GENERAL INTERPRETATION AND APPLICATION IN THE CISG AND THE PECL: LIMITATION OF REMEDIES AVAILABLE

The content and function of Article 8:101(3) PECL are similar in substance and form to its counterpart provision contained in Article 80 CISG. Both provisions exemplify the prohibition against contradicting one's own behavior – “venire contra factum proprium” – thereby incorporating an expression of general principles of good faith and fairness. Both Articles, however, prevent entitlement to remedies if the reason for the non-performance was the result of the act(s) or omission(s) of the party seeking relief. However, Article 8:101(3) PECL provides valuable insight as to the terms, definitions, and applications therein via cross-reference to other PECL Articles, thereby providing a supplemental source for interpreting Article 80 CISG.

“ACTS” CONSTITUTING FAILURE OF PERFORMANCE

Under Article 8:101(3) PECL, a cross-reference to Article 1:301 PECL provides that the definition of “act” includes omission. Such acts would include failure to provide information to the other party or giving wrong or incomplete information. This understanding of the term is commonly held true in all European legal systems; however, in Germany, the statutory provision that has been drafted for acts is not automatically applicable to omissions. In contrast, the CISG explicitly provides for acts and omissions. Hence, both provisions provide that a party seeking relief cannot seek relief if the failure to perform was due to the first party's act or omission.