联合国国际贸易买卖合同公约

第一节　国际货物买卖合同

Section 1　Contract for the International Sales of Goods

【The Fundamental】

A. The Convention on Contracts for the International Sale of Goods^[1]

1. Brief introduction of CISG.

Early attempts at constructing an international law of sales actually began in the late 1920s with the work of the International Institute for the Unification of Private Law, or UNIDROIT^[2], an organization of European lawyers that was working closely with the League of Nations. It successfully developed two conventions in 1964. However, the effort was primarily a European one (the United States and many other countries did not participate in drafting these documents), and the conventions never received wide acceptance.

In 1966, the United Nations created the U.N. Commission on International Trade Law, or UNCITRAL^[3]. UNCITRAL consists of thirty-six representatives from nations in every region of the world. Supported by a highly respected staff of lawyers, it is headquartered at the U.N. Vienna International Centre in Austria. UNCITRAL has drafted several widely accepted legal codes for international business, including the CISG. Unlike many other U.N. codes that are not binding, the CISG is a convention or agreement between nations that is binding once the legislature of a country adopts it. It then becomes a part of the country’s domestic law.

2. Applicability of the CISG to International Transactions.

The CISG applies if the following three conditions are met: (1) The contract is for the commercial sale of goods. (2) It is between parties whose places of business are in different countries (nationality or citizenship of individuals is not a determining factor). The places of business are located in countries that have ratified the convention.

In the case of buyers or sellers with places of business in more than one country, such as a multinational corporation, its “place of business” would be considered to be in the country that has the closest relation to the contract and where it will be performed. This could mean that if two American companies negotiated a contract entirely within the United States, but one of them had a place of business outside of the United States and the contract was to be performed outside the United States (e.g., the contract calls for delivery of the goods to a point outside the Untied States), then the CISG might govern the transaction.

The following types of sales have been specifically excluded from the convention:(a) Consumer goods sold for personal, family, or household use; (b) Goods bought at auction;(c) Stocks, securities, negotiable instruments, or money; (d) Ships, vessels, or aircraft;(e) Electricity; (f) Assembly contracts for the supply of goods to be manufactured or produced wherein the buyer provides a “substantial part of the materials necessary of such manufacture or production”; (g) Contracts that are in “preponderant part” for the supply of labor or other services. (h) Liability of the seller for death or personal injury caused by the goods; (i) Contracts where the parties specifically agree to “opt out” of the convention or where they choose to be bound by some other law.

Consumer sales were excluded from the CISG because consumer protection laws are so specific to every country that it would have been very difficult to harmonize them. Further, consumer sales are usually domestic in nature. The parties to a sales contract are free to negotiate other terms that might differ from the CISG. If they feel unsure about the code, they may “opt out” entirely, simply by specifying that the UCC (or the law of some other nation) will apply. Article 6 of the CISG states: “The parties may exclude the application of this Convention or derogate from or vary the effect of any of its provisions.”

B. Formation of International Sales Contracts

1. Entering the Agreement: the offer.

The contract laws of all countries require that the parties reach a mutual agreement and understanding about the essential terms of a contract. This agreement is reached through the bargaining process between offeror and offeree. The offeror, by making the offer, creates in theofferee the power of acceptance, or the power to form a contract.

(1) the Intention to be bound.

Under Article 14 of the CISG, a communication between the parties is considered an offer when (a) it is a proposal for concluding a contract, and (b) it is “sufficiently definite and indicates the intention of the offeror to be bound.” An offer is considered sufficiently definite if it (a) indicates or describes the goods, (b) expressly or implicitly specifies the quantity, and(c) expressly or implicitly specifies the price for the goods.

However, one should not think that presence of these three terms always indicates a contract. In many international contracts involving a great deal of money, no firm would make a commitment without reaching an agreement on many other terms, such as methods of payment, delivery dates, quality standards, etc. Take the following example. Buyer and seller are negotiating the sale of ten industrial knitting machines for five million Deutsche marks^[4]. The buyer states, “Everything seems agreeable. I’ll take the machines.” The agreement probably is not a contract even though it seems “sufficiently definite” under the CISG. The lack of any agreement on other matters indicates that the parties might not as yet have demonstrated their intention to be bound to a contract. However, if the court does find that the parties had the intention to be bound it can supply many of the missing terms by looking at the past dealings of the parties and at customs in the trade or industry, or by referring to the applicable provisions of the CISG.

(2) Public Offers.

The laws of some nations hold that an offer must be addressed to one or more specific persons. In those countries, an advertisement can never create the power of acceptance in a member of the public who reads it. In Germany, for instance, advertisements addressed to the public in general are mere invitations to deal. Other countries, such as the Untied States and China, while treating most advertisements as mere invitations to deal, do recognize that specific advertisements that describe the goods, their quantity, and price may be considered an offer. In China a price list sent to a customer is considered an invitation to deal. The CISG takes a middle position by creating a presumption that an advertisement or circular is not an offer “unless the contrary is clearly indicated by the person making the proposal.”Consequently, a seller may want to include in all of its price sheets and literature a notice that the material does not constitute an offer.

(3) Open Price Terms.

Merchants often fail to include price terms in the chain of correspondence or communications making up a contract. Perhaps they were relying on some external market factor or course of dealings to determine price. A contract may even make reference to a market price on a date that is months or even years away. If the price is left “open,” is the parties’ understanding sufficiently definite to constitute a valid contract? In the Untied States, most state UCC laws provide that if price is not specified, a “reasonable price” will be presumed. Under this flexible approach, the contract does not fail. On the other hand, such a provision would not be found in a socialist legal system in which prices are dictated by government central planning. Open price terms are not favored in developing countries either because they are major exporters of agricultural commodities, minerals, and other raw materials subject to a highly fluctuating market. Even in most civil law nations, such as France, a sales price must be sufficiently definite in order for a contract to be valid. Under Chinese law, if the price of goods is not stated in the contract, then a market price will be presumed. However, where Chinese law or administrative rulings specify a required or suggested price for the goods in question, then the government-established price must be used.

Although some conflict stems from the language of the CISG regarding open price terms(see Articles 14 and 55), the CISG provisions seem similar to those of U.S. state law. Article 55, found under the section on the obligations of the buyer, states that where price is not fixed, the price will be that charged “for such goods sold under comparable circumstances in the trade concerned.” Accordingly, if the buyer and seller fail to specify the price of the goods, a court might look to the trade to make its own determination of price, and the contract and all its other provisions will remain in effect.

(4) Firm Offers.

As a general rule, an offer may be revoked at any time prior to acceptance. Under the UCC, as between merchants, an offer may not be revoked if it is made in a signed writing that gives assurance that it will remain open for a stated period of time, not to exceed three months. Under the CISG, firm offers are valid even if they are not in writing. Moreover, an offer may not be revoked if the offeree reasonably relies on the offer as being irrevocable and the offeree has acted in reliance on the offer. Consider a buyer who states to a supplier, “Within the next month, I will be placing an order for one hundred computers, so please give me your best price.” The supplier responds, making no reference as to whether the offer will remain open. If the buyer then quotes a price on the computers for resale to a customer, the offer will beirrevocable during that month. Some civil law countries, such as Germany, France, Italy, and Japan, go even further in limiting the offeror’s power to revoke. In civil law countries, the offeror may not revoke during the period of time normally needed for the offeree’s acceptance to arrive.

2. Entering the Agreement: the Acceptance.

A contract is not formed until the offer is accepted by the offeree. The acceptance is the offeree’s manifestation of the intention to be bound to the terms of the offer. In all legal systems, the offeree may accept at any time until the offer is revoked by the offeror, until the offer expires due to the passage of time, until it is rejected by the offeree, until the offeree makes a counteroffer, or until termination in some other manner. Under the CISG, an acceptance may take the form of a statement or any other conduct by the offeree that indicates the offferee’s intention to be bound to the contract.

(1) Silence as Acceptance.

The rule in most countries is that the offeree’s silence should not be interpreted as an acceptance. This interpretation does not take into account, however, the realities of modern commercial trade practices. One exception, therefore, occurs when the parties’ previous dealings indicate that the rule should not be followed. Consider this case: For the past five years, company A regularly ordered quantities of soda ash from company B that were to be shipped within three months of placing the order. At first, B confirmed all orders. Soon, B stopped sending written confirmations of orders and just shipped. This time, A placed the order and B never responded and never shipped. A can sue for breach of contract on the basis that the established practice of the parties presumes B’s acceptance of A’s order.

(2) Valid Acceptance.

The time differences between buyers and sellers located across the globe increase the importance of knowing with some certainty when their correspondence or telecommunications form a contract (or, in terms of contract law, when the acceptance of the offeror’s terms is effective).

Under the common law, a contract is formed when the acceptance is dispatched by the offeree. In the case of an acceptance by letter, the time of dispatch is the time the letter is put into the hands of the postal authorities. This rule assumes that the correct mode of transmission is used (i.e., one that the offeror specifies of, if none, one that is reasonable under the circumstances). This assumption makes sense, for if a fax arrives offering to sell fresh roses sitting on the tarmac in Columbia, one does not accept by letter and expect a contract to beformed on dispatch. Hence, if a buyer submits a purchase order to a seller, a contract is formed upon the dispatch of the seller’s order confirmation. The buyer’s power to withdraw the purchase order ended at that time. Furthermore, the effect of this rule is that the seller is also bound to the contract upon dispatch and may no longer withdraw the offer after that time.

The CISG follows a somewhat different approach. Under Article 18, an acceptance is not effective upon dispatch, but is effective when it reaches the offeror. Article 16 protects the offeree by stating that the dispatch of an acceptance cuts off the offeror’s right to revoke the offer. Thus, an acceptance may possibly be withdrawn if the withdrawal reaches the offeror before or at the same time as the acceptance does (Article 22). Recall that under the common law, the offeree would not have had same right because the contract would have been formed at the moment of dispatch. This CISG follows the basic rules in effect in China and civil law countries.

(3) the Mirror Image Rule.

Most countries of the world follow the mirror image rule. The rule requires that an offeree respond to an offer with an acceptance that is definite and unconditional, and that matches the terms of the offer exactly and unequivocally. Under these laws, a purported acceptance that contains different or additional terms is considered a counteroffer and thus, a rejection of the original offer.

C. Warranty Provisions

Product warranties are contractual terms that define a product’s design and performance characteristics, quality, and workmanship. These terms need to be spelled out clearly so that no confusion arises over what the seller is responsible for doing. A misunderstanding here can permanently injure the long-term relationship between the parties. Consequently, warranties are often subject to intensive bargaining. Typically, sellers will want to limit the scope of their liability, place a ceiling on the amount of damages for which they can be liable, and place a limit on the time that the warranty will run. Buyers will want to negotiate the broadest provisions and gain the most legal protection.

Sometimes the parties might not realize that they are negotiating warranty terms. International contracts for the sale of goods are often not embodied in formal written documents carefully drafted by experienced lawyers. Due to the great distances involved in international business contracts often arise through a chain of correspondence and catalogs sent through the mail, by telex, or by facsimile over the telephone wires. Plagued with potential language problems and the possibility of a misunderstanding, internationalcompanies and experienced traders tend to place greater reliance on the use of modes, diagrams, spec sheets^[5]and samples to explain their product’s quality, packaging, and ability to perform. Each communication might contain some warranty about the product that also becomes an important part of the bargain between the parties.

1. Implied Warranties.

Under CISG Article 35, the seller must deliver goods that are of the quantity, quality and description required by the contract, and that (a) are fit for the purposes for which goods of the same description would ordinarily be used, (b) are fit for any particular purpose expressly or impliedly made known to the seller at the time of the conclusion of the contract, (c) possess the qualities of goods which the seller has held out to the buyer as a sample or model, (d) are contained or packaged in the manner usual for such goods or, where there is no such manner, in a manner adequate to preserve and protect the goods.

Clearly, items 3 and 4 reflect two important features of international business—the greater use of samples and models and the greater need for packaging that protects goods during ocean shipment. Nonconforming goods are those that do not conform to the express or implied terms of a contract.

One notable difference between the UCC and the CISG is that U.S law places restrictions on the parties’ ability to limit the implied warranties of the UCC. For instance, under the UCC, a seller may disclaim an implied warranty only by using conspicuous, or specified, language to that effect, such as the words “as is”. However, the CISG contains no provisions limiting disclaimers for several reasons: International sales contracts take place between more sophisticated and experienced buyers and sellers; the CISG does not apply to consumer sales, where the greatest chance of fraud and abuse might occur; and the nations participating in the drafting of the CISG wanted to preserve as much freedom of contract as possible for the merchants or companies involved. As such, any form of disclaimer will suffice under the CISG.

2. Notice of Nonconforming Goods.

If the shipment is nonconforming, or if the goods that are delivered are in some way deficient in quality, quantity, description, packaging, or warranties, both parties must understand what is expected of them and what their alternative courses of action may be.

The CISG requires that the buyer examine the goods “within as short a period as ispracticable” after they are received. Unless some reasonable excuse prevents doing so, the buyer must give notice of nonconformity or defect in the goods within a reasonable time after it is discovered or should have been discovered. In any event, however, notice must be given within two years from the date on which the goods were handed over to the buyer. When there is a fundamental breach, the notice should state that the contract is avoided. If the buyer fails to give proper notice, the results are clear: the buyer loses the right to assert the breach against the seller. The notice of nonconformity should specifically, and in necessary detail, state how the goods are nonconforming. This is necessary so a breaching party will be able to send substitute goods or otherwise correct the problem.

D. Remedies for Breach of Contract

The remedies available to a buyer or seller under the CISG are drawn from both common law and civil law systems. They are intended to give the parties the benefit of their bargain and to put the parties into the economic position they would have been in had the breach not occurred. The remedies outlined in the CISG include (a) avoidance of the contract, (b) seller’s right to remedy or cure, (c) seller’s additional time to perform, (d) price reduction, (e) money damages, and (f) specific performance.

The CISG distinguishes between a serious or fundamental breach of the contract and one that is minor or less than fundamental. Article 25 defines a fundamental breach as one that will“substantially deprive him of what he is entitled to expect under the contract.” The seller’s shipment of seriously defective goods that cannot be repaired, or that have no value to the buyer under the contract, is probably a fundamental breach. So too would be the seller’s failure and refusal to ship at all. A partial shipment may also amount to a fundamental breach if it presents a serious problem for the buyer and one that cannot quickly be remedied. Any further interpretation of fundamental breach will have to be left up to the courts.

1. Buyer’s Right to Avoidance.

If the breach is fundamental, the buyer need not take delivery nor pay for the goods, nor find a buyer to take them. A buyer may simply cancel the contract by notifying the seller of avoidance of the contract, taking care that the goods are temporarily protected and preserved, and returning them for a full refund of monies already paid. When the goods can rapidly deteriorate or decay, such as with certain foods, the buyer may notify the seller and then, take steps to sell them. These rights are especially important to a buyer in an international transaction because of the hardships associated with having to accept delivery and then reselling or disposing of imported goods in a foreign (i.e., the buyer’s) market. A buyer whoavoids a contract may still sue the seller for damages resulting from the seller’s breach.

The buyer’s avoidance rights are not effective until the seller is given notice. A buyer who has already accepted the goods, and then, discovers their nonconformity, loses the right to avoid the contract, if the buyer does not notify the seller of the intention to avoid within a reasonable time after the buyer knew or should have known of the breach. Thus, if the defect can be discovered only upon use, the buyer has a reasonable period from then on to notify the seller. In the case of goods that have been delivered late so that they no longer have any value to the buyer (i.e., a fundamental breach), the buyer can lose the right to avoid the contract, unless the buyer does so within a reasonable time after becoming aware of the late delivery.

2. Seller’s right to remedy.

A seller who has delivered some goods to the buyer prior to the delivery date, even if the goods are nonconforming or the shipment is not complete, has the chance to remedy (also called cure), or correct the problem in the shipment. The seller maintains this right to cure, and the buyer may not avoid, until the time for performance expires. Thus, if the buyer receives a defective shipment, or missing parts, or a quantity less than what was ordered, the seller has the right to cure by sending substitute or replacement goods if it can be done by the date for performance called for in the contract. Article 37 states that the seller may exercise this right only if it does not cause unreasonable inconvenience or expense to the buyer.

Unless the parties specify otherwise, the “date for delivery” under the contract (and for the purposes of determining the seller’s right to cure), is the date the seller hands the goods over directly to the first carrier (truck, rail, air, or ocean carrier). Consider the following example: DownPillow, Inc., enters a contract to buy 4 000 pounds of feathers from Federhaus GmbH. The contract calls for delivery by October 1. Federhaus ships 3 000 pounds on September 1 that arrive on October 15. Federhaus also ships l 000 pounds on September 30, one day prior to the delivery date. This shipment does not arrive until November 15. Federhaus has successfully remedied the short shipment of September 1 by delivering the remaining l 000 pounds to a carrier before the October l date. If the contract did not permit two shipments, then Federhaus could cure the defect only if the second shipment does not cause unreasonable inconvenience or expense to DownPillow. This example should serve as a warning to all international buyers. Businesses that require the goods to be in their hands by a certain date had better clearly specify an arrival date as well as a shipment date in the contract.

3. Seller’s Additional Time to Perform.

Both the UCC and the CISG allow the seller to cure a nonconforming shipment if it canbe done within the time for performance called for in the contract. Unlike the UCC, however, civil law systems traditionally grant an additional period of time, beyond the date called for, in the contract, within which the parties may perform. This grace period is often referred to in French civil law as mise en demeur and in German law as nachfrist , meaning “the period after.” The CISG adopts the civil law rule. In the event that the seller has failed to deliver the goods, and the time for their shipment or delivery has passed, the buyer may grant the seller extra time to do so. During this time, the buyer may not avoid the contract or resort to a breach of contract action. If the seller does not perform within the nachfrist period, the buyer may avoid the contract whether or not the breach was fundamental.

Article 48 contains a provision entitling the seller to invoke a nachfrist period, which allows a seller who fails to perform on time, or who delivers nonconforming goods, to cure performance if it does not cause the buyer “unreasonable delay” or “unreasonable inconvenience.” If a seller asks a buyer to agree to an extension of time for delivery and the buyer fails to respond within a reasonable time, the seller may perform within the time requested.

These provisions of the CISG attempt to encourage the parties to stay in their contract rather than to repudiate it in the event of a dispute. The parties will be more likely to negotiate, and where commercially reasonable, resolve their disputes in a manner that will keep the contract together and give each of them the benefit of their bargain. The CISG goes far beyond the UCC in achieving this goal.

4. Seller’s Avoidance.

The Seller also may avoid a contract. A seller may avoid a contract if a buyer either fails to take delivery, pay the purchase price, or otherwise commits a fundamental breach (CISG Article 64). The effect of avoidance is that the seller is released from the contract, need not deliver the goods still in the seller’s possession, and may claim their return if they have already been delivered. The seller also may seek damages under CISG Article 74.

5. Price Reduction.

One solution for the buyer in the event that the seller makes only a partial shipment, or if the goods are nonconforming, is that of price reduction. A buyer who would like to retain the goods may (unilaterally and without notice to the seller) adjust the amount paid by withholding a proportionate part of the purchase price in order to offset the shortage or to reflect the reduced value of the nonconforming goods. If the goods have already been paid for, the buyer may ask that the seller return a portion of the amount paid. Obviously, the amount ofreduction is far easier to calculate when the seller delivers less than the quantity promised than if the goods are damaged or are of inferior quality. The amount of reduction, then, is within the discretion of the buyer. A seller who disputes the buyer’s calculation can only resort to legal action.

The remedy of price reduction may be used by the buyer whether or not the seller’s breach has been fundamental. In the case of fundamental breach, price reduction is an alternative to other remedies. In the case of minor breach (one not fundamental), price reduction is often the buyer’s best remedy because the parties can more easily come to an amicable solution.

6. Money Damages.

In breach of contract cases the usual remedy granted by common law courts is the legal remedy of money damages. The CISG provides that that a breaching party shall be liable for damages in an amount sufficient to make the injured party whole in the event of a breach. Article 74 states that damages to an injured party shall consist of “a sum equal to the loss”. The method of measuring money damages depends on whether the buyer has been able to purchase substitute goods from another supplier. If the seller fails to perform and the buyer does purchase substitute goods, the buyer may claim damages if the substitute goods cost more than the contract price. If the buyer has not purchased substitute goods, damages are measured by the difference between the contract price and the current market price. As under the UCC, damages under CISG may also include an amount for lost profits and other consequential damages arising as a “reasonably foreseeable” consequence of the breach. These consequential damages are limited under Article 74 to those that the parties “foresaw or ought to have foreseen at the time of the conclusion of the contract.”

7. Specific Performance under the CISG.

The CISG draws strongly on the civil law’s acceptance of specific performance as a remedy in contract cases. This is based on the idea that the buyer wants what was ordered and not just the right to sue for those injuries that the seller’s nondelivery may have caused. Under Article 46, a court may grant specific performance only if all of the following conditions are met: (a) the buyer had not resorted to another remedy, such as avoidance or price reduction;(b) the seller had failed to deliver or, in the case of nonconforming goods, the nonconformity was so serious that it constituted a fundamental breach; (c) the buyer gave timely notice to the seller that the goods were nonconforming; and (d) the buyer had made a timely request that the seller provide substitute goods. As in the civil law nations, the court may grant specificperformance without regard to whether money damages are inadequate.

The provisions of the CISG probably will not have much effect on the law in common law countries. Article 28 places a limit on the buyer’s right to specific performance by providing that a court need not grant specific performance unless “it would do so under its own law”. Thus, the CISG will have little effect on the use of specific performance in the United States.

8. Anticipatory Breach.

Anticipatory breach occurs when one party clearly sees that the other party to the contract either will not perform a substantial part of its obligations or that it will commit a fundamental breach. The breach may occur as a result of one party repudiating the contract and notifying the other that it will not perform, or it may be determined from the conduct of the breaching party.

Either party may suspend performance under a contract if one party realizes that the other party will not perform “substantial part” of its obligations. A buyer may suspend payment when aware of evidence that the seller cannot or will not ship. A seller may suspend shipment when the buyer obviously cannot pay or take delivery of the goods. A seller who has already shipped may stop the goods in transit. The right to suspend performance ends when the other party provides adequate assurance that it will perform. If adequate assurance becomes impossible, the other party may then avoid the contract entirely.

If one of the parties is likely to commit a fundamental breach, the other party may avoid the contract. In contrast to the right to suspend as just discussed, avoidance is allowed where one party will never be able to perform. For instance, if the seller’s plant burns down, or if an embargo in the seller’s country makes it legally impossible to ship the contracted goods, then the buyer may avoid the contract.

When a contract calls for the delivery of goods by installments, the rules of avoidance apply to each individual delivery. Therefore, a single nonconforming shipment may be refused by a buyer if the seller has committed a fundamental breach. Assume that buyer and seller have a contract for 160 000 pounds of peanuts to be shipped from Georgia to Denmark in twenty shipments over five-year period. One shipment arrives in Denmark and is unfit for human consumption. In terms of the entire contract, the one shipment may not amount to a fundamental breach, but because it is an installment contract, the buyer may avoid the contract with respect to this shipment. Where the breach of one installment indicates strong grounds that a party will breach future installments, the nonbreaching party may declare the contractavoided if done within a reasonable time. So, if a buyer refuses to pay for one or two installments, the seller may avoid the remainder of the contract.

E. Events beyond the Control of the Parties: Excuses for Nonperformance

Occasionally, a party will find that circumstances make carrying out its part of the contract difficult, unprofitable, or even impossible. As a defense to an action for breach of contract, it may claim that it has been excused because intervening events beyond its control have made performance impossible or financially impracticable. But it will have a difficult time convincing a court. Courts generally do not allow a party to escape contractual obligations merely because it becomes unable to perform, even though inability to perform was through no fault of its own. When a seller’s employees go on strike, when suppliers fail to deliver raw materials on time, when equipment breaks down, when crops are destroyed due to bad weather, or when a party simply becomes financially distressed, its failure to deliver on time will generally not be excused. This common ruling is in keeping with generally accepted legal principles, which hold that contracts are binding. After all, when parties enter into agreements, do they not weigh these contingencies in setting their prices and establishing their terms?

Whether an intervening event will cause a party to be excused and discharged from its contractual promise depends on the reasoning used by the court. Some courts reason that a party’s performance is excused (a) if performance of the contract has been rendered physically or legally impossible, (b) if the underlying purposes of the contract no longer exist, or (c) if a change in circumstances has rendered the contract commercially or financially impracticable.

1. Impossibility of Performance.

Under English law, a court may excuse a party’s nonperformance where it becomes objectively impossible for it to perform. The courts hold that it must be impossible for anyone to perform, not just this particular party, and that the parties did not expressly assume such risk. Impossibility would therefore excuse nonperformance in cases involving the death of one of the parties, the destruction of the specific subject matter of the contract, or when performance of the contract has been rendered illegal or made impossible due to the fault of the other party. Impossibility is usually recognized only where performance becomes a physical impossibility. The inability to pay money is usually never accepted as an excuse.

2. Frustration of Purpose.

Does a contract to purchase a diamond engagement ring from a jeweler become unenforceable because the intended bride jilts her boyfriend?

Under the English common law a party’s performance could be excused if some unforeseen event occurred that frustrated the purposes of the contract. This event, called frustration of purpose, would have to destroy totally the value of the contract to the party relying on the excuse. Moreover, both parties must have known what the purposes of the contract were. However, frustration of purpose is not widely recognized in the United States today.

3. Commercial Impracticability.

A party to a contract that is prevented from performing may attempt to be excused under the doctrine of commercial impracticability. This modern doctrine is used in the United States today. It dates back to 1916 when a court stated, “A thing is impossible in legal contemplation when it is not practicable; and a thing is impracticable when it can be done only at an excessive and unreasonable cost”. Today, impracticability in the United States has been codified in the UCC and in Article 79 of the CISG. Remember, courts hesitate to excuse parties from contracts. Accordingly, the breaching party will be excused only if performance would result in extreme hardship, difficulty or unreasonable expense as a result of an unforeseen event.

The courts have experienced some difficulty in determining what a “hardship” is and how much additional cost is “unreasonable.” If the cost of performing the contract becomes so excessive that performance is rendered unrealistic and senseless, and threatens the viability of the business itself, performance may be excused. Of course, what is a lot of money to one company may be a drop in the bucket to another. Thus, if a large multinational corporation contracts to deliver goods at a contract price, and discovers that wage increases or an increase in the price of raw materials will cause it to lose millions of dollars on the deal; the courts still may not release the company from its obligation.

Courts also look to see whether the party claiming the excuse should have foreseen the likelihood of its occurrence. If the event was foreseeable, the nonperforming party will not be released from its obligations. This does not mean that the parties had to foresee the specific event that actually occurred. Rather, the parties should have foreseen that an even of this kind could occur.

4. The CISG Exemptions for Impediments beyond Control.

CISG Article 79 provides that a party is not liable for a failure to perform any obligations if (a) it was due to an impediment beyond control, (b) the impediment was not reasonably foreseeable at the time the contract was concluded, (c) the impediment was unavoidable andcould not be overcome, and (d) notice was given to the other party of the impediment and of its effect on the contract. An impediment does not entirely excuse performance, but merely suspends it during the time that the impediment exists.

5. Force Majeure Clauses.

Courts do not like to release parties from a contract on the basis of an excuse. Under the rule of commercial impracticability a party will not be excused if the risk was foreseeable because the party is assumed to have provided for that excuse in the contract itself. As a result, lawyers frequently advise their clients to incorporate a force majeure clause into a contract.

The term force means “superior force”. A force majeure clause in a contract is an exculpatory clause. It excuses a party from failing to perform on the occurrence of an event specified in the clause itself—a force majeure. Of course, this assumes the party claiming the force majeure did not cause the event and could not control it. These clauses usually list, specifically those events that will excuse nonperformance. These events might include war, blockades, fire, acts of governments, inability to obtain export licenses, acts of God, acts of public enemies, failure of transportation, quarantine restrictions, strikes, and others.

Lawyers advise that force majeure clauses should not just provide for standard contingencies such as those listed, but should be tailored to the special nature of the contract and the type of businesses involved. Force majeure clauses for the mining industry would not be the same as for the steel or textile industries, for example. A clause in a shipping contract issued by an ocean carrier would be different too because the risks differ.In major contracts, the drafting of a force majeure clause requires skilled lawyers. Language that is too narrow may not provide sufficient protection, and language that is too broad may leave too many outs in the contract.

In practice, most force majeure clauses do not excuse a party’s nonperformance entirely but only suspend it for the duration of the force majeure.

(Abridged from Chapter 4 of the International Business Law and Its Environment written by Richard Schaffer, Beverley Earle and Filiberto Agusti, published by International Thomson Publishing in 2001)

[The Reflections]

1. When can the CISG be applied?

2. How is a contract formed between parties?

3. What is fundamental breach?

4. What are the remedies for both seller and buyer?

5. What is specific performance?

6. What is anticipatory breach?

7. What is frustration of purpose?

8. What is commercial impracticability?

【The In-depth】

General Problems in the Application of Uniform Law

Although the overall advantages of the CISG are now undisputable, criticism regarding the application of the CISG to international commercial transactions remains, and it seems to nourish a strongly adverse view on the Convention in certain legal systems. Having a closer look at this criticism, however, reveals that it is in part unfounded because it results from general misunderstandings; even where it has some merit, appropriate solutions can be developed.

The first set of arguments relate to the general problems one faces with uniform law, namely, questions of uniform interpretation as well as the relationship between the application of uniform law and possibly concurrent domestic law remedies.

1. Uniform Interpretation.

One of the first and main criticisms has always been the problem of uniform interpretation of the CISG. In particular, the CISG is blamed for its imprecision and vague terms such as “reasonable” and for the use of general clauses such as the provision on fundamental breach (Article 25). This criticism is especially advanced by lawyers with a common law background. For centuries, they have been accustomed to extremely detailed statutes. This is in part due to the delicate relationship between the judiciary and the legislature. In order to restrict the room for interpretation, extensive catalogues of definitions as well as meticulous instructions for the construction and interpretation of contracts are often provided. Admittedly, in this respect the CISG indeed does not follow common law tradition but has instead been greatly inspired by the continental civil codes. It may, however, also draw on the continental experience with the interpretation of legal text. Given that the UCC contains terms similar to those of the CISG, American lawyers are also, at least to some extent, familiar with this approach.

Unlike the European Communities or OHADA, the CISG member states have no common supreme court guarding the interpretation of uniform or harmonized law; this may be regarded as a severe deficit. Yet, there are other means to safeguard uniformity. It is now common ground that uniform law has to be interpreted autonomously and regard is to be had to its international character. In this respect the comparative legal method has proven most adequate and successful. Part of this method involves giving due consideration to foreign court decisions and arbitral awards which are therefore becoming more and more important on the international level. Whatever the situation in a domestic legal system may be, there can be no doubt that foreign decisions do not have a binding effect upon national courts. Still, their potential persuasive authority is widely and justly recognized today.

Naturally, this method presupposes the accessibility and availability of foreign legal materials. Luckily, today this goal has been widely achieved, thanks to the endeavors of UNCITRAL and other extensive international databases and to English translation programs of foreign decisions and awards. The international development of the CISG is closely followed and analyzed by a rich variety of commentaries stemming from the German legal tradition, but published in English. Finally, the CISG Advisory Council issues opinions and provides guidelines for uniform interpretation of the Convention in crucial areas of possibly diverging approaches.

Realistically speaking, every uniform law has to rely on a certain imprecision. If a law is intended to be flexible enough to adapt to new factual and legal developments in decades to come, it has to leave room for interpretation. Unlike domestic law which may be changed and adapted rather easily by the legislator, it would be illusionary to believe it possible to bring seventy-two nations together on a regular basis in order to make adjustments to the wording of the CISG.

The problems and possible solutions addressed here may be illustrated by the debate revolving around the interpretation of Articles 38 and 39 CISG. These are the provisions on examination of the goods and notification of the seller in case of non-conforming goods. Most domestic legal systems do not recognize any such obligation of the buyer at all. Thus, it does not come as a great surprise that periods of more than a month were held to be still reasonable by courts from some countries. In contrast, especially German speaking courts, viewing the issue against their own historical background, have required notice to be given in a few days. Prompted by comparative scholarly writings, the different, formerly irreconcilable, attitudes are finally converging. A rule requiring an average period of one month for giving notice is now gaining ground in most legal systems.

2. Concurrent Remedies.

Another urgent problem jeopardizing uniformity may arise in the field of concurring remedies. The CISG is exclusively concerned with the contractual relationship between the seller and the buyer. However, under most legal systems the mere existence of contractual remedies does not preclude a party from relying on other remedies, particularly those based on tort. The crucial question then arises whether a party under a CISG sales contract can assert concurring remedies pursuant to domestic law, even though they may result in outcomes contrary to those reached under the CISG.

This is a problem particularly with regard to remedies for non-conformity of goods. Can a buyer rely on domestic concepts such as culpa in contrahendo, mistake or negligent misrepresentation? Can it recover purely economic loss caused by a defective product or property damages, especially in legal systems that recognize a tort claim for damage to the chattel itself? Can the buyer rely on these claims in cases where it is precluded from relying on the non-conformity of the goods under the CISG; if damages were not within the contemplation of the parties; or if avoidance under the CISG is not possible because the breach does not amount to a fundamental one?

The answers to these questions are highly controversial with civil lawyers favoring a pro-convention approach whereas Anglo-American scholars seem to adopt a different stance. If one seeks to achieve the greatest level of uniformity, it cannot be left to individual states to apply their domestic laws, whether contractual or based on tort. Therefore, the need to promote uniformity as it is laid down in Article 7(1) CISG requires that, as the late John Honnold put it, the CISG displaces any domestic rules if the facts that invoke such rules are the same that invoke the Convention. In other words, wherever concurring domestic remedies are only concerned with the non-conformity of the goods-such as negligence in delivering non-conforming goods, negligent misrepresentation of their qualities, or mistake as to their substance-such remedies must be pre-empted by the CISG. The CISG, however, does not deal with fraud or safety requirements under a product liability approach, thus leaving room for national concepts such as fraudulent misrepresentation or product liability in case of damage to property other than the goods sold.

Similar problems arise in the borderland of substantive and procedural law. Procedural questions are not addressed by the CISG. Thus, one may ask whether issues such as the burden and standard of proof, which may often determine the outcome of a case, are to be decided autonomously. In this context, compensation for legal costs has recently enjoyed great attention.

Today it is more and more accepted that national conceptions of line-drawing between procedural and substantive law cannot be decisive. Relying upon such a categorical distinction is outdated and unproductive. Instead, the analysis should focus on the general principles of the Convention, such as the principle of full compensation on the one hand and the equality between the parties on the other. As a result, the burden and standard of proof are to be derived from the Convention itself while the question of compensation for legal costs is to be decided by the respective domestic procedural law.

All this shows that even the swamp of concurrent domestic remedies can be forded safely today.

(Abridged from “The CISG-Successes and Pitfalls”, written by Ingeborg Schwenzer and Pascal Hachem, 57 Am. J. Comp. L. 457 )

[The Terms]

1. fundamental breach: 根本违约

2. common law: 普通法

3. UCC: 《美国统一商法典》（Uniform Commerical Code，简称UCC）

4. OHADA: 非洲商法协调组织

5. UNCITRAL: 联合国国际贸易法委员会

6. domestic law: 国内法

7. culpa in contrahendo: 缔约过失

8. avoidance: 宣告合同无效

9. product liability: 产品责任

10. substantive and procedural law: 实体法和程序法

[The Discussions]

1. Discuss about the successes and pitfalls of CISG.

2. While some commentators argue that the CISG is too seller friendly, others contend that the CISG favors the buyer too much. What’s your opinion?

【The Further Sources】

Nicole Kornet, The Common European Sales Law and the CISG-Complicating orSimplifying the Legal Environment?, Maastricht Journal of European and Comparative Law, 2012.

Antonin I. Pribetic, An ‘Unconventional Truth’: Conflict of Laws Issues Arising Under the CISG, N ordic Journal of Commercial Law, No. 1, June 2009

Lisa Spagnolo, Opening Pandora’s Box: Good Faith and Precontractual Liability in the CISG, Temple International ＆ Comparative Law Journal, Vol. 21, No. 2, 2007,

Peter Mazzacano, Harmonizing Values, Not Laws: The CISG and the Benefits of a Neo-Realist Perspective, Nordic Journal of Commercial Law, Issue 1, 2008.