Source: http://www.cisg.law.pace.edu/cisg/moot/griffith.html
Timestamp: 2019-04-25 16:25:28
Document Index: 11895401

Matched Legal Cases: ['Art. 7', 'Art.16', 'Art. 19', 'Art. 17', 'Art.7', 'Art.64', 'Art.28', 'Art. 17', 'Art. 7', 'Art. 7', 'Art. 17', 'Art. 7', 'Art. 17', 'Art. 7', 'Art. 46', 'Art. 28', 'Art. 28', 'Art. 28', 'Art. 28']

A. Valid Arbitration Agreement Under Art. 7(2) Model Law
B. DEEP WELL Letter of 13 May was an Irrevocable Offer
III. Irrevocable Under Art.16(2)(b) CISG
I. SPECULATIVE�s Letter of 21 May 1997 Was Not a Counter
Offer � Art. 19 Does Not Apply
II. SPECULATIVE�s Letter of 21 May 1997 Was Not a Rejection of
Offer Art. 17 Does Not Apply
a) Interpretation of Statements Made by Other Party Under
b) Interpretation of the Convention Under Art.7 CISG
I. SPECULATIVE�s Letter of 5 June 1997 was an Acceptance of the
a) Guarantee Was Opened Under Clause 2
b) Extension of DEEP WELL�s Time-Limits For Performance
of Clause 1 and 2
c) Interpretation of "Days"
C. DEEP WELL Was Not Entitled to Avoid the Contract Under Art.64
a) DEEP WELL�s Return of the Payment and Guarantee Does Not
Constitute Notice of Avoidance
b) Effect Of An Instalment Contract
4. AWARDS SOUGHT BY THE TRIBUNAL
A. SPECULATIVE Requests the Arbitral Tribunal to Grant an Award of Specific
I. SPECULATIVE�s Right to Specific Performance
III. Art.28 CISG is Applicable to this Dispute: Court Will Order Specific
B. SPECULATIVE Requests the Arbitral Tribunal to Grant an Interim Injunction to Prevent the Sale of Drilling Rig #23
I. The Arbitral Tribunal Has Authority to Grant an Interim Injunction
I. Applicability of the New York Convention
Bianca, C.M. and Bonnell, M.J. (ed.) Commentary on the International Sales Law: the 1980 Vienna Sales Convention. Milan: Giuffre, 1987.
Blanpain (ed) International Encyclopedia of Laws, Kluwer: 1993, p.64
Enderlein, Fritz and Maskow, Dietrich. International Sales Law
New York: Oceana Publications, 1992.
O�Donovan, James and Phillips, John. The Modern Contract of Guarantee (3rd ed)
Australia: LBC Information Services, 1996
Sono, Kazuaki. "Restoration of the Rule of Reason in Contract Formation: Has There Been Civil and Common Law Disparity?" Cornell International Law Journal 21 (1988) 477- 485
Schlechtriem, P Uniform Sales Law The UN Convention on Contracts for the International Sale of Goods Vienna: Manzsche, 1986
Will, Michael R. The UN Convention on Contracts for the International Sale of Goods.
Geneve: 995.
However, even in the absence of the choice of law clause, since Equatoriana and Mediterraneo are both Contracting States to the CISG, the convention would still apply.
"Not every answer to an offer is to be qualified as an acceptance. Inquiries or other remarks concerning the offer should not be promptly classified as a rejection.....Mere inquiries are neither acceptances or rejections."
Nowhere in the letter of 21 May are words to the effect that DEEP WELL's offer is rejected. The fact that SPECULATIVE reminded DEEP WELL in the 21 May letter that E$30,000,000 was unsatisfactory and expressly asked them to reconsider lowering the price made it clear that the offer was not rejected, SPECULATIVE were still very interested in purchasing drilling rig #23 and that the letter was a mere inquiry as to DEEP WELL's willingness to reduce their price.
In the complex world of international commercial negotiations, to view every response of an offeree to an offer as either an acceptance or a rejection is to take an overly simplistic and legalistic view of commercial reality. Misinterpreting Art. 17 in this way is antagonistic to the purpose and spirit of the Convention and also contrary to Art. 7, which sets out rules for the interpretation of Articles of the Convention. Art. 7 states that "In the interpretation of [the] Convention, regard is to be had to its international character and to the need to promote uniformity in its application and the observance of good faith in international trade." For DEEP WELL to assert after 2 months of intense negotiations that a mere letter of inquiry in response to their irrevocable offer was a rejection is not only a fundamental misapplication of Art. 17, but is contrary to the observance of good faith. To ignore the reality that not every response to an offer that is not an acceptance is not necessarily a rejection is incompatible with Art. 7's prescription that the articles of the convention be interpreted with regard to the need to promote the observance of good faith in international trade. DEEP WELL was manifestly aware that SPECULATIVE's intention was not to reject the offer and for them to assert a legalistic interpretation of Art. 17 is less than bona fide and thus contrary to the principles of interpretation enunciated down by Art. 7.
III. SPECULATIVE's Telefax of 5 June 1997 was an Acceptance of the Offer and a Binding Contract was Formed the Moment it Reached DEEP WELL
SPECULATIVE requests the Tribunal to declare that a contract of sale for drilling rig #23 exists between DEEP WELL as seller and SPECULATIVE as buyer on the terms contained in the DEEP WELL offer of 13 May 1997 and accepted by SPECULATIVE on 5 June 1997. In addition, SPECULATIVE asks the Tribunal to grant an award of specific performance, that is, order DEEP WELL to deliver the drilling rig to SPECULATIVE in accordance with Clauses 5 and 6 of the draft contract. In addition SPECULATIVE requests the Tribunal to grant an interim injunction preventing DEEP WELL from selling the drilling rig to any other party prior to the determination to be made by SPECULATIVE in accordance with Clause 6 of the draft contract..
These awards by the Tribunal are enforceable. Enforcement of an arbitral award is an implied term of every arbitration agreement, and its importance is duly emphasised in the Arbitration Rules. Enforceability of the Final award is governed by the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards (NYC), which is in force in Danubia, Equatoriana, Mediterraneo and Polarity. The Tribunal has the jurisdiction to make the awards sought by SPECULATIVE because there is a valid arbitration agreement in existence between the parties and the final award is not "domestic" as stated in Art. I(1) NYC but is a foreign arbitral award. It is a foreign award because SPECULATIVE wishes to enforce the award made in Danubia in Polarity.
A. SPECULATIVE Requests the Arbitral Tribunal to Grant an Award of Specific Performance
SPECULATIVE is entitled to demand specific performance of the contract from DEEP WELL. Art. 46 CISG provides the buyer a right to specific performance, an expression of the maxim pacta sunt servanda. Paragraph (1) refers to "performance by the seller of his obligations¼ .". Since "his obligations" is unrestricted and general, it necessarily refers to all of his obligations. Those obligations may have their origin not only in the contract between the parties, but also in the Convention, and established practices and usages. Thus, its purpose is to see to it that the obligations of the seller are performed as laid down in the contract and the Convention.
III. Art. 28 is Applicable to this Dispute : Court Will Order Specific Performance
SPECULATIVE submits that an order for specific performance in this case may be made as it is consistent with the position of the courts of both Danubia and Polarity with respect to those situations when specific performance will be granted. As a result, Art. 28 of the Convention does not inhibit the Tribunal from making the awards requested by SPECULATIVE. Art. 28 provides that even where "one party is entitled to require performance of any obligation by the other party, a court is not bound to enter a judgment for specific performance unless the court would do so under its own law in respect of similar contracts of sale not governed by this Convention". The phrase "unless the court would do so under its own law" is said to refer to "the domestic law of the forum and not its choice of law rules".
Art. 28 is relevant to the present dispute because the courts of Polarity can and do issue orders for specific performance. Such orders are said to be a "special" remedy. In practical terms, this means an order for specific performance is almost never given if the buyer could purchase substitute goods adequate to satisfy its needs. In the present circumstances a special remedy is warranted because it is improbable that SPECULATIVE will be able to purchase a substitute rig, within the necessary period of time to commence drilling, on similar terms to those it has bargained for. In addition, the inapplicability of alternate remedies, namely damages, amounts to special circumstances which require a remedy of specific performance.
B. SPECULATIVE Requests the Arbitral Tribunal to Grant an Interim Injunction to Prevent the Sale of Drilling Rig #23.
Because the interim order of protection granted by the Commercial Court of Mediterraneo terminates on 14 April 1998, SPECULATIVE requests the Tribunal to make an order extending the period during which DEEP WELL would be prohibited from selling the drilling rig to any other party. This order should extend to such a time pending the decision as to whether SPECULATIVE will receive the concession it requires from Polarity to begin its drilling operations in tract Active # 2.
SPECULATIVE submits that an award of the Tribunal will be enforceable in this instance. It is generally accepted that any order made by an Arbitral Tribunal will be ineffective unless national courts recognise them and they can be enforced by national law. When foreign arbitral awards are not carried out by either party, they can be given recognition and enforcement by the NYC.
SPECULATIVE requests that the Tribunal impose the arbitration costs and the expenses incurred for legal representation and normal legal costs on DEEP WELL. The Arbitration Rules provide, in principal, that the costs of the arbitration be borne by the unsuccessful party, although the arbitral tribunal may apportion them between the parties in its discretion, taking into account the circumstances of the case. SPECULATIVE submits that where the Tribunal orders the awards sought by it in this arbitration, DEEP WELL as the unsuccessful party should in principal bear the costs of the arbitration. However, SPECULATIVE acknowledges the Tribunal�s wide-ranging discretionary power with respect to the determination of costs and therefore asks that the Tribunal, in exercising this discretion, consider the totality of the circumstances resoundingly in SPECULATIVE�s favour. The Tribunal must take account of the reasonable and competent legal position established by SPECULATIVE, as well as it�s continued attempts to act in good faith, which, but for DEEP WELL�s desire to avoid the contract for self-motivated reasons, would have precluded the need to appear before the Tribunal in the first place.
In summary SPECULATIVE has established that:
(1)	The Tribunal has jurisdiction to arbitrate this matter on the basis that Claimant and Respondent are parties to a valid arbitration agreement;