COMPARATIVE PRIVATE LAW
NON-PERFORMANCE LIABILITY
University of Oslo
Prof. Giuditta Cordero Moss
Case I – Destruction of
subject-matter (1)
• Sale of car components built on
specifications
• An earthquake destroys the facilities and
the stored components
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Destruction of subject-matter (1)
• Norwegian law: Seller
is excused
• German law: Seller is
excused
• Italian law: Seller is
excused
• English law: Seller is
excused
• UNIDROIT: Seller is
excused
• PECL: Seller is
excused
• CISG: Seller is
excused
Case II – Destruction of
subject-matter (2)
• Sale of car components built on specifications
• A fire destroys the facilities and the stored
components
• The fire alarm had not been installed due to
illness of the person in charge of security in the
seller’s company
• Delivery cannot be made according to contract
• Is the seller liable for non-performance?
Destruction of subject-matter (2)
• Norwegian law: Seller
is not excused
• German law: Seller is
not excused
• Italian law: Seller is
not excused
• English law: Seller is
not excused
• UNIDROIT: Seller is
not excused
• PECL: Seller is not
excused
• CISG: Seller is not
excused
Case III – Act of god
(factum principis) (1)
• Sale of car components built on
specifications
• New governmental regulations forbid
export of various technical equipment, i.a.
car components
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Act of god (1)
• Norwegian law: Seller
is excused
• German law: Seller is
excused
• Italian law: Seller is
excused
• English law: Seller is
excused
• UNIDROIT: Seller is
excused
• PECL: Seller is
excused
• CISG: Seller is
excused
Case IV – Act of god
(factum principis) (2)
• Sale of car components built on
specifications
• The seller’s export licence is withdrawn
because of the seller’s non-compliance
with governmental requiremenets
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Act of god (2)
• Norwegian law: Seller
is not excused
• German law: Seller is
not excused
• Italian law: Seller is
not excused
• English law: Seller is
not excused
• UNIDROIT: Seller is
not excused
• PECL: Seller is not
excused
• CISG: Seller is not
excused
Case V – Supplier’s failure
• Sale of car components built on specifications
• The aluminium supplier fails to deliver aluminium
on time for the production of the components
• The aluminium supplier is a recognised supplier
on the market, but due to extraordinary
wheather conditions cannot ship on time
• Delivery cannot be made according to contract
• Is the seller liable for non-performance?
Supplier’s failure
• Norwegian law: Seller
is excused
• Italian law: Seller is
excused
• German law: Seller is
excused
• English law: Seller is
not excused
• CISG: Seller is not
excused
• UNIDROIT, PECL:
Seller is not excused
Case VI – Sub-contractor’s failure
• Sale of car components built on
specifications
• A sub-contractor fails to performe properly
its part of the production, due to internal
reorganisation
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Sub-contractor failure
• Norwegian law: Seller
is not excused
• German law: Seller is
not excused
• Italian law: Seller is
not excused
• English law: Seller is
not excused
• UNIDROIT: Seller is
not excused
• PECL: Seller is not
excused
• CISG: Seller is not
excused
Case VII – Choice between
contracts
• Sale of car components built on
specifications
• Destruction of part of the seller’s storage
• Volumes in store sufficient to meet
obligations towards one buyer, but not all
buyers
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Choice between contracts
• Norwegian law: Seller
is excused
• Italian law: Seller is
excused
• German law: Seller is
excused
• CISG: Seller is
excused (?)
• UNIDROIT, PECL:
Seller is excused (?)
• English law: Seller is
not excused
Case VIII – Unaffordability (1)
• Sale of car components built on
specifications
• Due to unexpected weather conditions the
ship cannot leave the harbour unless an
ice-breaker is especially ordered from
abroad
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Unaffordability (1)
• Norwegian law: Seller
is excused
• Italian law: Seller is
excused
• German law: Seller is
excused (but first:
renegotiation)
• UNIDROIT, PECL:
Seller can require
renegotiation
• English law: Seller is
not excused
• CISG: Seller is not
excused
Case IX – Unaffordability (2)
• Sale of car components built on
specifications
• The price of aluminium increases
significantly, and sale of the components
at the agreed price would result in
considerable losses for the seller
• Delivery “cannot” be made according to
contract
• Is the seller liable for non-performance?
Unaffordability (2)
• Norwegian law: Seller
is not excused
• Italian law: Seller is
not excused
• German law: Seller is
not excused
• UNIDROIT, PECL:
Seller is not excused
• English law: Seller is
not excused
• CISG: Seller is not
excused
Case X – Unaffordability (3)
• Sale of car components built on
specifications
• The price of aluminium increases
significantly, and due to its numerous
obligations the seller cannot pay for its raw
materials
• Delivery cannot be made according to
contract
• Is the seller liable for non-performance?
Unaffordability (3)
• Norwegian law: Seller
is not excused
• Italian law: Seller is
not excused
• German law: Seller is
not excused
• UNIDROIT, PECL:
Seller is not excused
• English law: Seller is
not excused
• CISG: Seller is not
excused
Possible aims of rules
excusing non-performance
• Allocate the risk of supervening events
• Sanction negligence and reward diligence
• Avoid unfair situations
Norwegian law
• Kjpl.§ 27 : A party is not liable for failure to
perform if due to impediment beyond his
control that could not reasonably be taken
into account or overcome
• ”Beyond his control”
– Not Directly or indirectly caused by him, but
– That could actually be controlled or affected
by him
German law
• §§ 276, 280 BGB: liability assumes
negligence (presumed) or wilful
misconduct
• §313: change in circumstances (including
economic impossibility) – supervening
events, unforeseen
Italian law
• Art. 1218 cc: Liability assumes that impediment
was not due to the prevented party
• Art. 1176 cc: Evidence of diligence is sufficient
• Art. 1175, 1375: Requesting performance is
against good faith if performance is unaffordable
• Art. 1467: Request termination if unaffordability
due to unforseeable, extraordinary supervening
event
English law
• Debtor has absolute obligation to perform
accurately
• Discharge only if supervening events (without
default) radically change the nature of the
obligations (frustration)
• Inconvenience or increased onerousness do not
qualify
• Self-induced events do not qualify
• Expressed provisions are deemed to have
allocated the risk
CISG
• Art. 79: A party is not liable for failure to
perform if due to impediment beyond his
control that could not reasonably be taken
into account or overcome
• To be constructed narrowly as frustration
or flexibly as Norwegian law?
UNIDROIT
• Art. 7.1.7: A party is not liable for failure to
perform if due to impediment beyond his control
that could not reasonably be taken into account
or overcome
• Art. 6.2.2: Change in circumstances –
fundamental alteration of contract’s balance due
to supervening event, unforeseeable, beyond
the control, and no assumption of risk was made
in the contract
PECL
• Art. 8:108: A party is not liable for failure to
perform if due to impediment beyond his
control that could not reasonably be taken
into account or overcome
• Art. 6.111: Change in circumstances –
contract becomes excessively onerous
due to supervening event, unforeseeable,
and no assumption of risk was made in the
contract
Common features
• Supervening, external and unforeseeable
event that objectively prevents
performance excuses
Supervening events that excuse
non-performance
90
80
70
60
Impossib.
diligence
fact.ctrl.
50
40
30
20
10
0
Norway
Germany
Italy
England
CISG
UNIDROIT
PECL