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Wednesday, 05 February 14
MARKET INSIGHT - TASOS PAPADOPOULOS
 KNOWLEDGE TO ELEVATE
COALspot.com: Let's take a break from market prospects, numbers, order book etc. and shed some light on the conclusions of the Tribunals in two recently decided cases, namely "The Union Power" and "The Griffon", which any prudent Seller/Buyer should be aware of before entering into an MOA for a secondhand tonnage. In "the Griffon" case an MoA based upon NSF 93 had been signed on 1st May 2010 for the purchase of m/v Griffon. A deposit of 10pct (i.e USD 2,156,000) was payable within 3 banking days of signature; that is by 5th May, 2010. The deposit was not paid by that date and Sellers, on 6th May, 2010 cancelled the MOA as per their express contractual right and claimed the deposit. Buyers had accepted that their failure to pay the deposit was in breach of contract but argued that Sellers should only be entitled to claim "compensation for losses" (as per clause 13 ) and not the whole deposit.
The Court of Appeal confirmed that Buyers are liable for the amount of the (unpaid) whole deposit, if the MOA is terminated as a result of Buyers’ breach. This heralds a departure from the previously held view that under clause 13 of NSF 93, where a Buyer fails to pay the deposit under clause 2, Sellers "shall have the right to cancel this Agreement, and they shall be entitled to claim compensation for their losses and for all expenses incurred together with interest" (which might be less than the amount of the deposit). During the arbitration it was argued that the damages recoverable by Sellers should be the difference between contract and market price which were said to be US$275,000; that is, substantially less than the deposit (i.e. USD 2,156,000). The Court however, concluded that Sellers are in fact entitled to claim the whole deposit in such circumstances.
Anyway, it would not make sense for Buyers to be able to put themselves in a better position than the one they would have been had they not paid the deposit. This case is a reminder to Buyers of secondhand tonnage that if they agree to pay a deposit, under standard NSF terms, they will lose the deposit if they fail to perform, even if Sellers suffer no loss. The case of "The Union Power" in turn, has caused us to re-assess the Sellers' obligation under clause 11 of NSF 93 (Condition on Delivery) and a different understanding of the terms "As is where is " and "As she was at the time of inspection". The MOA in this case, included clause 11 that stipulated that the vessel was to be “delivered and taken over as she was at the time of inspection, fair wear and tear excepted”. When the dispute arose, the buyers argued that a term as to satisfactory quality was to be implied into the MOA by way of s.14(2) of the Sale of Goods Act 1979 (SOGA). Sellers argued that the provision of clause 11, that the vessel was to be sold “as she was”, was inconsistent with implying such a term. The Commercial Court decided in favor of the Buyers, concluding that "class does not tell you the quality of the vessel, which is why the independent implied term as to satisfactory quality is required".
As a result, the effects of the expressions "As is" or "As is where is" no longer exclude the right of Buyers to claim for damages for breach of implied “quality” but only to exclude their right to reject the vessel and not take delivery of her as per the terms and provisions of the MOA. In my view, the above decision is contrary to the commercial common sense and market understanding that has been the basis for thousands of deals over the years.
However, it is worth mentioning that the new NSF 2012 includes wording under Clause 18 which excludes the SOGA regime. Ultimately, what matters is whether the parties have used express and clear wording, such as that of NSF2012, to exclude the SOGA regime if they wish to exclude the satisfactory quality rule.
Compiled by:
Intermodal Research & Valuations | research@intermodal.gr
Analysts:
Mr. George Lazaridis | g.lazaridis@intermodal.gr
Ms. Eva Tzima | e.tzima@intermodal.gr
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no re-producing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
Information contained within the website of COALspot.com is intended for informational purposes only and is not intended as professional counsel and should not be used as such.
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Saturday, 25 March 23
COAL INDIA HAS STRONG CASE TO INCREASE PRICES, TALKS ON: CMD AGRAWAL - BUSINESS STANDARD
Coal India (CIL) Chairman and Managing Director Pramod Agrawal said on Monday there is a “strong case” for increasing coal prices, and ...
Saturday, 25 March 23
ASIAN CRUDE PALM OIL WATCH 1Q23 - FITCH RATINGS
Malaysian benchmark crude palm oil (CPO) spot prices have averaged around USD915 per tonne (t) so far in 1Q23, sharply lower than the average of ar ...
Saturday, 25 March 23
INDONESIA’S COAL EXPORT INCREASED BY 21.0% YOY TO 388.4 MLN T IN 2022 - BANCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels. In the f ...
Saturday, 25 March 23
GLOBAL LNG-ASIA SPOT PRICES SLIP AS WEAK NORTHERN DEMAND REMAINS - REUTERS
Asian spot prices of liquefied natural gas (LNG) declined this week, falling to a 21-month low, as weak demand in the northeast Asia region continu ...
Wednesday, 22 March 23
OIL PRICE FALL SPECULATIVE, TO HIT $140 BY YEAR-END -ANDURAND: REUTERS
The recent fall in oil prices due to banking jitters is speculative and oil will hit $140 a barrel by the end of the year, hedge fund manager Pierr ...
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- Edison Trading Spa - Italy
- Coalindo Energy - Indonesia
- Global Business Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- AsiaOL BioFuels Corp., Philippines
- Orica Australia Pty. Ltd.
- Tamil Nadu electricity Board
- Electricity Generating Authority of Thailand
- Standard Chartered Bank - UAE
- Wilmar Investment Holdings
- PNOC Exploration Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mintek Dendrill Indonesia
- Aboitiz Power Corporation - Philippines
- Africa Commodities Group - South Africa
- Kohat Cement Company Ltd. - Pakistan
- Indian Energy Exchange, India
- Kobexindo Tractors - Indoneisa
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Therma Luzon, Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- Power Finance Corporation Ltd., India
- Chamber of Mines of South Africa
- VISA Power Limited - India
- Kumho Petrochemical, South Korea
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- Attock Cement Pakistan Limited
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Wood Mackenzie - Singapore
- Gujarat Electricity Regulatory Commission - India
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- CIMB Investment Bank - Malaysia
- GVK Power & Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Baiduri Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Central Java Power - Indonesia
- Formosa Plastics Group - Taiwan
- Bukit Makmur.PT - Indonesia
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- PetroVietnam Power Coal Import and Supply Company
- Meenaskhi Energy Private Limited - India
- Planning Commission, India
- SN Aboitiz Power Inc, Philippines
- Indika Energy - Indonesia
- Electricity Authority, New Zealand
- Singapore Mercantile Exchange
- Sical Logistics Limited - India
- Billiton Holdings Pty Ltd - Australia
- Larsen & Toubro Limited - India
- Savvy Resources Ltd - HongKong
- Bharathi Cement Corporation - India
- Merrill Lynch Commodities Europe
- Independent Power Producers Association of India
- Ministry of Finance - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Makarim & Taira - Indonesia
- Georgia Ports Authority, United States
- GAC Shipping (India) Pvt Ltd
- Antam Resourcindo - Indonesia
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Bhushan Steel Limited - India
- Maheswari Brothers Coal Limited - India
- Sojitz Corporation - Japan
- Semirara Mining Corp, Philippines
- Videocon Industries ltd - India
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Samtan Co., Ltd - South Korea
- Price Waterhouse Coopers - Russia
- Agrawal Coal Company - India
- Latin American Coal - Colombia
- Interocean Group of Companies - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Holcim Trading Pte Ltd - Singapore
- Rashtriya Ispat Nigam Limited - India
- TeaM Sual Corporation - Philippines
- London Commodity Brokers - England
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Sinarmas Energy and Mining - Indonesia
- MS Steel International - UAE
- Altura Mining Limited, Indonesia
- Kartika Selabumi Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- White Energy Company Limited
- Central Electricity Authority - India
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Bukit Asam (Persero) Tbk - Indonesia
- CNBM International Corporation - China
- Cigading International Bulk Terminal - Indonesia
- Australian Coal Association
- Heidelberg Cement - Germany
- Eastern Energy - Thailand
- The University of Queensland
- Coal and Oil Company - UAE
- Medco Energi Mining Internasional
- Oldendorff Carriers - Singapore
- Sarangani Energy Corporation, Philippines
- Goldman Sachs - Singapore
- GMR Energy Limited - India
- Deloitte Consulting - India
- Global Green Power PLC Corporation, Philippines
- Indonesian Coal Mining Association
- Renaissance Capital - South Africa
- Malabar Cements Ltd - India
- PowerSource Philippines DevCo
- Directorate Of Revenue Intelligence - India
- Manunggal Multi Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- South Luzon Thermal Energy Corporation
- Kapuas Tunggal Persada - Indonesia
- Grasim Industreis Ltd - India
- India Bulls Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Sakthi Sugars Limited - India
- Ambuja Cements Ltd - India
- The State Trading Corporation of India Ltd
- Minerals Council of Australia
- Bayan Resources Tbk. - Indonesia
- Romanian Commodities Exchange
- Salva Resources Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Barasentosa Lestari - Indonesia
- Toyota Tsusho Corporation, Japan
- Trasteel International SA, Italy
- McConnell Dowell - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Mines - Canada
- Parry Sugars Refinery, India
- Aditya Birla Group - India
- Kideco Jaya Agung - Indonesia
- Bulk Trading Sa - Switzerland
- Bhoruka Overseas - Indonesia
- SMC Global Power, Philippines
- IHS Mccloskey Coal Group - USA
- Port Waratah Coal Services - Australia
- Miang Besar Coal Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- Madhucon Powers Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Essar Steel Hazira Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bhatia International Limited - India
- Vizag Seaport Private Limited - India
- Xindia Steels Limited - India
- Anglo American - United Kingdom
- Energy Link Ltd, New Zealand
- New Zealand Coal & Carbon
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Australian Commodity Traders Exchange
- Lanco Infratech Ltd - India
- Gujarat Sidhee Cement - India
- Carbofer General Trading SA - India
- Semirara Mining and Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Indo Tambangraya Megah - Indonesia
- Posco Energy - South Korea
- Indian Oil Corporation Limited
- Borneo Indobara - Indonesia
- Metalloyd Limited - United Kingdom
- Bangladesh Power Developement Board
- Vedanta Resources Plc - India
- ASAPP Information Group - India
- Kepco SPC Power Corporation, Philippines
- Marubeni Corporation - India
- Banpu Public Company Limited - Thailand
- International Coal Ventures Pvt Ltd - India
- SMG Consultants - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Rio Tinto Coal - Australia
- Thiess Contractors Indonesia
- Energy Development Corp, Philippines
- Cement Manufacturers Association - India
- Tata Chemicals Ltd - India
- Straits Asia Resources Limited - Singapore
- European Bulk Services B.V. - Netherlands
- Indogreen Group - Indonesia
- Sree Jayajothi Cements Limited - India
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- OPG Power Generation Pvt Ltd - India
- Ministry of Transport, Egypt
- Commonwealth Bank - Australia
- Parliament of New Zealand
- Karaikal Port Pvt Ltd - India
- ICICI Bank Limited - India
- San Jose City I Power Corp, Philippines
- Uttam Galva Steels Limited - India
- Intertek Mineral Services - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Kaltim Prima Coal - Indonesia
- Leighton Contractors Pty Ltd - Australia
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