The corpus of Ethiopian civil law, particularly that segment consecrated to the regulation of the sale of goods, stands as a foundational pillar underpinning commercial intercourses and the transfer of property. This discourse is purposed to furnish a meticulous and comprehensive exposition of the seminal themes, pivotal jurisprudential concepts, and established factual tenets that delineate the contract of sale, as codified within Book V, Title XV, Chapter 1 of the Ethiopian Civil Code. Particular emphasis shall be accorded to the fundamental principles governing such contractual arrangements, the reciprocal obligations incumbent upon both the vendor and the vendee, the available mechanisms of redress for instances of non-performance, and the specialized provisions applicable to the myriad forms of sale encountered in commerce.
Definition and Purview of the Contract of Sale
A “contract of sale,” within the definitional ambit of the Civil Code, is formally constituted by an agreement whereby one of the contracting parties, designated as the seller, undertakes the unreserved obligation to deliver a particular chattel and to effectuate the unimpeded transference of its full and indefeasible ownership to the other party, denominated as the buyer. This undertaking is rendered in consideration of a stipulated pecuniary sum, explicitly expressed as a price, which the buyer correspondingly undertakes to remit. This foundational provision is precisely articulated in Article 2266.
The applicability of these statutory provisions extends primarily to the “sale of corporeal chattels,” a term referencing tangible, movable commodities, as definitively clarified by Article 2267 (1). Furthermore, even discrete components of immovable property, such as agricultural yields or construction aggregates, are jurisprudentially construed as subjects of a “sale of movables” should their physical detachment and subsequent transfer as corporeal chattels be contemplated, a principle firmly enshrined in Article 2268. A contractual arrangement stipulating the delivery of articles destined to be manufactured or produced is likewise classified as a sale, provided that the party undertaking such delivery furnishes the “main materials” requisite for their creation, a stipulation expressly found in Article 2269. The subject matter of a sale is capacious in scope, encompassing existing objects, objects in futuro (including those slated for fabrication by the seller), or even objects legally appertaining to a third party, the inclusion of which is permitted by Article 2270. With respect to the quintessential determination of the price, it may be fixed directly by the contracting parties or its ascertainment may be “referred to the arbitration of a third party.” Should this designated third party subsequently fail to effectuate such estimation, the unequivocal legal consequence is that “there shall be no sale,” a condition explicitly stated in Article 2271, thereby underscoring the indispensable nature of a determined price for the fundamental validity of the contractual agreement.
Formalization of the Contractual Nexus
Contracts of sale may manifest in a “pure and simple” form or may incorporate “special terms,” a recognized flexibility within the legal framework, as acknowledged by Article 2272 (1). Unless an explicit contrary stipulation is demonstrably present, obligations imposed by the contract are not to be construed as conditions precedent affecting the very existence or fundamental validity of the contractual agreement, a principle provided by Article 2272 (2). This tenet underscores the prevailing presumption of contractual enforceability notwithstanding ancillary or ancillary obligations.
Performance of Contract: The Obligations Incumbent Upon the Vendor
The primary obligations devolving upon the seller encompass three fundamental duties: firstly, to “deliver the thing to the buyer”; secondly, to “transfer the ownership of the thing to the buyer”; and thirdly, to “warrant him against certain defects in the things,” as comprehensively enumerated in Article 2273. These duties are jurisprudentially intrinsic to the very essence of a contract of sale, ensuring the vendee receives both physical possession and an unassailable legal title to the acquired chattel.
The Imperative of Delivery
The essence of delivery is formally understood as the “handing over of a thing and its accessories,” a precise definition provided by Article 2274. In instances where the contract stipulates delivery “about a certain quantity,” the seller is vested with the discretion to ascertain the precise amount, subject to a maximum permissible deviation of ten percent for a complete ship’s cargo or five percent for all other categories of goods, as explicitly specified in Article 2275. Concerning the temporal aspect of delivery, if the designated time is not deducible from the manifest intent of the parties, the seller is legally bound to deliver “as soon as the buyer requires him to do so,” a provision contained in Article 2276. Should delivery be contractually stipulated to occur within a designated period, the seller customarily fixes the exact date of said delivery, in accordance with Article 2277. A foundational principle, unless expressly provided otherwise by contractual stipulation, mandates that the delivery of the thing shall occur simultaneously with the remittance of the price. Consequently, the seller is afforded the legal prerogative to retain the thing until such payment has been duly effected, as unequivocally established by Article 2278, thereby embodying the delivery against payment principle. The conventional locus of delivery, pursuant to Article 2279, is juridically defined as the seller’s established place of business or customary residence at the precise juncture of contract formation. However, an exception applies to specific things or fungible goods drawn from a clearly identified stock, in which case delivery is to be effectuated at the ascertained location of the thing, as stipulated in Article 2280.
The Obligation to Effectuate Ownership Transfer
The seller is mandatorily obligated to undertake all “necessary steps for transferring to the buyer unassailable rights over the thing,” thereby ensuring a secure, indefeasible, and unimpeachable title, a duty enshrined in Article 2281. An integral and corollary aspect of this obligation is the warranty against dispossession, by virtue of which the seller warrants the buyer against total or partial deprivation of the thing by a third party asserting a pre-existing legal right, as prescribed by Article 2282. Exceptions to this warranty exist where the buyer demonstrably possessed knowledge of the risk of dispossession at the time of contract formation (unless the seller expressly undertook such risk), or where contractual clauses purport to exclude or restrict the warranty. It is imperative to note that such exclusionary clauses are, however, subjected to strict construction and are deemed ipso facto void if the seller is found to have fraudulently concealed pertinent information, as meticulously delineated in Articles 2283 and 2284. Furthermore, the buyer is charged with the procedural duty to “join the seller as a party to the proceedings” should they be subjected to an action for dispossession, a procedural requirement meticulously designed to ensure the proper enforcement of the seller’s warranty obligation, as precisely stated in Article 2285. This embodies the foundational principle of warranty of quiet enjoyment.
Warranty Against Intrinsic Defects of the Thing
A fundamental legal principle dictates that the seller guarantees the intrinsic conformity of the thing to the contractual stipulations and its absolute freedom from inherent defects, a comprehensive warranty established by Article 2287. Non-conformity formally arises in instances where an incorrect quantity, a materially different object, or an article of a divergent species is delivered, as lucidly elucidated in Article 2288. Defects, conversely, are indisputably present when the thing demonstrably lacks qualities requisite for its normal or particular intended use, or unequivocally fails to possess specific qualities expressly stipulated by the contract, according to Article 2289. The quintessential determination of conformity and the absolute absence of defects is generally assessed at the precise moment of the transfer of risks, as meticulously articulated in Article 2290.
Upon receipt, the buyer is encumbered with the peremptory duty to “without delay examine the thing” with all feasible expedition and diligence, as mandatorily prescribed by Article 2291. Subsequent to such examination, the buyer must “without delay give notice” to the seller should any non-conformity or defect be ascertained, concurrently indicating the precise nature thereof, a requirement explicitly specified in Article 2292. Failure to provide such timely notification typically results in the forfeiture of the buyer’s correlative rights, save where the seller has formally acknowledged the existence of the defect or a latent defect is subsequently discovered. It is noteworthy that any intentional misleading conduct by the seller legally vitiates the requirement for precise or timely notification, as per Article 2293.
The seller possesses certain affirmative defenses against the invocation of this warranty. Such defenses include the buyer’s actual knowledge of the defects at the time of contract formation (Article 2295). Additionally, the warranty may not be successfully invoked for defects “so obvious that the buyer could overlook them only as a result of gross negligence,” unless the seller expressly declared the thing to be free from such defects or specifically warranted particular qualities (Article 2296). Crucially, any contractual clause purporting to exclude the warranty is rendered void ab initio if the seller is found to have fraudulently concealed the defects, a vital safeguard against deceptive commercial practices (Article 2297). Procedurally, the buyer is obligated to initiate legal proceedings pertaining to the warranty within “one year from his having given notice,” unless the seller engaged in intentional misleading conduct. This prescriptive period cannot be curtailed by agreement between the parties, as strictly provided by Article 2298. In sales of fungible things, the seller is granted the remedial right to rectify defects by replacing the defective items. For custom-made goods, the seller may effectuate remedial action for defects within a reasonable temporal frame, a remedial right firmly established by Article 2300. This section encapsulates the warranty of fitness for purpose and merchantability.
Auxiliary Obligations of the Vendor
Beyond the core duties hereinbefore described, the seller is also obligated to hand over all relevant documents, such as those pertaining to transport, where such practice is commercially customary, as per Article 2301. Furthermore, the seller must furnish all necessary information to enable the buyer to procure appropriate carriage insurance, provided such insurance is customary within the trade and explicitly requested by the buyer, as meticulously articulated in Article 2302.
Performance of Contract: The Obligations Incumbent Upon the Vendee
The primary obligations devolving upon the buyer are bifarious: firstly, to “pay the price”; and secondly, to “take delivery of the thing,” as precisely stipulated in Article 2303. These reciprocal duties complete the performance cycle intrinsic to the contract of sale.
Payment Particulars
The obligation to remit the price extends to undertaking “any step provided by the contract or by custom to arrange for or guarantee the payment,” as broadened by Article 2304. In cases where the price is determined by weight, the net weight is presumed in instances of doubt, a practical rule found in Article 2305. Should the price be determined by reference to a current price or market quotation, the thing is deemed sold at the prevailing price for the specified time and place of delivery, as meticulously specified in Article 2306. If the thing is customarily sold by the seller, it is deemed sold at the seller’s normal prevailing price, a default rule provided by Article 2307. In instances where an excess quantity is delivered, the buyer is afforded the option to accept or refuse the surplus. If accepted, the buyer is obligated to remunerate proportionally for the excess, in accordance with Article 2308. The locus of payment is determined by express contractual stipulation; otherwise, payment is to be made at the seller’s address. If payment is intrinsically linked to the physical handing over of the thing or relevant documents, payment is to be effectuated at that specific location, as per Article 2309. Regarding the temporal aspect of payment, for cash on delivery sales, the buyer is not legally bound to make payment until an adequate opportunity for examination has been afforded, a protective measure for the buyer enshrined in Article 2310. In stark contrast, for credit sales, payment becomes exigible as soon as the seller demands it subsequent to the delivery date, as precisely stated in Article 2311.
Cooperation and Taking Delivery
The buyer is further obligated to cooperate in a manner that duly facilitates the seller’s delivery and to undertake all necessary preparatory steps to complete the act of taking delivery, duties meticulously stipulated in Articles 2312 and 2313, thereby embodying the principle of mutual cooperation in contractual performance.
Common Obligations and Principles Appertaining to Both Vendor and Vendee
Certain obligations and jurisprudential principles transcend the specific roles of seller and buyer, applying broadly and universally to the entirety of the contractual relationship.
Apportionment of Expenses
Expenses incurred during the initial contract formation are typically borne by the buyer, as per Article 2314. Payment expenses are also customarily borne by the buyer, unless an alteration in the seller’s address directly occasioned additional cost, in accordance with Article 2315. Delivery expenses, comprehensively encompassing costs associated with counting, measuring, and weighing, are mandatorily borne by the seller, as specifically detailed in Article 2316. Any expenses arising subsequent to the act of delivery are to be borne by the buyer, according to Article 2317. Transport expenses, in cases where the thing is dispatched to a different geographical location, are customarily borne by the buyer, unless a “carriage-free” stipulation is explicitly present. Additional expenses incurred due to unforeseen interruptions during transit are to be borne by the party carrying the risks at that particular juncture, as meticulously outlined in Article 2318. Customs duties, specifically import duties, fall squarely within the responsibility of the seller. Any increases in these duties subsequent to contract formation are added to the agreed price, whilst decreases correspondingly reduce the price. The seller, however, bears exclusive liability for increases directly attributable to their own delay, as per Article 2319.
Preservation of the Thing
Should the buyer demonstrably delay in taking delivery or in remitting payment, the seller is burdened with the obligation to preserve the thing at the buyer’s expense and may lawfully retain it until fully indemnified, a right conferred by Article 2320. Conversely, if the buyer receives the thing and subsequently expresses an intent to refuse it, the buyer is likewise obligated to preserve it at the seller’s expense and may retain it until indemnified, as provided by Article 2321. To mitigate the burden of preservation, either party may seek legal relief from this obligation by consigning the thing to a third party or effecting its sale, as expressly allowed by Article 2322.
Transfer of Risks
A fundamental principle governing the law of sale dictates that when risks transfer to the buyer, the buyer is unequivocally obligated to remit the price even if the thing is subsequently lost or its value undergoes alteration, as precisely stated in Article 2323. The default rule stipulates that risks transfer upon “delivery… in accordance with the provisions of the contract or of this Code.” This principle remains applicable even if the thing does not conform to the contractual specifications, unless the contract is subject to cancellation or replacement of the thing is imperatively required, as per Article 2324. Risks also transfer to the buyer from the day they delay in remitting the price. For fungible things, this transfer of risk necessitates clear designation and explicit notice by the seller to the buyer, as specifically detailed in Article 2325. When a thing is under voyage, risks generally transfer upon its “handing over to the carrier,” unless the seller demonstrably possessed knowledge that the thing had perished or was damaged at the precise moment of contract formation, a crucial condition outlined in Article 2326. It is expressly clarified that “any provision relating to expenses… shall not in itself transfer the risks,” unequivocally emphasizing that the allocation of expenses does not inherently dictate the allocation of risk, as robustly stated in Article 2327. This section articulates the core principle of res perit domino, signifying that the risk of loss falls squarely upon the owner.
Non-Performance of Contract: Remedial Measures and Recourse
In instances of contractual non-performance, the aggrieved party is formally afforded various remedial measures, encompassing demands for forced performance, the cancellation of the contract, and claims for the recovery of damages.
Forced Performance
The buyer is vested with the legal prerogative to demand forced performance should it be “of particular interest to him” and the thing is not regularly delivered, a right meticulously specified in Article 2329. However, this right is subject to distinct limitations; it is not applicable if a “purchase in replacement” is commercially practical or easily achievable for the buyer. Furthermore, the buyer irrevocably forfeits this right if they delay in duly informing the seller of their unequivocal intent to demand performance, as meticulously delineated in Articles 2330 and 2331. In cases of non-conformity or defects, the buyer may demand the provision of new things, the supply of missing parts, or the correction of existing defects (if amenable to repair by the seller for custom goods), as provided by Article 2332. Conversely, the seller possesses the corresponding right to demand payment in cases of non-payment, unless a “compensatory sale” is commercially customary, as per Article 2333. When a sale is transacted according to specifications provided by the buyer, if the buyer subsequently fails to furnish such specifications, the seller is legally empowered to formulate them in accordance with known requirements and may then bind the buyer by providing due notice and a reasonable period for the provision of different specifications, as meticulously detailed in Articles 2334 and 2335. This section explores the equitable remedy of specific performance.
Cancellation of Contract
A general principle permits contracting parties to seek court-ordered cancellation or to unilaterally declare cancellation in strict accordance with the general provisions pertaining to contracts, as referenced in Articles 2336 and 2347.
Reasons for cancellation primarily attributable to the buyer include instances where the delivery date is explicitly compulsory (e.g., for goods subject to significant fluctuations in market prices); in such cases, non-delivery may directly and immediately lead to cancellation, as per Article 2337. For non-compulsory delivery dates, the buyer may grant a reasonable additional period for performance, and if delivery remains unfulfilled thereafter, the contract is deemed “cancelled as of right,” as rigorously specified in Article 2338. Cancellation may also be legally justified if delivery at an erroneous location constitutes a “fundamental breach” of the contractual terms, as precisely indicated in Article 2340. A defective title or actual dispossession of the buyer may also trigger the right to cancellation; this occurs if the seller has not provided full, clear, and unencumbered ownership (unless the buyer was aware of the encumbrance or if its significance was de minimis), or if the buyer is totally (or partially, if of significant import) dispossessed, as provided by Articles 2341 and 2342. In situations characterized by partial delivery or inherent defects, the buyer may elect to cancel the entire contract if they would not have entered into the contract had they possessed prior knowledge of the partial or defective execution; otherwise, partial cancellation or a proportionate price reduction may be sought, as per Articles 2343 and 2344. Should a defect affect only a segment of the thing, cancellation typically applies solely to the defective items, unless their separation is impractical or the defective item constitutes the principal component of the aggregate, as meticulously outlined in Articles 2345 and 2346.
Reasons for cancellation primarily attributable to the seller encompass the non-payment of the price, in which case the seller may declare immediate cancellation if such right is expressly reserved, or after a reasonable period for market-quoted goods, or following a court-granted grace period, as per Article 2348. Default in taking delivery by the buyer may also legally entitle the seller to cancel the contract, particularly if such default engenders a reasonable apprehension of non-payment or if taking delivery was an essential and fundamental term of the contract, as outlined in Article 2349. Finally, the seller may unilaterally cancel the contract if the buyer fails to provide specifications by a compulsory date or after a reasonable period subsequent to a request for such specifications, as stipulated in Article 2350.
Common grounds for cancellation applicable to both parties include circumstances involving successive deliveries, where one party’s non-performance or inherent defect justifies a reasonable apprehension regarding the integrity of future deliveries, as per Article 2351. Furthermore, if contractual performance becomes objectively impossible or is subjected to severe and unreasonable delay, thereby fundamentally undermining the basis of the contract, cancellation may be warranted, as provided by Article 2352. An anticipatory breach, wherein a party explicitly declares an unequivocal intent of non-performance prior to the due date, also constitutes valid grounds for cancellation, as strictly stated in Article 2353.
The legal effects of cancellation are profound. Parties are formally released from their respective outstanding obligations, “without prejudice to such damages as may be due,” a critical caveat explicitly contained in Article 2355 (1). Both parties are correspondingly entitled to claim restitution of what they have supplied, inclusive of any related expenses, as clearly clarified by Article 2355 (2). The seller is jurisprudentially obligated to refund the price received plus accrued interest, whilst the buyer must restore the thing itself and any profits derived therefrom, as prescribed by Article 2356. The buyer retains the right to cancellation even if the thing perishes or is damaged without their fault, but this right is legally abrogated if the buyer assigned, transformed, or damaged the thing through their own volitional act, as distinctly provided in Articles 2357 and 2358. This section discusses the equitable remedies of rescission and restitution.
Damages
Damages may be claimed for non-performance, irrespective of whether the contract is ultimately cancelled or judicially upheld, as generally affirmed by Article 2360. Should the contract be upheld, damages are to be determined in accordance with the general contract provisions, with interest accruing on delayed price payments, as per Article 2361. Where the contract is cancelled and the thing possesses a current market price, damages are to be calculated as “the difference between the price fixed in the contract and the current price” on the day the right to cancellation could have been exercised, in addition to normal expenses associated with replacement or a compensatory sale. The actual purchase or sale price may be considered, though it may be reduced if such transaction was conducted in bad faith, as provided by Articles 2362 and 2363. Higher damages may be judicially awarded in instances where special circumstances causing greater prejudice were known at the time of contract formation, or where non-performance resulted from intentional harm, gross negligence, or grave fault, as rigorously stipulated in Article 2364. For things lacking a discernible current market price, damages are to be assessed as the “prejudice which non-performance would normally cause,” as per Article 2365. In cases of anticipatory breach, damages are to be meticulously calculated based on the market price prevalent on the last day of the performance period or the day the cancellation right could have been exercised, subject to limitations based on actual replacement or compensatory prices, as precisely outlined in Article 2366. Finally, in instances of dispossession, the seller is unequivocally obligated to reimburse all judicial and extrajudicial expenses incurred by the buyer in the proceedings, in addition to any other applicable damages, as specifically detailed in Article 2367. This segment addresses the assessment of compensatory damages and the overarching principle of foreseeability in damage calculation.
Various Forms of Sale: Specific Statutory Provisions
The Civil Code delineates specific provisions applicable to various distinct forms of sale, addressing the unique characteristics and attendant requirements of each.
Sale of Cattle and Other Living Animals
Sales involving cattle and other living animals are subject to the preceding general articles, augmented by specialized provisions, as noted in Article 2368. A key element is the legal warranty against contagious diseases, whereby the seller guarantees the animal’s freedom from a specific enumeration of such diseases. Any contractual stipulation to the contrary is rendered “of no effect” ab initio, serving as a protective measure for the buyer, as firmly established in Articles 2369 and 2370. The warranty for general defects applies if the animal is “not fitted for the purpose to which it is destined by its nature or under the contract.” Parties retain the prerogative to contractually exclude the warranty for specific defects or to extend it to cover certain qualities, as permissibly outlined in Articles 2371 and 2372. Remedial actions available to the buyer include the undisputed right to cancel the sale for contagious diseases or warrantable defects. Should the animal succumb to such a disease or defect, the entire loss is borne by the seller, who is correspondingly obligated to refund the price, as stipulated in Articles 2373 and 2374. Damages may be legitimately claimed from the seller if they expressly guaranteed the absence of disease or defect, or if they demonstrably possessed knowledge thereof at the precise time of delivery, as per Article 2375. The buyer irrevocably forfeits these rights if they fail to have the disease or defect expertly ascertained and to duly notify the seller within the agreed timeframe, or within thirty days if no specific time is fixed, a mandatory requirement in Article 2376.
Sale by Sample
In a sale by sample, the intrinsic qualities of the thing delivered must precisely and unequivocally conform to those of the provided sample, thereby establishing the sample as benchmark principle. Should a discrepancy exist between the sample and a descriptive account, the sample shall axiomatically prevail. Conversely, if differences exist but do not constitute a discrepancy, the thing is expected to embody a harmonious combination of both sets of qualities, as meticulously articulated in Article 2377. The party entrusted with the custody of the sample bears the burden of proving its identicality to the one originally received by the other party, as specifically detailed in Article 2378. It is critically important to note that a transaction is not to be jurisprudentially considered a sale by sample if the seller can demonstrably prove that the sample was furnished solely for informational purposes, without any undertaking of conformity, as clearly clarified in Article 2379.
Sale on Trial
In a sale on trial, the buyer is formally afforded a designated period within which to declare either acceptance or refusal of the thing, such period being either contractually stipulated or a reasonable duration set by the seller, as per Article 2380. Silence on the part of the buyer bears differing legal implications: if the thing was previously delivered for trial, silence implies acceptance; conversely, if the thing was not delivered for trial, silence is unequivocally deemed a refusal, as provided by Article 2381. Implied acceptance may also legally arise through specific overt actions, such as payment without reservation or the disposal of the thing beyond what is strictly necessary for trial purposes, according to Article 2382. A distinct and salient feature of this form of sale is that risks remain solely with the seller until the buyer formally and unequivocally accepts the thing, even subsequent to delivery, as precisely stated in Article 2383, thereby diverging markedly from the general rules governing risk transfer.
Sale by Installments
Should the buyer default on an installment payment, the seller is legally granted the option to recover the outstanding installment or to cancel the contract, provided this right is expressly and unambiguously reserved within the contractual terms, as per Article 2384. Upon such cancellation, the parties are mutually obligated to return payments previously exchanged. The seller may legitimately claim “fair rent and an indemnity for the wear and tear” of the thing. Any contractual stipulations imposing more onerous obligations upon the buyer than those statutorily prescribed are deemed null and void, serving as a protective measure for the buyer, as firmly established in Article 2385. The seller’s right to demand the full outstanding balance of the price is strictly restricted to instances where the buyer is “in arrears for two consecutive payments representing together not less than one tenth of the price.” Similarly, any more onerous stipulations regarding this exigibility are considered void ab initio, as specifically detailed in Article 2386, reflecting overarching principles of consumer protection.
Sale with Ownership Reserved
The reservation of ownership by the seller until full payment is remitted is legally effective against third parties exclusively if it is “entered in a public register,” thereby ensuring its publicity and enforceability. Special conditions apply to bankrupt third parties under the Commercial Code, as expressly noted in Article 2387. Notwithstanding the reservation of ownership, risks are exclusively borne by the buyer “from the time when the thing is delivered to him,” representing a critical distinction from the point of ownership transfer, as per Article 2388. Should the contract be cancelled, the seller is unequivocally obligated to return any partial payments previously received. The seller is, however, legally entitled to claim “fair rent and an indemnity for the wear and tear.” As with installment sales, any contractual stipulations imposing more onerous obligations upon the buyer are deemed void ab initio, as precisely provided by Article 2389.
Sale with Right of Redemption
The seller may contractually reserve the prerogative to redeem the sold thing within a specified period, a legal mechanism known as redemption. This redemption period is statutorily limited to a maximum duration of two years; if no period is expressly specified, it defaults to two years, as stated in Article 2391. A prohibition on the buyer’s assignment of the thing is legally effective against third parties only if duly recorded in a public register, thereby ensuring proper notice, as per Article 2392. Upon the exercise of the right of redemption, the seller is obligated to refund the price originally received and any contract expenses. Rules pertaining to unlawful enrichment are jurisprudentially applicable to the buyer’s expenses incurred on the thing, unless otherwise contractually agreed, as meticulously outlined in Article 2393.
Sale with Obligation to Forward the Thing
In sales involving the forwarding of the thing, the seller is obligated to arrange the necessary carriage contracts under usual commercial conditions, as per Article 2394. Delivery is generally considered effected by the physical “handing over of the thing to the carrier,” though rules may vary for the seller’s own transport or in cases involving successive carriers, as specifically detailed in Article 2395. Should the thing handed to the carrier not be clearly and unambiguously designated for the specific contract (e.g., incorrect address), delivery is not deemed complete unless the seller duly notifies the buyer and dispatches descriptive documents, as provided by Article 2396. For water carriage, delivery is formally effected by placing the thing on board a vessel or by ship, according to Article 2397. The seller retains a distinct right of retention, permitting them to postpone forwarding until paid if they lack effective control over the thing during its voyage. If the seller maintains such control, they may object to delivery to the buyer at the destination until payment is remitted, as strictly stated in Article 2398. When a bill of lading or a similar negotiable document is issued, payment may only be demanded against its due transfer. The buyer is legally precluded from refusing payment due to a lack of opportunity for examination. The transfer of such documents constitutes an “essential provision” of the contract, as per Article 2399. The seller also possesses the well-established right of stoppage in transit, allowing them to object to delivery if the buyer becomes insolvent, even if the buyer possesses the bill of lading. This right is curtailed if a third party in regular possession requires delivery and the document is clean, or if the third party knowingly acted to the seller’s detriment, as outlined in Article 2400. Should the thing be forwarded and placed at the buyer’s disposal, and the buyer subsequently intends to refuse it, the buyer is obligated to take possession on the seller’s behalf, provided it is feasible without payment or undue inconvenience/expense, unless the seller or a designated representative is present at the destination, as stipulated in Article 2401. Examination by the buyer is to occur at the designated destination. If the thing is subsequently re-dispatched without transshipment, examination is legitimately postponed until the new destination, provided the seller was aware of the re-dispatch possibility, as per Article 2402.
Sale by Auction
In a sale by auction, the contract is definitively concluded by the “auction which the seller or the auctioneer makes of the thing.” The auctioneer is generally entitled to knock down the article to the highest bidder, as provided by Article 2403. Bidders are legally bound by their submitted offers, but are released from such obligation if a higher bid is subsequently made or if their offer is not accepted immediately following the calls, as per Article 2404. Unless otherwise stipulated, the bidder is obligated to remit payment in cash. The seller retains the right to immediately cancel the sale if payment is not duly remitted, as strictly stated in Article 2405. With regard to warranty, in public or voluntary auctions, the seller provides the same warranty as is customary in ordinary sales, as per Article 2406 (1). Conversely, in compulsory auctions, the seller warrants solely in cases of demonstrable fraud, as per Article 2406 (2). The distrainer, being the party at whose behest the auction is conducted, warrants conformity to the description and is held liable for fraud, as meticulously outlined in Article 2407.