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Stockholm Arbitration Report (SAR)

Preview Page SAR 1999- 2

Observations by Ivan Zykin

Subject-matters:

(1) Applicable law

(2) Contradictory provisions in the contract regarding technical specifications. Non-conformity of goods delivered.

(3) Contractual provision depriving the buyer of its remedies against the seller’s breach of contract.

(4) The Vienna Sales Convention, article 74, and right to set-off.

Findings:

(1) The parties agreed at the hearing that Russian law applies; the choice of Russian law entails the application of the United Nations Convention on Contracts for the International Sale of Goods (The Vienna Sales Convention).

(2) The sole Arbitrator concluded that the goods did not conform to the Contract and that consequently, there was a breach of contract on the part of Claimant. 

(3) Respondent’s contractual obligation to make payment to Claimant, irrespective of any objections to the quantity or the quality of the goods, does not in itself deprive Respondent of the right to react against a breach of contract.