GAFTA Arbitration

The firm has a long history of acting on behalf of businesses trading internationally.

James Cradick regularly acts on behalf of commodity traders and recently represented a large French based grain trader in arbitration pursuant to GAFTA rules.

Whilst the specific details must remain confidential, broadly the client sold a consignment of wheat to Ukrainian Buyers using a standard GAFTA contract for a seven figure sum. The Buyers subsequently got into financial difficulties prior to shipment. The Sellers failed to load the vessel. Buyers claimed damages pursuant to the relevant default clause in the contract as a result of the non-shipment.

Sellers counterclaimed against Buyers asserting that pursuant to contractual terms the Buyers had in fact repudiated the contract by prematurely cancelling the vessel (thereby preventing the Sellers from loading).

Alternatively, Sellers argued that if they were wrong on that point the Buyers had not in the event sustained any market loss pursuant to the correct application of the standard default damages clause in the GAFTA contract.

Buyers commenced GAFTA arbitration proceedings.

Sellers arguments turned on interpretation of the notice provisions within the contract and the correct application of the standard default damages clause.

The outcome of the matter is confidential but given the importance of some of the issues to the wider trade the matter may eventually find its way before the Courts (when it will become a matter of public record).