Case number: 102
Article number: sales convention / 75(1); 79(1); 100(2)
Thessaurs issue:
Country of decision:
Year of decision: 1989
Type of decision: Arbitral award

Case 102: CISG 75(1); 79(1); 100(2)
International Chamber of Commerce, International Court of Arbitration
Arbitral award issued in 1989, case no. 6281
Extracts published in French: Journal de Droit International, 1114; and in English: Yearbook of
Commercial Arbitration, XV, 1990, 83 and Collection of ICC Arbitral Awards, Vol. II, 394

(Abstract prepared by S. Picard, ICC International Court of Arbitration)

The parties, of Egyptian and Yugoslav nationality, concluded a contract for the FOB sale of a certain quantity of steel. In conformity with the contract, the buyer announced that it wished to exercise its right to buy an additional quantity of steel at the price and on the conditions stipulated in the contract. The dispute arose from the seller's refusal to deliver the additional quantity of steel at the contract price, since the market price had gone up, as a result of which the buyer was forced to obtain the goods from another source at a higher price.

The tribunal found that, pursuant to article 100(2) CISG, the Convention was not applicable, since the contract was concluded before the Convention entered into force in the countries involved (including France, the place of arbitration), even though those countries were parties to the Convention at the time of issuance of the arbitral award. Applying the private international law rules of the countries concerned and article 3.1 of the Hague Convention of 15 June 1955 on the law applicable to international sales of goods, to which France is a party, the tribunal concluded that the applicable law was the law of Yugoslavia, as the law of the place where the seller had its principal place of business and where the contract was performed.

The tribunal compared the Yugoslav law with article 74.1 of the Uniform Law on the International Sale of Goods (ULIS) and with article 79(1) CISG and found that by refusing to deliver the additional goods at the contract price the seller had committed a breach of contract. The tribunal held that the seller could be relieved of the obligation to deliver the goods at the contract price only if the contract contained a price adjustment clause, or in case of frustration of the contract, which was not the case here, since the increase in the market price was, in fact, neither sudden nor substantial nor unforeseeable.

In order to determine the amount of compensation due to the buyer, the tribunal compared Yugoslav domestic law with articles 75 CISG and 85 ULIS and held that the buyer was entitled to the difference between the contract price and the price actually paid in order to obtain the goods from another source.