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Date:   16 December 2009
Court:   The Court of Vidzeme area of Riga city
Local case reference:   C30258107
CISG Nordic ID:   091216LV
Country of decision:   Latvia
Buyer's country:   Italy
Seller's country:   Latvia
Goods involved:   Frozen berries
Case history:   n/a
Original language:   Latvian
Provisions cited:   CISG articles 14, 30, 33, 45, 74
Original court document:   n/a
Rapporteur:   Aleksandrs Potaičuks
Case citations:   n/a

 

Abstract

by Aleksandrs Potaičuks

In the proceedings, which were brought on 31 July 2007, the Buyer (Italian company) claimed that the Seller (Latvian company) should be ordered to pay LVL (Latvian lats) 35,140.20, costs of adjudication, state fee, and costs relating to assistance of advocates.

In February 2006 the parties in mutual discussions and electronic correspondence concluded a contract on delivery of frozen berries. According to the contract the Seller had to deliver 40,000 kg of frozen blueberries to Latvia, and the Buyer had to pay 50% of the price in advance and the rest after the delivery. On 24 February 2006 the Buyer paid 50% of the price in advance. On 13 March 2006 the Seller requested payment of the remaining 50%, explaining that it was necessary to cover the expenses of the delivery. On 17 March 2006 the Buyer was informed that the Seller had difficulties and would not be able to deliver berries. The Seller promised to return the 50% advance payment. However, the goods were not delivered and the money was not paid back until the Buyer sued the Seller. Moreover, the Seller did not respond to the Buyer’s notifications and requests.

The Court held that no one has the right to unjustly enrich himself or herself, harming or acting at the expense of another person. Since the Seller failed to perform his obligation under the contract, the Buyer had the right to claim damages (Article 45 of CISG).  
Further more, the Court held that there was no evidence in the case as to what laws the mutual relations of parties should be adjudged in accordance with. Therefore it could be presumed that the contracting parties have made their obligation, in accordance with its substance and consequences, subject to the laws of the state where the obligation is to be performed (Article 19 of Civil Law of Latvia). The obligation is to be performed in Latvia and therefore the mutual relations of parties shall be adjudged in accordance with Latvian law and the CISG.
A proposal for concluding a contract addressed to one or more specific persons constitutes an offer if it is sufficiently definite by indicating the goods and expressly or implicitly fixing or makes provision for determining the quantity and the price (Article 14 (1) of CISG). In this case the proposal was sufficiently definite. Since the Buyer paid 50% of the price in advance, the contract was concluded.
The Seller must deliver the goods, hand over any documents relating to them and transfer the property in the goods, as required by the contract and this Convention (Article 30 of CISG).
Seller’s request to have the remaining 50% for the delivery was contrary to the contract.  
The Seller must deliver the goods within a reasonable time after the conclusion of the contract (Article 33 (c) of CISG). The goods were not delivered and the advance payment was not returned until the Buyer sued the Seller.
Damages for breach of contract by one party consist of a sum equal to the loss, including loss of profit, suffered by the other party as a consequence of the breach (Article 74 of CISG). Since the plaintiff paid 50% for berries without receiving delivery, the Court held that the Buyer suffered a loss of LVL 35,140.20 as a consequence of Seller’s action.
The Court held that the seller should pay the costs of adjudication (state fee). As for costs related to assistance of advocates, the Court held that the reference from attorney does not prove Buyer’s costs related to assistance of advocates.

 

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