A Spanish Seller and a U.S. Buyer meet at an agricultural trade fair. The Buyer

Question

A Spanish Seller and a U.S. Buyer meet at an agricultural trade fair. The Buyer is interested in purchasing a quantity of the Seller's sorghum. In the course of negotiating the purchase, the Seller sends the following email: Seller hereby agrees to arrange transportation of 200 bushels of sorghum (class "white") to Buyer CIF Miami, Florida, at current market price $4.02/bushel). Please confirm this arrangement and let us know whether you prefer a negotiable or straight bill of lading (with cost difference rebated to Buyer if straight bill is selected) The Buyer responds with the following email: We hereby confirm the terms you set forth and agree to pay current market price ($3.75/bushel) for 200 bushels of sorghum (class "tannin. We prefer a straight bill as we have no need to sell the sorghum en route The Seller then ships 200 bushels of sorghum (class "tannin") by the ship M/V Ssysir bound for Miami and forwards the straight bill of lading to the Buyer. Shortly after the Buyer receives the bill of lading, but before it has paid the Seller, pirates attack the M/V Geysit, kidnap the crew, and destroy all of the cargo. Does the Buyer have a legal obligation to pay the Seller? If so, how much? (Note there is no Letter of Credit involved in the transaction, nor has either party obtained marine insurance.) 2) A U.S. Seller of timber wants to ship 4 shipping containers of lumber to a Buyer in Canberra, Australia. The Seller/Shipper enters into a contract to transport the goods with Frank's Freight Forwarding (FFF), who issues Shipper a through bill of lading that contains the following clause Himalaya Clause All exceptions, defenses, immunities, limitations of liability, privileges and conditions applicable by COGSA to FFF shall be extended to the benefit of all persons performing services on behalf of FFF. FFF then arranges for the M/V Huakai to transport the containers to Sydney, Australia, where they will be picked up by Overland Trucking and taken to their final destination in Canberra. Both the M/V Huakai and Overland Trucking issue clean bills of lading. The lumber arrives in Canberra and the Buyer notices that one of the shipping containers has several large dents on the outside and broken lumber inside. What is the liability,if any, of FFF, M/V Huaka, and Overland Trucking

Explanation / Answer

Answer 1

Value of the shipped goods in this case was $3.75 per bushel x 200 bushels= $750

In case of Straight bill of lading, the the symbolic possession of goods happen as soon as the bill of lading is received by the buyer (which happened in this case). Therefore, the buyer has the legal obligation to pay to the seller and the amount should be $750 (value of consignment).

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