Lloyd's Maritime and Commercial Law Quarterly
ENGLISH SALE OF GOODS LAW
Djakhongir Saidov*
CASES
131. Euro-Asian Oil SA (formerly Euro-Asian Oil AG) v Abilo (UK) Ltd Euro-Asian Oil SA (formerly Euro-Asian Oil AG) v Credit Suisse AG 1
Sale of goods—CIF—whether a contract is in fact on CIF terms—Incoterms 2000—letters of credit—letter of indemnity—payment against shipping documents or letter of indemnity—letter of indemnity, signed by seller and seller’s bank—non-delivery—buyer suing seller and seller’s bank—whether buyer became a lawful holder of a bill of lading—Carriage of Goods by Sea Act 1992, s.2(2)—displacement of SGA 1979, s.51(3)—whether buyer liable in deceit—whether seller’s bank entitled to indemnity or contribution from seller—Civil Liability (Contribution) Act 1978
Euro-Asian claimed against Abilo and Mr Igniska (who controls Abilo) in one action, and against Credit Suisse in another. Its claims concerned what was called the “Fourth sale contract” and the “Fourth letter of indemnity” (LOI), which Abilo tendered for payment under a letter of credit. Euro-Asian’s case was that it had paid Abilo the purchase price of almost US$16 million for some 20,000 metric tonnes (“mt”) of ultra-low sulphur diesel (“ULSD”) under the Fourth sale contract, but received no product. The claims arose as a result of four transactions Euro-Asian entered into with Abilo in 2009–2010. Abilo purchased ULSD from suppliers,2 which Abilo then on-sold to Euro-Asian CIF Constanza (when not inconsistent, Incoterms CIF 2000, as amended, applied), for further sub-sale to another of Mr Igniska’s companies, Real Oil. Credit Suisse’s involvement was due to its financing of Abilo’s purchases of the ULSD from its suppliers. It also co-signed the LOIs with Abilo, which were presented, in lieu of the bills of lading, to Euro-Asian’s banks under the letters of credit (“l/c”),3 which those
* Professor of Commercial Law, King’s College London.
The following abbreviations are used:Benjamin:
Benjamin’s Sale of Goods, 9th edn (Sweet & Maxwell, London, 2014);
SGA 1979: Sale of Goods Act 1979.
1. [2016] EWHC 3340 (Comm); [2017] 1 Lloyd’s Rep 287.
2. Such as Glencore or Select Energy.
3. “Payment by Euro-Asian to Abilo was to be in US dollars in immediately available funds ‘by means of an irrevocable documentary letter of credit’. It was to be made ‘120 days ... after the B/L [bill of lading] date’ against presentation of original documents, including a commercial invoice and a ‘full set 3/3 clean on board ocean bills of lading issued or endorsed to the order of buyer or buyer’s bank and marked freight payable as per charterparty’ … In the event that the original shipping documents were not available when payment became due the contract provided, in the ordinary way, that payment was to be effected against: ‘presentation of the commercial invoice and seller’s letter of indemnity (telex/fax documents acceptable) in a format acceptable to buyer and countersigned by a first-class international bank acceptable to buyer’”(at [19–20]).
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