Under Common Law, Exceptions to the rule of consideration: promises (in writing) to pay past debts; promises to pay for benefits/services

received; modification of a contract for the sale

of goods; option contract; guaranty contract; and

promissory estoppel.

The doctrine of promise estoppel A promise will be enforceable without

consideration if: (i) the promisee acts or forbears in

reliance on the promise; and (ii) this action or forbearance was

reasonably foreseeable by the promisor.

Usually applied in a situation of a promise to make a gift.

Sources of Rules Governing International Sale of Goods

United Nations Convention on Contracts for the International Sale of Goods

National Law Principles of International Commercial

Contracts International Customs and Usages:

Incoterms

CISG Background Introduction1. Lex Mercatoria2. UNCITRAL-furthering the progressive

harmonization and modernization at UNIDROIT to prepare a uniform law f

or the international sale of goods in 1930. In 1964, two drafts were submitted in Hague.

Drafts to diplomatic conference

Criticism-primarily reflecting the legal traditions and economic realities of continental Western Europe

ULFThe Convention relating

to a Uniform Law on the International Sale of Goods

ULIS The convention

relating to a Uniform Law on the Formation of Contracts for the International Sale of Goods

3. CISGin order to be accepted widely, study on the former two convention were made and a new convention CISG was adopted by diplomatic conference. Details see CISG test and explanatory note.pdf

National Law

Still important partly due to the incomplete coverage of contractual issues by CISG, and partly attributed to the legal and cultural tradition of different countries.

In common law counties, rules are embodied in case law.

American statutes have been adopted. Eg. 1951, Uniform Commercial Code(UCC)

1. UCC, the primary commercial law for domestic transactions in the United States.2. Drafted as a model law, however, it has been adopted by all US states, but Louisiana.3. It covers many areas, but the sale of real estate or services, insurance, and intellectual property not included.4. U.S became a member of CISG, having been a supplanted.5. contracts not covered by the CISG, turns to UCC or other statutes. Otherwise, they are covered by common law.

PICC

Principles of International Commercial Contracts

is model law playing importantly in the field

Preparation Framework Comments

Preparation

1968, UNIDROIT Propose to initiate a “restatement of

law” at international level. Members of the Group were legal scho

lars, leading experts in contract law and international trade law. Until 1994, it was published.

Framework Widely covered area Extending to transactions in services and i

nvestment Establishing commercial principles1. Freedom to contract2. Good faith3. Fair dealing4. Favor contractus

Comments In nature it is a model law, non-legal-

binding document; More frequently used as an alternative

of national law and CISG in the area of international contract practice and dispute resolution;

Covers more categories of sales rather than sale of goods

Individuals free to choose, considered “best practice”

International Customs and Usages: Incoterms

Abbreviated trade terms describing such matters as the time and place where a buyer is to take delivery, the time and place for payment, the price, the time when risk of loss shifts from the seller to buyer, and the costs of freight and insurance.

Built up by International Chamber of Commerce( ICC), first published in 1936

Incoterms Attention: Incoterms is limited to

matters relating to the rights and obligations of the parties to the contract of sales with respect to the delivery of goods sold.

Two misunderstandings:1. It applies to the contract of carriage;2. It is wrongly assumed to provide for all

the duties.