On 29 September 2014, Hapag-Lloyd’s container vessel Colombo Express collided with the Maersk Tanjong in the Suez Canal of Port Said, in an attempt to overtake the Maersk vessel. The collision resulted in a 20 meter dent to the left side of the Colombo Express, with some damage to containers on board and three fallen containers.
Advise the following (fictional) parties as to the legal implications of the loss or damage to the contract goods arising from the collision. All contracts are governed by English law and incorporate the Incoterms.
(i) Euro Metals Co., a Dutch precious metal trader, contracted with a number of Indian based importers for the sale of 20,000 tonnes of silver bars. All of the bars were placed in the same container, in pallets of 30 bars, which were subsequently lost at sea following the collapse of the stacks.
(a) India Imports Inc. contracted for the sale of 10,000 tonnes of the silver bars. Shipment was made FOB Port of Rotterdam. India Imports Inc. had paid half of the contract price prior to the collapse.
(b) Indian Precious Metals Co. contracted for the sale of the other 10,000 tonnes of silver bars. Shipment was made FOB Port of Rotterdam and Euro Metals indicated to the ships master that the bottom half of the container of silver bars was to fulfil the contract with Indian Precious Metals Co. While Euro Metals had the goods alongside the Colombo Express at Rotterdam in time for shipment, as per the contract of sale, they failed to give notice of that shipment to Indian Precious Metals Co. in order for them to insure the goods.
(ii) India Tech Co. contracted with International Technology Trading for the sale of 500 personal computers (PCs). The PCs were shipped in a container as part of a larger shipment of goods belonging to other sellers, CIF Port of Mumbai, 15th September 2014. The goods were alongside the Colombo Express with sufficient time for loading but delays in loading at Rotterdam lead to the late shipment of the goods early on the 17th September. The late shipment was not clear from the bill of lading as the ships master had dated it within the intended date of shipment.
The container was not lost but damage to the container from the collision cannot be ruled out. International Technology Trading has attempted to tender India Tech Co. a commercial invoice which identifies those PCs fulfilling their contract by serial number, the policy of insurance and a clean bill of lading. On the basis of possible damage, however, India Tech Co. is refusing to accept the documents and take delivery of the goods.
In this essay will need explain in depth knowledge FOB, CIF contract, Sale Of Goods Act 1979 and Nature of Goods that the essay have to relate in the face of question i(a),i(b ) and ii
The question i(a)
Fob contract, Nature of goods relate with Sale Of Goods act 1979. The property passes as from shipment under FOB contract, but I am not sure which section in Sale Of Goods Act 1979 will relate in this question.
The Question i(b)
It might useful for this question.
The purpose of role in s 32 r 3 SGA states that when both parties agrees to transport goods by sea, vendor shall provide the notice of loading to enable the buyer for insure the goods, and if seller fail to do so, the risk shall not be transferred to the buyer. However, in case of Wimble, Sons & Co Ltd v Rosenberg and Sons states that the s 32 SGA applies to FOB term, if the buyer have informed sufficient information concerning of all necessary particular knowledge (namely first port destination and name of the ship), the risk shall pass to the buyer; even though the seller fail to give notice of the shipment. According to Buckley LJ held that “the latter was not necessary to enable him to insure”. It means that the seller must inform the buyer for a sufficient information even the seller fail to give notice of the shipment as the risk shall pass to the buyer when the property have been loading on the board of vessel under FOB contract apply by s 32 r 3 SGA. Hence, the circumstance is unclear under s 32 r 3 SGA. If the circumstance is following by Buckley LJ that in FOB contract, the buyer should give sufficient information concerning the time of shipment and the destination of the ports to take out insurance and the s 32 r 3 SGA should not apply to FOB contract of sale.
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