Question

Buyer and Seller entered into a contract governed by the CISG for Seller to deliver a sophisticated computer to Buyer by January 1. Seller was late in delivering themachine, so Buyer wired Seller on January 2: “Anxious to take delivery of the computer. Hope that it arrives by February1.”Seller delivers the computer on February 5, but Buyer refused to accept it and declares that the contract is avoided because Seller failed to hand over the computer before the February 1 date specified in the January 2 telegram.Both Buyer and Seller agree that there has not been a fundamental breach.Is Buyer able to avoid the contract under these circumstance?

Answer 1

The buyer can NOT avoid the contract in this case.

A buyer can avoid the contract if the original contract terms are held up as agreed to. According to Article 33 of the CISG,

- a seller must deliver the agreed upon goods by or before the fixed date : The date as per the contract was January 1st.

The delivery date is way past a 'reasonable' delay and so the seller can be held in breach and the buyer can avoid the contract and refuse to accept delivery.

However, the buyer amended the delivery date in the contract with the wire sent on Jan 1st. Contract terms can be modified by both parties as long as both agree according to Article 29. And so the contract is considered amended with the new delivery date is set as Feb 1st.

The seller delayed delivery by another 4 days. As per Article 33, the seller can deliver the goods within a reasonable time (4 days) after the conclusion of the contract which was Feb 1st. And as such the contract can be considered to be concluded effectively with the delayed delivery.  

Additionally, a breach of contract as per Article 25 is when it results in fundamental detriment to the buyer which both buyer and seller agree has not happened.

Since neither of these two conditions are met, the buyer can not avoid the contract and must accept delivery from the seller.

(Pace Law school, 2007)

Reference :

Pace Law school institute of international commercial law. (2007) UNITED NATIONS CONVENTION ON CONTRACTS FOR THE INTERNATIONAL SALE OF GOODS (1980) [CISG].