Advise Ming’s Metals Ltd
(1) Advise Ming’s Metals Ltd, whether it could have rejected the documents when they first arrived? Additionally, how would damages have been calculated?
Distance sales have always involved in particular difficult situations. In an ordinary sale, a buyer pays for the goods once they are delivered. A buyer must always have the advantage of withholding part of the purchase price until the goods are offered in the condition that he recommended. If the products are not in the conformity that he requested them to be, he can refuse to pay. A buyer has the advantage to bridge the gaps that primarily exist between the seller’s delivery and what they ordered for. However, in a distance sale, it would not be practical to wait for a delivery to pay for it. It is not an efficient solution to pay for the seller to transport the goods without payment. The seller will be risking, especially if the buyer refuses to pay at the ultimate destination. If the buyer has to refuse to pay them, he has to get a chance to inspect them. It is for such practicality reasons that the concept of contractual law exists. The laws have evolved with time so that the gap between the sellers and the buyers has been bridged. All these thanks to the introduction of the bill of lading.
According to the bill of lading, when the seller has shipped or bought goods of contract descriptions afloat, it is essential that he fulfills his part of the bargain by tendering the proper shipping documents to the buyer. When restated as it appears in the bill of lading, the seller must sell goods afloat in accordance with the contract and to tender the proper shipping documents.
In the case, the Ming, they have been given the shipping documents. However, they notice that from the shipping documents that the shipping was done after the contract has expired. The possibility of Mings limited rejecting the papers will depend on different legal factors as explained below;
Firstly since the items are delivered after the shipping periods, the Ming Company has every right to reject the documents. They can decide to play against the papers, but take the delivery of the goods. According to section two of English law that governs the bill of lading, the buyer is only unable to reject the documents when the duration is past long enough so that he cannot prove breach of contract. However, as per the exhibit produced by the Mings Limited, the tampering of the documents has been done by Tham’s Tin Limited, who is the sellers of the goods and not with the shipping company. The evidence of alteration can be proven through exhibit 1. Such is enough evidence for Ming Limited to reject the documents and sue for compensation. Mings Limited has the right to claim damages of a breach under the contractual obligations that both companies agreed. According to the contract signed, the date of shipment is supposed to be on 30th; however, the time has been recorded as 2nd. Such disparity in the documents, according to the bill of lading corporate and business law, is enough for the company to reject the materials and claim for damages. Don't use plagiarised sources.Get your custom essay just from $11/page
Of the three documents, the bill of lading, a policy of insurance, and an invoice, the buyer can reject only the bill of lading. The bill of lading is the only contractual document that links the delivery to the seller and the buyer. Rejection of the bill of lading document is the rejection of all the three documents. However, if the buyer, the Mings limited wish to reject the documents through the invoice of the policy of insurance, it will not be possible.
To determine payment coming from discrepancies in the documents, it is logical to use the Hague Visby rules. According to Hague Visby’s rules article three rules four, the figures to be used for compensation are supposed to be recovered from the documents in the bill of lading. The documents in the bill of lading are the conclusive evidence between the carrier and the third party receiver (the buyer). The carriers are assumed to be transporting the goods in good faith. They cannot, therefore, determine a payment that the seller will claim.
(2) Advise Ming’s Metals Ltd whether it can reject the goods when they arrive? Additionally, how will damages be calculated?
According to the laws of a contract of buying and selling based on the bill of lading governed by the English law, it is not possible to reject goods order once the documents have reached the buyer. The shipment will have to be delivered if the company has any chance to reject it. The tins from Tham’s Tin Limited have to be delivered to the Mings Limited. After they are delivered the Mings limited have a chance to reject the delivery. The right to reject the documents is always when the documents are tendered; the right to reject the goods arises at the moment they land and after an examination has determined that they are not in conformity with the contract as they agreed. However, they can only reject delivery based on the factors explained below;
The right to refuse is given to the buyer at the chance of a fallen market price of the tin. With the opportunity of a decreased market price, the Mings Limited as buyers also have an opportunity to escape the lousy bargain between them and the sellers the Tham’s Tin Limited. The Manager, however, should have proof of market loss that they suffered that could, however, have been avoided. At this point, the career and the seller will be liable to compensate for the failures of the buying company (The mings limited). In this case, the carrier is not the one responsible for bearing the pursuit for compensation because they did not delay on delivery. According to the bill of lading document, as shown in the exhibit, the shipment with the tins was delivered late by the selling company (Tham’s Tin Limited). The career only takes responsibilities at the moment the goods (the tins) are loaded at the dock and the time they are delivered and discharged from the transporting ship. The abject responsibility of the career has ended at the time of delivery of the goods. They are not to be asked for compensation based on the delivery of the billing. The same claim of the carrer not be liable for delays is shared under the Hague Visby Rules. The Hague Visby rules only recognize the basis for the fault on the liability and not the carrier.
However, at the moment of rejecting the tins or demanding compensation, there are things that the filing company (Mings Limited) has to comply with.
Two things have to be considered when asking for compensation related to antedated bill of lading. The Manager has to prove that the market condition or the market sales would have remained the same and only shifted because of the delay that was caused. He has to prove that the buyer incurs losses from the Thai Tin Limited Company. It is the antedating that caused the market loss that the company had predicted as they ordered for the shipping. If the antedating is not proven by the Manager the rejection of goods would not be able to hold up. As per the statement for the Manager the antedating that he claims holds up. If the date of the shipping left the dock on 2nd October and the investigating agencies agree that there was a misquote and the years of bills had been interfered with to try and compensate for the mistake made, the Mings Limited is at will to ask for compensation from the Thai Tins Limited.
The information from the Ports Authority is enough evidence for the rejection of the goods. The invoice, the insurance, and the bill lading document are documents used for the shipment of the goods. At any moment any of the papers are doctored, there is every reason to doubt the products that have been delivered. According to The Hague Visby rules, article three, part four, the products are linked to the buyer through the document. The moment there are discrepancies in the document, there is a possibility of rejecting the goods.
There is a need to analyze the factors that could make the Mings Limited lose the right to rejection or the right to demand compensation. The two elements are waiver and estoppel; In English law, the right to reject is only through waiver or estoppel. Estoppel demands that the buyer must have been involved in an explicit activity that has led to the effect. For example, buyer delayed in payments of the pre-shipment amount has no right of rejection. However, there has to be enough evidence to prove the same. Secondly, the right to dismissal is lost when the buyer has acted in reliance on the actions of the seller. For instance, if the date of delivery is made known to the buyer and he notices there are discrepancies, but the still goes ahead and pays for the goods, the right of rejection is limited from the buyer. In the case of Ming, there is not any instance that denies the right of rejection whatsoever. According to the English law, the Mings Company is at will to reject the goods and demand for compensation.
On matters compensation and how the prizes of the goods should be calculated, the Manager can use two methods. The Manager of the Mings Limited is at liberty to introduce the levels of estimation from the market loss. The market loss helps calculate the amount of compensation that Thai Limited will pay to the Mings Limited. The payment for compensation is made directly to the Mings Company.
Another way of calculating the amount of compensation for Mings Company is through the use of the invoice. According to The Hague Visby rules, an invoice is not a legal document that can be used for asking for compensation or rejection. However, the rule only applies when the invoice is the only document used between the seller and the buyer. In the case of the Mings Company and the Thai Tins Limited, the invoice can be used to calculate the amount of compensation. The rates of payment can be used with the invoice because it is connected to the other three documents. The invoice has the cost of all the shipping, the tins, and the amount spent. Since it is connected to the bill of lading document, the amounts in the invoice can be used to calculate the values for compensation.
It is not to be forgotten that the amount involved in the compensation will be higher than the $200,000 considering all the damages that the Thai have had to undergo following their delay in delivery.
(3) Advice on liability in this matter.
According to the English law applying on the bill of lading, various liability laws apply in this case. The English law does set out liability on the career for incorrect statement for a bill lading acquired for a third party. The liability is given to the shipment company, the carrier, for miss-statements in the bill lading document when the two companies are involved. In this case, the shipping company, the XYZ careers Limited are first to take liability. The discrepancies being investigated at the port, according to English law, makes them viable. According to the English law, the careers can also only be viable if they hide the right to rejection of the buyer from the seller. According to Mings Metal Limited, there hasn’t been any case of a hindrance to the right of rejection. The career remains viable to liability only on the aspect of the statement of the bill lading document.
Another point that qualifies liability to the carrier is that the carrier was aware of the miss-statement in the bill lading document. The level of awareness is proven in two ways. Firstly, if the career did not understand that there was a miss-statement in the bill and lading documents. Secondly, if the carrier was aware of the miss-information and still went ahead to ship the goods. In the case of Mings Metal Limited, the XYZ qualifies for liability, having known that there was an alteration of the dates, and they continued to take up the shipping assignment. Additionally, the carrier is still liable for the second qualification. The carrier is aware that the information on the bill lading is of importance to the buyer, but has failed to bring it to the attention of the buyer. From such an analysis, the carrier, in our case, has to be liable. According to this matter on liability, a lot allusion has been made to the English Law. In matters liability, the English law and The Hague Visby rules are quite similar.
(4) Advise on remedies in this matter.
Using the English law, according to the case presented by the Mings Metals Limited, there are two very distinct possibilities that the Manager at the Mings Limited could go for as remedy. The Manager could choose between rejecting the goods or accepting the goods and demanding compensation through claiming the seller’s breach of the obligation to perform about the contract. Each of the remedies has its consequences.
The first remedy of rejecting the goods will see the buyer entitled to recover the 200, 000 Euros purchase price that the company used. If the company decides to go with accepting the goods and claiming damages, they will be entitled to compensation suffered through market loss. The Mings Metals Limited is authorized to gain from the market loss they suffered after they did not reject the tender of the documents.
Analyzing the two scenarios, the company should take up the following situation than the first. Mings Metal limited should demand compensation for market compensation and accept the goods than rejecting the products to get their purchase price (200,000) back. The remedy decision is because of the following facts, which are derived from the Kwei Tek Chao case, which has always remained relevant in establishing whether purchase price should be paid or market compensation should be paid.
Firstly, the case shares a lot of similarities with the Mings Metal Limited case. In both cases, the documents are antedated. In both cases, the documents were accepted before delivery, then the managers realized and requested either compensation of the purchase price or the market price. The evidence shared the fact that purchase would be given in rejection while market compensation would be given in acceptance of the goods.
According to the decision by the ruling Judge, the formal distinction between the two breaches of contract affects the commercial reality of the case. The judges determined that the company had the right to reject both the documents and the goods. However, the two as separated as a matter of business. The Judge justified that the two are treated separately because the buyers consider very different things when making the decisions on each of them.
The decision to deny the company the right to reject the goods was based on an analysis of the documents. The Judge claimed that in an ordinary case, the buyer accepting the papers would have made him pay the purchase price for them. At the moment, acceptance of the materials is complete. It limits the possibility of rejection of goods as per the ordinary formula of buying where shipping is not involved. Immediately the materials are delivered, the buyer pays for the products. The Judge continued to acknowledge that if the buyer places himself in this position, then he merely has the unsecured claim of recovery of the selling price. It is so because, in rejection of the documents, the buyer has no security that will make him get back the selling price. Placing the buyer at such a risk will be uncalled for. Deriving from the judgment of Judge David J, the Mings Metal Limited should find remedy in the accepting the goods and requesting to market compensation from the Thai Tins Limited. With the latter, the Manager of Mings has several proofs regarding demanding for a breach. In the second argument, Mings Metals Limited has the right to treat the case as a breach of condition or a violation of warranty. If they do, they will find remedy and will be adequately compensated.
Most importantly, the Manager will be allowed to do determine market compensation, which has to remain the same; however, the seller decides to deal with it. The logical remedy to go for based on the case analysis above is accepting the goods and demanding market compensation. A legal, honest advice would be an acceptance of the products, but demand for market compensation for breach of contract agreement on the side of the seller (the That Tin Limited). The former advice would only work before acceptance of the documents.
(5) Advice on what further information (if any) is needed.
To make a proper judgment on the case involving Mings Metal Limited, the only further information required as per the decision in the British James Finlay act is determining if there are any damages in the goods that were delivered. Having paid the price exploring if the goods are damaged is a whole new viable alternative.