Chapter 2 Quantity Clause

2.1 The Systems of Weights and Measures

Any business deal consists of a certain quantity of goods supplied by the seller and a certain sum of money paid by the buyer. Without a certain quantity of goods, any business deal would be groundless. Thus, quantity clause is also one of the essential terms and conditions in a contract. It is required that the seller's delivery quantity must be identical to that stipulated in the contract; otherwise, the buyer reserves the right to claim for compensation and even reject the goods.

British Sale of Goods Act 1893（1993 Revision）provides, “if the quantity delivered by the seller is greater than the amount stipulated in the contract, the buyer is entitled to reject the goods excessive in quantity, or he may reject the whole lot”.

United Nations Convention on Contracts of International Sale of Goods also states, “the quantity of goods delivered should be identical to that called for in the contract, otherwise the buyer is entitled to reject the portion of goods excessive in quantity, and to claim against the seller if the quantity is found to be less than that called for in the contract. If the seller delivers a quantity of goods greater than that provided for in the contract, the buyer may take delivery or refuse to take delivery of the excess quantity. If the buyer takes delivery of all or part of the excess quantity, he must pay for it at the contract rate”.

Since the quantity agreed by both parties is the basis of delivery, it is of great significance to command quantity and conclude quantity clause in the transaction correctly. The main content of quantity clause includes measurement units, systems of calculating units, methods of calculating weight, etc. If the delivery is less than the agreed quantity, the seller should make up for the shortage within the time limit, but even so, the buyer reserves the right to lodge a claim.

Because different countries have different systems of calculating units, such as length, capacity and weight, the units of measurement vary from a country to another. Furthermore, the same unit of measurement may represent different quantities. Take example of“ton”. There are various“tons”weighing differently indifferent systems such as long ton/English ton（2240 lbs）, short ton/American ton（2000 lbs）and metric ton/French ton（about 2204 lbs）. Therefore, it is greatly important for the traders to know the units of measurement in different systems and the way how they are converted in to another. The commonly used systems in the world are the metric system, International System of Units, British system and U.S. system. What unit of measurement should be chosen in the contract should be in accordance with the nature of the goods.

In addition, each country also has its own customary measurement method. For example, cotton per pack is 480 pounds in the United States, 398.8 pounds in Brazil, 730 pounds in Egypt; sugar per bag is 133 kilograms in Cuba,60 kilograms in Brazil. As the above countries are the world's traditional distribution centers of commodities in international trade, the above measurement standards are considered as appropriate when signing a contract.

2.1.1 Metric System

There are two categories of metric units, which are used to show the quantity of commodity in international trade. One is the metric unit, including weight, length, area, volume and capacity, the other is numbers, including some customary units such as dozen, gross, great gross, ream, and some packing units like barrel, bale（cotton）, etc.

The main units are kilogram（kg）, meter（m）, square meter（sq m）and liter（l）. Some other units are metric ton（M/T）, kilometer（km）and so on. This system is widely used in European continent and many other countries.

2.1.2 International System of Units

The system is published by the International Standard Metrical Organization, and is based on metric system. Its primary units include kilogram, meter, second, etc. this is China's legal metrical system.

2.1.3 British System

Under this system, primary units are pound and yard. It is adopted by the British Commonwealth. However, announcement of abandoning this system has been made by British since it has been a member of European Union. It presently uses the metric system.

2.1.4 The U.S. System

The primary units are the same as British system, this is, pound and yard. But there are differences in some units. For instance, while the long ton（L/T）in British system equals to 2200 pounds, the short ton（S/T）equals to 2000 pounds. Besides, some capacity units like gallon and barrel are of the same names under British system and the U.S. system, but the actual capacities are different.

2.2 Quantity Units

Generally, the following measuring units are adopted in China:

2.2.1 Number

It is constantly used for measurement of industrial manufactured products and general product such as ready-made clothes, stationery, paper, toys and so on, such as piece（pc）, package（pkg）, pair, set, dozen（doz）, gross（gr）, ream（rm）, roll, coil, etc.

2.2.2 Weight

This is the most frequently used method in international trade at present. It is usually used for mineral products, agricultural and by-products such as wool, cotton, grains and ore products. When it is used in the contract, there are metric ton or kilo ton, long ton or gross ton, short ton or net ton, gram（g）, kilogram（kg）, ounce（oz）, pound（lb）, quintal, hundred weight（or cwt）, etc.

2.2.3 Length

It is mostly used for textile products metal cords, electric wires, ropes and so on, such as meter（m）, foot（ft）, yard（yd）, etc.

2.2.4 Area

It is often used in trade of glass, textile products such as carpets, etc., like square meter （sqm）, square foot（sq ft）, square yard（sq yd）and the like. Often, we add thickness in the contract.

2.2.5 Volume

It is generally used for timber, wood, chemical gases, etc. It includes cubic meter（cu m）, cubic centimeter（cu cm）, cubic foot（cu ft）, cubic yard（cu yd）, etc.

2.2.6 Capacity

It is mostly used for grain, petroleum/gas, liquid cargoes, etc. The commonly used capacity units are liter（l）, gallon（gal）, pint（pt）, bushel（bu）and so on.

2.2.7 Package

It is often used in the packing of cement, cotton, tin food and so on, such as bag, carton, case, bale, etc.

2.3 Methods for Calculating Weight

Within the international trade, goods are most often measured in the units of weight. The methods to measure the weight of goods are stated as follows.

2.3.1 Gross Weight: Gross for Net

Gross weight is the sum of total weight of the commodity itself and the tare（the package weight）. That is to say it refers to the net weight plus the tare weight of the goods. Some products, for example sack-packed rice or horse bean, are measured in gross weight as net weight, since their unit value is not very high and the weight of it packaging can be negligible. Under this situation, the method is called Gross for Net.

2.3.2 Net Weight

Net weight is the actual weight of commodity itself without the addition of the tare. In international trade if the goods are sold by weight, the net weight is often used.

Net weight=gross weight-tare weight

There are four ways to calculate tare weight.

（1）By actual tare: the actual weight of packages of the whole commodities.

（2）By average tare: in this way, the weight of packages is calculated on the basis of the average tare of a part of the packages.

（3）By customary tare: the weight of standardized package has a generally recognized weight which can be used to represent the weight of such packages.

（4）By computed tare: the weight of package is calculated according to the tare previously agreed upon by the seller and the buyer instead of actual weight.

It is customary to calculate the weight by net weight if the contract does not stipulate definitely by gross weight or by net weight. Occasionally, the weights of some commodities are usually calculated by conditioned weight and theoretical weight. Conditioned weight is obtained with the moisture content of the commodity removed by scientific methods and the standardized moisture added. It is often applicable to such commodities as raw silk and wool, which are of high economic value and with unsteady moisture content. Commodities with regular specifications and regular sizes, such as galvanized iron and steel plate, are suitable to be weighed by theoretical weight which is computed by the total number of the sheets.

2.3.3 Conditioned Weight

This refers to the kind of weight derived from the process, with which the moisture content of the commodity is removed and standardized moisture added both by scientific methods. This kind of calculating method is suitable to those cargoes, which are of high economic value and with unsteady moisture content（whose water contents are not stable）, such as wool, raw silk, etc.

2.3.4 Theoretical Weight

Commodities that have regular specifications and fixed regular size, such as galvanized iron, tin plate and armor plate are often subject to the use of theoretical weight. So long as the specifications and the size of such commodities are the same, their theoretical weight is constructed by the number of the sheets put together. Some fixed cargoes, such as tin plate and steel plate, have unified shapes and measurement, as long as the specification is identical, the size is conformable, the weight will be about the same, and we can calculate the weight according to the number of pieces.

Theoretical Weight = Unit Weight × Quantity

2.3.5 Legal Weight

Legal weight is the weight of the goods and the immediate package of the goods. Such kinds of goods include cans, small paper boxes, small bottles, etc.

Legal Weight = Net Weight + Tare（Immediate Package）

2.3.6 Net Net Weight

Subtracting outer packaging weight from the gross weight is net weight, and then subtracting inner packaging in direct contact with the commodity is“net net weight”.

Within the international trade, it is customary to calculate the weight by net weight if a contract does not stipulate definitely by gross weight or by net weight.

2.4 Quantity Clause in the Contract

The quantity clause of a sales contract is the foundation for effecting delivery of the goods. The basic contents of the quantity clause consist of two parts—the quantity to be delivered and the measurement to be used. If the quantity is calculated by weight, the clause should also indicate the way of calculating weight such as gross weight, net weight, conditioned weight, etc. The contents of the quantity clause can be various depending on the characteristics of goods.

2.4.1 More or Less Clause

At the time of the conclusion of a contract, the quantity clause should be clearly and definitely stipulated so as not to give rise to disputes thereafter, expressions like“about or approximate 10,000 metric tons”would not be allowed because“about or approximate”may be given several ambiguous interpretations: some refer to 2% more or less, and some 5%, and some 10%. However, it is very difficult to measure accurately those bulk goods of agricultural and mineral products like corn, soybean, wheat, coal, etc. in some cases, because of the change of the limitation of processing of the goods resources, the quantity of the goods last delivered may be not in accordance with the stipulations in the contract. What's more, influenced by natural conditions, packing patterns, loading and unloading methods, the quantity of goods delivered by the seller usually doesn't conform to the quantity definitely stipulated in the contract. In order to facilitate the processing of the contract, the seller and the buyer, generally, will stipulate quantity difference when stipulating the quantity clause and agree to use“more or less clause”, or“plus or minus clause”. It means over-load and under-load are permitted but should not surpass a certain percentage of the stipulated quantity. That's to say both the seller and the buyer agree to allow some more or less of the goods delivered, but not beyond the fixed percentage range agreed upon before, for instance, “20,000 metric tons,5% more or less at seller' option”, or“Zinc ingot:10,000 metric tons, with 7% more or less”. “Plus, or minus”or the sign“+ or -”might also be used to take the place of“more or less”. Under the more or less clause, the payment for the over-load or under-load will be made according to the contract price or at the market price at the time of shipment.

According to the convention, when the numbers or items of some commodities（such as automobiles, color televisions and other manufactured goods）can be accurately calculated, it is suitable to adopt more or less clause. Also, as stated in the CISG, “the words ‘about',‘approximately', ‘circa' or similar expressions used in connection with the amount of the credit or the quantity or the unit price stated in the credit are to be construed as allowing a difference not to exceed 10% more or 10% less than the amount or the quantity or the unit price to which they refer.”Sometimes, we can put words such as“about”, “circa”, “approximately”in front of the quantity in the contract to indicate the quantity allowance. But, up to now there are no uniform interpretations of these words, that is, they represent a different amount of quantity allowance in different nations. It is advisable to employ the method in practice.

A complete more or less term should include the following three parts:

（1）First, there is a certain proportion. The range of quantity difference is usually expressed by percentage such as range from 3% to 5%. Different commodities decide how much the range of quantity difference should be. For some commodities with lower value such as sandstone or coal, it is allowed to stipulate a wider range, usually 10% more or less. For some products like metals and minerals, quantity difference should be set within a smaller margin. The trader can also make a variety of provisions in the more or less clause accordingly, one of which is stipulating quantity difference of the contracted quantity by percentage, without specific range for each batch. As long as the quantity delivered by the seller is within the range, it is regarded as delivery in accordance with the contract. Another method is stipulating specific range for each batch besides the overall quantity difference of the contracted quantity. （2）Secondly, who should determine how much more or less would be allowed? Generally, the seller is to decide the quantity difference in practice. As stipulated in a contract, it is also practical to allow the shipper or the party in charge of shipment to decide the quantity according to the capacity of cabin. For example, under the FOB terms, it is the buyer to charter a liner to carry the goods, so in the contract we can stipulate that the shipper or the buyer determines the quantity difference.

（3）Thirdly, pay attention to the calculation of more or less clause. Under the more or less clause, the payment for the over-load or under-load portion will be made either according to contract price or at the international market price at the time of shipment or arrival so that when international market price fluctuates, the seller cannot take advantage of the more or less clause to load more or less on purpose and harm the interests of the buyer.

2.4.2 Attentions when Making Quantity Clauses

Important points that should be taken into notice when making quantity terms.

（1）Understanding very clearly the whole quantity to be delivered both for import and export；

（2）The supply conditions at home market；

（3）The supply conditions at abroad market；

（4）The financial standing and management capability of the foreign customers；

（5）The price fluctuation both at the world's market and at the domestic market.

As for the quantity terms in the contract, we should make the terms very specific and clear. In order to avoid unnecessary disputes, the quantity terms in the contract should be made very specific and clear. It is better not to use the words like“about”, “approximate”, “or so”, etc. This is because there is different understanding for these words, which will cause ambiguity. It should be also very clear for quantity units. For example, if it is calculated by tons, there will be M/T, or L/T, or S/T. For the goods calculated by weight, the specific calculating method should be stipulated, such as“gross for net”.

2.4.3 Sample Quantity Clauses

The quantity clauses have varied forms and contents depending on different industries and situations, and the following are some typical examples:

（1）Bleached cotton clothing 25,000 yds., with 5% more or less at seller's option.

（2）Chinese northeast soybean:6,000 M/T, gross for net,3% more or less at carrier's option.

（3）500 metric tons,5% more or less at buyer's option.

（4）The seller is allowed to load 3% more or less, the price shall be calculated according to the unit price in the contract.

（5）To be packed in double gunny bags containing about 100 kgs and each bag shall weigh 1.15 kgs with allowance of 0.1 kg more or less；

（6）It is agreed that a margin of 10 % shall be allowed for over or short count.