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Gill Duffus v Berger

Gill Duffus v Berger - Gill Duffus SA v Berger Co Inc Also...

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Gill & Duffus SA v Berger & Co Inc Also known as: Berger & Co v Gill & Duffus SA (HL) House of Lords 15 December 1983 Where Reported [1984] A.C. 382 [1984] 2 W.L.R. 95 [1984] 1 All E.R. 438 [1984] 1 Lloyd's Rep. 227 (1984) 81 L.S.G. 429 (1984) 128 S.J. 47 Summary Subject: Contract Keywords: CIF contracts; Repudiation Catchphrases: Repudiation; fundamental breach; description Abstract: The buyers' refusal to pay the contract price upon presentation of shipping documents in a c.i.f. contract is a fundamental breach of contract, and where the sellers treat that refusal as a repudiation of the contract, their obligations under the contract cease so that the buyers have no right thereafter to reject the goods for not conforming to the contract description. By a contract of sale by sample S sold to B 500 tonnes of "Argentine bolita beans - 1974 crop" c.i.f. Le Havre. The contract provided for payment against shipping documents on first presentation and that a certificate of quality at port of discharge given by General Superintendence Co Paris (GSC) should be final. On March 21, 1977, the goods arrived in Le Havre but only 445 tonnes were discharged, the balance of 55 tonnes being overcarried to Rotterdam. On March 22 S presented shipping documents for payment but B rejected them. On March 30 S re-presented the documents together with a GSC certificate in respect of the 445 tonnes but B again rejected them. On April 1 S elected to rescind the contract and sought damages for B's wrongful repudiation of the contract. On April 2 the balance of 55 tonnes arrived in Le Havre and B contended that they were entitled to reject the goods for breaches of description which were not covered by the GSC certificate of quality and that in any event the certificate was in respect of 445 tonnes only. B sought damages for non- delivery. S contended that the GSC certificate covered description as well as quality and was final. The dispute was referred to arbitration and the umpire found in favour of S. After various appeals the Court of Appeal found in favour of B in
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respect of the whole 500 tonnes. Summary: Held, allowing S's appeal to the House of Lords, that B's refusal to pay the contract price upon presentation of the shipping documents was a fundamental breach of the contract: since S had elected to treat that breach as a repudiation their primary obligations under the contract ceased, and they were under no duty to deliver the 55 tonnes overcarried to Rotterdam and B's rights to reject the goods for not conforming with the contract description, after inspection, could not survive the termination of the contract. B were liable to pay the contract price for the 500 tonnes unless they could prove that they would have been able to reject the goods on delivery at Le Havre. The GSC certificate was conclusive that the goods conformed with the sample and in the absence of any suggestion that the quality between the 445 tonnes and the 55 tonnes differed, they had failed to show that a certificate would not have been given in respect of the 55 tonnes also ( Alfred C.
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