Cisg's Principle of Rule-Displacement: Validity and Three-Party Cases

Abstract

Central to the implementation of the United Nations Convention on International Contracts for the Sale of Goods (CISG) is a principle of rule-displacement: When CISG's rules address an issue, they displace domestic law controlling the same issue. When its rules do not address an issue, domestic law continues to control. This article briefly describes CISG's application to two sorts of cases in which the principle is implicated: cases involving the validity of a contract provision and cases involving three-party priority contests in goods. The two sorts of cases make application of the principle difficult, for different reasons. "Validity" cases can require determining whether CISG's rules address an issue arising from the sales contract. The answer often simply is indeterminate. Three-party cases require ordering priorities to goods by keeping track of both property rights to the goods controlled by domestic law and contract rights to goods provided by CISG. Priorities in these cases can be determined. Whether the overlap of domestic law and CISG is a good thing depends on the substance of domestic law - a normative question. The mere fact that an overlap in applicable law risks uniformity in CISG's implementation is by itself normatively irrelevant. This article raises the normative question but does not answer it.