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CISG - Restitutionary aspects
 
 

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Restitution?

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The UN Convention on Contracts for the International Sale of Goods ("CISG") is a highly successful international convention on sales contracts.

Restitution is a subsidiary concern of the CISG, as one aspect of breach of contract. Particularly significant are:

CISG article 81

(1) Avoidance of the contract releases both parties from their obligations under it, subject to any damages which may be due. Avoidance does not affect any provision of the contract for the settlement of disputes or any other provision of the contract governing the rights and obligations of the parties consequent upon the avoidance of the contract.

(2) A party who has performed the contract either wholly or in part may claim restitution from the other party of whatever the first party has supplied or paid under the contract. If both parties are bound to make restitution, they must do so concurrently.

CISG article 84

(1) If the seller is bound to refund the price, he must also pay interest on it, from the date on which the price was paid.

(2) The buyer must account to the seller for all benefits which he has derived from the goods or part of them:

(a) if he must make restitution of the goods or part of them; or

(b) if it is impossible for him to make restitution of all or part of the goods or to make restitution of all or part of the goods substantially in the condition in which he received them, but he has nevertheless declared the contract avoided or required the seller to deliver substitute goods.

On these provisions see especially:
Annotated text of CISG article 81, with commentary

Annotated text of CISG article 84, with commentary

See also: Remarks on the manner in which Articles 7.3.5 and 7.3.6 of the UNIDROIT Principles compare with Articles 81 and 82 of the CISG by Florian Mohs (January 2004)

There is a great deal of case law on the Pace CISG site. Here is a selection:

Topic

Jurisdiction

Date

Avoidance; modification of contract
Germany
22 February 1994
Avoidance of contract
ICC
March 1999
Avoidance: restitution by each party of benefits received
Germany
8 February 1995
Duty to pay interest when returning price
Germany
29 December 1998
Duty to pay interest when returning price
Germany
24 May 1995
Effect of avoidance
Austria
29 June 1999
Extent of damages available along with restitution
Switzerland
5 February 1997
Inability to return goods after work done on them
Germany
27 September 1991
Inability to return, through onsale
Germany
10 February 1994
Non-conforming goods
United States
10 October 2006
Payment for missing goods
Switzerland
7 July 2004
Remedy of reduction of price
United States
22 May 1990
Restitutionary damages
Israel
2 November 1988
Restitution of a deposit
Austria
8 September 1997
Restitution of a deposit
Austria
10 March 1998
Restitution of an advance payment
Austria
11 March 1999
Restitution of price paid under bank guarantee
Germany
8 February 1995
Restitution of price - does CISG apply?
Germany
28 January 1998
Statute of limitations
ICC
1990
Unreasonably retained goods
Russia
27 April 2001

See also: Remedies Under the New International Sales Convention: The Perspective from Article 2 of the UCC by Harry M Flechtner (1988)

For resources on the CISG generally see especially: Pace database on the CISG and The Autonomous Network of CISG Websites.

     
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This page was compiled by Steve Hedley, to whom all comments should be addressed.
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