Respondent should be excused from liability under the Article 79 (2)

RESPONDENT is aware, that in purpose to be excused from liability under the Art. 79(2) it bears burden of prof that third person falls within the rule in paragraph 2 of the Art. 79, id est, the impediment was unforeseeable and avoidable by Specialty Devices as a third person.

1) Article 79(2) as applicable to the resent case

Specialty Devices had to manufacture and deliver to RESPONDENT processing units which were to be used to installation of master control system. Specialty Devices, in its turn, sub-contracted High Performance to deliver the D-28 chips as a precondition to the main obligation.

Considering the sub-contract was concluded, which means, the defaulting party have asked a third person to perform some task connected with the main contract and the latter knew that his action is an essential stage of performing the main contract,there is an “organic link” between it and the main contract. Taking into account that the provisions provided by Article 79(2) can only be used by the link which binds the two contracts, RESPONDENT has legal grounds for recognizing 79(2) as applicable to the case at hand.[ Barry Nicholas ‘Impracticability and Impossibility in the U.N. Convention on Contracts for the International Sale of Goods’].

2) In accordance with CISG provisions, RESPONDENT in order to be exempt from liability under Art. 79(2) should prove that “third party” to RESPONDENT should be also exempted from liability under Art. 79(1) because of failure to perform its obligation due to the impediment occurred beyond its control.

Specialty Devices could not meet the contractual date of delivery of the processing units to RESPONDENT for reasons that were beyond its control, id est, the failure of High Performance to deliver the D-28 chips to it at the contractual date of performance.

Specialty Devices failed to perform its obligations timely because of the fire occurred at High Performance’s factory. Such failure was beyond its own control as fire on the factory was ruled by fire inspectors as an accident [PR.O. 8]. Thus Specialty Devices could not have taken the accident into account by the time of conclusion of contract and it could not anticipate or to overcome this impediment.

3) Specialty Devices could not overcome the consequences of impediment occurred

There were other regular customers apart from Atlantis, so, there were no reasonable grounds to deem that Specialty Devices would have got chips if no preference has given to Atlantis [Cl. Ex. No. 3]. However, Specialty Devices took all possible efforts to influence on allocation process, namely it communicated Atlantis Technical Solutions about the possibility to purchase the number of D-28 chips it would need for processing units, but Atlantis Technical Solutions had refused [Pro.Or.11].

Besides, RESPONDENT is acknowledged, in order to recognize Specialty Devices excused from liability it should prove impossibility to choose another “auxiliary suppliers” or procure, produce goods in any other manner [ Comments on Article 79 from seminal 1986 by Peter Schlechtriem, p.104].

These requirements are met through the case of non-replaceable goods, that made Specialty Devices not capable to find on the market goods of similar quality and perform its obligations timely [CLOUT case No. 277 Oberlandesgericht Hamburg, Germany, 28 February 1997].

Irreplaceability can be proved by the fact that at the time of impediment there were no substitute chips with comparable qualities available [Pro. Or. 12]. Utilization of rival chips after their launching or even “cloning” of the D-28 chips by another manufacturer would have involved more adverse delay in performance and additional costs [AfA, para. 9].

1) It is unreasonable to allege, that D-28 chips might have been supplied before fire occurred.

RESPONDENT argues, CLAIMANT is not entitled to make such a request for RESPONDENT as to provide facts proving RESPONDENT`s capability to perform its obligation timely [MoCl. Para.107]. The contract between CLAIMANT fixed only the final date on which obligation had to be performed. There were no intermediate dates agreed so, that can not give rise to the allegation to deliver the chips before the fire occurred.

It is reasonable to state due to High Performance is a sub-contractor of Specialty Devices and had its own schedule of delivery of chips to its customers and acted in accordance with it. Respondent could not influence on High Performance`s performance because it had no legal connection and therefore it had no legal authority to force them to deliver chips on calculated by CLAIMANT date. RESPONDENT itself could not influence High Performance to allocate chips to Specialty Devices, because RESPONDENT has no contractual obligations with it. (AfA, para)

As about the CLAIMANT`s statement concerning the RESPONDENT`s entrance into the contract, it contravene to the general rule of parties’ autonomy as a general principle of the International Private Law.

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