Scope of UNCISG When is contract governed by the CISG?

International Diversity  Two countries who principal place of business is in different States (nations) and (a) both states are contracting states or (b) one state is a contracting state and international choice of law rules lead to the application of the law of the contracting state.  Article 95 Reservation

International Diversity  More than 1 place of business: the place with the closest relationship to the contract is the “place of business” for determining international diversity. Article 10(a)

Sale of Goods  Article 2: Convention does not define “goods” but specifically excludes:  Commercial paper  Securities  Ships  Aircraft  Electricity  Goods sold to consumers

Mixed Contracts  Article 3(2)  Governed by CISG unless the “preponderant part of the obligations of the party who furnishes the goods, consists in the supply of labor and other services  If a large part of sellers obligation is to provide labor and other services, does not apply.

Future Goods Art. 3  Applies to Contract for future goods, unless the buyer supplies a substantial part of the materials.

Other “Goods”  Intellectual Goods Not mentioned CISG  Real Property not covered

Choice of Law  Principals of private international law determine which States domestic laws apply  Hague Convention on Law Applicable to International Sales of Goods

What does CISG govern?  Article 4: convention only governs: formation of contract and the rights and obligations of the parties  Does not govern the “validity” of contract, not concerned with fairness

When CISG is incomplete  Article 7(2) Look to the conventions general principals if applicable principal cannot be found use applicable domestic law.  3 step analogical analysis:  Look at things that are regulated by the convention  Does the convention reject extension  Is the case so similar that the results should be the same.

General Provisions  Article 7  Inhibits local courts who hear convention cases from applying local law  Requires good faith in interpreting the convention but no good faith requirement in making the contract

General provisions  Article 8- rules for interpreting the contract. 3 step analysis:  Where parties have common intent, give effect to parties agreement  Divergent intent- one party has knowledge or could not have been unaware of other party’s intent then other parties interpretation prevails  Divergent intent- parties unaware- the statements and conduct are subjected to reasonable person standard

General Provisions  Article 9  Allows parties to include any usage to which they have agreed.  Article 11  Contract can be enforceable even if it is not in writing and may be proven by any means.  Reservation possible (Art 12 and 96)