BLAW Ch 4

In CISG, a communication between parties is considered an offer when what?

(1) it is a proposal for concluding a contract and (2)it is "sufficiently definite and indicates the intention of the offeror to be bound.

What are the only trade usages that can be used to interpret or fill the gaps in a contract under CISG?

(1) those to which the parties have agreed or that they have established between themselves and (2) those of which the parties knew or ought to have known, and that are widely known in international trade (or at least in those countries in which both buyer and seller are located) and regularly observed in the industry or trade involved.

An offer is considered sufficiently definite when:

(1)indicates or describes the goods, (2) expressly or implicitly specifies the quantity, and (3) expressly or implicitly specifies the price for the goods.

What is the American approach to contract negotiations?

-Aggressive, Adversarial -Win-lose proposition -Lawyers accustomed to practicing in a highly litigious society, press for every legal advantage

What is the seller's right to cure under CISG?

-CISG attempts to encourage the parties to stay in their contracts rather than to repudiate it in the event of a dispute -Nachfrist: extension of time or grace period -A seller may avoid a contract if a buyer fails to either take delivery or pay the purchase price or otherwise commits a fundamental breach

what are choice of law provisions?

-Despite widespread acceptance of CISG, many attorneys recommend that their clients negotiate a choice of law provision calling for the resolution of disputes according to their own national laws -US lawyers prefer to have the more familiar UCC govern their clients' contracts -CISG allows parties to "exclude the application of this Convention... or vary from any of its provisions" → "opting out"

What are the buyer's responsibilities?

-Pay the price for the goods and take delivery of them as required -Obligation to inspect the goods and notify the seller of any nonconformity

What are implied warranties under the UCC?

-Warranty of merchantability The thing will do what it's supposed to do -Warranty of fitness for a particular purpose in which the buyer relies on the skill and expertise of the seller -Warranty of title

What is the mailbox rule?

-a mailbox rule determines the time at which an offer must be accepted - under CISG, acceptance is good once it reaches the other party

What is a fundamental breach?

-allows the distressed party to terminate performance of the contract -Most late shipments are not a fundamental breach -Under CISG sellers are usually given additional time to perform even when they are late -Attempts to encourage the parties to stay in their contract rather than repudiate it in the event of a dispute

Some courts reason that a party's performance is excused if:

-performance of the contract has been rendered physically or legally impossible, -the underlying purposes of the contract no longer exist, or -a change in circumstances has rendered the contract commercially or financially impracticable.

What is sales law? what does it not apply to?

-the law which relates to the sale of good, movable item or ownership of property from one person to another for monetary value -Does not apply to contracts for real estate, intangibles )like stocks, bonds, patents, copyrights, and trademarks), Employment, Insurance, Provision of services

What is the parol evidence rule?

-the parol evidence rule is a rule in cases that does not allow a party to a written contract from presenting evidence (agreements made outside of contract do not apply) -Has not been incorporated in the CISG

What is the perfect tender rule?

-under UCC: if seller sells to buyer nonconforming goods then the buyer can reject the goods, accept some and reject some, or accept them all -CISG: if buyer receives nonconformity, they must notify the seller, the seller is allowed tim to fix it, and parties still fulfill the contract

CISG provides that a party is not liable for a failure to perform any obligations if:

1) it was due to an impediment beyond control 2) the impediment was not reasonably foreseeable at the time the contract was concluded 3) the impediment was unavoidable and could not be overcome 4) notice was given to the other party of the impediment and of its effect on the contract

Under CISG, the seller must deliver goods that are the quantity, quality, and description required by the contract and that:

1. Are fit for the purposes for which goods of the same description would ordinarily be used 2. Are fit for any particular purpose expressly or impliedly made known to the seller at the time of the conclusion of the contract, 3. Possess the qualities of goods that the seller has held out to the buyer as a sample or model. 4. Are contained or packaged in the manner usual for such goods or, where there is no such manner, in a manner adequate to preserve and protect the goods

For negotiating contracts in Japan, what is confucian thinking?

1. Every person must strive to maintain harmony and accord in society 2. The maintenance of harmony and the importance placed on personal dignity stress the importance of not causing others to "lose face" or become embarrassed 3. Importance of social group to which you belong → group loyalty and desire for group harmony

When does CISG apply?

1. The contract is for the commercial sale of goods (the CISG does not define the term "goods") 2. It is between parties whose places of business are in different countries (nationality or citizenship of individuals is not a determining factor) 3. The parties' places of business are located in countries that have ratified the Convention

In CISG, what is the place of business?

Considered to be the country that has the closest relation to the contract where it will be performed

What state has not adopted UCC?

Louisiana (prefers to follow rules in its french-influenced civil code

What are the 3 different areas of law that deal with goods?

State common law UCC (uniform commercial code) CISG (Convention for the International Sale of Goods)

What is anticipatory breach?

a clear refusal by a party to perform a contract

What is mutual assent?

a mutual agreement between two parties

What is specific performance?

a remedy that compels a party to do a specific act according to the precise terms agreed upon both parties for justice

What are lost profits?

a seller is compensated for the profit without releasing, due to a breach of contract by a buyer

What is suspend performance?

a temporary ceasing of a contract

What are the elements of a contract in common law and UCC?

agreement, consideration, capacity, legality

What is a pro forma invoice?

an estimated invoice sent by a seller to a buyer in advance to give the buyer a description and the cost of the purchased goods

What are the remedies outlined in CISG in case of breach of contract?

avoidance (cancellation) of the contract; the right to remedy or cure; the setting of an additional time, or extension, for performance; price reduction; money damages; and specific performance.

Why are consumer sales excluded from CISG?

because consumer protection laws are so specific to every country and they're usually domestic in nature

What is pacta sunt servanda?

contractual obligations must be kept

What are consequential damages?

damages that are claimed which were caused as a direct result of wrongdoing

What is a purchase order?

displays the descriptions, quantities, prices, discounts, payment terms, date of performance or shipment, other associated terms and conditions

What is commercial impracticability?

incapable to practice, to perform, or to accomplish with the availability means

What is an integrated contract?

it contains all the terms of agreement that the parties agreed to

What is the mirror image rule?

it refers to a contract law principle that the acceptance must match the offer to form a contract

What is force majeure?

it refers to natural and unavoidable catastrophes that interrupt the expected course of events

What is the battle of the forms?

it starts when 2 businesses are negotiating the terms of a contract and each party wants the contract on the basis of its own terms

What is frustration of purpose?

it takes place when unexpected circumstances undermine the purpose of the contract

What are the elements of a contract under CISG?

just agreement!!

what is objective impossibility?

no one can provide service due to unreasonable difficulty

what is order confirmation?

notifies the customer, and defines the product to be supplied, the service that has to be provided and the overall supply conditions

What are the terms and conditions?

rules that one must agree to abide in order to use a service

What is sale?

the amount of tangible goods, services, or properties sold for monetary value in a given time period

A court may grant specific performance under CISG only if all the following conditions are met:

the buyer has not resorted to another remedy; the seller failed to deliver or, in the case of nonconforming goods, the nonconformity was so serious that it constituted a fundamental breach; the buyer gave timely notice to the seller that the goods were nonconforming; and the buyer made a timely request that the seller provide substitute goods.

What are trade usages?

the customs that are commonly used and accepted by the merchants in the trade (ex. in the construction industry, common practices to use certain materials and certain methods that are expected to be used because that's what's always used)

What is lex mercatoria?

the latin word for "merchant law"

What is unification of law?

the process involved in ensuring uniformity across all national laws

What are liquidated damages?

the total amount of compensation given to the aggrieved party