Case no. 1
On 5 of March 2010, a company producing military helicopters, operating and administered in Brasov, Romania concluded a contract for the purchase of special technical IT elements with a Frenchcompany producing this equipment. The delivery of the components was established as no later than on 10March 2011. In reality, the equipment arrived eight months later, forcing the buyer to postpone the delivery of a number of helicopters to its own clients.
The Romanian company asked the seller to reduce the price owed for the IT elements or to pay the damages caused by this delay. The French company invoked that it was not responsible for the delay as one of its Asian providers for special metals and alloys used in the production of IT components suddenly stopped the delivery due to a natural disaster which determined the closing of its mines.
In May 2013, the Romanian company filed a claim against the defendant, the French company before the Brasov Tribunal asking for 100.000 Euros pecuniary damages caused by the delay in the delivery of the products which affected significantly the commercial relationship with its clients.
The defendant did not contest the Romanian Court’s jurisdiction.
On the merits of the case, the French company stated that the action was time-barred as the parties agreed in their contract that any litigation between parties in connection with their rights and contractual obligation shall be invoked/ submitted to courts only one year after the occurrence of the disputed event.The relevant provisions of the Romanian Civil Code allow such agreements of the parties as to the reduction of the legal time of 3 years for promoting a civil claim based on a commercial contract. Secondly, on the merits of the case, the Court should apply the relevant principle provisions regarding hardship[1] as the responsibility for the damages caused by the delay of delivery of products was caused by the unexpected closing of rare metals mine of its Asian distributor.
The applicant replied that the court should rely on the French provisions on time-limitation of legal actions which provide for a longer period (five years[2]) from the day following that on which the action accrued, which cannot be subject to any party dispositions if they reduce the delay less than a year.[3]On the merits of the case, the applicant underlined that no hardship clause was inserted in the contract as the French Civil Code[4]does not accept in contractual matters such clauses (imprévision).
Tasks for the Court
- Are the provisions of Rome I Regulation applicable ratione materiae, temporis, loci in this case? Identify the relevant provisions.
- Which law applies to the issue whether this action is time-barred and on the aspects concerning the hardship?
- It is possible for the parties to agree that the French law will be the applicable law on most aspects of the contract while the Romanian law will applyonly to the prescription (time-bar)?
- What will be the solution if the parties did not make a choice as to the applicable law to the contract?
- Should the competent court consider also the application of the 1980 UN Convention on the Contracts for the International Sale of Goods?
- Should the competent court consider also the application of the 1974 UN Convention on the Limitation Period in the International Sale of Goods?
1
[1]Hardship clause is a clause in a contract that is intended to cover cases in which unforeseen events occur that fundamentally alter the equilibrium of a contract resulting in an excessive burden being placed on one of the parties involved.
[2] See Article 2224 French Civil Code
[3] Article 2254 paragraph 1 French Civil Code
[4] As applicable ratione temporis to the facts of the case, namely, before the modification of Article no. 1195 of the Civil Code based on the Ordinance no. 2016-131 of 10 February 2016