UTAL v. Dickens & Matson

1. Background and facts Ukraine Telparts resale sale

UTAL used telephone / sample D & M(a mail order com.)

UTAL specified the goods in contract and D & M provided UTAL with samples.

UTAL discovered the nonconformity of goods and notified the rejection of the shipment by fax. UTAL sued for breach of contract.

The contract specified it should be interpreted according to the law of England.

(the choice of law clause)

2. What is the legal issue of this case?

Whether the defendant breached the contract?

Whether the defendant breached the condition of the contract or the warranty of the contract?

3. Legal principles

The English law of contract: English Sale of goods Act of 1979 (货物买卖法案）

(1) If a term in a contract constitutes a substantial ingredient in identifying the thing sold, it is a “condition”. A term in the contract that is relatively unimportant is a “warranty”.

(2) The effect of breaching a condition:

The innocent party can rescind the contract and sue for damages. It is excused from performance of the contract.

The effect of breaching a warranty: The innocent party can sue for

damages but it is not excused from performance.

(3) How to determine whether a breach of a term in a contract is a breach of condition rather than a breach of warranty----

whether the innocent party is deprived of the benefit it bargained for when it entered into the contract.

(making a comparison to Art. 25 of the CISG)

4. Reasoning

Judge’s point of view: Defendant’s shipment of nonconforming goods amounts to a breach of condition of the contract.

A breach of an express condition----defendant’s action of shipping unusable and damaged phone parts

(1) UTAL’s purpose (2) D&M’s attitude: admitted, conceded (3) UTAL’s benefit deprived (4) conclusion

A breach of the implied conditions from three different perspectives:

(1) breach of implied condition of correspondence with description-- two-piece push button telephone

(2) breach of implied condition of merchantability-- phones could work

(3) breach of implied condition of fitness for a particular purpose----UTAL could sell working phones in the UKraine

Decision: Judgment for the plaintiff. The defendant breached both

express and implied conditions in the contract.

Comment: If this case involved fraud, the

plaintiff could ask for punitive damages, which are usually associated with torts.

GmbH (the buyer) v. Rockland (the seller)1. Facts

2. Legal issues: Whether the buyer can recover on the seller’s breach of the warranty ( nonconformity of goods)?

(1)Whether the buyer should bear the burden of proving the exact nature of the defect in the goods in order to recover for breach of warranty?

(2)Whether the buyer has reasonably relied on the seller’s representations that the goods was suitable for particular purpose

3. Reasoning: CISG Art.35 “nonconformity of goods”

(1)A. seller’s argument---- buyer must prove… B. buyer’s argument----all it need show…, and it

need not show… C. Judge’s attitude-- a. Buyer can recover for breach of warranty if it

can show the goods were unfit for the particular purpose warranted

b. Buyer does not need introduce evidence to prove why or how the fabric was unfit

c. Buyer still must prove the transfer printing process was well-performed. (enough evidence)

---- Judge is in favor of the buyer’s claim.

(2) seller’s argument—buyer did not rely on its advice

Judge’s attitude—court found that buyer relied on the seller’s statements proclaiming the goods’ suitability for particular purpose.

4. Decision: (1) (2) (3)