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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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- Independent Power Producers Association of India
- Coastal Gujarat Power Limited - India
- Coalindo Energy - Indonesia
- Mercuria Energy - Indonesia
- Agrawal Coal Company - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Bhatia International Limited - India
- Commonwealth Bank - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Siam City Cement - Thailand
- Sindya Power Generating Company Private Ltd
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- Central Java Power - Indonesia
- Riau Bara Harum - Indonesia
- Electricity Authority, New Zealand
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Banpu Public Company Limited - Thailand
- South Luzon Thermal Energy Corporation
- IHS Mccloskey Coal Group - USA
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Semirara Mining and Power Corporation, Philippines
- Ministry of Transport, Egypt
- Bhushan Steel Limited - India
- Cigading International Bulk Terminal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Energy Development Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Global Business Power Corporation, Philippines
- Mercator Lines Limited - India
- Sarangani Energy Corporation, Philippines
- Planning Commission, India
- Indonesian Coal Mining Association
- Edison Trading Spa - Italy
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Bharathi Cement Corporation - India
- Xindia Steels Limited - India
- Petron Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Miang Besar Coal Terminal - Indonesia
- Jindal Steel & Power Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Sidhee Cement - India
- Parliament of New Zealand
- Power Finance Corporation Ltd., India
- Baramulti Group, Indonesia
- Salva Resources Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- TeaM Sual Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Energy Exchange, India
- Goldman Sachs - Singapore
- Bangladesh Power Developement Board
- Marubeni Corporation - India
- Pendopo Energi Batubara - Indonesia
- London Commodity Brokers - England
- Jorong Barutama Greston.PT - Indonesia
- Cement Manufacturers Association - India
- Grasim Industreis Ltd - India
- Toyota Tsusho Corporation, Japan
- Straits Asia Resources Limited - Singapore
- Tamil Nadu electricity Board
- White Energy Company Limited
- IEA Clean Coal Centre - UK
- Bukit Makmur.PT - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Price Waterhouse Coopers - Russia
- MS Steel International - UAE
- Meenaskhi Energy Private Limited - India
- Meralco Power Generation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Formosa Plastics Group - Taiwan
- Semirara Mining Corp, Philippines
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- TNB Fuel Sdn Bhd - Malaysia
- Bulk Trading Sa - Switzerland
- Eastern Energy - Thailand
- Oldendorff Carriers - Singapore
- Sree Jayajothi Cements Limited - India
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Ambuja Cements Ltd - India
- Savvy Resources Ltd - HongKong
- Madhucon Powers Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- PowerSource Philippines DevCo
- McConnell Dowell - Australia
- SN Aboitiz Power Inc, Philippines
- Mjunction Services Limited - India
- CNBM International Corporation - China
- New Zealand Coal & Carbon
- Carbofer General Trading SA - India
- VISA Power Limited - India
- Metalloyd Limited - United Kingdom
- Holcim Trading Pte Ltd - Singapore
- AsiaOL BioFuels Corp., Philippines
- Ministry of Mines - Canada
- Bayan Resources Tbk. - Indonesia
- Makarim & Taira - Indonesia
- Singapore Mercantile Exchange
- Central Electricity Authority - India
- Star Paper Mills Limited - India
- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- San Jose City I Power Corp, Philippines
- Africa Commodities Group - South Africa
- Barasentosa Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Intertek Mineral Services - Indonesia
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- Ind-Barath Power Infra Limited - India
- Minerals Council of Australia
- Rio Tinto Coal - Australia
- Energy Link Ltd, New Zealand
- Anglo American - United Kingdom
- Sical Logistics Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Posco Energy - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Malabar Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Latin American Coal - Colombia
- Eastern Coal Council - USA
- LBH Netherlands Bv - Netherlands
- Bhoruka Overseas - Indonesia
- Wilmar Investment Holdings
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- Altura Mining Limited, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Dalmia Cement Bharat India
- GMR Energy Limited - India
- PTC India Limited - India
- Maheswari Brothers Coal Limited - India
- India Bulls Power Limited - India
- Kartika Selabumi Mining - Indonesia
- Australian Commodity Traders Exchange
- Global Coal Blending Company Limited - Australia
- Siam City Cement PLC, Thailand
- The University of Queensland
- SMG Consultants - Indonesia
- Mintek Dendrill Indonesia
- Borneo Indobara - Indonesia
- GVK Power & Infra Limited - India
- Economic Council, Georgia
- Port Waratah Coal Services - Australia
- Globalindo Alam Lestari - Indonesia
- Wood Mackenzie - Singapore
- Interocean Group of Companies - India
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- PNOC Exploration Corporation - Philippines
- Standard Chartered Bank - UAE
- Sojitz Corporation - Japan
- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Uttam Galva Steels Limited - India
- Kumho Petrochemical, South Korea
- Gujarat Electricity Regulatory Commission - India
- The Treasury - Australian Government
- Neyveli Lignite Corporation Ltd, - India
- Sinarmas Energy and Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- Videocon Industries ltd - India
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Indika Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Australian Coal Association
- Chettinad Cement Corporation Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Finance - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- ICICI Bank Limited - India
- Medco Energi Mining Internasional
- Simpson Spence & Young - Indonesia
- Coal and Oil Company - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Chamber of Mines of South Africa
- Renaissance Capital - South Africa
- OPG Power Generation Pvt Ltd - India
- SMC Global Power, Philippines
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- European Bulk Services B.V. - Netherlands
- Rashtriya Ispat Nigam Limited - India
- CIMB Investment Bank - Malaysia
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Larsen & Toubro Limited - India
- Thai Mozambique Logistica
- Parry Sugars Refinery, India
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