International sale of goods
Professor Michael Bridge
Two 2.5-hour seminars per week over four-week period * Second semester * City
Objectives Upon completion of this subject, students should have (1) a general understanding of the principal duties of seller and buyer in the most characteristic of international sale contracts; (2) a detailed understanding of certain aspects of these transactions, for example, the documentary duties of a c.i.f. seller and the f.o.b. buyer's duty to nominate an effective ship; (3) insight into the market aspects of commodity transactions, alerting them to certain features of the relevant law, for example the strict approach to timely performance, that should be examined carefully before it is applied to very different contractual transactions, for example the sale of fashion shoes to a chain of retain stores; (4) an understanding of the essential differences between the law of commodity sales and the Vienna Convention on the Law of International Sale of Goods; (5) a critical sense of whether market-driven transactions should be dominated by `hard' law that repels notions of good faith; (6) an understanding of `string' contracts, `circle' settlements and other features of commodities dealing; (7) a general appreciation of how future market risk can be limited by `hedging' transactions; and (8) an understanding of the merits of using standard forms.
Synopsis This subject focuses primarily upon the international sale of commodities concluded on c.i.f., f.o.b. and similar terms. It will cover the physical and documentary obligations of buyer and seller. The emphasis in f.o.b. contracts will be placed upon the interlocking obligations of buyer (to provide a ship) and on seller (to ship the goods). In the case of c.i.f. contracts, the emphasis will be on the duality of contract as concerning performance and remedies relating to both documents and goods. An important feature of commodity sales in non-oil products is that they are commonly paper transactions of a speculative character, functioning in much the same way as financial derivatives but in an unregulated market. They are dominated by a smaller number of private multinational companies. A large body of case law, mainly English, has been generated out of trading on standard-forms contracts promulgated by London-based trading associations, such as GAFTA (Grain and Feed Trade Association) and FOSFA (Federation of Oil Seeds and Fats Associations). Commodity sales are market-driven transactions, a feature that will be explored through the remedies for breach and standard-forms, such as GAFTA 100 (c.i.f.) and FOSFA 52 (f.o.b.). This will be contrasted with the approach adopted by the Vienna Convention on International Sale of Goods 1980, which has an altogether different philosophy in its scheme of remedies for breach of contract.
Assessment Essay (5000 words): 50% * Take home examination: 50%
Texts
To be advised
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