Case number: 2
Article number: sales convention / 1(1)(b); 3(1); 49(1)(a); 25
Thessaurs issue:
Country of decision: Germany
Year of decision: 1991
Type of decision: Judicial decision

Case 2: CISG 1(1)(b); 3(1); 49(1)(a); 25
Germany: Oberlandesgericht Frankfurt a.M.; 5 U 164/90 17 September 1991
Published in German: Recht der Internationalen Wirtschaft 1991, 950 Reproduced in German with brief summary in English and French: Uniform Law Review, 1991, I, 382

An Italian manufacturer had agreed to produce 130 pairs of shoes according to specifications given by a German buyer, to be used as a basis for further orders. At a trade fair, the manufacturer displayed some shoes produced according to these specifications and bearing a trade mark of which the buyer was the licensee. When the manufacturer refused to remove those shoes, the buyer advised the manufacturer by telex one day after the fair that the buyer discontinued the relationship and would not pay for the 130 sample shoes which were no longer of any value to the buyer.

The court applied CISG as the relevant Italian law pursuant to German private international law and considered the above agreement as a contract of sale according to article 3(1)CISG. It held that the buyer had timely and effectively declared the contract avoided; the manufacturer's breach of the ancillary duty of preserving exclusivity constituted a fundamental breach of the contract under article 25 CISG since it endangered the purpose of the contract to such a degree that, as was foreseeable to the manufacturer, the buyer had no more interest in the contract.