When International Buyers and Sellers Disagree

When International Buyers and Sellers Disagree

Introduction

The following case study looks into a dispute between a Germany and USA's company over a 30,000 lbs order of pork livers. It depicts how understanding the cultural background and practices of nation, when indulging in international trade, is imperative to mitigate the probability of disagreements.

Discussion

Question 1

Who's Law?

In this dispute, the law of United States of America would be applicable. This is because if we consider this case on the basis of the fundamentals set by the Contracts for the International Sales of Goods (CISG), we can analyze that this scenario meets all the desired requirements for CISG to set in. Thus, according to it, the party which is responsible for fulfilling the characteristic part of the contract - which in this case is US - that party's law would be applicable (Bailey, 1999). However, different states of America adhere to a different state laws. Therefore, considering the state where the contract was entered into, the applicable law specifically pertaining to that area would be analyzed.

This case study doesn't mention any jurisdictional clause in the contract between the buyer and seller; thus the rulings of CISG are considered. It states that since the quality of the pork was both suitable, sellable and as per the required weight, Germany would have to accept the order - since they failed to specifically mention their preference for the male pork livers, therefore, they cannot claim for settlement of any sort of price allowance.Question 2

US Court vs. Germany Court

The seller party belongs to USA while the buyers belong to Germany. Both of these countries have a different law system. The legal system of Germany is based on the civil law (Dainow, 1961), whereas the legal system of USA is based on common law. Due to this variance, the results of the dispute would be different if tried in either country.

If the case was tried in USA, then the seller would win. The basis for this can be the fact that the seller adhered to all the specifications mentioned in the contract by the buyer. There was no explicit demand for male pork livers alone; thus the seller party has the upper hand. Also, if sow liver was not needed, then clear mention of this fact on account of the buyer should have been present.

In Germany, either of the two parties can win the dispute. The seller can win on the same basis as mentioned above, however the buyer can win this dispute on the basis that since the order was placed from Germany for their local market, thus the standards followed in the local market should have been adhered to.

Question 3

Part A

In order to avoid the dispute over whose law should be applicable, a clause regarding the jurisdiction can be added. This clause would clearly state that in a situation where disagreement occurs between the two parties, then which country's law should be applicable on the situation; should it be the buyer's or the ...