ISSUE HEADING DRAFTS, 14 October 2014

  1. The Respondent has no right to avoid the contract.
  1. The Respondent did not rightfully avoid the contract of 28 March 2014 by its declaration of avoidance.
  1. The actions of the Claimant do not constitute a fundamental breach, therefore the Respondent did not rightfully avoid the contract.
  1. The Claimant did not breach the contract and therefore could not have committed a fundamental breach that would be required in order for the Respondent validly to avoid the contract.
  1. The Respondent did not rightfully avoid the contract because the Claimant did not breach, and therefore did not fundamentally breach, the contract.
  1. There was no valid avoidance on 7 July 2014.
  1. The Claimant did not breach the contract.

a)Claimant provided a letter of credit in the correct amount.

  • P.7, Cl. Ex. No. 1, Art. 4 – Letter of credit in the amount of $1,350,000 established (Respondent alleges in wrong amount, which is a breach)

b)Claimant provided a letter of credit calling for the CIP price delivery term, which was specifically requested by Respondent in the notice of transport.

  • P.7, Cl. Ex. No. 1, Art. 5 – CIF INCOTERMS (Respondent alleges non-conformity of payment mechanism because Claimant used wrong terms)

c)Claimant provided the letter of credit within the time provided in the contract.

  • P.8, CL. Ex. No. 2 – The notice of transport was issued on 25 June 2014
  1. Even if the Claimant breached the contract, that breach was not a fundamental breach as defined in CISG Article 25.
  1. Even if there was a fundamental breach, the Respondent did not give proper notice of avoidance.
  1. There was no valid avoidance on 9 July 2014.
  1. The Claimant did not breach the contract.

a)Respondent did not rightfully avoid the contract on 7 July 2014, therefore the letter of credit could not have been received too late.

b)Claimant provided the letter of credit within the time provided in the contract.

  • P.8, CL. Ex. No. 2 – The notice of transport was issued on 25 June 2014

c)The requirement that Respondent present a commercial invoice in order to comply with the second letter of credit is not a breach of contract.

  1. Even if the Claimant breached the contract, that breach was not a fundamental breach as defined in CISG Article 25.
  1. Even if there was a fundamental breach, the Respondent did not give proper notice of avoidance.