Exemption from liability under Article 79 of the United Nations Convention on Contracts for the International Sale of Goods: general characteristics and conditions of application

Abstract

The article examines the issue of the exemption from liability under Article 79 of the United Nations Convention on Contracts for the International Sale of Goods. This provision is crucial in international trade, as it outlines conditions under which a party may be exempted from liability for non­performance due to «impediments beyond his control». The study is particularly relevant in light of the 2022 Russian invasion of Ukraine, which disrupted many international contracts. The article discusses the multifaceted nature of «impediments» that may qualify for exemption, including natural disasters, political upheavals, and unforeseen legal restrictions. It emphasizes that for an exemption to be valid, the impediment must be beyond the party’s control, unforeseeable, unavoidable, and directly causing the non­performance. Key judicial decisions are reviewed, including the case of Scafom International BV v. Lorraine Tubes S.A.S., where the court defined the notion of «impediment» as changed circumstances that have made a party’s performance a matter of economic hardship or have increased the burden of performance of the contract in a disproportionate manner. Another case, the «Vine Wax» case, highlights the importance of the causal link between the impediment and the failure to perform. The article also addresses the challenges in proving unforeseeability, often assessed using the «reasonable person» standard. This standard considers whether a «reasonable person» from a point of view of the defaulting party could have foreseen the initial or subsequent existence of an impediment. In conclusion, the article suggests that while Article 79 provides a reliable framework for exemption from liability for a party, its application requires careful consideration of contractual obligations, trade practices, and the specific circumstances surrounding the impediment. It advocates for clearer guidelines and consistent judicial interpretations to aid in the uniform application of Article 79 across different legal systems.

Keywords

• exemption from liability
• impediment
• non-performance
• unforeseeability
• unavoidability
• causation