ABSTRACT
Nevertheless it seems apparent that “loss” does not include attorneys’ fees incurred in the litigation of a suit for breach of contract, though certain pre-litigation legal expenditures, for example expenditures designed to mitigate the plaintiff’s damages, would probably be covered as “incidental” damages. [. . .] The Convention is about contracts, not about procedure. The principles for determining when a losing party must reimburse the winner for the latter’s expense of litigation are usually not a part of a substantive body of law, such as contract law, but a part of procedural law. For example, the “American rule,” that the winner must bear his own litigation expenses, and the “English rule” (followed in most other countries as well), that he is entitled to reimbursement, are rules of general applicability. They are not field-specific. There are, however, numerous exceptions to the principle that provisions regarding attorneys’ fees are part of general procedure law. For example, federal antidiscrimination, antitrust, copyright, pension, and securities laws all contain field-specific provisions modifying the American rule (as do many other field-specific statutes). An international convention on contract law could do the same. But not only is the question of attorneys’ fees not “expressly settled” in the Convention, it is not even mentioned. And there are no “principles” that can be drawn out of the provisions of the Convention for determining whether “loss” includes attorneys’ fees; so by the terms of the Convention itself the matter must be left to domestic law (i.e., the law picked out by “the rules of private international law,” which means the rules governing choice of law in international legal disputes). U.S. contract law is different from, say, French contract law, and the general U.S. rule on attorneys’ fee shifting (the “American rule”) is different from the French rule (loser pays). But no one would say that French contract law differs from U.S. because the winner of a contract suit in France is entitled to be reimbursed by the loser, and in the U.S. not. That’s an important difference but not a contract-law difference. It is a difference resulting from differing procedural rules of general applicability. The interpretation of “loss” for which Zapata contends would produce anomalies, which is another reason to reject the interpretation. On Zapata’s view the prevailing plaintiff in a suit under the Convention would [. . .] get his attorneys’ fees reimbursed more or less automatically (the reason for the “more or less” qualification will become evident in a moment). But what if the defendant won? Could he invoke the domestic law, if as is likely other than in the United States that law entitled either side that wins to reimbursement of his fees by the loser? Well, if so, could the plaintiff waive his right to attorneys’ fees under the Convention in favor of domestic law, which might be more or less generous than Article 74, since Article 74 requires that any loss must, to be recoverable, be foreseeable, which beyond some level attorneys’ fees, though reasonable ex post, might not be? And how likely is it that the United States would have signed the Convention had it thought that in doing so it was abandoning the hallowed American rule? To the vast majority of the signatories of the Convention, being nations in which loser pays is the rule anyway, the question whether “loss” includes attorneys’ fees would have held little interest; there is no reason to suppose they thought about the question at all. For these reasons, we conclude that “loss” in Article 74 does not include attorneys’ fees [. . .]
bb) Currency devaluation Whether loss resulting from the devaluation of currency may be recovered under the CISG is disputed. Read thereto the following case abstract.
