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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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Thursday, 06 February 14
THE WORLD LARGEST COAL EXPORTER SHIPPED AROUND 35.90 MMT OF COAL IN DECEMBER 2013
COALspot.com: Indonesia, the world 4th largest coal producer and the Global largest multi grade coal exporter shipped around $2* billion worth ...
Thursday, 06 February 14
PANAMAX: FAR EAST IS ALMOST ABSENT AND ATLANTIC ON SLOW STEAM
Handy
Due to ongoing Chinese New Year the market is still quiet. Slowly we can see some fresh coal cargos entering the market with second half Feb/ ...
Wednesday, 05 February 14
DRY BULK MARKET HAS LOST FURTHER GROUND THIS PAST WEEK - INTERMODAL
COALspot.com: The Dry Bulk market has lost further ground this past week as activity ex-Far East disappeared into the Chinese holidays and owners id ...
Tuesday, 04 February 14
NEWCASTLE PORT'S WEEKLY COAL EXPORTS HIT NEW HIGH OF 3.53 MMT
COALspot.com: In the week ended 3 February 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled ...
Monday, 03 February 14
SUB-BIT INDONESIA COAL SWAP GAINED WEEK ON WEEK
COALspot.com – Swaps prices gained for thermal coal loading from Indonesia, the world’s largest exporter of the fuel, according SGX.
...
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- Star Paper Mills Limited - India
- PNOC Exploration Corporation - Philippines
- Eastern Coal Council - USA
- Holcim Trading Pte Ltd - Singapore
- Billiton Holdings Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- GMR Energy Limited - India
- Bukit Baiduri Energy - Indonesia
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- McConnell Dowell - Australia
- The University of Queensland
- Baramulti Group, Indonesia
- Uttam Galva Steels Limited - India
- Savvy Resources Ltd - HongKong
- ASAPP Information Group - India
- Global Green Power PLC Corporation, Philippines
- Orica Australia Pty. Ltd.
- Madhucon Powers Ltd - India
- Metalloyd Limited - United Kingdom
- Romanian Commodities Exchange
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Maheswari Brothers Coal Limited - India
- GAC Shipping (India) Pvt Ltd
- Economic Council, Georgia
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Price Waterhouse Coopers - Russia
- Coal and Oil Company - UAE
- Meralco Power Generation, Philippines
- Power Finance Corporation Ltd., India
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Wilmar Investment Holdings
- Gujarat Electricity Regulatory Commission - India
- Siam City Cement - Thailand
- Aditya Birla Group - India
- Sinarmas Energy and Mining - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Global Coal Blending Company Limited - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- Bhatia International Limited - India
- Karaikal Port Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- Kumho Petrochemical, South Korea
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- Altura Mining Limited, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Transport, Egypt
- Directorate Of Revenue Intelligence - India
- Thai Mozambique Logistica
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bayan Resources Tbk. - Indonesia
- Energy Link Ltd, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- European Bulk Services B.V. - Netherlands
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Orica Mining Services - Indonesia
- Kobexindo Tractors - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- Meenaskhi Energy Private Limited - India
- The State Trading Corporation of India Ltd
- Heidelberg Cement - Germany
- Electricity Generating Authority of Thailand
- MS Steel International - UAE
- Tata Chemicals Ltd - India
- Australian Coal Association
- Singapore Mercantile Exchange
- Kapuas Tunggal Persada - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
- Attock Cement Pakistan Limited
- Wood Mackenzie - Singapore
- Kepco SPC Power Corporation, Philippines
- Trasteel International SA, Italy
- Deloitte Consulting - India
- Port Waratah Coal Services - Australia
- Larsen & Toubro Limited - India
- Banpu Public Company Limited - Thailand
- Ind-Barath Power Infra Limited - India
- Siam City Cement PLC, Thailand
- Therma Luzon, Inc, Philippines
- Xindia Steels Limited - India
- SMG Consultants - Indonesia
- Tamil Nadu electricity Board
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vizag Seaport Private Limited - India
- PTC India Limited - India
- Electricity Authority, New Zealand
- Pendopo Energi Batubara - Indonesia
- New Zealand Coal & Carbon
- Bangladesh Power Developement Board
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Malabar Cements Ltd - India
- Barasentosa Lestari - Indonesia
- Intertek Mineral Services - Indonesia
- South Luzon Thermal Energy Corporation
- Chettinad Cement Corporation Ltd - India
- Bulk Trading Sa - Switzerland
- Miang Besar Coal Terminal - Indonesia
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Sical Logistics Limited - India
- Riau Bara Harum - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bukit Asam (Persero) Tbk - Indonesia
- Carbofer General Trading SA - India
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Petron Corporation, Philippines
- Parry Sugars Refinery, India
- GVK Power & Infra Limited - India
- IHS Mccloskey Coal Group - USA
- Interocean Group of Companies - India
- Mercuria Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Oldendorff Carriers - Singapore
- Africa Commodities Group - South Africa
- Rio Tinto Coal - Australia
- Sakthi Sugars Limited - India
- Marubeni Corporation - India
- Sarangani Energy Corporation, Philippines
- Eastern Energy - Thailand
- Straits Asia Resources Limited - Singapore
- VISA Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- PowerSource Philippines DevCo
- Indo Tambangraya Megah - Indonesia
- Toyota Tsusho Corporation, Japan
- PetroVietnam Power Coal Import and Supply Company
- Medco Energi Mining Internasional
- Bhoruka Overseas - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- White Energy Company Limited
- SMC Global Power, Philippines
- Ministry of Mines - Canada
- Ceylon Electricity Board - Sri Lanka
- The Treasury - Australian Government
- Mercator Lines Limited - India
- Indian Energy Exchange, India
- Jindal Steel & Power Ltd - India
- Cement Manufacturers Association - India
- London Commodity Brokers - England
- Semirara Mining Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Makarim & Taira - Indonesia
- Standard Chartered Bank - UAE
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Parliament of New Zealand
- Indian Oil Corporation Limited
- Bharathi Cement Corporation - India
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Global Business Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Bhushan Steel Limited - India
- Indika Energy - Indonesia
- Posco Energy - South Korea
- Leighton Contractors Pty Ltd - Australia
- Minerals Council of Australia
- Planning Commission, India
- Antam Resourcindo - Indonesia
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Central Electricity Authority - India
- Australian Commodity Traders Exchange
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Borneo Indobara - Indonesia
- Sree Jayajothi Cements Limited - India
- Binh Thuan Hamico - Vietnam
- Globalindo Alam Lestari - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Salva Resources Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- Kohat Cement Company Ltd. - Pakistan
- Bukit Makmur.PT - Indonesia
- International Coal Ventures Pvt Ltd - India
- Latin American Coal - Colombia
- Videocon Industries ltd - India
- Independent Power Producers Association of India
- Alfred C Toepfer International GmbH - Germany
- Indonesian Coal Mining Association
- Jaiprakash Power Ventures ltd
- Coalindo Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
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