Common use of Reliance on Articles 6 and 7 to Support Reference to the CISG in Validating a Penalty Clause Clause in Contracts

Reliance on Articles 6 and 7 to Support Reference to the CISG in Validating a Penalty Clause. At bottom, the approaches of both Hachem and ▇▇▇▇▇▇ rest on the principles found in Articles 6 and 7 of the CISG.50 However, nothing in either of these articles mandates a departure from the traditional rule that the validity of fixed sums must be determined entirely by reference to otherwise applicable law—and not the CISG. As explained below, the parties’ exercise of autonomy under Article 6 remains limited to any issue of validity under applicable law—and not the CISG51and Article 7 (1) has no application to the issue of validity, because that issue is not governed by the CISG.52 Moreover, 47. Hachem also attempts to rely on Article 74 to support the idea that penalties are fully enforceable by reference to the general principles of the CISG, as found in this provision. Hachem, Agreed Sums, supra note 24, at 146. However, his arguments are equally unavailing for the same reasons explained herein.

Reliance on Articles 6 and 7 to Support Reference to the CISG in Validating a Penalty Clause. At bottom, the approaches of both Hachem and ▇▇▇▇▇▇ rest on the principles found in Articles 6 and 7 of the CISG.50 However, nothing in either of these articles mandates a departure from the traditional rule that the validity of fixed sums must be determined entirely by reference to otherwise applicable law—and not the CISG. As explained below, the parties’ exercise of autonomy under Article 6 remains limited to any issue of validity under applicable law—and not the CISG51and Article 7 (1) has no application to the issue of validity, because that issue is not governed by the CISG.52 Moreover, 47. Hachem ▇▇▇▇▇▇ also attempts to rely on Article 74 to support the idea that penalties are fully enforceable by reference to the general principles of the CISG, as found in this provision. Hachem, Agreed Sums, supra note 24, at 146. However, his arguments are equally unavailing for the same reasons explained herein.