det är förenligt med de principer som är utsatta i artikel 7 att ta hänsyn till rättspraxis och doktrin från olika konventionsstater, förarbeten till konventionen och andra internationella regelverk för internationell handel vid tolkning av konventionen, så som The UNIDROIT Principles of International Commercial Contracts.

Även om doktrinen kring ämnet står delad kan en majoritet urskiljas till fördel för ståndpunkten som förespråkar att artikel 49 inte har företräde framför artikel 48, samt att väsentligheten i ett avtalsbrott ska bedömas med hänsyn till säljarens vilja att avhjälpa fel i varan. En minoritet menar dock att säljaren inte besitter en rätt att avhjälpa fel i vara i det fall köparen har hävt avtalet. Rättspraxis bekräftar den mening som förespråkas av majoriteten i doktrinen i det avseendet att domstolar ser till omständigheten huruvida säljaren är beredd att avhjälpa felet och huruvida ett avhjälpande kan anses som rimligt och möjligt under omständigheterna.

Beträffande förarbetena till konventionen har det konstaterats att inget definitivt svar kan ges på frågan om företrädesrätten till artikel 49 i konventionen. Inte desto mindre, har det konstaterats att döma efter de diskussioner som fördes delegationerna emellan vid mötet i Wien så finns tydliga indikationer på att artikel 49 inte skall ges prioritet över artikel 48. Likaså, indikerar diskussionerna att väsentligheten i ett avtalsbrott skall bedömas med hänsyn till säljares vilja att avhjälpa fel i vara.

Beträffande ”godtrosprincipen” i anknytning till säljarens rätt att avhjälpa fel i vara har det konstaterats att principen inte är lämpad för att tvinga köparen att tillmötesgå säljarens vilja att avhjälpa fel då principen fungerar i samband parternas intentioner. Således, är principen endast lämplig i situationer då köparen avtalat med säljaren om att avhjälpa fel men sedermera agerar mot sitt löfte.

Beträffande användningen av UNIDROIT Principles för att tolka konventionen har det konstaterats att dessa principer talar för att köparens hävning av avtalet inte hindrar säljaren från att avhjälpa fel i varan.

Avslutningsvis konstateras att frågan huruvida artikel 49 har prioritet över artikel 48 är avhängig av huruvida ett avhjälpande skulle anses som betungande för köparen. Sådana situationer kan således uppstå då köparen tappat förtroende för säljaren, då säljaren har beretts möjlighet att avhjälpa fel utan positivt resultat eller då ett avhjälpande är att anses som extra betungande under omständigheterna i det enskilda fallet. Således nås slutsatsen att väsentligheten i säljarens avtalsbrott skall bedömas med hänsyn till säljarens villighet att avhjälpa fel i varan. (Less)
Abstract
The United Nations Convention on Contracts for The International Sale of Goods is one of the most successful instruments of uniform commercial law worldwide. With 62 countries from a variety of legal backgrounds involved in the preparation process of such an instrument compromises are inevitable regarding the substance of the provisions involving controversial issues. As a result, compromises might subsequently create ambiguities and controversy concerning the interpretation of such provisions. This thesis is intended to elaborate on such a controversial subject that was intensely debated during the preparation of the Convention, namely the two conflicting interests of a seller’s right to cure a defect in performance according to article... (More)
The United Nations Convention on Contracts for The International Sale of Goods is one of the most successful instruments of uniform commercial law worldwide. With 62 countries from a variety of legal backgrounds involved in the preparation process of such an instrument compromises are inevitable regarding the substance of the provisions involving controversial issues. As a result, compromises might subsequently create ambiguities and controversy concerning the interpretation of such provisions. This thesis is intended to elaborate on such a controversial subject that was intensely debated during the preparation of the Convention, namely the two conflicting interests of a seller’s right to cure a defect in performance according to article 48 CISG on the one hand and a buyer’s right to avoid a contract in the event of a seller’s fundamental breach according to article 49 on the other.

In this regard questions arise as to whether a buyer’s right to avoid a contract according to article 49 in the event of a seller’s fundamental breach takes precedence over article 48 in any event? Or, whether the fundamentality of the breach should be considered in the light of an offer by the seller to cure the defect?

These questions are of importance to sellers as an avoidance of a contract by a buyer will cause a seller to not only lose the profit in the price contracted for but also incur expenses for transportation and storage in returning the dispatched goods. The right to avoid a contract by a buyer is equally of importance as this might be preferable to a cure in situations where a buyer has lost faith in a seller’s ability to perform or in a situation where avoidance would cause less damage to his business compared to keeping the contract afoot with cure in combination with a remedy in damages e.g. loss of contracts with other parties. The question can also be of importance to buyers in a fluctuating market where a buyer would seek grounds for escaping the contract for more profitable deals.

In order to answer the above questions the interpretative methods of the Convention are analyzed. Reference to article 7 of the Convention is made as it provides the set of rules to be followed when interpreting the Convention. It is concluded that article 7 provides that the Convention needs to be interpreted in an autonomous way, free from concepts and principles established in domestic law and that the provision imposes a duty to act in good faith between parties to contracts governed by the CISG. Additionally, it is established that it is consistent with the principles set out in article 7 to have regard to case law from different jurisdictions as well as scholarly writings, the legislative history of the Convention and other international instruments on commercial law such as the UNIDROIT Principles of International Commercial Contracts when interpreting the Convention.

Although scholars remain divided on the subject as to whether the right to avoid a contract always takes precedence over a seller’s right to cure, a majority of scholars favors the approach in which article 49 as a rule does not take precedence to article 48 and that fundamental breach should be viewed in the light of an offer to cure. Others consider that a seller is not allowed to cure in the event of fundamental breach and a buyer has avoided the contract. Examples in case law confirm the support of the prevailing opinion among scholars in that the courts look to whether the seller is willing to cure and such a cure would be possible and reasonable under the circumstances.

Regarding the legislative history of the Convention it has been found that there is no conclusive evidence to support any of the approaches taken in scholarly opinion. However, it is concluded that due to the discussions among delegates of the Vienna convention a strong case can be made for the approach that considers that article 49 does not generally take precedence over article 48 and that fundamental breach should be considered in the light of an offer to cure.

Concerning the principle of good faith in the Convention it was found that the principle is not suited for obligating a buyer to allow a seller to cure as it works in conjunction with the intention of the parties. Hence, the use of the principle would only be appropriate in this setting when a party acts in contravention to his promise.

As a final point the conclusion is reached that the use of The UNIDROIT Principles in interpreting the Convention show that a buyer’s right to avoid a contract for fundamental breach does not preclude a seller from curing a defect in performance.

As a result of the above, it is concluded that the question as to whether article 49 takes precedence over article 48 should be answered in the negative, with the exception for situations where a cure would be unreasonably burdensome to a buyer. Such situations would be present where a buyer loses faith in a seller’s ability to perform, cure have been allowed but failed or where a cure would be considered as unreasonably inconvenient to the buyer under the circumstances. Consequently, the question whether fundamental breach should be viewed in light of a seller’s willingness to cure should be answered in the positive. (Less)
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author
Permats, Christoffer LU
supervisor
organization
course
JURM02 20121
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
Avtalsrätt Contract Law
language
English
id
2335781
date added to LUP
2012-05-29 14:48:33
date last changed
2012-05-29 14:48:33
@misc{2335781,
  abstract     = {The United Nations Convention on Contracts for The International Sale of Goods is one of the most successful instruments of uniform commercial law worldwide. With 62 countries from a variety of legal backgrounds involved in the preparation process of such an instrument compromises are inevitable regarding the substance of the provisions involving controversial issues. As a result, compromises might subsequently create ambiguities and controversy concerning the interpretation of such provisions. This thesis is intended to elaborate on such a controversial subject that was intensely debated during the preparation of the Convention, namely the two conflicting interests of a seller’s right to cure a defect in performance according to article 48 CISG on the one hand and a buyer’s right to avoid a contract in the event of a seller’s fundamental breach according to article 49 on the other.

In this regard questions arise as to whether a buyer’s right to avoid a contract according to article 49 in the event of a seller’s fundamental breach takes precedence over article 48 in any event? Or, whether the fundamentality of the breach should be considered in the light of an offer by the seller to cure the defect? 

These questions are of importance to sellers as an avoidance of a contract by a buyer will cause a seller to not only lose the profit in the price contracted for but also incur expenses for transportation and storage in returning the dispatched goods. The right to avoid a contract by a buyer is equally of importance as this might be preferable to a cure in situations where a buyer has lost faith in a seller’s ability to perform or in a situation where avoidance would cause less damage to his business compared to keeping the contract afoot with cure in combination with a remedy in damages e.g. loss of contracts with other parties. The question can also be of importance to buyers in a fluctuating market where a buyer would seek grounds for escaping the contract for more profitable deals.

In order to answer the above questions the interpretative methods of the Convention are analyzed. Reference to article 7 of the Convention is made as it provides the set of rules to be followed when interpreting the Convention. It is concluded that article 7 provides that the Convention needs to be interpreted in an autonomous way, free from concepts and principles established in domestic law and that the provision imposes a duty to act in good faith between parties to contracts governed by the CISG. Additionally, it is established that it is consistent with the principles set out in article 7 to have regard to case law from different jurisdictions as well as scholarly writings, the legislative history of the Convention and other international instruments on commercial law such as the UNIDROIT Principles of International Commercial Contracts when interpreting the Convention. 

Although scholars remain divided on the subject as to whether the right to avoid a contract always takes precedence over a seller’s right to cure, a majority of scholars favors the approach in which article 49 as a rule does not take precedence to article 48 and that fundamental breach should be viewed in the light of an offer to cure. Others consider that a seller is not allowed to cure in the event of fundamental breach and a buyer has avoided the contract. Examples in case law confirm the support of the prevailing opinion among scholars in that the courts look to whether the seller is willing to cure and such a cure would be possible and reasonable under the circumstances. 

Regarding the legislative history of the Convention it has been found that there is no conclusive evidence to support any of the approaches taken in scholarly opinion. However, it is concluded that due to the discussions among delegates of the Vienna convention a strong case can be made for the approach that considers that article 49 does not generally take precedence over article 48 and that fundamental breach should be considered in the light of an offer to cure.
 
Concerning the principle of good faith in the Convention it was found that the principle is not suited for obligating a buyer to allow a seller to cure as it works in conjunction with the intention of the parties. Hence, the use of the principle would only be appropriate in this setting when a party acts in contravention to his promise.

As a final point the conclusion is reached that the use of The UNIDROIT Principles in interpreting the Convention show that a buyer’s right to avoid a contract for fundamental breach does not preclude a seller from curing a defect in performance.

As a result of the above, it is concluded that the question as to whether article 49 takes precedence over article 48 should be answered in the negative, with the exception for situations where a cure would be unreasonably burdensome to a buyer. Such situations would be present where a buyer loses faith in a seller’s ability to perform, cure have been allowed but failed or where a cure would be considered as unreasonably inconvenient to the buyer under the circumstances. Consequently, the question whether fundamental breach should be viewed in light of a seller’s willingness to cure should be answered in the positive.},
  author       = {Permats, Christoffer},
  keyword      = {Avtalsrätt Contract Law},
  language     = {eng},
  note         = {Student Paper},
  title        = {Seller’s right to cure under the United Nations Convention for the International Sale of Goods (CISG)},
  year         = {2012},
}