Scafom International BV v. Lorraine Tubes S.A.S.: a case review of changing circumstances under the United Nations Convention on International Sale of Goods (CISG) of 1980

Author:Amalina Ahmad Tajudin
Position:Universiti Sains Islam, Malaysia
Pages:212-225
SUMMARY

This paper analyses the Belgium Supreme Court decision of Scafom International BV v. Lorraine Tubes S.A.S. The case involved a contract of sale of volatile goods ie steel tubes whereby a fixed-price contract caused it to be unenforceable because of the 70% market price increase just before the goods were delivered to the buyer. While the seller requested for renegotiation, for a higher contract... (see full summary)

 
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Scafom International BV v. Lorraine Tubes S.A.S.: a case review
of changing circumstances under the United Nations Convention
on International Sale of Goods (CISG) of 1980
Senior Lecturer Amalina AHMAD TAJUDIN1
Abstract
This paper analyses the Belgium Supreme Court decision of Scafom International
BV v. Lorraine Tubes S.A.S. The case involved a contract of sale of volatile goods ie steel
tubes whereby a fixed-price contract caused it to be unenforceable because of the 70%
market price increase just before the goods were delivered to the buyer. While the seller
requested for renegotiation, for a higher contract price, the buyer refused to come to terms
with the former. The court, by virtue of the United Nations sales law, held that
renegotiation was the appropriate remedy in such a situation. In addition, the paper tests
the different possible outcomes of this decision under the English Sale of Goods Act 1979 ,
as well as the US Uniform Commercial Code. The finding of this test proves that these two
sales laws would have tackled the issue of volatile market differently from that of the United
Nations’.
Keywords: CISG, fluctuation, renegotiation, fixed-price
JEL Classification: K12, K 22, K33
1. Introduction: United Nations Convention on International Sale
of Goods 1980 (CISG) as international law of sales
The CISG is a product of more than two generations of international
negotiation, and was unanimously approved by delegations representing 62
national legal systems at a diplomatic conference convened by the United Nations
General Assembly in Vienna in 1980.2 Its final text was approved at a diplomatic
conference convened by the United Nations General Assembly in Vienna in 1980.3
The 62 nations comprised of 22 from the ‘Western developed’ countries, 11
‘socialist regimes’ and 29 third world countries.4 The US delegates participated
actively in the discussions of the CISG, voting in favour of the final text of the
CISG.5 The US signed the CISG on August 31, 1981, and subsequently on
September 21, 1983, the US President requested for the advice and consent of the
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1 Amalina Ahmad Tajudin – Universiti Sains Islam, Malaysia, amalina@usim.edu.my
2 Paul Amato, U.N. Convention on Contracts for the International Sale of Goods-The Open Price
Term and Uniform Application: An Early Interpretation by the Hungarian Courts, 13 ‘Journal of
Law and Commerce’ (1993) 1-29, 2.
3 Alejandro M Garro, Reconciliation of Legal Traditions in the U.N. Convention on Convention for
the International Sale of Goods 23 ‘International Lawyer’ (1989) 443-48, 444.
4 Ibidem.
5 Ibidem 445.

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