Party Autonomy in International Property Law - Peace Palace Library

8. European Conflict Rules for the Mutual Recognition of Security Rights in Goods
8.2.3. Foreign retentions of title recognized –
unless resale is allowed
a) Principle and exception
Denmark and Sweden generally recognize foreign retentions of title. 32
However, an exception to this rule is made if the Danish or Swedish buyer
is a merchant and is entitled, according to the terms of the contract of
sale, to dispose of the goods bought in favour of a sub-buyer. 33 Economically,
the exception alluded to in the title of this section is very important,
since it has a broad field of application. In effect, it voids retention of title
clauses in sales to merchants reselling to other merchants. The effect of
these clauses is limited to sales to producers and to merchants reselling
to consumers.
b) Conclusion
Is the Scandinavian exception compatible with the European obligation
of mutual recognition of retentions of title? In my view it is. Recognition
of security rights in the field of corporeal movables does not mean
that retentions of title must be accorded the full effects of the security
right that they may enjoy in the country of exportation. The effect of
recognizing retentions of title must be limited to the effect that a cor-
32
Denmark: English seller’s retention of title in machine to be used in Danish
buyer’s enterprise recognized: S.Ct. 3 November 1983, UfR 1984 A 8. In
Sweden, no directly relevant case has been found. However, already in 1932
a German seller’s retention of title was recognized in the Swedish buyer’s
bankruptcy: S.Ct. 27 April 1932, NJA 1932 I no. 84.
33
Denmark: S.Ct. 8 February 1983, UfR 1983 A 311; Vestre Landsret 31 January
1992, UfR 1992 A 373; Østre Landsret (ØL) 6 April 1998, UfR 1998
A 1073. If the asset sold by a German seller but not paid for by the Danish
buyer is retaken by the German seller with the consent of the Danish buyer
shortly before the latter’s bankruptcy, the buyer is entitled to reclaim the purchase
price from the German seller: S.Ct. 21 August 1987, UfR 1987 A 766.
Sweden: In the bankruptcy of the Swedish buyer, the German seller, despite
a reservation of ownership clause, was not allowed to reclaim the sold but
unpaid-for machines from the buyer’s bankruptcy estate: S.Ct. 31 October
1978, NJA 1978 no. 114.
Ulrich Drobnig
175
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