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Basic Contract and Sales Law

Basic Contract Law according to the UN CISG 1980

More about remedying

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I refer to my previous post where I quoted CISG article 48 about remedying shortcomings of the goods or services delivered.

There is, however, situations where the customer can refuse to accept an offer of remedying by repair or by substitute goods. This is a question if the offer is reasonable or not.

According to the just mentioned CISG article 48, the seller may try to meet the buyer’s claims by offering to remedy his own breach of contract and eventually bring about a performance that conforms to the contract. This means repairing the goods or delivering substitute goods. If the seller succeeds in doing this, the buyer may lose his right to claim price reduction or cancel the contract.

As to the latter we must bear in mind the opening phrase of CISG article 48 (1): «Subject to article 49». This phrase was much disputed in the negotiations during the formation of the CISG convention and represents a compromise. Its meaning is most likely that the buyer is entitled to declare the contract avoided according to article 49 if the seller’s breach of contract, despite an eventual successful remedying, still amounts to a fundamental breach. This is the case if the breaches of contract by the seller influence the buyer’s total situation so severely that the criteria in article 25 are met.

In other words the inconvenience and delay caused by the seller’s breach of contract hits the buyer so hard that it would be reasonable to allow him to declare the contract avoided even if the seller eventually manages to bring about an acceptable performance.

Let us again go back to my previous post; What if the customer has to wait several hours before a new hotel room is provided? Even if the new room is satisfactory, the guest may have lost a good night's sleep. She/he may then still be able to claim price reduction or her/his money back.

See page 76 in Overview of International CISG Sales Law.

Contract Law and TourismHow do we decide if the seller's remedy offer is "unreasonable". CISG article 48.

Comments

Nuôi-Dạy-ConNuoi-Day-Con Tuesday, July 8, 2008 3:47:34 AM

Practically, +/-3% is acceptable in bulk production/delivery.

roaldm1 Tuesday, July 8, 2008 12:10:10 PM

Yes, I guess that is a fair estimation (it depends on what is common in the trade in question).

If more than that lacks or is damaged, the buyer may be entitled to a price reduction. If the seller does not within a reasonable period of time supplies what is lacking, see see my post today.

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