According to the Universal German Commercial Law, and later, according
to the Civil Code of Law, the buyer has the right to cancel the
contract, or to demand a reduction in price, if the goods delivered do
not equal the quality guaranteed.
Experts had to decide, whether the quality tendered was up to the
guarantee.--These experts were appointed by the law, in accordance with
the proposals of the parties concerned. The cotton trade followed, in
olden days, this same procedure, but the weak point, was the verdict of
the experts, because there were no experts in Germany outside Bremen,
and no party could forecast the likely result of the verdict. A far
worse consequence of the Law Conditions was for the cotton trade, the
fact, that the law made no difference, whether the goods differed much
or little from the stipulated quality. In both cases, the buyer had the
right to place the goods at the disposal of the seller. The result of
this, was most damaging to the Trade, sometimes, the sellers had the
worst of it, sometimes the buyers. A few examples taken from actual
experience will best explain this:
Extracts from business letters of past years.
We have received to-day your 100 bales of cotton, but find the
quality not up to our expectations. You have to deliver us
middlingfair, but the cotton is hardly goodmiddling. We cannot use
the cotton, as it is unsuitable for our hosiery yarns. We place the
100 bales at your disposal.
* * * * *
We insist upon your taking delivery of the 100 bales. The quality
is perfectly correct, you can ask any expert in Bremen about it.
* * * * *
We have nothing to do with your Bremen Experts, if need be, our
local experts will decide. We have no doubt that you know the law
on this point. The fact remains, that we place the 100 bales at
your disposal.
* * * * *
Your intention to place the 100 bales at our disposal is caused, no
doubt, by the fall in prices. We know very well that if it comes to
law, experts will decide, who know nothing about it, moreover, the
verdict will only be given after many months. This is unbearable;
what allowances do you want?
* * * * *
If you wish us to use the cotton, we demand an allowance of....
* * * * *
Your demand is preposterous, but we have to agree to it, as we
cannot help ourselves. We prefer not to make you any offers in
future.
* * * * *
I am sorry to inform you, that the 100 bales are not equal to the
sample, consequently, I place the cotton at your disposal.
* * * * *
The buying sample has been taken from the actual bales delivered, a
difference in the quality is quite impossible. We insist upon your
keeping the 100 bales.
* * * * *
I am sending you a few samples of the delivered cotton, any child
can see that they are different from the buying sample.
* * * * *
The samples sent to us are of no account. 100 bales represent a big
quantity of cotton, amongst which, a few inferior flakes are sure
to be found, if one searches diligently for them. We cannot agree
to your demands.
* * * * *
My lawyer tells me, that every bale and every part of the bales
must be equal to the sample. I have opened several bales and find
the contents very irregular. There are good and bad flakes in them,
I can only use regular cotton. The 100 bales are at your disposal.
* * * * *
Your 100 bales turn out very badly indeed and are much below the
guaranteed quality. What allowance are you willing to make us?
* * * * *
There can be no question of an allowance, if the 100 bales do not
suit you, why do you not place them at our disposal, as you did in
a previous case. This time, however, prices have advanced, while
last time, they had fallen, now perhaps the case will appear to you
in a different light.
* * * * *
You surely never expect me to take bad cotton instead of good? I
cannot return the cotton, as I cannot stop my mill. I propose, that
experts fix the lower value, and you pay me the difference
according to law.
* * * * *
If you wish to invoke the law, you must remember, that the cotton
is not allowed to be touched, till the experts have made their
report and the legal verdict has been given. You say, "you must use
the cotton at once," while our agent tells us, "that a few bales
have already been spun." This finishes your claim, and we refuse to
do anything in the matter.
* * * * *
A spinner bought direct from America 100 bales of a certain class.
The market rose rapidly, and when the bales arrived, they were much
inferior, in fact, fully two classes too low. The spinner
complained bitterly to the shipper, and demanded an allowance,
which the latter refused, on the plea, that, for the price of the
contract, he could only deliver low quality.
* * * * *
From these examples it will be seen that the cotton Trade had no
suitable foundation in the Law.