Equapack, Inc. v. Medi-Machines S.A. Memorandum for Medi ...

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discontinued machine with immediate shipment. [Claimant’s Ex. 2]. In light of these circumstances, a deviation of 2.8 to 5.6% for one type of product is not unreasonable. This is supported by existing case law. The German Supreme Court held that a seller who delivered mussels containing a cadmium concentration exceeding the limit recommended by the German health authority was not in breach of contract since the buyer did not inform seller of the limits and the product was still edible. [BGH, 8 Mar. 1995 (Germany)]. In another case, considering that the buyer had not provided the seller with information regarding the manner in which the fabrics had to be cut in order to be economical and that the fabrics were suitable for the production of skirts and dresses, the court found that the fabrics conformed to the contract. [LG Regensburg, 24 Sept. 1998 (Germany)]. Finally, another court found that the buyer did not prove that the sheep were nonconforming since the buyer failed to prove that it made seller aware that the sheep needed to be ready for slaughter upon delivery. [OLG Schleswig, 22 Aug. 2002 (Germany)]. 2. RESPONDENT did not make any warranties regarding the machines’ processing speed. 30. CLAIMANT relies on Uniform Commercial Code 2-313(1)(a) to support its contention that RESPONDENT created an express warranty regarding processing speed by the use of the words “top products” and “complete satisfaction.” [Memorandum for Claimant 42-43]. The CISG has abandoned traditional notions of warranty found in various domestic laws and has replaced it with a unitary notion of conformity. [Supermicro Computer v. Digitechnic (U.S.A.); G. & C. v. I (Switzerland)]. If the UCC is taken into consideration, however, it actually supports RESPONDENT’s position. UCC 2-313(2) provides that “an affirmation merely of the value of the goods or a statement purporting to be merely the seller’s opinion or commendation of the goods does not create a warranty.” UCC 2-313 Official Comment 8 further clarifies that some statements or predictions cannot fairly be viewed as entering into the bargain. 31. The law recognizes that reasonable consumers would not take RESPONDENT’s sales “puffing” literally. Puffing refers to “loose general statements made by sellers in commending their products. These statements embody exaggerations, the truth or falsity of which cannot be determined easily, that amount to no more than an expression of the seller's opinion about the character or quality of the product.” [Ladd v. Honda Motor (U.S.A.)]. For example, one court recognized that the statement “you meet the nicest people on a Honda” was puffing and rejected 11
a warranty claim by a consumer. [Baughn v. Honda Motor (U.S.A.)]. Thus, under the UCC, buyers can rely on affirmations of facts about seller’s goods but buyers do not have a right to rely on seller’s opinion or commendation regarding its product. [Ladd v. Honda Motor (U.S.A..); Baughn v. Honda Motor (U.S.A.)]. In the instant case, RESPONDENT’s statements—that the machines were “top products” and would deliver “complete satisfaction”—were not affirmations of fact, but rather RESPONDENT’s commendation regarding its machines. Therefore, CLAIMANT was not entitled to rely on such statements. II. EVEN IF THE MODEL 14 MACHINES DID NOT CONFORM TO THE CONTRACT, CLAIMANT IS NOT ENTITLED TO RELY ON THE LACK OF CONFORMITY. 32. CLAIMANT is not entitled to rely on the alleged lack of conformity because it failed its duty to inspect (A.) and its duty to mitigate (B.). A. CLAIMANT failed to properly inspect the machines. 1. CLAIMANT did not conduct an appropriately diligent examination of the machines. a) CLAIMANT failed to conduct a test run. 33. The CISG imposes on the buyer a duty to “examine the goods, or cause them to be examined, within as short a period as is practicable in the circumstances.” [Art. 38(1) CISG]. RESPONDENT agreed that it would not raise any questions under Article 39 CISG regarding notice of non-conformity [Proc. Order 2, 2]. However, it is well settled that a buyer’s duty to inspect under Article 38 CISG is distinct from a buyer’s duty to notify. [Provincial Court of Pontevedra, 3 Oct. 2002 (Spain); OGH, 14 Jan. 2002 (Austria); Shuttle v. Tsonakis (U.S.A.); OLG Koblenz, 18 Nov. 1999 (Germany); Beijing Light Automobile v. Connell (Sweden); Wonderfil v. Depraetere (Belgium); OG Luzern, 8 Jan. 1997 (Switzerland); OLG Saarbrücken, 13 Jan. 1993 (Germany). 34. “Article 38 does not define the intensity of the examination required.” [Kuoppala 96]. The examination must be such as to disclose recognizable defects in light of all the circumstances. [Kuoppala 97]. The examination must be “appropriately diligent, even in the case of goods' features that are hard to examine; if necessary, the buyer must call in experts.” [OGH 27 Aug. 1999 (Austria)]. In the case of complicated machinery, as is the case in the instant dispute, the 12
Page 1 and 2: ELEVENTH ANNUAL WILLEM C. VIS INTER
Page 3 and 4: II. EVEN IF THE MODEL 14 MACHINES D
Page 5 and 6: LIST OF ABBREVIATIONS Paragraph P
Page 7 and 8: TABLE OF AUTHORITIES Articles and T
Page 9 and 10: Fouchard, Philippe, Gaillard, Emman
Page 11 and 12: Murray, John E. Jr., Nakamura, Tats
Page 13 and 14: Towle, Holly K. Online Contract For
Page 15 and 16: Cases Australia Commonwealth of Aus
Page 17 and 18: Landgericht Frankfurt am Main (16 S
Page 19 and 20: Handelsgericht Zürich (26 Apr. 199
Page 21 and 22: Arbitral Awards Netherlands Arbitra
Page 23 and 24: 5. Mr. Swan contacted Mr. Drake on
Page 25 and 26: non-corrosive, including salt. [Mem
Page 27 and 28: 3. RESPONDENT adequately informed C
Page 29 and 30: 22. Finally, even if the Tribunal w
Page 31: appropriate comparison should have
Page 35 and 36: Offer, or Acceptance. Lastly, altho
Page 37 and 38: If CLAIMANT had taken reasonable st
Page 39 and 40: a processing speed of 180 bags per
Page 41 and 42: In the discussions leading up to th
Page 43 and 44: obligated to perform. [Art. 38 CISG
Page 45 and 46: ealized the supposed defects before
Page 47 and 48: serious concerns about CLAIMANT’s
Page 49 and 50: The presence of separate rules in t
Page 51 and 52: Because each case would be consider
Page 53 and 54: d) Requiring confidentiality of a t
Page 55 and 56: Rules to govern any disputes arisin

Equapack, Inc. v. Medi-Machines S.A. Memorandum for Medi ...

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