The Latest Case Law on Swiss Commercial Contracts
Case Law
Sale of business
No Knowledge, No Fraud: Warranty disclaimer upheld despite hidden defects
The Swiss Federal Supreme Court confirmed the validity of an exclusion of warranty (disclaimer of liability) in a sale contract because the seller lacked actual knowledge of the hidden defect at issue and thus had not fraudulently concealed it under article 199 of the Swiss Code of Obligations (SCO).
Simple partnership
Real estate development and silent partnership: appearances may not always be deceiving
Unlike in a simple partnership, the silent partner in a silent partnership is not liable for a debt incurred by the general partner under a work contract with a contractor in a real estate development project.
Share purchase agreement
Right of First Refusal and Obligation to Sell: How to reconcile two interrelated contractual clauses?
When shareholders have agreed to a right of first refusal alongside an obligation to sell under certain circumstances, it remains uncertain whether a shareholder who is obliged to sell must formally notify the other shareholders to allow them to exercise their right of first refusal.
Share purchase agreement
Interpretation and scope of a non-competition clause in a share purchase agreement and judicial reduction of an excessive penalty
This Federal Supreme Court decision concerns a dispute arising from the breach of a non-competition clause in a share purchase agreement between two companies. The court confirmed the breach but upheld a reduction of the contractual penalty on the grounds that it was excessive.
Sale of goods
Risk Transfer under the CISG for Gold (allegedly) Stolen in Ghana
The Federal Supreme Court clarifies the conditions for risk transfer under the CISG and joint liability under the SCO. The Court confirms that when it comes to sales contracts involving transportation of goods, risk remains with the seller until the goods have been delivered to the carrier, and that joint liability can be established through contractual form as well as subsequent conduct.
Insurance agreement
Can the Massive Increase of Insurance Premiums for Private Room Supplementary Insurance be a Ground for Contract Invalidation?
A policyholder suffering from leukemia has benefited from supplementary private room insurance for years. During the coverage period, the insurance company has increased the insurance premium by a staggering amount. The policyholder unsuccessfully tried to invalidate the contract to obtain a partial refund of the premiums paid.