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Date:   30 March 2006
Court:   Tallinn Circuit Court
Local case reference:   2-04-280
CISG Nordic ID:   060330EE
Country of decision:   Estonia
Buyer's country:   Estonia
Seller's country:   Norway
Goods involved:   Vehicles (4 Scania vehicles, 1 Volvo), 1370 tires, a bench for tire works
Case history:   The judgment is made by the court of second instance (court of appeal). Judgment of the court of first instance was given on 07.11.2005 by the Tallinn City Court (now the Harju County Court) who satisfied the claim in full. Appeal was filed by the Buyer.
Original language:   Estonian
Provisions cited:   CISG articles 18, 53, 55, 81
Original court document:   Available
Rapporteur:   Aleksandra Vasiljeva, Gea Lepik and the University of Tartu
Case citations:   n/a

 

Abstract

by Gea Lepik and the University of Tartu


An Estonian company OÜ F (the Buyer) and a Norwegian citizen O. W. concluded an oral agreement in 2001 whereby O. W. agreed to deliver to the Buyer either personally, or through a legal entity which he has the right to represent, 5 used vehicles (4 Scania vehicles and 1 Volvo FL 408), 1 370 used car tires and a used bench for tire works (the Contract). O. W. fulfilled the Contract partly via a company G. AS and partly as a self-emplyed person under the business name Ø (the Sellers).
The goods were delivered to Estonia. On 07.09.2001 the representatives of the parties signed a statement No. 0308 stating that the 4 Scania vehicles and 1350 tires are not fit for use or resale and the Buyer refuses to pay for them.
G. AS issued invoices in the total amount of 161 500 NOK and Ø issued two invoices in the total amount of 57 700 NOK. The Buyer did not pay the invoices. The Sellers filed claims to the Tallinn City Court against the Buyer for the payment of the purchase price, relying on Art-s 53 and 62 of the CISG.
The Buyer did not accept these claims. According to the defendant’s response to the claims, the Buyer considered the statement No. 0308 to be an agreement to terminate the Contract whereby the Buyer was freed of the obligation to pay for the goods. The Buyer further explained that after the alleged termination of the Contract O.W. and the Buyer had orally agreed that the Buyer would help O.W. to sell the vehicles in Estonia and that O.W. would cover the necessary costs. The Buyer sold the 4 Scania vehicles in Estonia for a total of 275 600 EEK. The tires were unusable and thus were brought to the dumping ground.
The Tallinn City Court satisfied the Sellers’ claims in full, relying on Art 53 of the CISG. The Buyer then filed an appeal to the Tallinn Circuit Court (the Court).
The Court first addressed the issue of termination of the Contract. The Court referred to Art 81 (2) of the CISG pursuant to which a party who has performed the contract either wholly or in part may claim restitution from the other party of whathever the first party has supplied or paid under the contract. The Court found that as some of the goods had been resold, they could not be returned, and since the parties had not agreed on the price of the goods in the oral sales Contract, the Buyer had to reimburse to the Seller the income gained from reselling the goods. This income would presumably correspond to the market value of such goods in the given territory.
The Court went on to analyse the issue of compensation with respect to the specific goods which had been resold by the Buyer. It was considered proven that 1350 tires were unfit for use or resale and thus the Sellers’ claim was not grounded with respect to these tires. The 4 Scania vehicles, however, were not found unfit for use or resale. Firstly, there was no evidence to suggest that their technical condition did not allow them to be used or resold; secondly, the Buyer had registered them in the Estonian national motor vehicle register and resold them. Thus, the Sellers could claim the market value of the 4 Scania vehicles from the Buyer. As the Buyer had received a net income of 233 559 EEK from their sale (275 500 EEK minus VAT), the same amount had to be compensated to G. AS.
As for the rest of the goods – the Volvo, 20 tires and the bench for tire-works – the Court concluded that statement No. 0308 does not contain the statement of intent of the Buyer to terminate the Contract with regard to those goods. The Court referred to Art 53 of the CISG pursuant to which the buyer must pay the price for the goods. However, the exact price of the goods was difficult to determine in this case as there was no evidence that the parties had agreed on the price on the conclusion of the Contract. The Court held that the prices unilaterally indicated on the customs declaration were not relevant as there was nothing to prove that the Buyer had consented to such prices. The Court referred to Art 18 (1) of the CISG and noted that silence or inactivity does not in itself amount to acceptance.
In this situation the Court applied Art 55 of the CISG which establishes that where a contract does not expressly or implicitly fix or make provision for determining the price, the parties are considered, in the absence of any indication to the contrary, to have impliedly made reference to the price generally charged at the time of the conclusion of the contract for such goods sold under comparable circumstances in the trade concerned. The Court held that since the goods were intended to be resold in Estonia, their price would also have to be determined based on the local market price in Estonia. The amounts requested by the Sellers (46 363 EEK for the Volvo, 371 EEK for the 20 resalable tires and 927 EEK for the bench for tire works) where found not to exceed the local market price and were thus justified.

The Court held that the Buyer had to pay 233 559 EEK to G. AS for the 4 Scania vehicles and 47 681 EEK to Ø for the Volvo, 20 tires and the bench for tire works.

 

Translated text

n/a

 

Original text

See link <https://www.riigiteataja.ee/kohtuteave/maa_ringkonna_kohtulahendid/menetlus.html?kohtuasjaNumber=2-04-280/3>

 

 

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