- Court of Appeal of Buenos Aires
- Nea Commerce S.A. vs. SKY Argentina SCA
BROADCASTING SERVICE CONTRACT - BETWEEN TWO ARGENTINIAN COMPANIES
UNIDROIT PRINCIPLES AS A MEANS OF INTERPRETING APPLICABLE DOMESTIC LAW (ARGENTINIAN LAW)
STANDARD TERMS BETWEEN BUSINESS PERSONS - TO BE INTERPRETED BASICALLY IN THE SAME WAY AS INDIVIDUALLY NEGOTIATED TERMS AND UNENFORCEABLE ONLY IN EXCEPTIONAL CIRCUMSTANCE - REFERENCE TO ARTICLES 2.1.20, 2.1.21 AND 2.1.22 UNIDROIT PRINCIPLES
Two Argentinian companies entered into an agreement according to which Claimant undertook to set up the equipment necessary to permit Defendant to broadcast its television programmes in Argentina ("the Agreement". The Agreement, which was in the form of standard terms prepared by Defendant, provided for a one year term subject to renewal by Defendant. When, at the end of the first year, Defendant decided not to renew the Agreement, Claimant commenced arbitral proceedings claiming damages on the ground that Defendant had violated, if not the express terms of the Agreement, its content as resulting from its scope as apparent from, among others, the negotiations.
The arbitral tribunal decided basically in favour of Defendant, prompting Claimant to challenge the award before the Court of Appeal of Buenos Aires.
The Court of Appeal confirmed the decision of the arbitral tribunal and in so doing pointed out that the Agreement expressly provided for a term of one year only after which Defendant was entitled not to renew it. According to the Court the fact that the Agreement was contained in standard terms prepared by Defendant was irrelevant: indeed standard terms are to be considered an expression of party autonomy and, at least between business persons, are to be interpreted basically in the same manner as individually negotiated terms and can be invalidated only in exceptional circumstances such as the violation of the principle of good faith. In support of its decision based on the applicable Argentinian law, the Court referred to Articles 2.20, 2.21 and 2.22 (now Articles 2.1.20, 2.1.21 and 2.1.22) of the UNIDROIT Principles.