UCC_vs_CISG

UCC vs. CISG Farris 1
UCC vs. CISG:
Increasing Efficiency in International Contract Drafting and Enforcement
I. Introduction
Modern international contract law balances a number of synthesized domestic
perspectives with an over-arching set of international principles; the former tends to
matters of comity, while the latter provides certainty. These current international contract
law standards have been codified in a body of law called the Convention on the
International Sale of Goods (“CISG” or “Convention”). The primary purpose of the
Convention includes promoting certainty, predictability, and uniformity in result.
Many substantive differences can exist between the uniform international contract
law and a nation’s domestic contract law. In the United States, the Uniform Commercial
Code (“UCC”) governs all contracts, with Article 2 particularly outlining provisions for
the sale of goods.
This paper will emphasize the need to increase efficiency within the realm of
U.S.-foreign transactions by first articulating the substantive legal differences between
CISG and UCC, and then identifying what courts’ consider ineffective opt-out clauses as
well as general mistakes in judges’ misapplication of the Convention. Because of the
outcome-determinative nature of the substantive differences and the courts’ consistent
errors, I will elucidate the importance of increasing efficient contract drafting, i.e.,
successfully opting-out of the CISG (if one so desires), and judicial enforcement, i.e.
accurately guiding future courts.

II. Legislative Background
In 1985, the United Nations Commission on International Trade Law
(UNCITRAL) developed and codified the principles surrounding uniform international
sales law in the Convention,1
in order to encourage predictability and uniformity in
result.2
The purpose of the CISG was to adopt uniform rules to remove legal barriers in
international trade, to promise the development of international trade, and to reduce
misunderstandings and controversies that may arise when one law governs the seller and
a different law governs the buyer.3
The CISG is accepted as the substantive law upon which contracting parties,
courts, and arbitrators can rely. Like all international treaties, the treaty’s restrictions do
not apply to a country unless the country ratifies said treaty. Under United States law, the
CISG is considered a “self-executing treaty,” meaning that no subsequent congressional
enactment is required to make the Convention’s provisions binding on U.S. Courts.4
In
that case, the Convention is incorporated into the U.S. domestic law to substitute any
otherwise application domestic law, such as the UCC, with regard to transactions for
sales of goods between a U.S. contracting party and a foreign contracting party.
Article 1(1)(b) requires CISG’s application to a dispute when the rules find that
one contracting-nation’s law should govern the contract; however, when the U.S. ratified

1
See
Christopher C. Kokoruda, The UN Convention of Contracts for the International Sale of
Goods – It’s Not Your Father’s Uniform Commercial Code, 85 Florida Bar Journal 6, 103 (Jun.
2011)(“The general principles upon which the CISG is based are its “international character and .
. . the need to promote uniformity in its application and the observance of good faith in
international trade.”).

2
See CISG art. 7(1).
3
See Kokoruda, supra, note 1.
4
See Kokoruda, supra, note 1; see Chicago Prim Packers, Inc. v. Northam Food Trading Co.,
408 F.3d 894, 897 (7th Cir. 2000).

the CISG, the U.S. made an “Article 85 declaration,” which eliminated Article 1(1)(b) of
the CISG from the American text.5
Because of this expressed reservation, in the U.S., the
CISG only applies to situations that satisfy Article 1(1)(a).6
Of course, an exception
occurs when the CISG itself expressly excludes the transaction between the parties.
The UCC codified many U.S. common law principles, and has been adopted by
most states in an attempt to make commercial law uniform. In all 50 states, the state-
UCC law functions as the jurisdiction’s domestic contract law. While the UCC governs
all contracts for the sale of goods,7
it does not cover ideas (Intellectual Property),
services, rentals, or property. Sometimes the UCC is silent on an issue, but this silence is
purposeful and encourages the forum court to defer to the common law. The UCC
provides contractual “gap-fillers,” i.e., terms that apply to the sale of goods unless parties
opt-out, default rules, and mandatory rules. Default UCC rules are automatic unless you
change them, whereas you cannot contract around mandatory UCC rules.
Very basically and for our limited purposes, Article 2 of the UCC is organized
into seven categories; six of the categories listed, and their substantive provisions,
directly conflict with the CISG. Section 2-201 outlines the Statute of Frauds, and lists the
five contract-types that are not enforceable unless signed in writing. Section 2-202
pertains to parol evidence, or “extrinsic” evidence not found in the contract. Section 2-
203 abolishes the formal seal requirement. Section 2-204 details the parameters of
contract formation.8
Section 2-205 involves firm offers, where a merchant can force an
offer to stay open, and thus irrevocable, for a three-month period. Section 2-206

5
6
Kokoruda, supra, note 1 (For example, “a transaction for the international sale of goods when
the parties have their places of business in different nations party to the Convention.”).
7
These goods include only tangible, movable things.
8
Generally, if you act like you have a contract, you probably do.

discusses matters of offer and acceptance; an offer is viewed as inviting acceptance, and
silence is not acceptance except in certain circumstances. Section 2-207 diverges from
the common law on the battle of the forms, which occurs when additional terms are
included in the acceptance or acknowledgment, and includes the “Unless Clause.”9
Unlike the UCC, the CISG does not apply to domestic sales within a country, but
rather international sales.10
If the parties to the contract have their places of business in
different contracting states (that have adopted the CISG), then the sale is considered
“international.”11
The CISG is linked to goods or where goods are predominant part of
sale.12
Where a party has places of business in more than one country, the relevant place
of business is the one most closely connected to the subject sales transaction.13
For these
agreements for the international sale of goods, barring a few exceptions,14
the CISG
applies as substantive sales law.15
As an international treaty, the Convention preempts the UCC and will apply to all
contracts between a U.S. party and a non-U.S. party,16
unless the agreement specifically
disclaims the CISG’s application and “opts-out” of the CISG.17
The desire to opt-out

9
UCC § 2-207(1)(Acceptance expressly conditional on assent to the additional or different terms
is considered a counter-offer.)
10
See Knowledge to Negotiate: UCC and CISG (Jul. 5, 2011).
11
Christine E. Nicholas, Teach and Old UCC Dog New Tricks: An Overview of the U.N.
Convention on the International Sale of Goods, 18 Business Law Today, No. 1 (Sept. 2008).
12
Timothy Murray, CISG: Opt Out, or Not? CISG In A Nutshell, Murray, Hogue & Lannis (Apr.
6, 2010).
13
See Nicholas, supra, note 11.
14
See CISG art. 2 (“The Convention does not apply to sales of goods purchased for personal,
family, or household use; goods purchased at auction; securities, negotiable instruments, or
money; ships, vessels, aircraft, or “hovercraft”; and electricity.”).

15
See, generally, MCC-Marble Ceramic Center, Inc. v. Ceramica Nuova d’Agostino, S.p.A., 144
F.3d 1384 (11th Cir. 1998).
16
CISG art. 1-1(a); see Kokoruda, supra, note 1 (“Whenever parties to an agreement for the
international sale of goods are from two different signatory states, the CISG will automatically
provide the governing substantive law, not the UCC.”).
17
CISG art. 6.

should be expressed explicitly in the contract, while also stating another applicable law.
If the parties desire to effectively exclude application of the Convention, the exclusion
should be similar to the following:
“The rights and obligations of the parties under this contract shall not be
governed by the United Nations Convention on Contracts for the
International Sale of Goods, but instead shall be governed by the laws of
the state of Idaho without regard to principles of conflict of law, and the
United Nations Convention on Contracts for the International Sale of
Goods is specifically disclaimed and excluded.”18
The CISG’s supremacy in the U.S. underscores the importance of expressly excluding its
application.
In the United States, if the parties do not agree to opt-out and choose other choice-
of-law provisions to govern the contract (other than the CISG), the Convention replaces
Article 2 of the UCC. If a U.S. party and another contracting-state party do agree to opt-
out and exclude the CISG’s application, they could explore three other options. First, the
parties could agree to use UCC law where the CISG would apply. Second, the
contracting parties could agree upon a particular state-UCC law, where the State’s sales
law would apply. Last, the parties could agree to have the laws of another nation apply.19
Instead of entirely opting-out of the Convention’s application, the parties are also
free to derogate from or vary the CISG’s provisions. In other words, the parties could
invoke a depeçage-like approach to the contract’s choice-of-law provisions: UCC could
govern some issues of the contract, while CISG would pertain to others. If the parties
would like to derogate and include a choice-of-law clause, such as, “Matters involving
warranties and disclaimers under this contract shall be governed by and construed in

18
19
See Knowledge to Negotiate, supra, note 9 (This is done when that other location may be more
favorable to the specific type of transaction or may have more law or case law on the subject.).

accordance with the laws of the state of New York,” the contract likely includes the
CISG, despite that New York’s UCC-law could be applied to the issue warranties and
disclaimers.
Any time a non-U.S. party is involved in contracting, CISG’s possible
applicability ought to be considered for two primary reasons;20
firstly, the CISG may
impact a party’s choice of forum, i.e., state court versus federal court. The CISG is a
federal law (a treaty), and, therefore, imparts federal subject-matter jurisdiction under 28
U.S.C. §1331. Thus, unlike causes of action brought under Article 2 of the UCC, claims
under the CISG do not require complete diversity of citizenship and more than $75,000 to
be in controversy to open federal courthouse doors. The CISG creates a private right of
action in federal court for breach of the international sales agreement in question.
Second, Article 2 of the UCC (as well as the common law) starkly differs from the CISG.
The Convention’s applicability should also be considered because the UCC and
CISG differ, broadly, in terms of the contract formation process and actions under an
already-established contract. For that reason, drafters may be inclined to contract
underneath one body of principles over the other. However, many drafters neglect to
adequately opt-out of the Convention. Additionally, courts tend to misinterpret the
substance of and scope of CISG. In order to increase the efficiency in properly applying
the Convention versus the UCC, attorneys should first account for these substantive
differences, and draft in accordance with the parties’ desired choice-of-law provision. If
the parties desire to opt-out of the CISG, attorneys should next effectively exclude the
Convention’s application, while providing an adequate substitute. At that point, judges

20
See Murray, supra, note 12 (“Even where a U.S. buyer of goods contracts with a U.S.
distributor, if it appears that the goods are the product of a seller with a principal place of
business in another CISG country, it is important to know that CISG applies.”).

can stop fumbling with ambiguous choice-of-law clauses and hasty judicial opinions, and
instead focus on providing proper precedent to latter courts entertaining similar matters.
II.A. Substantive Differences (UCC vs. CISG in theory)
After carefully comparing and contrasting the UCC and the CISG, I found that the
substantive differences could be separated into two broad categories: (1) contract
formation process, and (2) actions under already-established contract. The first
characterization implies that these differences involve basic matters of offer/acceptance
and revocation of the offer. The second characterization refers to differences in rights
granted to aggrieved parties and the flexibility of the parol evidence rule.
Contract Formation Process
By “contract formation,” I mean the elements necessary to create a valid and
binding contract, as well as actions taken to void the agreement before the contract is
finalized. Generally speaking, these substantive differences in contract formation include
matters of acceptance, the Statute of Frauds, warranties and disclaimers, revocation of an
offer, and rejection of an offer. Drafters and contracting parties should be aware of
certain vital distinctions between the UCC and the CISG, such as writing requirements, in
order to avoid being blindsided in the event of a dispute.
In terms of contract formation, the first substantive difference between the CISG
and the UCC involves the rules for acceptance. Acceptance can be defined as the
manifestation of assent to the terms thereof made by the offeree in a manner invited or
required by the offer. If the offer stipulates that acceptance must be by performance, in
order to form a unilateral contract, common law requires that at least part of what the

offeror requests be performed or tendered and includes acceptance by a performance,
which operates as a return promise. If the offer demands acceptance by promise, in order
to form a bilateral contract, common law requires that the offeree complete every act
essential to the making of the promise.
Under the UCC, an offer is accepted once the acceptance has been mailed, i.e. the
“mailbox” rule. Although the mailbox rule only applies to acceptances, not other
communications, the rule reaches more types of acceptances than just by mailing a letter.
If the mailing of an acceptance completes the contract, what happens thereafter, whether
the death of either party, the receipt of a revocation or rejection, or a telegraphic recalling
of the acceptance, though occurring before the receipt of the acceptance, will be of no
avail.21
Even if the offeree regains possession of the letter from the post office, the
contract has been completed.
Conversely, under the CISG, an acceptance must be received within the time
stated in the offer in order to be effective.22
Nonetheless, with “late” acceptances may
still be effective in certain circumstances.23
Namely, the Convention distinguishes
between late acceptances due to delay in transmission versus delay in late dispatch. In
the former instance, the acceptance will still be valid if, evident from the document, the

21
See, generally, Second Restatement on Conflict of Laws, infra, note 94.
22
See CISG art. 20(1) (“A period of time for acceptance fixed by the offeror in a telegram or a
letter begins to run fro the moment the telegram is handed in for dispatch or from the date shown
on the letter, or if no date is shown, from the date shown on the envelope. A period of time fixed
by the offeror by telephone, telex of other means of instantaneous communication [email?] begins
to run from the moment the offer reaches the offeree.”).
23
See CISG art. 21 (“(1) A late acceptance is nevertheless effective as an acceptance if without
delay the offeror orally so informs the offeree or dispatches a notice to that effect. (2) If a letter or
other writing containing a late acceptance shows that it has been sent in such circumstances that if
its transmission had been normal it would have reached the offeror in due time, the late
acceptance is effective as an acceptance unless, without delay, the offeror orally informs the
offeree that he considers his offer as having lapsed or dispatches a notice to that effect.”).

acceptance was communicated in a timely manner, but was subject to external delays in
transmission to the offeror. Underlying this exception to Article 18(2) is that the offeror
must convey timely dispatch of receiving the acceptance, thus providing notice to the
offeree. Some may interpret this notice as a counter-offer, communicating to the offeree
that the offeror intends to be bound by the terms of the agreement. However, common
interpretation of the provision is that the notice gives effect to the offeree’s conveyed
acceptance; therefore, in the instance of late acceptance, the agreement cannot be
solidified until the offeror dispatches his receipt of the offeree’s acceptance. Problems
may arise in situations where the market has fluctuated between the time when the
acceptance of goods was dispatched and when it was received.
A choice-of-law problem may be raised where an offer states that a party has a
certain timeframe in which to accept, e.g., 10 days.24
Under the UCC, the 10-day
timeframe to accept the offer would not start tolling until the offer had been received.25
However, under the CISG, the ten-day timeframe begins to toll in accordance with the
date on the offer.26
Therefore, by the time the offer is received, a certain number the ten-
day timeframe may have elapsed, thus the offer mandates that acceptance be received
within the remainder of that 10-day timeframe, instead of within a separate ten-day
window.27
Not only does this pose a problem with fair dealing, but parties can also just
avoid the problem entirely by stating an exact time and date of offer expiration.28
A second substantive difference pertains to the UCC’s Statute of Frauds and its
writing requirement. The UCC requires any contract for the sale of goods priced at $500

24
See Murray, supra, note 12.
25
Id.
26
Id.
27
Id.
28
Id.

or more to be evidenced by a “writing” or electronic record.29
The party, against whom
enforcement is sought, must sign the contract unless some exception to the statute
applies. The statute is not a basis for challenging the existence of a contract, for it
establishes no requirements for the making of a contract. It can be satisfied by writings
that were never effective, or intended to be, as an integration of the agreement.
The Convention lacks this writing provision, and CISG’s language almost speaks
counter to the Statute of Frauds.30
Despite that the provision states a writing is not
necessary, this contention does not apply to all circumstances when the validity of a
contract may be based on that very notion, such as, in some cases, whether an agent has
the authority to bind its principal in the government setting.31
On the other hand, despite
that the law may specifically require a writing, CISG principles may still prevail. In sum,
unlike the UCC, a contract for the sale of goods does not need to be in writing to be
enforceable under the CISG.32
If the parties have not opted-out of the CISG, a writing
requirement can be incorporated into the contract.
The UCC and the CISG also diverge in how each handles warranties and
disclaimers. Warranties can be separated into two broad categories: express and implied.
Express warranties for fitness are written explicitly into the contract, and are more

29
UCC § 2-201 (“A contract for the sale of goods for the price of $500 or more is not enforceable
unless there is a writing sufficient to indicate that a contract for sale has been made between the
parties and signed by the party against whom enforcement is sought.”).
30
See CISG art. 11 (“A contract for a sale need not be concluded in or evidenced by a writing . . .
It may be proved by any means, including witnesses.”).
31
See Albert H. Kritzer, Guide to Practical Applications of the United Nations Convention on
Contracts for the International Sale of Goods (Kluwer Law International), Suppl. 7, September
1993, Detailed Analysis 113-114.
32
See, e.g., Fercus, S.R.L. v. Palazoo, 2000 WL 1118925, *4 (S.D.N.Y. 2000)(explaining that an
agreement need not be evidenced by a writing under the CISG); see also Miami Valley Paper,
LLC v. Lebbing Engineering & Consulting Gmbh, 2009 WL 816618, *5 (S.D. Ohio
2009)(explaining that CISG art. 11 provides that agreements may be “proved by any means,
including witnesses”).

difficult to negotiate around. Implied warranties depend on a reasonable person’s
perspective under the circumstances. Both bodies of law employ an underlying
obligation to sellers to provide goods that are fit for their usual purpose, also known as an
“implied warranty of merchantability.” In order to disclaim any type of warranty, U.S.
common law favors that the disclaimer is written expressly into the contract.
Express warranties can be created under the UCC in three different ways.33
Additionally, in order to disclaim an implied warranty, the contract must explicitly
contain terms of art or expressions in conspicuous writing.34
The UCC also details other
requirements for exclusion or modification of implied warranties of merchantability, and
implied warranty of fitness for a particular purpose.35
If requirements for exclusion
cannot be met initially, the merchant may appeal to possible alternative means for the
exclusion of implied warranties.36
Conversely, under the CISG, disclaimers of warranties are permitted so long as
the parties have agreed to such either in writing or orally.37
Instead the party assumes

33
See UCC § 2-313(1)(“Express warranties by the seller are created as follows: (a) Any
affirmation of fact or promise made by the seller to the buyer which relates to the goods and
becomes part of the basis of the bargain creates an express warranty that the goods shall conform
to the affirmation or promise. (b) Any description of the goods, which is made part of the basis
of the bargain, creates an express warranty that the goods shall conform to the description. (c)
Any sample or model which is made part of the basis of the bargain creates an express warranty
that the whole of the goods shall conform to the sample or model.”).
34
See UCC § 2-316(1) (Written disclaimer must include words, conduct relevant to creation of
express warranty and simultaneous words, conduct tending to negate or limit).
35
UCC § 2-316(2).
36
UCC § 2-316(3).
37
See CISG art. 36(2)(“The seller is also liable for any lack of conformity . . . which is due to a
breach of any of his obligations, including a breach of any guarantee that for a period of time the
goods will remain fit for their ordinary purpose or for some particular purpose or will retain
specified qualities or characteristics.”).

that the seller has good faith in fulfilling the implied warranty of merchantability.38
Despite that the Convention does not specifically detail “merchantability” in its
provisions, both parties must agree to expressly disclaim the implied warranty.
Additionally, the UCC and the CISG substantively clash on matters of revocation
of offers and “firm” offers. Under U.S. common law, after an offer is made, the offeror
may “revoke” the offer, i.e., take the offer off the table, any time prior to acceptance.
Generally, if the offer is good for thirty days, it means it is good for thirty days or until it
is revoked. An offer is always revocable until the other party accepts unless it is an
option contract, in which it must be backed by consideration. Once the other party has
accepted, the offeror can no longer revoke the contract.
Under the UCC, merchants39
are permitted to make “firm” offers if the offer is
signed, and if the offer provides assurance to the offeree that the offer will be held open.
If this assurance is on a form supplied by the offeree, the offeror must sign the assurance
separately (to make sure offeror is aware of the term). Assuming that the above criteria
are satisfied, the offer promised to remain open and irrevocable for the time stated or for
a reasonable time, if no time is stated. Without consideration, the UCC places a three-
month limit on the irrevocability of a merchant’s firm offer,40
but this time limit can be
exceeded with consideration. Additionally, merchants can make an offer irrevocable

38
See CISG art. 35 (“[S]eller must deliver goods which are of the quantity, quality and
description required by the contract and which are contained or packaged in the manner required
by the contract.”).
39
Merchants are people who deal in goods of the kind involved in the transaction or who
otherwise, by trade or profession, represents that he has skill or knowledge in regard to the goods
or the transaction.
40
UCC § 2-205 (“An offer by a merchant to buy or sell goods in a signed writing which by its
terms gives assurance that it will be held open is not revocable, for lack of consideration, during
the time stated or if no time is stated for a reasonable time, but in no event may such period of
irrevocability exceed three months; but any such term of assurance on a form supplied by the
offeree must be separately signed by the offeror.”).

without entering into an option contract if the parties expressly state that this is their
intent. Otherwise, the default is that offers are revocable. A firm offer is binding as an
option contract if the offeror can reasonably expect the offer to induce action on the part
of the offeree, and it actually does induce such action.
Under the CISG, an offeror may withdraw an offer before it reaches the offeree,
but can revoke an offer after it reaches the offeree, unless of course the offeree has acted
on the offer or the offer is irrevocable.41
Surpassing the UCC’s generous three-month
limit on keeping a firm offer open, under the CISG, an offer can become irrevocable by
merely inserting an offer’s expiration time.42
For example, under the CISG, an offer with
a 10-day duration prevents the offeror from revoking it within that 10-day period.43
If the
offer is made with a definite duration, the power to revoke must be expressly reserved by
the parties, meaning that the contract should expressly state the CISG provision on this
matter does not apply.44
If the offer is made without a definite duration, acceptance must
occur within a “reasonable time” in light of the surrounding circumstances.45
Lastly, the UCC and CISG vary on rules regarding rejections of offers and
counter-offers. A “battle of the forms” situation occurs when a customer sends a
purchase order for a sale back to the seller, and the seller acknowledges this acceptance
with additional terms. When dealing with a battle of the forms, the common law “mirror
image” rule assumes that a contract’s final form and its final terms consist of the terms of
the original offer, barring the acceptance’s modifications. An acceptance at common law

41
42
CISG art. 16.
43
See CISG art. 12(2)(a)(An offer “cannot be revoked if it indicates, whether by stating a fixed
time for acceptance or otherwise that it is irrevocable.”).
44
45
Kokoruda, supra, note 1.

must mirror the offer; no new or different terms can be added. The offeree must accept
the terms as they are offered. Otherwise, it is a counter-offer. When operating under the
common law last shot rule, whoever sends the last form is the master of the offer. When
the last form contains conflicting terms, the last form will prevail.
For battle of the forms situations, the UCC rejected both the mirror-image rule
and the last shot rule, and instead promoted the Knock-Out Rule.46
Instead of the
traditional mirror-image rule, if a response looks like an acceptance, it is, even if the
terms do not mirror the offer. In accordance with the Knock-Out Rule, any conflicting
terms in the acceptance fall away and do not become part of the agreement. In lieu of the
traditional last shot rule, if the response is a counteroffer, subsequent performance is not
considered acceptance by conduct. A contract is not simply on the terms of the last
communication.
Instead of having the last form govern the contract, the UCC prefers to use the
penultimate form to govern the contract’s enforcement.47
Once the contract has been
formed, the consumer’s additional terms are considered proposals. As between
merchants, additional terms automatically become part of the contract unless: (1) the
offer expressly limits acceptance to the terms of the offer, (2) the additional terms
materially alter the offer, or (3) notification of objection to the additional terms already
has been given or is given within a reasonable time after notice has been received. For

46
See UCC §2-207 (“(1) A definite and seasonable expression of acceptance or a written
confirmation which is sent within a reasonable time operates as an acceptance even though it
states terms additional to or different from those offered or agreed upon, unless acceptance is
expressly made conditional on assent to the additional or different terms. (2) Battle of the Forms
– Additional terms become part of contract unless: (a) Offer expressly limit acceptance to the
terms of the offer; (b) They materially alter it; (c) Offering party notifies the accepting party of its
objection to the additional terms. (3) Knock-Out Rule – Inconsistent terms are knocked out and
replaced with Article 2 gap-fillers.”).
47

example, under the UCC, if a buyer sent a purchase order to seller, and seller responded
with an acknowledgment adding terms to the offer, the seller’s acknowledgment may still
be considered an acceptance.48
“Additional” terms materially alter the offer by adding
new terms, while “different” terms vary or contradict something in the offer.
Conversely, the CISG is consistent with the traditional common law rule: once
delivery and acceptance have occurred, the last party to make material changes usually
prevails.49
Additionally, any additional terms contained in the seller’s acknowledgment
will be considered a counter-offer, rather than the final form of the original offer.50
This
determination is likely because the CISG favors a “meeting of the minds” perspective on
contract formation. The CISG includes an exception to this “matching acceptance”
rule,51
but the exception is so tapered to such specific circumstances that it might as well
be deemed irrelevant.52
On this basis alone, the buyer would likely prefer to have CISG
govern the contract, while seller would be more inclined to take advantage of the
flexibility granted under the UCC.

48
49
50
CISG art. 19(1)(“A reply to an offer, which purports to be an acceptance but contains additions,
limitations or other modifications, is a rejection of the offer and constitutes a counter offer.”).
51
CISG art. 19(2)(“However, a reply to an offer which purports to be an acceptance buy contains
additional or different terms which do not materially alter the terms of the offer constitutes an
acceptance, unless the offer, without undue delay, objects orally to such a discrepancy or
dispatches a notice to that effect. If he does not so object, the terms of the contract are the terms
of the offer with the modifications contained in the acceptance.”).
52
CISG art. 19(3)(“Additional or different terms relating, among other things, to the price,
payment, quality and quantity of the goods, place and time of delivery, extent of one party’s
liability to the other or the settlement of disputes are considered to alter the terms of the offer
materially.”).

Actions Under Already-Established Contract
The CISG and UCC disagree significantly on the treatment of parol evidence, or
evidence “extrinsic” to the contract. Parol evidence pertains to exchanges between the
parties that occurred after the finalization of the contract. If the extrinsic terms were
partially integrated into the contract, parol evidence may be treated as fully integrated so
long as it does not contradict any explicit contractual terms. Parol evidence tends to be
barred because a final writing often is intended to supersede earlier preliminary
agreements and understandings, but excluding parol evidence also protects against
fraudulent claims that there are new or different terms.
Under the UCC, the Parol Evidence Rule (“PER”) limits evidence that the court
can look at in interpreting contract. Parol evidence will not be admitted to supplement,
explain or contradict terms in a parties’ finalized expression of their agreement; however,
if the agreement was not finalized, consistent and non-contradictory parol evidence can
be admitted to supplement terms that have not been finally expressed.53
Consistent
additional terms should be excluded only where the court decides that if such terms had
actually been agreed upon, they most certainly would have been in the writing. Unlike
the Statute of Frauds, PER does not require a corroborating writing at all, except in the
sense that it can apply only where there is a written document adopted by the parties as
the integration of their agreement.

53
See UCC §2-202 (“Terms with respect to which the confirmatory memoranda of the parties
agree or which are otherwise set forth in a writing intended by the parties as a final expression of
their agreement (fully integrated) with respect to such terms as are included therein may not be
contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may
be explained or supplemented (a) by course of dealing or usage or trade (§1-205) or by course of
performance (§2-208); and (b) by evidence of consistent additional terms unless the court finds
the writing to have been intended also as a complete and exclusive statement of the terms of the
agreement.”).

The UCC’s PER operates to exclude otherwise admissible evidence. Specifically,
the UCC-rule excludes evidence of prior oral or written agreements and of
contemporaneous oral agreements. The Rule does not exclude parol evidence of
subsequent oral or written agreements or of contemporaneous written agreements, unless
they are within the scope of a completely integrated written agreement. If applicable,
PER prevents one party from introducing into court extrinsic evidence of matters not
contained in the written agreement between the parties where that evidence is offered to
supplement or contradict the written agreement. If PER does not apply, admissibility of
the evidence will turn on the body of rules that collectively make up the law of evidence.
However, the UCC’s PER includes a few exceptions to its formulaic application.
Namely, oral conditions are admissible in the event of fraud, i.e., the person making the
statement knew it was false. Also, parol evidence as to contract reformation is
permissible if reformation is necessary due to mistake or clerical error. Additionally,
when the contract contains ambiguous language, thus provoking more than one
reasonable meaning of the term, the judge will make the call and not permit parol
evidence. However, parol evidence of a collateral agreement will be admitted so long as
the writing and oral terms were together the terms of the deal, or the oral and writing
were two separate contracts, e.g., there was a side deal, unless the parties normally would
have covered the subject-matter in the finalized writing. Lastly, parol evidence of
subsequent dealings is always permissible: anything that happens after the agreement is
made is fair game.

Under the CISG, no PER exists, 54
so evidence of oral exchanges are permitted to
be included in the contract, even if they contradict the written terms.55
Moreover, the
Convention emphasizes on the parties’ subjective intentions,56
and highlights how these
intentions can trump written contractual terms.57
By shifting the focus towards the
parties’ subjective intentions rather than objective intentions, the CISG’s provisions on
parol evidence seem to run directly contrary to U.S. case law.58
In the United States, the
CISG standard has been likened to the reasoning behind the decision in Raffles v.
Wishelhaus,59
meaning that the Convention places more emphasis on what the parties’
thought when they were consenting to the contract’s terms, and not what a reasonable
person would do in the same situation.60
Therefore, the Convention considers subjective

54
CISG art. 8(3)(In addressing how a court should determine the subjective intent of a party
under 8(1) or the understanding of a reasonable person under 8(2), “due consideration is to be
given to all relevant circumstances of the case including the negotiations and practices, which the
parties have established between themselves, usages and any subsequent conduct of the parties.”).
55
See Claudia v. Olivieri Footwear Ltd., No. 96 Civ. 8052 (HB)(THK), 1998 U.S. Dist. LEXIS
4586, *4-*5 (S.D.N.Y. Apr. 7, 1998)(“[T]he CISG, unlike American contract law, includes no
Parol Evidence rule, and allows all relevant information into evidence even if it contradicts the
written documentation.”).
56
See TeeveeToons, Inc. v. Gerhard Schubert GmbH, 2006 U.S. Dist. LEXIS 59455 (S.D. N.Y.
2006)(holding that negotiations include prior agreements, which are permissible under CISG, and
are admissible to the extent that they reveal the parties’ subjective intent).
57
CISG art. 8(1)(“[S]tatements made by and other conduct of a party are to be interpreted
according to his intent when the other party knew or could not have been unaware what that
intent was.”); CISG art. 8(2)(“[S]tatements made by and other conduct of a party are to be
interpreted according to the understanding that a reasonable person of the same kind as the other
party would have had in the same circumstances.”).
58
See, e.g., Gendzier v. Bielecki, 97 So. 2d 603, 608 (Fla. 1957)(“[I]n determining whether there
has been mutual consent to a contract, the courts will not explore the ‘subjective intent’ of the
parties but only their ‘objective intent’; that is, the courts will undertake only to determine what a
reasonable man would believe from the outward manifestations of the consent of the parties as
evidenced by the language of the written document.”).
59
Raffles v. Wishelhaus, 2 H. & C 906 (1864)(explaining that the contract had not been formed
because of a mistake in properly identifying the right ‘Peerless’ ship, and thus resulting in a lack
of mutual assent).
60
See Guang Dong Light Headgear Factory Co., Ltd. V. ACI International, Inc., 2007 U.S. Dist.
LEXIS 76844 (D.C. Kan. 2007)(“The plain language of the CISG requires the court to evaluate a
party’s subjective intent, so long as the other party was aware of that intent.”); see MCC-Marble,
supra, note 15 (holding that parol evidence of the subjective intent of the parties must be

intent of higher probative value, in terms of discerning admissible parol evidence, and for
that reason, the CISG is more lenient in its writing requirements than the UCC.
The UCC and CISG also differ in regard to the rejection of nonconforming goods.
When there is a good faith rejection of goods, buyers are afforded particular remedies to
rectify the wrong. Depending on the governing law, the amount and versatility of
remedies afforded to the buyer varies. In some jurisdictions, even the slightest
nonconformity can grant the buyer wide variety of options, while other jurisdictions may
mandate a “fundamental breach” in order to warrant certain buyer remedies.
The UCC operates in accordance with the “Perfect Tender” Rule (“PTR”), which
means that a buyer may reject goods under a one-delivery contract that fail, in any regard,
to conform to the contract.61
Exceptions to the UCC’s PTR include installment contract
provisions62
and parties’ contrary agreement.63
Under the UCC, a buyer has a right to
either cancel the contract or recover damages arising from the nonconformity,64
but this
provision embodies an after-the-fact remedy to rectify the wrong. Once the aggrieved
party has accepted the goods, the privileges of the PTR vanish, thus precluding rejection
of goods and limiting revocation because of nonconformity.65
Nevertheless, the

considered to interpret the parties’ preprinted forms); see also Herbert Berstein & Joseph
Lookofsky, Understanding the CISG in Europe 29 (1997) (“[T]he CISG has dispensed with the
parole evidence rule which might otherwise operate to exclude extrinsic evidence under the law
of certain Common Law countries.”).
61
See UCC § 2-601 (“A buyer can reject any goods that fail to conform to the contract.”); see
UCC § 2-608 (Nonconformity must substantially impair the value of the goods.).
62
UCC § 2-612.
63
UCC §§ 2-718, 2-719.
64
See UCC § 2-711 (“A buyer can cancel the contract and recover monetary damages, such as
costs of cover.”); see also UCC § 2-714 (“If a buyer accepts nonconforming goods and fails to
properly revoke acceptance, a buyer can recover damages [including incidental and consequential
damages] arising from the nonconformity.”).
65
UCC §2-607(2).

aggrieved party must notify the seller promptly in order to receive damages.66
This
notice also provides the seller with an opportunity for the seller to come back and try
again, if there is still time before original performance was due.67
The CISG, however, provides a remedy to buyers is called an “avoidance” clause:
Parties may declare a contract avoided only when one of the parties is determined to be in
“fundamental breach” of the contract.68
This perspective appropriately lends itself to a
proper rationale: expense involved in reshipping nonconforming goods around the world.
Following with this perspective, “reasonable time” under the Convention has been
interpreted narrowly, implying that the buyer must inspect the goods in as short a period
of time as practicable.69
The CISG also includes an explicit provision granting the buyer
the opportunity to unilaterally reduce the price of goods in the event of the
nonconformity.70

66
See UCC § 2-607(3)(“Where a tender has been accepted, the buyer must within a reasonable
time after he discovers or should have discovered any breach notify the seller, or be barred from
any remedy.”).
67
UCC § 2-508.
68
CISG art. 25, 49, and 64; but see Albert Kritzer, et al., 4 International Contract Manual §81:28
(2010)(explaining that CISG’s remedy of avoidance is more difficult to invoke than rejection,
revocation of acceptance, or cancellation under the UCC).
69
Nicholas, supra, note 11.
70
CISG art. 45 (“If the goods “do not conform with the contract . . . the buyer may reduce the
price in the same proportion as the value that the goods actually delivered had at the time of the
delivery bears to the value that the conforming goods would have had at that time.”).

III.B. Judicial Findings (UCC vs. CISG in practice)
Despite the stark differences between the two documents, contracting parties’
intentions to use either UCC or CISG, i.e., the binding nature of such enactments of party
autonomy, are usually defeated in U.S. courts. By examining U.S. case law on the
subject, I found that the parties lose the ability to have their expectations in the desired
execution of the contract come to light, either because attorneys drafted inefficient
opting-out clauses, or because courts misapplied or misinterpreted CISG’s scope of
jurisdiction.
Attorneys Inefficiently Opting-out of the CISG
In terms of inefficient opting-out clauses, attorneys make the mistake of thinking
that a “catchall” choice-of-law clause is sufficient to opt-out of the CISG, which courts
have held is not. In Easom Automation Systems, Inc. v. Thyssenkrupp Fabco, Corp., the
court held that when the contract is between two CISG contracting parties, the contract
cannot merely declare the law of that party’s designated state governs.71
If the choice-of-
law provision does not also exclude CISG’s application, the CISG will govern the
contract. Unbeknownst to the drafting attorney, the contract is often still governed by the
CISG despite that it may have been drafted to operate under UCC provisions.72
Therefore, courts have held that the opting-out must be written expressly into the contract
in order to be upheld.

71
See Easom Automation Systems, Inc. v. Thyssenkrupp Fabco, Corp., 2007 U.S. Dist. LEXIS
72461 (E.D. Mich. 2007).
72
See Ingeborg Schwenzer & Pascal Hachem, The CISG – Successes and Pitfalls, 57 Amer. J. of
Comparative Law 457, 457 (2009)(estimating that 70 to 80 percent of all international
transactions are potentially governed by the CISG).

Some courts have found that a general choice-of-law provision in an international
sales agreement--that would otherwise be governed by the CISG--is not sufficient to opt-
out of the Convention because the CISG is the substantive law of the contract. 73
In BP
Oil Int’l Ltd. v. Empresa Estatal Petroleos de Ecuador, the court found that CISG is
Ecuadorian law, thus the Convention is treated as a federal treaty, and held that “a choice
of law provision designating Ecuadorian merely confirms that the treaty governs the
transaction.”74
Some courts have gone so far as to provide an example of what met the standard
for an efficient opting-out clause. In Hull 753 Corp. v. Elbe Flugzeugwerke GmbH, the
court found that the parties had no effectively opted-out of the Convention’s
application.75
For demonstrative purposes, the court provided an example of an explicit
opt-out clause to contrast the parties’ failed attempt: “[T]he Uniform Law on the
Formation of Contracts for the Sale of Goods, based upon the United Nations Convention
on Contracts for the International Sale of Goods, shall not be applicable.”76
However, the
court’s example was not perfect.

73
See Usinor Industeel v. Leeco Steel Products, Inc., 209 F. Supp. 2d 880 (N.D. Ill.
2002)(reasoning that the Convention must be explicitly excluded because CISG is a federal
treaty, thus preempts the state-UCC provisions).
74
BP Oil Int’l Ltd. v. Empresa Estatal Petroleos de Ecuador, 332 F.3d 333, 335-37 (5th Cir.
2003).
75
Hull 753 Corp. v. Elbe Flugzeugwerke GmbH, 58 F. Supp. 2d 925 (N.D. Ill. 2002).

76
See id at 927.

Judges Mistakenly Misapplying the CISG
In terms of mistakes in the misapplication of the CISG’s provisions and
jurisdictional reach, U.S. courts have initial difficulty in correctly articulating the CISG’s
provisions, which tends to result in the CISG not applying to the dispute. In Stawski
Distributing Co. v. Browary Zyweic S.A., the court noted that the seller was “located” in
Poland,77
but location is irrelevant because the CISG looks to the party’s “place of
business” to determine their affiliated nation-state.78
Comparably, in OrthoTec LLC v.
Eurosurgical, S.A., the court inaccurately looks to location of the parties rather than the
parties’ place of business: “The CISG is an international treaty governing contracts of
that sale of goods between parties living in those countries that have signed the treaty.”79
Additionally, U.S. courts have failed to apply the CISG not only due to an
improper articulation of its provisions, but also due to an ambiguous analysis of its scope.
In Delchi Carrier SpA v. Rotorex Corp, the court broadened the scope of the Convention,
and stated that the Convention applies to “sales contracts,” where the CISG in reality
applies to sales contracts for goods.80
Moreover, in OrthoTec, the court narrowed the
scope of the Convention, and made the hasty generalization that a “catchall” choice-of-
law provision substituting “CISG” with “California law” was sufficient to exclude the
CISG’s application.81
In Attorneys Trust v. Videotape Computer Products, the court
neglected to entertain the scope of the Convention, and ambiguously held the CISG did

77
See Stawski Distributing co. v. Browary Zywiec S.A., 349 F.3d 1023 (7th Cir. 2003).

78
See CISG art. 1(1)(a)(“This Convention applies to contracts of sale of goods between parties
whose places of business are in different states.”).
79
OrthoTec LLC v. Eurosurgical, S.A., 2007 WL 1830810 (Cal. Ct. App. June 27,
2007)(emphasis added).
80
Delchi Carrier SpA v. Rotorex Corp., 71 F.3d 1024 (2d Cir. 1995); see CISG art. 1(1)(“This
Convention applies to contracts of sale of goods . . .”).
81
See OrthoTec LLC, supra, note 79 at *12.

not apply because the Taiwanese party was too late in bringing the proceedings against its
U.S. adversary.82
Courts have also conflated language used in modern conflict of laws theory with
the appropriate lens to examine the Convention’s applicability. In American Biophysics
Corp. v. Dubois Marine Specialties, the court found that the agreement expressly stated
that the contract “shall be construed and enforced in accordance with the laws of Rhode
Island,” and that provision was sufficient to exlusde the CISG.83
By hinging its decision
on this choice-of-law provision, the court made a fatal error in determining the CISG’s
applicability to the contract:
“CISG governs ‘contracts for the sale of goods where the parties have
places of business in different nations, the nations are CISG signatories,
and the contract does not contain a choice of law provision.’”84
[The court’s findings are predictable considering that it cited the decision in Delchi
Carrier SpA., which also misconstrued the CISG’s scope,85
and are also indicative of the
problem in creating imprecise language in judicial precedents.] Unsurprisingly, in
Golden Valley Grape Juice & Wine LLC v. Cenrisys Corp., the court used the exact
language from American Biophysics, but the court went even further to say the
Convention never applies to disputes when the parties have included a choice-of-law
provision stating the contrary.86
Moving on from mistakes in misapplication of the Convention, U.S. courts have
also tended to reject the CISG’s applicability on the basis of counsel error, namely in

82
Attorneys Trust v. Videotape Computer Products, 50 F.3d 593, 600 (9th Cir. 1996).
83
American Biophysics Corp v. Dubois Marine Specialties, 411 F. Supp. 2d 61 (D.R.I. 2006).
84
Id. at 63 (emphasis added); see Restatement (Second) of Conflict of Laws, infra, note 94 at §
187.
85
Delchi Carrier SpA., supra, note 80 at 1027.
86
Golden Valley Grape Juice & Wine LLC v. Centrisys Corp., 2010 U.S. Dist. LEXIS 11884
(E.D. Cal. 2010).

terms of raising the issue in a timely manner. In GPL Treatment, Ltd. v. Louisiana-
Pacific Corporation, because counsel raised the issue too late, the court flatly rejected to
discuss [in his judicial opinion] neither the scope of the CISG nor whether the CISG
applied to a sales contract between a Canadian party and an American party.87
Similarly,
in Ho Myung Moolsan Co. v. Manitou Mineral Water, Inc., the court found that the buyer
waited too long to raise the issue of CISG’s applicability because the buyer “consented to
the application” of NY law through the discovery process.88
IV. Conclusion
In order to increase efficiency in the CISG’s application or non-application, these
two problems (attorneys inefficiently opting-out of the CISG and judges mistakenly
misapplying the CISG) should be corrected. Attorneys should be aware of the
substantive legal differences, and have the tools to effectively exclude the CISG. Judges,
on the other hand, should accurately articulate the CISG’s scope and provisions,
especially the opt-out exception.
U.S. attorneys involved in foreign transactions should consider (1) if the
Convention is applicable, (2) if it should be used in light of the substantive differences
between the CISG and UCC, and (3) if an effective opt-out clause is in place, if desired.
Most attorneys and judges do not recognize that the CISG automatically applies to many
transactions. A seller, for example, may prefer to contract under the UCC because the
Convention affords buyers the option of unilaterally reduce the price of nonconforming
goods. If the contract was drafted under the assumption that the UCC would govern, but

87
See GPL Treatment, Ltd. v. Louisiana-Pacific Corp., 914 P.2d 682 (Or. 1996).
88
Ho Myung Moolsan Co. v. Manitou Mineral Water, Inc., 2010 U.S. Dist. LEXIS 127869
(S.D.N.Y. Dec. 2, 2010).

the court instead invokes CISG jurisdiction, this discrepancy will likely result in a
disgruntled seller-client.
By highlighting when UCC provisions would be advantageous to a foreign seller,
U.S. attorneys can contrast these advantages and invoke the converse to protect their
U.S.-client. After careful examination of the differences between the CISG and the UCC,
foreign parties would likely prefer the UCC in two situations: definiteness of terms and
price and revocation of the offer. To the former, under the UCC, a contract still exists
despite if certain terms, like price, are specified,89
whereas the contract would likely be
held invalid under the CISG.90
This situation may be beneficial to the seller in the event
of an oral agreement or a purchase order from the buyer that does not state a price.91
To
the latter, under the UCC, a contract can be revoked at any time before acceptance, unless
the offer is a “firm” offer that has been promised to be held open for a definite duration of
time, not exceeding 30 days; unlike the UCC, offers under the CISG are easily
irrevocable. If a foreign seller makes an offer to a U.S. buyer, the seller can retract the
offer barring any evidence of a promise to keep it open, or evidence that the offer has
already been accepted. Had the Convention governed the contract, the buyer would
merely have to show that s/he reasonably relied on the offer, and thus the seller would be
obligated to perform the contract.
If the attorney and contracting parties decide that it is in their best interest to use
non-CISG principles, the contract must be drafted to contain an explicit opt-out clause as

89
See N.Y. U.C.C. Law § 2-204(3) (“Even though one or more of its terms are left open, a
contract for sale does not fail for indefiniteness if the parties have intended to make a contract and
there is a reasonably certain basis for giving an appropriate remedy.”).
90
See Kina Grbic, Putting the CISG Where it Belongs: In the Uniform Commercial Code, 29
Touro Law Review 173 (Apr. 22, 2013); see also CISG art. 14 (This provision has been
interpreted to require the offer either explicitly or implicitly refers to the price, quantity, etc.).
91
See Grbic, supra, note 90.

to exclude CISG’s application. A “catchall” choice-of-law clause will not suffice, in
terms of merely substituting with a particular state’s law. The opt-out clause must
expressly exclude the CISG and provide a substitute for the substantive law. Courts will
not recognize an opt-out clause as binding unless it is explicit and the substitute law has
some reasonable relation to the contract.
In order to effectively opt-out of the CISG, the clause must broadly state an
explicit exclusion of the Convention, either entirely or in part, and then narrowly identify
an adequate substitute, either entirely or in part. In OrthoTec, the court failed to
recognize that “California law” encompasses the CISG, as a federal treaty, and thus that
the choice-of-law provision was ineffective. A party first states a general, but explicit
opting-out provision, such as, “The parties hereby agree that the U.N. Convention on
CISG will not apply to this contract.”92
The drafters can then substitute the CISG with
the law of the jurisdiction of the parties’ choosing, so long as the law has a reasonable
relation93
to the contract, like “The parties instead agree that the law of the state of
Maryland will apply to all rights and obligations under this contract.” At that time, if the
parties had failed to provide an adequate substitute, the court would use the rules private
international law to find an appropriate law to govern the contract.94
Additionally, U.S. judges involved in settling disputes arising from foreign
transactions should consider accurately articulating the Convention’s provisions and

92
Murray, supra, note 12.
93
The “reasonable relation” requirement can be likened to Conflict of Laws common law on
Party Autonomy provisions in contracts: (1) the choice-of-law provision must be bona fide, and
(2) the chosen State must have a reasonable and rational relation to the contract.
94
By contrast, when two U.S. contracting parties have failed to invoke their right to a Party
Autonomy provision, the court will determine the applicable State law that has the most
significant relationship to the contract. See Restatement (Second) of Conflict of Laws, §§ 6(2),
187, 188 (1971).

unambiguously analyzing the CISG’s scope, thus providing proper precedent for other
latter courts to construe the Convention’s potential applicability. In Attorneys Trust, the
court should have first explained whether the parties met the scope of the CISG at all.95
Instead, the court merely designated the Taiwanese corporation as a “Republic of China
Corporation.”96
Similarly, in Stawski Distributing Co., Judge Easterbrook neglected to
discuss the scope of the CISG, and blindly determined that Illinois law applied to the
dispute.97
Instead of denying discussing the issue at all, in GPL Treatment, the court
should have considered entertaining and elaborating on the scope of the CISG, in order to
provide instructive precedent.98
Despite that the court distinguished itself from the court
in GPL Treatment by at least stating that CISG would have applied had the issue been
raised sooner, the Ho Myung court still failed to outline why the CISG would have
applied.99
Complications from judicial mishaps affect the basic tenets of U.S. constitutional
law.100
When U.S. judges misconstrue the Convention’s reach, the courts essentially
disregard a pillar of U.S. constitutional law, being federal supremacy. As explained
earlier, CISG has been ratified as a federal treaty, and therefore takes supremacy over
individual state law. Similar to Article 7 of the UCC, when federal laws regarding bills
preempt Article 7 provisions, CISG operates as substantive federal law, thus replacing
UCC substantive law. Also elucidated earlier, failing to replace UCC Articles 2 or 7 with
CISG may result in substantial differences, due to the outcome-determinative nature of

95
96
See Attorneys Trust, supra, note 82 at 593.

97
See Stawski Distributing Co., supra, note 77 at 1024-25.
98
See Kokoruda, supra, note 1

99
See id.
100
See id.

both documents’ terms. In addition, misapplication prevents American buyers and sellers
from enacting their rights to reach stream of international commerce that the Convention
is designed to supply.
Fortunately, the problem of ambiguous court analysis seems to be disappearing.
In Forestal Guarani, S.A. v. Daros International, Inc., the trial court misapplied the
Convention’s scope, suggesting that if the parties had included a difference choice-of-law
provision then that choice would effectively replace the CISG.101
However, on appear,
the Third Circuit court corrected the mistake, and removed the trial court’s language from
its decision. This decision landmarks a new trend in how U.S. courts treat international
contracts involving opt-out clauses. First, the appellate court was familiar with the
Convention’s provisions, appreciating the need for an opt-out clause. Second, the court
researched similar case law in order to distinguish between adequate, and thus effective,
opt-out clauses versus inefficient stipulations. Finally, the court considered the
decision’s use as precedent for latter courts, and actively attempted to steer future judges
in the correct direction. Hopefully, courts in the United States will follow the Third
Circuit’s lead, thereby increasing efficiency in drafting international contracts (involving
either the UCC or the CISG), and intended execution and enforcement in U.S. courts.

101
See Forestal Guarani, S.A. v. Daros International, Inc., 613 F.3d 395 (3d 2010).

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2007).
25. Delchi Carrier SpA v. Rotorex Corp., 71 F.3d 1024 (2d Cir. 1995).
26. Attorneys Trust v. Videotape Computer Products, 50 F.3d 593 (9th Cir. 1996).

27. American Biophysics Corp v. Dubois Marine Specialties, 411 F. Supp. 2d 61 (D.R.I.
2006).
28. Golden Valley Grape Juice & Wine LLC v. Centrisys Corp., 2010 U.S. Dist. LEXIS
11884 (E.D. Cal. 2010).
29. GPL Treatment, Ltd. v. Louisiana-Pacific Corp., 914 P.2d 682 (Or. 1996).
30. Ho Myung Moolsan Co. v. Manitou Mineral Water, Inc., 2010 U.S. Dist. LEXIS
127869 (S.D.N.Y. Dec. 2, 2010).
31. N.Y. U.C.C.
32. Kina Grbic, Putting the CISG Where it Belongs: In the Uniform Commercial Code,
29 Touro Law Review 173 (Apr. 22, 2013).
33. Forestal Guarani, S.A. v. Daros International, Inc., 613 F.3d 395 (3d 2010).

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