AGA Partners successfully represented a Scottish trading company in a dispute with a manufacturing company from Egypt resolved in arbitration. The dispute arose based on a contract for the supply of wheat on the basis CIF amounting to a total of USD2.5 mln.
The dispute arose at the stage of agreeing the terms of the contract. The buyer terminated negotiations on a number of unsettled terms and subsequently refused to perform the contract as he believed the latter was not concluded. As a result, the client suffered significant losses and resorted to London arbitration.
The arbitrator found that the contract was concluded as the terms on which the parties had not agreed were not essential and did not affect the parties’ ability to perform the contract.
The biggest challenge was to prove that the terms discussed by the parties during the contract negotiation were not essential for both parties. When deciding whether the terms are essential, the arbitrators first of all take into account the ability of the parties to perform the contract without agreeing such terms, and also consider whether the parties treat such terms as a precondition to the conclusion of a contract.
AGA Partners team proved that the parties did conclude the contract and secured full satisfaction of the client’s claims of over USD100,000.