Austrian Cases on the UN Convention on Contracts for the International Sale of

Goods
Willibald Posch [*] and Thoma Petz [**]
1. Introduction
2. Issues Discussed by the Austrian Supreme Court under CISG
3. General Provisions (Articles 7-13 CISG)
4. Formation of Contract (Articles 14-25 CISG)
5. Substantive Sales Law

6. Closing Remarks
1. INTRODUCTION

The Convention on Contracts for the International Sale of Goods (CISG) [1] is also
known as the "Vienna (Sales) Convention" because it was adopted in April 1980 by
the representatives of 62 nations on the occasion of a diplomatic conference organised
by the United Nations Commission on International Trade Law (UNCITRAL) in
Vienna. That explains why the advocates of the unification of the law of sale of goods
in the Austrian Federal Ministry of Justice intended to make Austria the tenth state to
ratify CISG. According to Article 99 CISG, Austria would thus have caused the
Convention to enter into force. The Austrian Parliament was delayed, however, and it
was not before [page 1] December 1987 that CISG was ratified.[2] Thus Austria
failed, after all, to be the tenth Contracting State and CISG came into force in Austria
at the beginning of 1989.[3]
In the first six years after its entry into force in Austria, CISG was only of limited
importance,[4] but with the help of Austrian legal scholars [5] it has become well
established in Austrian court practice in recent years. In earlier times Austrian
practitioners and legal consultants of the Austrian Federal Chamber of Commerce
used to suggest the application of CISG to be contractually excluded by the parties of
an international sales contract. The explanation for this position may, on the one hand,
be found in CISG's deviation from the traditional substantive sales law as established
by both the Austrian Civil and Commercial Codes, and on the other hand, it appeared
to provide no significant advantages for Austrian parties.

This skeptical approach to CISG is not yet been completely overcome. Many Austrian
companies still resort to standard terms or standardised forms excluding the
application of CISG, thereby exercising their right of "opting out" as provided by
Article 6 CISG, and quite often so, without any further consideration.[6] Moreover,
such clauses were (and still are) often set up in general terms designating the
applicable substantive law of a Contracting State, since the draftsmen of the standard
terms were not aware of the fact that such a clause would not automatically entail the
exclusion of the application of CISG.[7]
Thus, the fact that the Supreme Court (OGH) has referred [8] to CISG in more than
thirty cases by the end of 2001 becomes even more remarkable, and the statement of a
German [page 2] "CISG-specialist" is obviously correct that "with the exception of
the Austrian Supreme Court no other Supreme Court of any Contracting State referred
as often to CISG as the German Supreme Court (BGH)".[9] In relation to the
respective populations of the two countries the quantity of decisions related to CISG
is significantly higher in Austria. CISG's earlier entry into law in Austria cannot
satisfactorily explain this contrast, which is even more astonishing if one considers
that Austrian practitioners have not had the useful and valuable experience of German
lawyers and judges with the Hague Uniform Laws of International Sale of Goods.[10]
The first reported decision of an Austrian court applying rules of substantive law of
CISG was rendered by the District Commercial Court of Vienna on 20 February,
1992.[11] In those early days, the Austrian Supreme Court used to refer to CISG only
by way of obiter dicta.[12] In April 1994, the Austrian Supreme Court applied Article
1(1)(b) CISG for the first time, determining the applicable law. In this case, pursuant
to the "characteristic performance test" under 36 of the Austrian Law of Private
International Law (IPRG),[13] the judgment was governed by the national substantive
law of a non-Contracting State.[14] [page 3]
Finally, the judgment of the Second Chamber of the Austrian Supreme Court of 10
November, 1994 [15] added a new dimension to Austrian case law on CISG. For the
first time, the Austrian Supreme Court had to deal with the content of specific
substantive provisions of CISG,[16] and that explains why this holding is generally
deemed to be the "the Austrian Supreme Court's first CISG-decision on the merits of a
case".[17]
2. ISSUES DISCUSSED BY THE AUSTRIAN SUPREME COURT UNDER CISG

2.1 Survey
In its more than 30 decisions on CISG, the Austrian Supreme Court had to deal with a
surprising variety of legal issues. It had to resolve questions concerning the sphere of

application, validity and precedence of trade usages, interpretation of declarations of

intent, formal requirements, offer and acceptance, and the formation of contracts.
Furthermore, issues such as modification of contract, obligations of seller or buyer,
remedies for breach of contract by seller or buyer, assessment, and mitigation of
damages were discussed.
2.2 Sphere of Application (Articles 1 - 6 CISG)
A considerable number of the Austrian Supreme Court decisions on CISG concern the
rules on its sphere of application (Articles 1 to 6).
Thus, the private international law clause of Article 1(1)(b) CISG was correctly
applied by the Austrian Supreme Court for the first time in May 1994[18], in a case
involving a dispute between an Austrian seller and a German buyer. The application of
CISG was denied, because at the time of the conclusion of the contract, Germany had
not yet ratified the Convention and the characteristic performance test pointed to
domestic German law as the law at the seller's place of business.
A few years later the Austrian Supreme Court had to apply the private international
law clause of Article 1(1)(b) CISG to a case that concerned a contract between an
Austrian buyer and a Dutch seller.[19]Since the contract had been concluded in
November 1989, at [page 4] a time when only Austria was already a Contracting
State, the characteristic performance test of 36 of the Austrian Private International
Law Act led to the application of Dutch domestic law, viz. the Hague Conventions on
Uniform Sales Law which were still in force in the Netherlands at the time of the
conclusion of the contract.
In two other decisions, the international private law clause of Article 1(1)(b) CISG led
to the application of domestic Austrian law. Of special interest is the later [20] rather
than the earlier [21] of these cases. Decided by the Austrian Supreme Court basically
along the same lines as in the aforementioned decisions, this case involved a sales
contract between an Austrian and a Germany corporation in respect of some hundred
tons of natural gas. When this contract was concluded in December 1990, the
Convention had not yet been in force in Germany. The contract provided that the
German company bought natural gas from the Austrian company in order to sell it on
the Belgium market. The supplier of the Austrian seller, however, did not give the
permission which was required for selling the natural gas in a BENELUX country.
Consequently, the seller failed to name the loading point and in turn, the buyer refused
to issue a letter of credit so that, in the end, no delivery took place. Claiming lost
profit from the envisaged resale of the natural gas in Belgium, the buyer instituted
proceedings in an Austrian Court. The Austrian Supreme Court held that, as the

seller's performance was the "characteristic" one, Austrian domestic law as "the
seller's law" was applicable to the facts of this case.
However, the Austrian Supreme Court did not always apply the private international
law clause of Article 1(1)(b) CISG correctly. In a case [22] concerning the sale of
machinery for the production of steel by an Austrian manufacturer to a German buyer,
the Austrian Supreme Court failed to apply CISG. Instead, it held without any
reference to Article 1(1)(b) CISG that Austrian domestic law was the applicable law.
Since the contract in question was a contract for work and materials to which the
Convention applies [page 5] according to its Article 3(1), and since CISG had already
entered into effect in Austria at the time of the conclusion of the contract, the Court
was wrong.
The applicability test as provided by Article 1(1)(a) CISG has sometimes been illconceived by Austrian lawyers and judges, especially in respect of contracts between
parties having their places of business in Germany and in Austria. These two countries
are not only neighbouring States, they also share the same language and, to a large
extent, the same legal tradition. Therefore, their domestic laws of sales are closely
related. Consequently, for parties involved in Austrian-German cross-border sales
contracts, the private international law problems that resulted from the entry into force
of CISG in the two jurisdictions have often occurred as a surprise. The existence of
CISG used to be neglected by the parties upon conclusion of the contract and in the
proceedings before the courts. That motivated the Austrian Supreme Court on various
occasions [23] to place particular emphasis on the aspect that Article 1(1)(a) CISG has
to be considered in determining the law that governs an international contract for the
sale of goods.
When discussing the conflict of laws aspects of CISG, another important decision of
the Austrian Supreme Court has to be mentioned.[24] In this case of a contract for the
sale of sunshades, the Czech manufacturer sought payment of the price by the
Austrian buyer who reacted with a claim for damages for defective performance. One
of the controversial issues in this case was whether a choice of law clause in favour of
"Austrian law" would entail the application of CISG. In an earlier award of the
International Arbitration Tribunal of the Austrian Chamber of Commerce [25] it was
regarded as "self-evident"[26] that a choice of law clause held in such general terms
would [page 6] result in the application of CISG, which provides the specific rules for
international sales contracts in Austrian law.
In its "Czech sunshades" decision, the Austrian Supreme Court came to the same
conclusion.[27] CISG has become, upon its ratification, an integral part of Austrian
domestic law. Therefore, a choice of law clause in an international sales contract

using, without any further specification, such broad language as "Austrian law shall
apply" leads to the application of CISG.
In another case the Austrian Supreme Court gave a clear answer to the question
whether the identical citizenship of the contracting parties would affect the application
of CISG to a cross-border sale. Quoting Article 1(3) CISG, the Court held that
citizenship of the parties would not matter, but that all depended on whether the
parties had their places of business in different countries.[28]
Shortly after CISG had become effective in Austria, the Austrian Supreme Court had
the opportunity to explicitly clarify that CISG would not apply to contracts that had
been concluded before 1 January, 1989.[29] Early on, the Court also had to decide
which kind of agreements would meet the requirements of an "international contract
for the sale of goods" according to CISG.[30] A cross-border drop shipment was
regarded to be subject to the application of CISG, at least in principle.[31] Contrary
thereto, a processing contract providing that the buyer of the finished goods had to
supply all the raw materials for being processed and returned thereafter by the seller
was not considered to comply with the requirements provided by Article 3(2) CISG
for international contracts for the "sale of goods".[32]Furthermore, in a case
concerning the sale of a deluxe sports car manufactured by Lamborghini,[33] the
Court held that the transaction was a consumer contract, since the purchase was for
private use. Thus, pursuant to Article 2 (a), the case did not fall within CISG. [page 7]
It is commonplace that issues which are not covered by CISG are governed by the
domestic law that is designated as applicable by the conflict rules of the forum.
[34] However, the Austrian Supreme Court repeatedly found it necessary to have this
aspect stressed explicitly. It did so with respect to limitation of actions and limitation
periods,[35] an action for recourse,[36] agency and lack of authority,[37] error,
[38] assumption of a debt,[39] claims for status quo ante arising from an avoided
sales contract,[40] assignment,[41] the obligations of a surety,[42] and a party's claim
that a bank guarantee may not be invoked.[43]
In a recent decision, the Austrian Supreme Court had to examine the validity of an
agreement between the parties of an international sales contract modifying the buyer's
rights, and it held that, pursuant to Article 4(a) CISG, the Convention did not apply.
Whether the agreement was valid was to be resolved in compliance with the domestic
law that, according to the rules of private international law, would govern the contract.
[44]
On several occasions, an Austrian corporation had bought tombstones from a German
corporation, which used to respond to the buyer's orders each time by a letter of
confirmation that comprised the seller's standard terms which modified the buyer's

statutory rights by excluding - inter alia - his right of retention. The crucial question
before the Austrian Supreme Court was whether this clause was valid. The Court held
that questions relating to the validity of clauses in standard terms modifying the rights
of a party are not governed by CISG. Consequently, as the conflict rules led to the
application of the law at the seller's place of business, German domestic law had to
be [page 8] applied, and under German commercial law the right of retention may be
validly excluded by agreement in contracts between merchants.
However, the Austrian Supreme Court also held that provisions of domestic law were
to be regarded as invalid if they infringed the fundamental principles on which CISG
is based. This would be the case if a domestic law excluded the right to declare a
contract void.[45] In the Court's view it was sufficient, however, if the loyal party's
right to claim compensatory damages would be preserved. Thus, the recognition of the
validity of a contractual exclusion of the right of retention by domestic German law
was accepted.
3. GENERAL PROVISIONS (ARTICLES 7 - 13 CISG)

On several occasions, the Austrian Supreme Court had the opportunity to discuss
issues relating to the interpretation of statements made by parties to an international
sales contract. In particular, the Court had to deal with the establishment of practices
between two parties and the interaction between trade usages and the Convention.
In its important decision of 6 February, 1996, the Supreme Court held that
conceptions that a party may have had during the negotiations but did not find
expression in an agreement between the parties may be regarded as "established
practices between the parties" pursuant to Article 9(1) CISG.[46] Consequently, such
(pre-contractual) practice of one party may, from the beginning of the business
relations of the parties (including their first contact), become part of an international
contract for the sale of goods. However, this is provided that it is obvious to the other
party from the circumstances of the negotiations that his or her partner is prepared to
conclude the contract only under specific conditions or in a special form.
In two judgments, the Austrian Supreme Court had to deal with the question whether
trade usages prevail over the non-mandatory provisions of CISG.[47] Here, the
decision of 15 October, 1998 concerning the "Austrian Usages for the Trade With
Timber"[48] is of [page 9] fundamental importance.[49] In this case, the Austrian
Supreme Court held that trade usages to which the parties agreed, as well as practices
they established between themselves, prevail over optional provisions of CISG.
However, according to the Court, a party to an international sales contract has to be
familiar only with those international trade usages that are commonly known and
regularly observed by parties to contracts of that specific branch in the specific

geographic area where the party in question has his or her place of business. Whether
the domestic "Austrian Usages for the Trade with Lumber" constitute such a widely
known and regularly observed international trade usage in cross-boarder sales of
timber by an Austrian seller to an Italian buyer is a question of fact. In the absence of
any finding of fact on this issue, the Supreme Court had to remit this case to the Court
of First Instance.
In the more recent decision [50] on the relationship of trade usages and CISG, the
Austrian Supreme Court had the opportunity to decide on the merits of the case.
Again, genuine domestic usages for the trade of timber, the "Tegernsee Usages", were
at stake. The Austrian Supreme Court held that these Bavarian usages prevailed over
the provisions of CISG, since it had been established by the Court of First Instance
that these usages were widely known to and regularly observed by parties in crossborder timber trade between Austria and Germany.
Hitherto, the Austrian Supreme Court had to deal with issues concerning the question
of formal requirements of an international sales contract, only in obiter dicta. In one
case, the Court referred to Article 11 CISG when accentuating that its abstention from
prescribing the observance of any formal requirement is considered a fundamental
principle of the Convention.[51] Furthermore, an analogy to Article 13 CISG was part
of the argument in a case concerning the writing requirement of Article 30 CMR,
where the Court held that the formal requirement is met whenever a notice is sent by
telefacsimile.[52] [page 10]
4. FORMATION OF CONTRACT (ARTICLES 14 - 25 CISG)

The obscure relationship of Articles 14 and 55 CISG and the question whether an
offer has to be definite to create a valid contract was the central issue in the Supreme
Court's decision of 10 November, 1994.[53] In this case a contract for the sale of
chinchilla furs was concluded between a German breeder and an Austrian who
occasionally traded with furs without an agreement on the precise quantity and price.
The only agreement between the parties was that, for furs of average and good quality,
a price of 35 to 60 German Marks per item should be paid.[54]
The Supreme Court found that, according to its Articles 1(1)(a) and 10(b), CISG
applied to the facts of the case and came to the conclusion that the offer was
sufficiently definite. Whilst the Court of Appeal reached this result on the basis of
Article 55, the Supreme Court resorted to Article 14 CISG finding that the criteria of
definiteness of an offer are met if the parties have implicitly fixed both the quantity
and the price in a way that makes it possible to identify the parties' intention. As the
parties had agreed on a price margin, there was a sufficiently definite indicator for
determining the price in respect of the quantity and quality of the furs that the German

breeder had delivered. The Court was not forced to search for a solution of the wellknown inconsistency of Articles 14 and 55 CISG.[55]
In its judgment of 20 March, 1997,[56] the Austrian Supreme Court did not regard it
as necessary to comment on this issue, but held [57] that an offer would comply with
the requirement of definiteness under Article 14 CISG whenever "a reasonable person
of the same kind as the offeree in the same circumstances"[58] would understand the
substance of the resulting agreement as sufficiently definite. [page 11]
In its most recent decision [59] on Article 14 CISG, the Austrian Supreme Court
resumed the arguments of its earlier cases in point and held that the decisive factor for
the interpretation of the offer, once the definiteness of an offer is established, is the
offeror's intent which the offeree knew or could not have been unaware. Previous
thereto, the Court had the opportunity to clarify that an offer could be accepted by no
other party as the one to which it was addressed.[60] In other words, an offer may
only bind the offeror in respect of the offeree. The Court deduces this position from
Articles 14 and 18 CISG and from general principles of contract law.
In the context of formation of contract, another issue before the Austrian Supreme
Court [61] was that of material alteration according to Article 19(2) and (3) CISG. The
Court concluded that the enumeration of terms that materially alter an offer in Article
19(3) CISG constituted a general assumption that may be rebutted in an individual
case.[62] This opinion is consistent with the prevailing view of Austrian legal
scholars. Consequently, even though these terms are explicitly mentioned as material
alterations, not all of these alterations necessarily have to be material in their
character. In the opinion of the Supreme Court, whether a term constitutes a material
or a non-material alteration of the offer depends on factors such as practices
established between the parties, trade usages, conduct during preliminary negotiations,
and particular circumstances of the individual case. On the merits of the case in point,
the Court held that alterations that were more favourable for the offeror would not
need a "counter- acceptance".
5. SUBSTANTIVE SALES LAW

5.1 General provisions (Articles 25 - 29 CISG)

Hitherto, the Austrian Supreme Court has, against all expectations, only rarely been
faced with the interpretation and application of the general provisions of Part III of
CISG, and has rendered rather insignificant decisions thereto. Surprisingly, this is
particularly true with regard to the concept of "fundamental breach" in Article 25
CISG, [page 12] since, notwithstanding its "pivotal character"[63] within the

Convention's system of remedies, no significant opinion on this provision has been

rendered so far.
The Court had the opportunity to specify that, according to Article 27 CISG, a buyer
giving notice of lack of conformity in due time would not bear the risk of delay or
loss.[64] Furthermore, it held that this provision would not apply to oral statements of
simultaneously present parties and that it would be sufficient that such oral statements
were articulate and audible by the other party.[65] No more than two holdings on
Article 29 CISG may further be mentioned. Thus, the question arose [66] as to
whether the parties were allowed under CISG to unanimously modify the contract
they had concluded by increasing the quantity of the goods. The Court held that the
Convention permitted such a unanimous subsequent modification of an international
sales contract. And in another case, the parties to an international sale of goods agreed
to unanimously declare the contract void. It was non-controversial that the parties
were entitled thereto under Article 6 CISG. However, the Austrian Supreme Court
resorted to Article 29 CISG to support the position that the parties' agreement to
modify an international sales contract falls within the Convention's scope of
application.[67]
5.2 Obligations of the seller and remedies of the buyer (Articles 30 - 52 CISG)
The important decision of 6 February 1996 [68] gave rise to the interpretation of
Article 30 CISG by the Austrian Supreme Court. This Article deals with the general
obligation of the seller to deliver the goods. The Court held that, as a consequence of
this provision, the buyer was entitled to expect the goods to be put to his or her
unrestricted disposal as long as no extraordinary obstacles (e.g. embargo, limitations
by law, restrictions affecting the specific branch of business) occur, and that it was the
seller's obligation to disclose any potential restrictions of the use of the goods
contracted for. This duty to inform flows from Article 41 CISG which provides that
"the seller must deliver goods which are free from any right or claim of a third party
unless the buyer agreed to take the goods subject to that right or claim". [page 13]
On 10 September 1998, the Austrian Supreme Court rendered two decisions [69] that
were occasioned by the adoption of the Lugano Convention on Jurisdiction and the
Enforcement of Judgments in Civil and Commercial Matters [70] that entered into
effect on 1 September 1996. In order to determine the meaning of "place of
performance" in Article 5 N 1 of this Convention,[71] the Austrian Supreme Court
had to interpret the contractual terms "free construction site Vienna"[72] and "free
domicile Klagenfurt".[73] In these two cases,[74] the German sellers claimed that
these contractual terms would indicate that the respective places of performance were
located in Austria, and that, under the Lugano Convention, they were entitled to sue
the Austrian buyers in Austrian Courts. As CISG applied to both Austrian-German

cross-border sales, the place of performance had to be determined in accordance with

Article 31 CISG.
The Court held that, if uniform substantive law applied, the contractual obligation to
perform at a certain place would have to be interpreted pursuant to the relevant
provisions of the respective uniform law, and rejected the claimants' arguments. With
reference
to
the
commentaries
on
CISG
edited
by von
Caemmerer/Schlechtriem and Honsell, the Supreme Court argued that, according to
Article 31 CISG, terms like the ones used in the contracts in question were insufficient
to constitute a place of performance and entail jurisdiction of the courts in the
Austrian cities mentioned therein.
In the first case,[75] the Austrian Supreme Court held that Article 31 contained
provisions concerning the place for delivery. When the parties agreed on a certain
place for delivery, they would envisage aspects such as the costs of the carriage of
goods, the modalities of delivery, and the bearing of risk. It would be inappropriate to
combine these issues with matters of jurisdiction, especially, if the place for delivery
is neither the place of business of the seller, nor that of the buyer. It should also be
considered [page 14] that, according to Article 31(a) CISG, the seller's place of
business is the place of performance that is relevant for the determination of subjectmatter jurisdiction.
In the second judgment of 10 September, 1998,[76] the Austrian Supreme Court
complemented it decision on Article 31 CISG by stating that terms imposing an
obligation on the seller to ship the goods would not constitute jurisdiction at the place
where the goods should arrive. The Court added, however, that it is a matter of
interpretation whether a contractual term fixing the place for delivery is, at the same
time, intended to determine special jurisdiction under Article 5 N 1 of the Lugano
Convention. As in the previous case, the appeal was dismissed and jurisdiction of the
relevant Court of First Instance denied.
In its decision of 29 June, 1999 [77] the Austrian Supreme Court held that the
Convention's concept of "non-conformity of goods" as stated in Articles 35 et
seq. CISG had to be understood in a broad sense. Therefore, it also comprises the
delivery of a commodity of a different kind as the one contracted for. Consequently,
under the regime of CISG, "wrong delivery" has to be assessed by Articles 35 et
seq. CISG instead of being treated as a case of non-delivery.[78]
More important in this context is a recent decision [79] of the Austrian Supreme Court
which concerned the sale of a second hand placement machine by a German seller to
an Austrian buyer. 8 of the Austrian Federal Regulation on the Security of Machines
(MSV)[80] requires the "CE-label", but this compulsory mark was missing. The buyer

asserted to have notified the seller of the lack of conformity in due time and claimed
reduction of price.
The Court rejected the claimant's argument that the Austrian Federal Regulation on
the Security of Machines ought to be considered when assessing the conformity of the
contracted goods. In the absence of a party agreement on this point, the "objective
minimum standard" as provided by Article 35(2) CISG should instead be relevant.
This means that goods are in conformity with the contract if they are fit for the
purposes for which goods of the same description would ordinarily be used. In the
Court's opinion, it [page 15] may be taken as a rule that the words "purposes for
which goods of the same description would ordinarily be used" have to be determined
in compliance with the standards of the seller's country. Consequently, the goods need
not be in conformity with the regulations on security, labelling and composition in the
country of importation, nor is the seller bound to know this country's relevant
standards. Moreover, it is the obligation of the buyer to make himself or herself
familiar with the requirements of public law in the country of utilisation. In any event,
he or she may incorporate these requirements into the contract as provided by Article
35(1) and (2)(b) CISG.[81]
It is not surprising that several decisions of the Austrian Supreme Court concerning
non-conforming delivery of goods by a seller focus on the examination of goods and
the notification of lack of conformity, and on the relevant time limits for these
activities of the buyer. So far, there have been six decisions [82] in which the Austrian
Supreme Court had to apply Articles 38 et seq. CISG.
The first decision, rendered on 12 February, 1998 [83] set out the basic lines of how to
apply Articles 38 et seq. CISG. However, in the absence of any finding of fact on the
timeliness of the notice of lack of conformity, the Court could not decide on the
merits, but had to remit the case to the Court of First Instance.
On 30 June, 1998,[84] the Austrian Supreme Court had to deal with Article 39 et
seq. CISG for the second time. This decision involved an international contract for the
sale of tropical fruit, which by agreement of the parties was subject to the
COFREUROP-rules.[85] These rules impose on the buyer an obligation to monitor
the goods in an appropriate way and to immediately notify any defect.
Notwithstanding the incorporation of the COFREUROP-rules into the contract, the
Austrian Supreme Court applied Article 27 CISG to the case and exempted the party
dispatching the notice of lack of conformity from the risk of delay or loss. Apart from
a reference to a comment [page 16] by Kramer,[86] the Court failed to provide any
reason for this decision. However, similar to the case mentioned above, the Court of
First Instance did not make any findings of fact on whether the notice of defects had
happened in due time. As a consequence, the case had to be remitted.

The third decision on the examination and notification of defects of 15 October,

1998 [87] is clearly more important. The Austrian Supreme Court had to decide
whether there is any difference at all in the assessment of the periods of time provided
by Article 38(1) for the examination of conformity, and by Article 39(1) CISG for the
notification of non-conformity, and how these two periods interact. By referring to
scholarly writings and a decision which the German Federal Supreme Court (BGH)
had rendered on this issue on 8 March, 1995,[88] the Austrian Supreme Court held
that "as short a period [of time] as it is practicable in the circumstances" has to be
distinguished from "a reasonable [period of] time". In conformity with the position
of Magnus [89] and Piltz [90] the Court held that, as long as the individual
circumstances of the case would not indicate a shorter or longer period, the overall
period of time for the examination of the goods and the notification of defects should
amount to 14 days approximately.[91]
Since this opinion was confirmed by the Austrian Supreme Court on the occasion of
its fourth decision on Article 38 et seq. CISG, it can be regarded as the Court's
permanent practice. When rendering this decision on August 27, 1999,[92] the Court
set out several criteria for the determination of the "short" period of time provided by
Article 38 (1) CISG. Among these criteria are the size of the buyer's business, the kind
of goods to be examined,[93] their quantity, complexity, seasonal or perishable
character, the expenditures required for a proper examination etc. When applying
these criteria, a court has to take into account both the objective and the subjective
peculiarities of the [page 17] individual case. These are, for instance, the buyer's
specific operational and personal conditions, the characteristics of the goods, the
quantity delivered, and the kind of the remedy chosen by the buyer. Likewise, the time
period of Article 39 CISG has to be assessed according to the relevant objective and
subjective circumstances.
Furthermore, the Court held that in comparison to 377 Austrian Commercial Code,
requiring "immediate" examination and notification of eventually detected defects, the
regime of Articles 38 and 39 CISG was more lenient. Nevertheless, the Court
emphasised that both periods of CISG would not be "long periods". Provided, that
individual circumstances would not justify a longer or a shorter period of time, the
overall period may be fixed at about 14 days, and the Court gave an explanation for its
opinion. Accordingly, the primary purpose of Articles 38 and 39 CISG would be to
rapidly[94] clarify whether a delivery was in conformity with the contractual
obligations. Thus, the danger of dubious claims and disputes arising from defects
subsequent to the delivery should be reduced. This is necessary because, with regard
to subsequent defects it is often controversial whether they were caused by the seller
or, due to improper handling, by the buyer. Finally, the Court held that the buyer was
charged with the burden of proof whether a notification of non-conformity was given
properly and in due time.

This last sentence was supplemented by the Austrian Supreme Court in its fifth
decision on Articles 38 et seq. CISG,[95] which otherwise was completely in
accordance with the Court's previous decisions on the subject. The Court held that the
question whether a seller had renounced the buyer's compliance with the requirements
of Articles 38 and 39 CISG, or whether insistence on such compliance would violate
"good faith", may only be answered in accordance with the circumstances of the
individual case. The same was considered true where, in the case of a delayed or
insubstantial notice, a seller who, regardless of the defect in the notification, first had
tried to cure the lack of conformity, but denied the buyer a right to cure thereafter.
Finally, the Austrian Supreme Court could not identify a relevant question of law in
this recent case.
A dictum of the Austrian Supreme Court in its decision of 19 May, 1999 should be
mentioned in this context. It concerns the preclusive period of two years according to
Article 39(2) CISG. The court held that the period of two years may be exhausted in
its entirety only in one of three cases. Firstly, if the buyer is unable to examine the
goods at [page 18] an earlier time. Secondly, if he or she, despite of an examination,
could not detect the non-conformity any earlier. Thirdly, if he or she, despite the
detection of a non-conformity, could not give notice at an earlier time. When giving
its reasons for this decision, the Austrian Supreme Court did nothing more than
literally repeat a sentence in the explanatory report accompanying the draft bill for the
ratification of the Convention by the Parliament.[96] Thus, it appears that the rule of
Article 7(1) CISG requesting the "international interpretation" of the Convention may
have been neglected by the Court.
5.3 Obligations of the buyer and remedies of the seller (Articles 53 - 60 CISG)
Of the provisions in this part of CISG, only Article 57 and Articles 63-64 CISG have
caused controversies about their interpretation giving rise to decisions of the Austrian
Supreme Court. Article 57 determines the place of payment of an international sales
contract in the absence of an agreement by the parties, and Articles 63-64 CISG
establish the consequences of a violation of the buyer's duty to pay the purchase price.
In its leading decision of November 10, 1994,[97] the Austrian Supreme Court, in
an obiter dictum, dealt with the Convention's various provisions on the place of
performance. Thereby, it particularly mentioned Article 57(1)(b), according to which
payment in exchange of handing over of the goods or of documents is to be made at
the place where the handing over takes place. However, from the facts of the case it
followed that the chinchilla furs were delivered by postal service and no third person
was authorised to collect the payment, so that Article 57(1)(b) CISG was inapplicable.
Consequently, according to Article 57(1)(a) CISG the seller's place of business was
determined as the relevant place of payment.

On 11 September, 1997 [98] and on 28 April, 2000,[99] the Austrian Supreme Court
rendered decisions on the fixing of an additional period of time for performance. In
the earlier decision, it held in ambiguous language that CISG, which is applicable on
the merits of the case, "also" required that an additional period of time for
performance was fixed and [page 19] the contract declared void according to Articles
63(1) and 64(1)(b) CISG. In the later decision the Court stated that, according to
Article 63 CISG, the seller was entitled to fix an additional period of time of
reasonable length for performance, and, if the buyer either failed to pay the purchase
price within this additional period or refused to pay at all, the seller might unilaterally
declare the contract void. The Court emphasised that there are no formal requirements
for this declaration of avoidance and that it must not fix a time limit. What has to be
clearly expressed, however, is that neither party shall remain bound by the contract.
In the relevant case, the meaning of a statement made by the seller's lawyer, after
having brought an action against the buyer, was at issue. In this statement, the lawyer
declared that no performance would be accepted if the buyer failed to perform within
the additional period of time. Notwithstanding the ambiguity of the statement that
made it appear as if the avoidance of the contract was just meant as an alternative, the
court regarded it as sufficiently definite to constitute a declaration of avoidance after
an action had been brought by the seller.
5.4 Anticipatory breach and instalment contracts (Articles 71 - 73 CISG)
Whereas the Austrian Supreme Court has not yet had an opportunity to decide matters
relating to the Convention's Articles 66 et seq. on the passing of risk, the provisions on
anticipatory breach and instalment contracts have already been subject of a decision of
the Court. In the "Czech sunshades case"[100] the contract between a Czech seller and
an Austrian buyer provided delivery of a great quantity of sunshades by instalments.
However, because of the buyer's failure to pay for the instalments delivered, the seller
stopped further deliveries and declared the contract void.
Quite correctly, the Austrian Supreme Court held that in the circumstances of case, the
seller's declaration of avoidance was made too early and that Article 71 CISG applied
to the merits of the case. According to this provision, a party to an international sales
contract may suspend his performance without declaring the contract void.[101]
Furthermore, the Court had to deal with the question of the relationship between
Article 71 CISG and the more comprehensive remedies of domestic law which aim at
being [page 20] respected in the same situation, viz., when after the conclusion of a
contract, facts become apparent that give rise for reasonable doubt that the debtor will
perform his obligations. On this issue, the Court held that Article 71 CISG ruled out
the application of any identical or comparable remedies of the particular domestic law

that is found applicable under the rules of private international law of the forum. This
was particularly true in relation to the question of whether a recourse to the more
extensive rights of retention of the domestic law of a Contracting State should be
granted.
Moreover, the Austrian Supreme Court held that suspension of performance under
Article 71 CISG not only required the presence of "serious" circumstances that may
prohibit performance, but also of economic difficulties including lack of
creditworthiness of the other party. This would be the case if bankruptcy proceedings
had commenced, or if the debtor stopped his or her payments or deliveries. However,
according to the Court, a delay with a single instalment or a sluggish payment is not
sufficient to indicate a serious lack of creditworthiness.[102]
5.5 Damages (Articles 74 -77 CISG)
Articles 74 et seq. CISG entitle a loyal party to claim damages from the party in
breach of the contract. This claim exists in addition to other remedies granted by the
Convention. Contrary to Austrian domestic law, this liability of the party in breach of
a contract under CISG is a form of strict liability. It was obvious that this difference
would create problems, and that issues relating to the Convention's provisions on
damages would induce court proceedings.
The decision of 6 February, 1996 [103] is the leading case in the practice of the
Austrian Supreme Court concerning Articles 74 et seq. CISG. In this context the Court
held that the assessment of damages is determined by the "foreseeability test" as
provided by Article 74 CISG. Therefore, it is of significant importance for the
assessment of damages what the loyal party may have expected at the time of the
conclusion of the contract as result of the correct performance by the other party.
Thus, damages for all [page 21] foreseeable loss, including loss of profits as well as
consequential damages and damages for delayed performance, are recoverable
pursuant to Article 74 CISG.
In the actual case, the Austrian Supreme Court held that lost profits which a buyer
could have gained from resale, had the seller properly performed his or her contractual
obligations, must be compensated if such profit from resale was foreseeable for the
party in breach, and that, whenever commercial goods are sold to a merchant, no
further proof of the foreseeability of a resale-transaction is required.[104]
In its decision of 9 March, 2000,[105] the Austrian Supreme Court affirmed its
decision of 6 February, 1996. By doing so, the court held with regard to damages
under Article 74 CISG, that the Convention is based on the principle of full
compensation, but only for cases in which, as a result of a breach of contractual

obligations, a contract is declared void and where the methods of assessing damages
are explicitly stated. In fact, guidance for finding the correct amount of compensation,
either by a substitute transaction or by payment of the market price of a conforming
good, is provided by Articles 75 and 76 CISG.
The Austrian Court's latest judgment on Article 74 CISG was rendered on 28 April,
2000.[106] In this decision, the Court resorted to a higher precision in the
interpretation of that key provision of the Convention. In the view of the Court, the
principle of awarding damages for breach of contract that amount to full
compensation of the loss, including loss of profit, ought to be understood as a
continuation of legal conceptions that had been developed by national courts
interpreting their domestic law prior to CISG. Thus, the courts came to acknowledge
the general rule that merchants, whose business is the trading of goods like those of
the avoided contract in question,[107] would always able to conclude a contract on the
basis of the market price. The only advantage that a merchant would draw from being
released from the duty to perform the avoided contract is that he or she would not
have to purchase additional goods when performing the substitute transaction. The
merchant would save the acquisition costs and the difference between the defaulted
purchase price of the avoided contract and his or her savings of acquisition costs; in
other words, the profit margin would constitute the amount of damages suffered by
the seller of fungible goods. The loss of this profit would qualify as "actual [page
22] damages", because it had already been a part of the seller's assets at the time of
conclusion of the contract. In the end, the Austrian Supreme Court stated in explicit
wording that the seller's usual trade margin would usually be his or her foreseeable
loss of profit within in the meaning of Article 74 CISG.
Furthermore, the Supreme Court mentioned in this decision that, in the same way as
provided by the relevant rules of Austrian domestic law, damages may be assessed
under CISG either on the basis of a "concrete method of computation", viz. by
substitute transaction according to Article 75 CISG, or on an "abstract basis of
calculation", viz. by reference to the current market price according to Article 76
CISG. However, neither Article 75 nor Article 76 CISG precludes the creditor's right
to assess damages in accordance with the general rule of Article 74 CISG.
A final reference to the Austrian Supreme Court's decision of 6 February,
1996 [108] shall conclude this survey of Austrian case law on CISG. When dealing
with the Convention's provision on mitigation of damages (Article 77 CISG), the
court held that the loss, including lost profits, suffered from a breach of contract may
only be claimed to the extent to which the loss should not have been mitigated by
measures that would have been reasonable in the circumstances. Examples of such
reasonable measures to mitigate the loss would be those which under the
circumstances of the individual case could have been expected in good faith. In the

Court's view, the answer to the question of which measures would be reasonable and
ought to be taken depends on how a reasonable creditor would have acted in the same
situation.[109]
6. CLOSING REMARKS

It would be a difficult and futile undertaking to search for a convincing explanation

why CISG has become as widely accepted by the Austrian Supreme Court as the great
number of cases suggest. Neither do Austrian parties to contracts for the international
sale of goods demonstrate a stronger tendency to initiate court proceedings against
their partners and to file appeals, nor are provisions in standard terms for international
sales contracts that would expressly exclude the application of CISG less commonly
used in Austria than in other Contracting States. Further, it cannot be seriously
claimed, that, due to its Viennese origin, a sentimental affection to CISG would
dominate among Austrian legal consultants, attorneys and judges. [page 23]
In the end, any attempt of finding an explanation for the surprising increase in the
number of decisions that the Austrian Supreme Court rendered on the basis of the
Convention for the International Sale of Goods between 1994 and 2001 inevitably
leads to mere speculation. [page 24]

FOOTNOTES
* Dr. juris, Professor of Law, Institute for Austrian Civil Law, Foreign and
International Private Law, University of Graz, Austria.
** Mag. Juris, Research Assistant, Institute for Austrian Civil Law, Foreign and
International :rivate Law, University of Graz, Austria.
1. The German translation of the title of the convention is "bereinkommen der
Vereinten Nationen ber Vertrge ber den Internationalen Warenkauf". Contrary to
the English version, the German text and title of CISG are not authentic, but the result
of a concerted translation effort by Austria, Switzerland, The German Federal
Republic and the Former German Democratic Republic. There is no generally
accepted German abbreviation of the title of the convention. In its decisions, the
Austrian Supreme Court uses abbreviations such as "UNK", "UN-K" or "UN-KR" in
an arbitrarily inconsistent way. In the writings of German and Austrian academic
scholars, however, instead of German abbreviations, the English "CISG" is usually
preferred. See Magnus, U., in Staudinger, J. (Ed.), Wiener UN-Kaufrecht (CISG)1994
De Gruyter, Berlin. For a more recent examples, see Piltz, B., "Entscheidungen des

BGH zum CISG" (1999) Transportrecht und Internationales Handelsrecht (TranspR IHR) p. 13; Schlechtriem, P. (Ed.), Kommentar zum Einheitlichen UN-Kaufrecht CISG, 3rd edition 2000 Beck, Munich.
2. Austrian Federal Legal Gazette (BGBl) 1988 N 96. The UN Treaty Section reports
that Austria and Mexico ratified or acceded to the CISG on 29 December 1987.
3. By February 1, 2001, there are 61 Contracting States.
4. Cf. Posch, W., "Das Wiener Kaufrecht in der sterreichischen Praxis"
(1997) Mlanges Neumayer - Emptio - venditio inter nationes, at p. 89 et seq. In 1997,
there was still reason for the assumption that the overwhelming majority of Austrian
lawyers and judges was not familiar with CISG. By now, however, this assumption
appears to be falsified. As CISG has been an integral part of the relevant collections of
Austrian private law statutes for years, it is today commonly known by Austrian
attorneys and judges.
5. For academic writings on CISG Cf. Doralt, P. (Ed.), Das UNCITRAL-Kaufrecht im
Vergleich zum sterreichischen Recht, 1985 Manz, Vienna; Loewe, R., Internationales
Kaufrecht, 1989 Manz, Vienna; Karollus, M., UN-Kaufrecht, 1992 Springer, Vienna;
Hoyer, H. and Posch, W. (Eds.), Das Einheitliche Wiener Kaufrecht, 1992 Orac,
Vienna; Wilhelm, G., UN-Kaufrecht, 1993 Manz, Vienna; Posch, W., in Schwimann,
M., ABGB-Praxiskommentar 2nd Ed. Vol. 5, 1997 Orac, Vienna.
6. Cf. Posch, W., supra (footnote 4), at p. 92 et seq.
7. Cf. Austrian Supreme Court (OGH), December 12, 1998, published in 1998 Recht
der Wirtschaft (RdW), at p. 335.
8. Quite often, however, the Court only referred obiter to the Convention.
9. Piltz, B., supra (fn 1), at p. 13. This statement is confirmed by the latest edition of
the case law digest on CISG compiled by Michael R. Will, Twenty Years of
International Sales Law Under CISG, 2000 Kluwer, The Hague, at p. 253 et seq.
10. Cf. Schlechtriem, P. and Magnus, U. (Eds.), Internationale Rechtsprechung zu
EKG und EAG, 1987 Nomos, Baden-Baden; Schlechtriem, P., "Einheitliches
Kaufrecht. Erfahrungen mit den Haager Kaufgesetzen - Folgerungen fr das Wiener
Kaufrecht" 1989 RdW p. 41. The Hague Uniform Law of Sales was never ratified by
Austria.

11. District Commercial Court of Vienna, 20 February, 1992, published in 1992 RdW,
at p. 239. This is the first example of how the private law clause of Art 1(1)(b) CISG
is correctly applied. Cf. Posch, W., supra (fn 4), at p. 99 et seq, whereas the Supreme
Court's reference to Art 9(2) CISG in its decision of 7 June, 1990 (see 1990 RdW, at p.
406) on issues of private international law that was occasioned by an - insubstantial argument advanced by one of the parties, is rather surprising.
12. Austrian Supreme Court, 2 July, 1993, published in 1994 RdW, at p. 75; Austrian
Supreme Court, 24 November, 1993, published in 1994 RdW, at p. 208; Austrian
Supreme Court, 28 April, 1994, 6 Ob1549/94, unpublished. For a commentary on
these decisions, see Posch, W., supra (fn 4), at p. 97 et seq.
13. This provision was repealed when the Austrian Private International Law Act
(IPRG) became partly replaced by the Rome Convention on the Law Applicable to
Contractual Obligations on 1 December, 1998, Austrian Federal Legal Gazette I 1998
No 119. As a result of the accession to the European Union on January 1, 1995, the
amendment was necessary to implement the Rome Convention. Whereas 36 of the
Austrian Private International Law Act was still applicable to the actual case, Article 4
of the Rome Convention would be the relevant provision today.
14. Austrian Supreme Court, 26 May, 1994, published in 1994 ecolex, at p. 619.
15. Austrian Supreme Court, 10 November, 1994, published in 67 Sammlung
zivilrechtlicher Entscheidungen (SZ) N197. A translation of this decision appears at
(2002) 6 Vindobona Journal of International Commercial Law and Arbitration 147.
16. Primarily the relationship between Art. 14 and Art. 55 CISG was at stake.
17. Cf. 1995 ecolex, at p. 94.
18. Austrian Supreme Court, May 26, 1994, published in 1994 ecolex p. 619 (supra fn
12); cf. District Commercial Court of Vienna, February 20, 1992, published in 1992
RdW p. 239 (Cf. supra fn 11).
19. Decision of 27 May, 1997, published in 1997 RdW, at p. 594. The Austrian
Supreme Court proceeds along the same lines in its decision of April 2, 1998
concerning the sale of apple juice concentrate from a Polish seller to an Austrian
buyer. The headnotes of this decision are published in 1998 Zeitschrift fr
Rechtsvergleichung (ZfRV) N 53.

20. Austrian Supreme Court, 6 February, 1996, published in 69 SZ N 26 1996 RdW,

at p. 203. A translation of this decision appears at (2002) 6 Vindobona Journal of
International Commercial Law and Arbitration 153.
21. Austrian Supreme Court, 24 October, 1995, headnotes published in 1996 ZfRV N
20. In this decision, the question was whether a limitation period for claims arising
from contractual obligations and matters of recourse fell within the sphere of
application of CISG. The Austrian Supreme Court held that CISG does not contain
any provision on this, so that issues concerning a limitation period are excluded from
the Convention's sphere of application. Consequently, it applied Austrian domestic
law as the law at the seller's place of business.
22. Austrian Supreme Court, 19 December, 1995, published in 1996 ZfRV, at p. 161.
23. Austrian Supreme Court, 20 March, 1997, published in 1997 Juristische
Bltter (JBl), at p. 592; 1997 Evidenzblatt der Rechtsmittelentscheidungen (EvBl) N
169 1997 RdW, at p. 334; 1997 ZfRV, at p. 204; 1997 ecolex, at p. 656; Austrian
Supreme Court, 11 September, 1997, published in 1998 ecolex, at p. 331; Austrian
Supreme Court, 11 March, 1999, headnotes published in 1999 ZfRV N 50; Austrian
Supreme Court, 21 March, 2000, published in 2000 ecolex, at p. 306; Austrian
Supreme Court, 13 April, 2000, published in 2000 RdW N 506;
2000 Richterzeitung (RZ) N 24; Austrian Supreme Court, 28 April, 2000, published
in 2000 EvBl N 167; 2000 RdW N 643. A translation of the latter decision is appears
at (2002) 6 Vindobona Journal of International Commercial Law and Arbitration 184.
24. Austrian Supreme Court, 12 February, 1998, 71 SZ N 21; 1999 JBl 54;
1998 RdW, at p. 335; 1999 ZfRV, at p. 65.
25. Award N 4366, published in 1995 Recht der internationalen Wirtschaft (RIW), at
p. 590. See the award of 12 October, 1997 rendered by the Exchange of Agricultural
Products, published in 1998 ZfRV, at p. 211.
26. In his comment of this decision Schlechtriem remarks that this solution not only
had become the prevailing one under the Hague conventions, but also - "undisputedly"
- under CISG: see 1995 RIW, at p. 593.
27. Austrian Supreme Court, 12 February, 1998 (supra fn 24). See also Austrian
Supreme Court, 28 April 2000 (supra fn 23) and Austrian Supreme Court, 22 October,
2001, 1 Ob 77/01g, unpublished.

28. Austrian Supreme Court, 15 October, 1998, published in 1999 JBl, at p. 318;
1999 RdW, at p. 135. A translation of this decision appears at (2002) 6 Vindobona
Journal of International Journal and Arbitration 169.
29. Cf. Austrian Supreme Court, 28 March, 1990, published in 3 IPRE N 9; Austrian
Supreme Court, 24 November, 1993, published in 1994 RdW, at p. 208.
30. See Austrian Supreme Court, 10 November, 1994 (supra fn 15).
31. Austrian Supreme Court, 24 October, 1995, headnotes published in 1996 ZfRV N
20.
32. Austrian Supreme Court, 27 October, 1994, published in 1995 ZfRV 159.
33. Austrian Supreme Court, 11 February, 1997, 10 Ob 1506/94, unpublished.
34. Since 1 December 1998 the relevant rules are provided by the European
Convention on the Law Applicable to Contractual Obligations.
35. Austrian Supreme Court, 24 October, 1995 (supra fn 31); Austrian Supreme
Court, 25 June, 1998, published in 71 SZ N 115; also published in 1998 RdW 668;
most recently, cf.: Austrian Supreme Court, 7 September, 2000, published in
2000 RdW N 19.
36. Austrian Supreme Court, 24 October, 1995 (supra fn 31).
37. Austrian Supreme Court, 20 March, 1997 (supra fn 23) and most recently,
Austrian Supreme Court, 22 October, 2001, 1 Ob 49/01i unpublished.
38. Austrian Supreme Court, 20 March, 1997 (supra fn 37).
39. Austrian Supreme Court, 24 April, 1997, published in 1997 RdW 531.
40. Austrian Supreme Court, 10 March, 1998, published in 1998 RdW 552. However,
contrary to this decision the Austrian Supreme Court held on 29 June, 1999 that issues
concerning the rewinding of contracts were to be resolved by filling gaps within the
Convention. This contradictory decision was published in 2000 RdW N 9;
2000 ZfRV 33.
41. Austrian Supreme Court, 25 June, 1998 (supra fn 35); employing the same
arguments is the Supreme Court's decision of 7 September, 2000 (supra fn 35).
42. Austrian Supreme Court, 12 November, 1998, published in 1999 RdW 211.

43. Austrian Supreme Court, 28 July, 1999, headnotes published in 2000 ZfRV N 4.
44. Austrian Supreme Court, 7 September, 2000 (supra fn 35).
45. The Supreme Court substantiated this view by emphasising, that the right to avoid
a contract would be the last resort of a party performing his or her contractual
obligations, if the other party failed to perform within an additional period of
reasonable length, or if the supplied goods continued to be useless for the buyer.
46. Austrian Supreme Court, 6 February, 1996 (supra fn 20). A translation of this
decision appears at (2002) 6 Vindobona Journal of International Commercial Law
and Arbitration 153.
47. The Austrian Supreme Court had already dealt with this topic in an obiter dictum
in its judgment of 6 February, 1996 (supra fn 20).
48. "sterreichische Holzhandelsusancen".
49. Austrian Supreme Court, 15 October, 1998 (supra fn 28). Cf. the obiter dicta in
the Supreme Court's decision of 27 August, 1999, concerning the Bavarian "Tegernsee
(timber trade) Usages" ("Tegernseer Gebruche"), published in 2000 RdW N 10. A
translation of this decision appears at (2002) 6 Vindobona Journal of International
Commercial Law and Arbitration 169.
50. Austrian Supreme Court, 21 March, 2000 (supra fn 23).
51. Austrian Supreme Court, 6 February, 1996 (supra fn 20); Austrian Supreme Court,
9 March, 2000, published in 2000 RdW N 379.
52. Austrian Supreme Court, 26 April, 1996, published in 69 SZ N 107;
1996 JBl 659; 1997 RdW 76. The Court found that the requirement of a document to
be "in writing" is different from the requirement to be "signed".
53. Austrian Supreme Court, 10 November, 1994, (supra fn 15); for a comment in
German, see Posch, W., supra (fn 4), at p. 101 et seq.
54. Under the terms of this contract, the breeder delivered an amount of 249 furs of
predominantly average quality. Immediately after having received the furs, the buyer
himself sold and delivered the furs in their original packages to an Italian merchant.
However, upon arrival the Italian buyer rejected 13 of the 249 furs on grounds of nonconformity with the quality contracted for. In turn, the Austrian trader complained
about these 13 furs to the German breeder. At the same time, he transferred 2400

German Marks to the German breeder, no more than 10 Marks for one fur. The
German breeder then sued the Austrian trader for the payment of another 9500
German Marks. The basis of the breeder's calculation of total payments due was a
price of 50 German Marks for one fur: a difference to the Austrian buyer's calculation
of 40 German Marks for one fur.
55. According to the Court, it could be disregarded, whether a determination of the
contract price might be possible by fictitiously assuming that the parties have accepted
the price that is generally charged for the relevant goods at the time of the conclusion
of the contract.
56. Austrian Supreme Court, 20 March, 1997 (supra fn 23).
57. With reference to Schlechtriem, Kommentar (supra fn 2), Comment N 4 to Art 14
CISG.
58. Cf. Article 8(2) CISG.
59. Austrian Supreme Court, 9 March, 2000 (supra fn 51).
60. Austrian Supreme Court, 18 June, 1997, 1998 published in JBl 255; 1998 RdW 12.
61. Austrian Supreme Court, 20 March, 1997(supra fn 23).
62. With reference to the writings of Karollus (supra fn 5), and Bydlinski F. in Doralt,
P. (Ed.) (supra fn 5) and further references in support of this "prevailing Austrian
view" to the German commentaries on CISG by Schlechtriem and Herber.
63. Aicher, J. in Hoyer, H. and Posch, W. (Eds.), Das Einheitliche Wiener Kaufrecht.
Neues Recht fr den Internationalen Warenkauf, 1992 Orac, Vienna, at p. 59.
64. Austrian Supreme Court,
1998 RdW 736; 1999, at p. 37.

30

June,

1998,

published

in

65. Austrian Supreme Court, 15 October, 1998 (supra fn 28).

66. In the aforementioned judgment of 6 February, 1996 (supra fn 20).
67. Austrian Supreme Court, 29 June, 1999 (supra fn 40).
68. Supra fn 20.

1999 JBl 252;

69. Austrian Supreme Court, 10 September, 1998, 2 Ob 208/98x, published in

1999 RdW 210; and Austrian Supreme Court, 10 September, 1998, 2 Ob 221/98h,
published in 1999 JBl 333; 1999 RdW 210.
70. Austrian Federal Legal Gazette 1996 No 448.
71. Article 5 N 1 of the Lugano Convention states, that a party to an international
contract domiciled in a Contracting State may launch proceedings for breach of
contract by the other party in the court of the place where performance is due,
provided that this is a court of a Contracting State.
72. "frei Baustelle Wien".
73. "frei Haus Klagenfurt".
74. One involved the sale of rotors for heat exchangers, the other the sale of satellite
receivers.
75. Austrian Supreme Court, 10 September, 1998, 2 Ob 208/98x (supra fn 69)
76. Austrian Supreme Court, 10 September, 1998, 2 Ob 221/98h (supra fn 69)
77. Austrian Supreme Court, 29 June, 1999 (supra fn 40).
78. Along the same lines proceed the arguments in the Supreme Court's decision of 21
March, 2000 (supra fn 23).
79. Austrian Supreme Court, 13 April, 2000 (supra fn 23).
80. Austrian Federal Legal Gazette 1994 N 306.
81. This decision is interesting from a European Community Law point-of-view. It
obviously complies with the rules on the free movement of goods.
82. Austrian Supreme Court, 12 February, 1998 (supra fn 24); Austrian Supreme
Court, 30 June, 1998, (supra fn 64); Austrian Supreme Court, 15 October, 1998
(supra fn 30); Austrian Supreme Court, 19 May, 1999, headnotes published in
2000 ZfRV No 1; Austrian Supreme Court, 27 August, 1999 (supra fn 49); Austrian
Supreme Court, 21 March, 2000 (supra fn 23).
83. Austrian Supreme Court, 12 February, 1998 (supra fn 24).
84. Austrian Supreme Court, 30 June, 1998 (supra fn 66).

85. COFREUROP is the acronym for "Common European Usages for the Domestic
and International Sale of Eatable Fruits and Vegetables".
86. In Straube, M. (Ed.), HGB-Kommentar 2nd ed, 1995 Manz, Vienna, Comment N
43 to 377, 378 HGB.
87. Austrian Supreme Court, 15 October, 1998 (supra fn 28).
88. German Federal Supreme Court, March 8, 1995, published in 1995 RIW 595.
89. Magnus, U. in Staudinger, J. (Ed.), CISG, supra note *.
90. Piltz, B., UN-Kaufrecht, Comments N 142 and 145.
91. In contrast thereto, Wilhelm, 1999 ecolex at p. 262, regards the "splitting of the
periods of time" in Articles 38 and 39 CISG as a purely scholastic exercise to
distinguish a "short" time period from a "reasonable" one. However, this view ignores
the requirement of Article 7(1) CISG of interpreting the convention autonomously,
and it entirely disregards, that in the authentic versions of CISG this distinction is all
but meaningless.
92. Austrian Supreme Court, 27 August, 1999 (supra fn 49).
93. In the actual case, the sold goods were sneakers which were inspected rather
negligently by the Swedish buyer.
94. The German word "schnell" appears in bold characters in the original version of
the decision.
95. Austrian Supreme Court, 21 March, 2000 (supra fn 23).
96. Explanatory remarks, Protocol N 94 of the Austrian National Assembly,
17th Session of Parliament, at p. 59.
97. Supra fn 15: The case is known as the "chincilla furs case".
98. Supra fn 23.
99. Supra fn 23. A translation of this decision appears at (2002) 6 Vindobona Journal
of International Commercial Law and Arbitration184.
100. Austrian Supreme Court, 12 February, 1998 (supra fn 24).

101. The right of suspension of performance (Article 71) exists independently from
the right to avoid a contract (Article 73).
102. As payments for only two instalments were delayed, a serious lack of
creditworthiness of the Austrian buyer could not be assumed in the relevant case. The
cancellation of an order for remittance does not indicate such a lack of
creditworthiness. Consequently, as the requirements of Article 71 CISG were not met,
the right to suspend performance could not be granted to the Czech seller. The
Austrian Supreme Courts was criticised by Karollus in 2000 JBl, at p. 56, for
interpreting the relevant criteria of Article 71 CISG too strictly: Bankruptcy
proceedings need not be commenced; it should be sufficient that a reason for opening
such proceedings exists.
103. The decision was rendered with regard to a contract for the sale of natural gas,
supra fn 20.
104. In the case in question, even the defendant admitted that it was obvious to him
that the goods would be resold.
105. Austrian Supreme Court, 9 March, 2000 (supra fn 51).
106. Austrian Supreme Court, 28 April , 2000 (supra fn 23).
107. A German manufacturer of jewellery sold jewels to an Austrian jeweller.
108. Austrian Supreme Court, 6 February, 2000 (supra fn 20).
109. Because of the absence of any substantial argument on this point during the
proceedings, this question was not answered by the Austrian Supreme Court in greater
detail.