A Time-Limit Running Wild? Article 39(2) CISG and Domestic Limitation Periods

Abstract

Article 39(2) of the United Nations Convention on Contracts for the International Sale of Goods of 11 April 1980 (CISG) imposes a cut-off period on the buyer's remedies for the delivery of non-conforming goods, depriving the buyer of all remedies under the CISG if he has not given notice of non-conformity to the seller within two years after the goods were handed over. Despite the fact that the CISG itself contains no rules on the limitation of actions (prescription), courts in various jurisdictions have held that Article 39(2) CISG pre-empts the application of limitation periods under domestic laws that are shorter than two years – a practically relevant scenario, because a significant number of domestic laws throughout the world know relatively brief limitation periods. The present article challenges this approach and argues that the prevailing interpretation of Article 39(2) CISG inter alia overlooks the provision's systematic function as a mere supplement to Article 39(1) CISG, with its cut-off rule applying only where the defect remained undetectable for the buyer. Even more importantly, the prevailing opinion misunderstands Article 39(2) CISG’s purpose of exclusively protecting the seller’s interests, and not the buyer’s – if the provision is (mis-)construed as displacing limitation periods that would otherwise prevent buyers’ claims from being exercised, Article 39(2) CISG is turned into a rule that protects the buyer’s interest, thereby violating its purpose. The article therefore concludes that no conflict exists between the CISG's two-year cut-off rule and shorter domestic limitation periods.