Maintaining Uniformity in International Uniform Law via Autonomous Interpretation: Software Contracts and the CISG

Pace International Law Review Volume 8 Issue 2 Spring 1996 Article 2 April 1996 Maintaining Uniformity in International Uniform Law via Autonomous Interpretation: Software Contracts and the CISG Frank Diedrich Follow this and additional works at: https://digitalcommons.pace.edu/pilr Recommended Citation Frank Diedrich, Maintaining Uniformity in International Uniform Law via Autonomous Interpretation: Software Contracts and the CISG, 8 Pace Int'l L. Rev. 303 (1996) Available at: https://digitalcommons.pace.edu/pilr/vol8/iss2/2 This Article is brought to you for free and open access by the School of Law at DigitalCommons@Pace. It has been accepted for inclusion in Pace International Law Review by an authorized administrator of DigitalCommons@Pace. For more information, please contact . ARTICLES MAINTAINING UNIFORMITY IN INTERNATIONAL UNIFORM LAW VIA AUTONOMOUS INTERPRETATION: SOFTWARE CONTRACTS AND THE CISG Frank Diedricht I. INTRODUCTION International Uniform Law is a good thing in theory: The attainment of legal certainty via well-balanced subsidiary rules made for international contracts and the avoidance of weak legal relationships are among its major goals.1 The goal of the United Nations Convention on Contracts for the International Sale of Goods (CISG),2 as stated in its preamble, 3 is to support the international trade and exchange of goods. However, International Uniform Law, including the CISG, lacks a common legal theory and practice upon which judges and practitioners t Dr. iur., 1994; M.L.E., 1990, Universit~t Hannover Germany; Universitat Rostock. 1 See KEGEL, INTERNATIONALES PRIVATRECHT 112 (7th ed. 1995) for a discus- sion of the international uniform application of private law as the supreme goal of both unified and non-unified private international law. 2 United Nations Convention on Contracts for the International Sale of Goods, opened for signature Apr. 11, 1980, U.N. Doc. A/CONF.97/18, Annex I (1980), reprintedin S. TREATY Doc. No. 98-9, 98th Cong., 1st Sess. 22 (1983), Official Records, U.N. Conference on Contracts for the International Sale of Goods 178-90, U.N. Doc. A/CONF.97/19(1981) and 19 I.L.M. 668 (1980) [hereinafter CISGI. In force since January 1, 1988, the CISG has been applicable in the Federal Republic of Germany since January 1, 1991, 568 BGBI. I, 11 (1989). It has been applicable in the former German Democratic Republic since March 1, 1990, GBI. DDR II 65 (1989). Equally authentic are the English, French, Spanish, Russian, Arabic and Chinese text of the CISG. The English and French text in connection with the official German translation can, e.g., be found in HERBER & CZERWENKA, INTERNATIONALES KAUFREcHT 475 (1991). 3 See HERBER & CZERWENKA, supra note 2, at 417-18. 1 PACE INT'L L. REV. [Vol. 8:303 can rely. 4 This results in the well-known "homeward-trend" in favor of the lex fori5 when international lawyers interpret contractual language. 6 Such an interpretation puts a uniform application of International Uniform Law at risk. With every new ratification, it becomes more unlikely that an international court will be established to ensure the uniform interpretation and application of the CISG and other uniform laws in the contracting states. Problems of binding force, seat and procedure may be too great to overcome in interpreting the CISG. The globalization of business has resulted in transborder data exchanges that have made the linkage of communication systems necessary. One may even regard such linkages as a "second industrial revolution" 7 with computer software sent from one continent to another by wire or even satellite. The parties to these international transactions are most likely unaware that the law governing them is underdeveloped. Legal certainty will not be improved if the rising number of international contracts for the transfer of software are reviewed on a case-by-case basis using only one body of law for interpretation.8 Most international software contracts consist of the transfer of a ready-to-install computer program (either standard or bespoke software) in exchange for a sum of money. Such con4 See Merryman, On the Convergence and Divergence of the Civil Law and the Common law, 17 STAN. J. INT'L L. 357, 365 (1981). 5 Lex fori refers to "the law of the forum or court; that is, the positive law of the state, country, or jurisdiction of whose judicial system the court where the suit is brought or remedy sought is an integral part." BLACes LAw DICTIONARY 910 (6th ed. 1990). 6 For a discussion of the problem of the "homeward trend" under non-unified conflict of law rules, see KEGEL, supra note 1, at 114-15. 7 The "Industrial Revolution" was "a rapid and major change in an economy m.. Marked by the general introduction of power-driven machinery or by an important change in the prevailing types and methods of use of such machines." WEBSTERS NINTH COLLEGIATE DICTIONARY 617 (1987). 8 For an American point of view on this issue, see Primak, Computer Software: Should the U.N. Convention of Contracts for the InternationalSale of Goods Apply? A ContextualApproach to the Question, 9 COMPuTER/L.J. 197 (1991); Fakes, The Application of the United Convention on Contractsfor the International Sale of Goods to Computer, Software and DatabaseTransactions,3 SoFrwARE L.J. 559 (1990). For a German point of view, see MUGLICH, SOFTWAREUBERLASUNG NACH US-AMERIKANISCHEM VORBILD ZUR tYBERTRAGBARKEIT DES UCC IN DAS DEUTSCHE RECHT, 648-53 CR (1991). https://digitalcommons.pace.edu/pilr/vol8/iss2/2 2 1996] SOFTWARE CONTRACTS AND THE CISG tracts have on their face the features of a sale of goods. 9 This characterization is also in accordance with a comparative law classification, 10 since within the largest legal systems in the world, a contract under which the main mutual obligations of the parties consist of the transfer of goods for payment is unanimously characterized as a sales contract. The CISG then has potential applicability. If the CISG achieves acceptance as a "world sales code," then its application to international software contracts would result in certainty as to the applicable law. Moreover, the CISG provides a set of rules in six languages that are not only modern, but closely adhere to the needs of international trade. These rules provide an ideal compromise, and an alternative to interpreting contracts using only one party's local or domestic law. Furthermore, with the simplified, clear norms of the CISG governing the contract, there is no danger of a "parachute drop into darkness" as often happens when parties choose the unknown law of a third country as a neutral compromise. Also, the applicability of the CISG diminishes contractual difficulties arising over the choice of subsidiary applicable law. 1 Nevertheless, it remains questionable whether software can be regarded as a "good" under the CISG. This leads to problems with interpreting the CISG according to its preamble and Article 7(1) that requi (...truncated)