contracts 574 - 92.docx - Contracts 574-92 Totem Marine Tug...

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Contracts 574-92 Totem Marine Tug & Barge, Inc. v. Aleyska Pipeline Service Co. Facts: June of 1975 , o Totem entered into a contract with Alyeska under which Totem was to transport pipeline construction materials from Houston, Texas, to a designated port in southern Alaska, with the possibility of one or two cargo stops along the way. o In order to carry out this contract, which was Totem's first, Totem chartered a barge (The "Marine Flasher") and an ocean-going tug (the "Kirt Chouest"). Costs were made possible by loans to Totem from Richard Stair individually and Pacific, Inc., a corporation of which Stair was principal stockholder and officer, as well as by guarantees by Stair and Pacific. Totem was to have completed performance by approximately August 15, 1975 o Problems occurred Upon the arrival of the tug and barge in Houston, however, Totem found that about 6,700 to 7,200 tons of coated pipe, steel beams and valves, haphazardly and improperly piled, were in the yard to be loaded called for remodeling of the barge and extra cranes and stevedores, and resulted in the loading taking thirty days rather than the three days o lengthy loading also caused in part by Alyeska's delay in assuring Totem that it would pay for the additional expenses, bad weather and other administrative problems. After leaving Houston, vessels were travelling more slowly than anticipated because of the extra load August 13, 1975 , Totem chartered a second tug, the "N. Joseph Guidry. o When the "Guidry" reached the Panama Canal, however, Alyeska had not yet furnished the written amendment to the parties' contract.
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Contracts 574-92 Afraid that Alyeska would not agree to cover the cost of the second tug, Stair notified the "Guidry" not to go through the Canal. Alyeska complained of the delays and accused Totem of lying about the horsepower of the first tug, Alyeska executed the amendment on August 21, 1975 Upon finally meeting, the three vessels encountered the tail of a hurricane which lasted for about eight or nine days and which substantially impeded their progress three vessels finally arrived in the vicinity of San Pedro, California, where Totem planned to change crews and refuel. On Alyeska's orders, however, the vessels instead pulled into port at Long Beach, California Alyeska's agents commenced off-loading the barge, without Totem's consent, without the necessary load survey, and without a marine survey, the absence of which voided Totem's insurance. September 14, 1975 Alyeska terminated the contract. Totem submitted termination invoices to Alyeska and began pressing the latter for payment. o between $260,000 and $300,000. o An official from Alyeska told Totem they were not sure when payment would be made perhaps in a day or perhaps in six to eight months.
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  • Spring '16
  • Pleading, Alyeska

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