1. Approach 1: Buyer has to become owner of the goods under Article 30 of the CISG

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The first approach takes the wording of Article 30 of the CISG literally and deduces from the obligation to transfer the property in the goods to the buyer that the buyer actually has to become owner of the goods and no third party can remain the owner of the goods. If, for any reason, the buyer does not become the owner of the goods, Article 30 of the CISG is breached. Since the wording of Article 43(1) of the CISG requires notification only with re 72 gard to Articles 41 and 42 of the CISG, buyers would not lose their right to rely on Article 30 of the CISG if they failed to notify the seller in time.

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The Court of Appeal Dresden, the Court of Appeal Munich, and the District Court Freiburg have adopted this approach.384 All three cases concerned the sale of stolen cars. Thus, under the respective applicable national laws the victims of the theft retained property in the cars. The courts considered it irrelevant whether the buyers had notified the sellers within a reasonable time under Article of the 43(1) CISG. Even though the buyers had not in all cases notified the seller in time, the sellers had also breached Article 30 of the CISG by not transferring property. The Court of Appeal Munich explicitly stated that Article 30 of the CISG required the seller to make the buyer the owner of the goods.385 It has to be noted at this stage that this understanding cannot be generalized as an approach by the German courts, since the German Supreme Court has considered Article 43(1) of the CISG to be applicable in a similar constellation of a different case, and did not even mention Article 30 of the CISG.386 Yet, the decisions of the Court of Appeal Dresden and the Court of Appeal Munich were handed down after the Supreme Court’s judgment. Therefore, these lower courts were not deterred in their approach by the Supreme Court’s decision.

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Bridge states that where the seller is not the owner of the goods and English law would apply section 12 of the Sale of Goods Act 1979 should be assessed under Article 41 of the CISG “as well as under Article 30, which requires the seller to transfer the property in the goods.”387 In the accompanying footnote, he cites the decision by the Court of Appeal Dresden just mentioned.388

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Most criticism of this approach (directly or indirectly) points out that this interpretation would circumvent the buyer’s duty to notify the seller of the legal defect under Article 43 of the CISG.389 A stronger argument against this approach can be derived from Article 7(1) of the CISG and its mandate to 73 interpret the Convention in a manner that promotes uniformity in its application. The German courts had to decide cases in which the law applicable to property contained an absolute notion of property390 to find that Article 30 of the CISG had been breached. In contrast, if one were to assume a relative notion of property,391 the seller could be considered to have transferred the property to the buyer even in cases in which the goods had been stolen. Consequently, Article 30 of the CISG would not be breached. This potential divergence due to different national, unharmonized understandings of “property” under Article 30 of the CISG would lead to far-reaching differences in results, due to Article 43 of the CISG only blocking the buyer’s remedies comprehensively under a relative notion of property, while leaving the buyer with such remedies if an absolute notion of property were employed. Proponents of this first approach may counter that they apply the CISG in a uniform manner but that the differences in results stem from differences in national property law. Yet, the seller’s liability for third parties’ rights is governed by the CISG, and uniformity cannot be achieved if the relevant understanding of property in Article 30 of the CISG is left to national law. Article 7(1) of the CISG not only requires uniformity by requiring the transfer of property under Article 30 of the CISG, but its effect extends to the question what property is. Otherwise, for example, the question of whether Article 30 of the CISG is breached when a third party remains the owner of the goods would be answered divergently depending on the respective national law’s understanding of property.

2. Approach 2: Article 30 of the CISG obliges the seller to fulfill the necessary acts under national law to effect a transfer of property

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A second approach advanced by many scholars interprets Article 30 of the CISG to contain the seller’s obligation to comply with all acts necessary under the law applicable to the transfer of property without regard to whether the buyer eventually becomes the owner of the goods.392 The respective 74 requirements are to be determined under the (national) law applicable to the transfer of property, and may include: handing over of the goods, a distinct agreement that property should pass, no further acts being necessary due to the causal nature of the transfer of property.393

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Compared to the first approach, this approach renders the obligation to transfer the property under Article 30 of the CISG for most practical cases less relevant, since the cases in which the seller does not comply with the necessary acts under national law to transfer property will mostly coincide with non-delivery of the goods. For cases in which a third party remains the owner of the goods, Article 43(1) of the CISG requires the buyer to notify the seller within a reasonable period of time, and Article 30 of the CISG will generally not be breached to afford the buyer an alternative breach of contract to rely on despite the lack of notification to the seller.

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Yet, the wording of Article 30 of the CISG makes no reference to the acts necessary to transfer the property. The seller has to “transfer the property”, and the proponents of this approach limit the breaches of this obligation to the situation in which the lack of transfer of property is due to the seller not agreeing to transfer the property or not handing over the goods. In contrast, situations in which the transfer of property fails due to the seller not acquiring the necessary legal position to transfer the property would be considered a breach of Article 41 of the CISG. However, in both situations, the seller has ultimately not transferred the property, which puts this differentiation in conflict with the wording of Article 30 of the CISG.

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Counterarguments against this interpretation of the wording can also be found in the historical records. The differentiation between an obligation de moyen and an obligation de résultat was discussed during the drafting of the provision that would become Article 30 of the CISG. An obligation de moyen is breached if the debtor does not perform the required acts or fails to comply with the means to reach a result, but it is irrelevant whether the result is achieved. In contrast, an obligation de résultat is breached if the result is not achieved. The second draft of a uniform sales law of 1939 was the first draft that contained a provision on the obligation to transfer the property. Article 52(1) of the (Rome) draft read: “Le vendeur est obligé d’accomplir les actes qui sont nécessaires pour transférer à l’acheteur la propriété 75 et la possession de la chose au sens de la loi nationale compétente.”394 In 1953 during the third meeting of the Special Commission in Nice, the Commission changed the wording to “[l]e vendeur s’oblige à transférer à l’acheteur la propriété de la chose au sens de la loi nationale compétente”, which was accepted without further discussion.395 At the conference at the Hague in 1964 when the final text of the ULIS was negotiated, Gutzwiller (who was a member of the Special Commission396) explained that in Nice it had been decided to leave out the phrase “actes nécessaires pour transférer la propriété”. “This was in order to simplify the law and to specify more clearly the seller’s obligation. In this way the concept of possession had been set aside because Swedish legislation, for instance, did not include the concept of property in the goods, in the sense in which this was understood in continental European countries.”397 Eula (the then president of Unidroit) explicitly favored the Rome draft over the new wording.398 Tunc responded that it was a deliberate change in wording that went hand in hand with a change from an obligation de moyen to an obligation de résultat.399

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Due to proposals by Great Britain and Norway, it was decided at a late stage of the drafting to carve out the obligation to transfer the property from the provision that became Article 52 of the ULIS and create a new provision outlining the seller’s obligations (Article 18 of the ULIS) that included the obligation to transfer the property.400 It is not entirely clear whether this was meant to have any impact on the interpretation of the ULIS or was merely a question of drafting and structure guided by the existence of such a provision summarizing the buyer’s obligations (Article 56 of the ULIS).401 This is because, in contrast to Article 41 of the CISG, Article 52 of the ULIS was titled “transfer of property” and, thus, Article 18 of the ULIS might have just referenced this obligation. On the other hand, Tunc’s commentary on 76 Article 52 of the ULIS states that this provision is not a mere repetition of Article 18 of the ULIS but has a more extensive scope.402 None of these changes, however, cast doubt on the decision to consider the fragment that ended up in Article 18 of the ULIS to be an obligation de résultat. No further changes in the wording in this regard were undertaken by UNCITRAL at the conference in Vienna, and this wording was accepted for Article 30 of the CISG. Hence, the travaux préparatoires of the CISG, including the prior work at Unidroit and by the Special Commission,403 militate against the second approach, which interprets Article 30 of the CISG as containing an obligation of the seller to comply with the necessary acts to transfer property under national law.

3. Approach 3: Article 30 of the CISG is merely an overview elaborated by Article 41 of the CISG and contains no independent obligation

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The third approach considers Article 41 of the CISG to specify Article 30, which is why the latter provision is not considered to contain an independent or stand-alone obligation to transfer the property.404 If the buyer does not become owner of the goods, only Article 41 of the CISG is breached and the duty to notify under Article 43 of the CISG, thus, applies comprehensively to such cases. Tebel argues that this approach is justified with regard to the wording of Article 30 of the CISG which requires the transfer of property “as required by [...] this Convention.”405 Moreover, considering Article 30 of the CISG as the opening provision of “Chapter II. Obligations of the Seller”, one may interpret the provision to only provide an overview of the obligations that follow in Articles 31 to 44.406 This interpretation would correspond to the common understanding of Article 53 of the CISG, according 77 to which the latter provision also provides an overview of the buyer’s obligations, while Articles 54 to 60 specify said obligations.407

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Yet, Article 30 of the CISG refers to the obligations to deliver the goods, hand over the documents, and transfer the property. The obligations to deliver the goods and hand over documents have clear provisions addressing these obligations with consistent wording (delivery, Articles 31 to 33, handing over the documents, Article 34). In contrast, Article 41 of the CISG – as highlighted – does not refer to “transfer of the property” at any point. This also differs from Article 53 of the CISG, where the following provisions correspond in wording to the former provision. The key to this puzzle might, however, be discovered in Article 52 of the ULIS, the predecessor of Article 41 of the CISG, which was titled “Section III. Transfer of Property”. Although the title was (rightfully) dropped during the drafting of the CISG due to ambiguousness given that the actual transfer of property was not envisaged to be unified, this historical fact may prompt one to interpret “transfer the property” in Article 18 of the ULIS or Article 30 of the CISG to refer to Article 52 of the ULIS or Article 41 of the CISG. However, Article 18 of the ULIS was already considered to contain its own obligation to transfer the property, and to be differentiated from Article 52 of the ULIS as explicitly stated by Tunc in the commentary on the ULIS.408 Tunc’s understanding of Article 52 as containing a different obligation than Article 18 is supported by the reasoning why references to the transfer of property were dropped in Article 52: The reference was dropped to avoid repetition of an obligation that was already contained in Article 18.409 Therefore, the title of Article 52 of the ULIS as the predecessor of Article 41 of the CISG is no persuasive argument to favor the third approach.

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Furthermore, if Article 30 of the CISG were to be understood as providing an overview also extending to Article 41, there would be no obvious systematic reason why Article 30 is silent with regard to Article 35 (non-conformity of the goods). While one might counter that the obligation to “deliver the goods [...] as required by [...] this Convention” can be construed to encompass Article 35 of the CISG, because the latter provision is part of the Convention and requires goods to be delivered in accordance with the contract and its requirements, the same argument could be raised regarding Article 41. Hence, it is not convincing to interpret the reference to the obli 78 gation to transfer the property in Article 30 of the CISG to merely provide the overview of the seller’s obligation under Article 41 of the CISG, since Article 30 of the CISG would in this case have to refer to the obligation to deliver conforming goods, too.

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Lastly, the interpretation is not in line with the wording of Article 41 of the CISG. If Article 41 truly absorbed Article 30, Article 41 would also have to be applied if the seller retained rights in the goods. The seller would, consequently, have to be considered a “third person” under Article 41. This obvious conflict with the wording is commonly shrugged off.410 Some scholars justify this result with an analogy of Article 41 of the CISG with regard to rights of the seller.411 The provisions of the CISG only name three different private parties: the buyer, the seller, and third parties. Therefore, it appears to be more than a stretch to apply Article 41 of the CISG directly to rights of the seller. Moreover, depriving Article 30 of the CISG its scope of application with regard to the seller’s obligation to transfer the property only to apply Article 41 of the CISG in analogy to fill this self-inflicted gap is superfluous.