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    Natural Gas Case and International Law

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    Here is instruction.

    ? Read case 10-5, The Natural Gas Case, in International Business Law. Address the following:

    ? Summarize the facts of the case.

    o What is at risk for the seller, for the buyer, and in general?
    o What was the outcome?

    ? Provide an explanation of the issues in the case using international law.

    o Had the buyer breached by not obtaining the letter of credit?
    o Had the seller breached?
    o Was the contract avoided?
    o Was the buyer entitled to lost profits?
    o Had the buyer failed to mitigate?
    o How may these risks be minimized?

    Need few references and citations important.

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    Solution Preview

    ? Summarize the facts of the case.
    In 1990 a German Company agreed to buy 700 to 800 tons of propane gas from the defendant. at the price of $376 per ton. The plaintiff agreed to secure the purchase with a letter of credit. However, the letter of credit could not be opened till the defendant supplier the name of the port from which the propane gas could be exported. This information was required by the bank. Further, in response to the request of the defendant, the German Company agreed to increase its purchase by 3,000 tons at the rate of $381 tons. In January 1991, the defendant informed the plaintiff that the shipping could not be carried out because the US supplier could not export propane to Belgium. When the defendant failed to ship the goods, the German Company claimed $141,131 for increased costs and $15,00 for loss of profit. The trial court, and the court of appeals decided in favor of the plaintiff. The case went to the Supreme Court applied the different articles of the UN convention on Contracts for the International Sale of Goods. The court decided that since the letter of credit was not prepared because the defendant failed to supply the name of the port from which the shipment was to be made. Further, the breach of contract happened because the defendant was not able to obtain the appropriate clearances, and so the seller (defendant) had breached the contract. Further, as the non-breaching party was deprived of what it expected to receive, the plaintiff should receive $15,000 for the breach of contract and loss of profits and the Dutch company $141,131 from the Dutch reseller.
    o What is at risk for the seller, for the buyer, and in general?
    The buyer's risk is that ...

    Solution Summary

    This solution gives you a detailed discussion on Natural gas case: