(a) The buyer’s enquiry to the seller constituted an invitation to make offers. The seller then made an offer within the meaning of Article 14 CISG. The buyer then made a counter-offer within the meaning of Article 19 CISG because it ordered a different quantity and different goods. As this counter-offer was not accepted by the seller, no contract was concluded.

(b) US, English and German law: same solution as under Article 19 CISG.

(c) See section on domestic legal systems under section I B above.

Relevant: time of acceptance and conclusion of the contract; no statements accepting the attorneys’ fees modification; VLM had already completely performed under the original agreement.

Irrelevant: VLM’s subjective intent; Illinois Trading’s failure to object; Art 9(1) CISG; Illinois Trading’s contracts with other vendors.

(a) The term contained on the invoice of the seller that complaints will be acknowledged only before the installation of the goods and that in any case goods may only be rejected up to 30 days from the date of the invoice.

(b) and (c) The seller’s agent referred to the terms in the order confirmations. As it was an immaterial change, it constituted an acceptance with the addition of the change.

The court held that the seller had accepted the buyer’s general purchase conditions by performance of the contract, and not by through sending its confirmation of order. As the seller’s jurisdictional clause is a material change under Article 19 CISG, but performance was made without discussing or asking for any modification, the buyer’s and not the seller’s jurisdictional clause became part of the contract.

The finding in C 19-5 appears to be sound, but the reasoning is odd. It is clear that the purpose of Art 19(3) is to set out examples of material alterations and it would be against the wording of the CISG to hold otherwise. However, in the present case, the decisive factor would appear to be not that the term was immaterial, but that the defendant accepted the term by opening a letter of credit for the plaintiff as “FOB Taiwan Airport”.

(a) The court did not make a definitive finding on this issue, but stated that a reasonable argument could be made that a forum-selection clause would materially alter the offer under the CISG.

(b) The reason given was that a forum-selection clause relates to the settlement of disputes, which is included in the non-exhaustive list in Article 19(3) CISG.

The general view is that it should fall within, for the reasons stated above. Since a forum selection clause will determine the seat of the dispute and a range of procedural issues associated with this, it should be considered material within the meaning of Article 19(3) CISG.

This is doubtful. The court appears to take the view that even if ICC arbitration had been commonplace in the industry, arbitration was never discussed between the parties and witness evidence showed that arbitration would not have been agreed. The court also found relevant that DTS had failed to expressly negotiate the term.

The situation by which both parties send their standard terms and conditions in negotiating the conclusion of a contract, in an attempt to have their standard terms and conditions govern the contract ultimately concluded.

Q 19-10

The ‘knock-out rule’, whereby only those terms that do not contradict each other are incorporated, with the remaining rules left to the applicable law.

The ‘last shot rule’, whereby the last set of standard terms communicated will govern the contract.

The court applied the knock-out rule.

The court referred to both the knock-out rule and the doctrine of the last word. It is noteworthy that one set of terms and conditions is referred to in the contract signed by the parties.

The knock-out rule, by making a full appraisal of all relevant provisions.

(a) Most legal systems use the knock-out rule.

(b) Answer dependent on legal system; for teachers to assess on an individual basis.