Can we avoid ‘false friends’ in transnational commercial law conventions? – the case of adequate assurance of performance under the CISG

by Dr Katarzyna Kryla-Cudna, The Law School, University of Bristol

The concept of faux amis (‘false friends’) has been used in the literature to describe terms used in an international convention which seem familiar to an interpreter but which, in fact, are defined differently in the convention to in the domestic legal system the interpreter is used to. Several instances of faux amis have been identified on the basis of the UN Convention on Contracts for the International Sale of Goods (CISG). One major example can be found in the US case of Delchi Carrier SpA v Rotorex Corp., which required an interpretation of Article 74 CISG. This provision states that ‘damages may not exceed the loss which the party in breach foresaw or ought to have foreseen at the time of the conclusion of the contract.’ The US court understood this rule as a reference to the ‘familiar principle of foreseeability established in Hadley v Baxendale.’ Hadley v Baxendale is the leading English case on remoteness of damage and has also gained recognition in the US. Rather than referring to the preparatory works and other materials examining the specific meaning of the foreseeability rule under the CISG, the court thus reached for an analogy from its own jurisdiction. (more…)