Loss due to delayed arrival of the goods In 2006 an import and export corporation exported 1 000 to

Loss due to delayed arrival of the goods

In 2006 an import and export corporation exported 1 000 tons of walnut to a British company on the basis of CIF. Payment is made by irrevocable letter of credit at sight. The terms of delivery is subject to the arrival of the goods in Avonmouth on December 2 ,2006 , which is a special item. Our violation to this term resultecl in some economic losses. The basic items in the contract as follows :

Shipment: To be shipped during Oct. 2006 from China port to Avonmouth. The relevant UC opened by the Buyer will reach the Seller before the end of Sept. 2006. Seller undertakes to guarantee that the carrying steamer shall arrive at the named port of destination not later than Dec.2,2006. The actual date of her arrival at the named port of destination will be subject to the actual date of her arrival at the port of destination named verified by the relevant carrier or her agents.

Special terms and conditions on Prices :

(1) In case the carrying vessel arrives at Avonmouth earlier than Nov. 26 ,2006 , the Buyer shall pay the Seller price premium of 0.2% on the total invoice value per day.

(2)In case the carrying streamer arrives at Avonmouth later than Dec. 2,2006, the Seller shall agree to have the contract cancelled if so requested by the Buyer and if the payment has been already collected , it shall be refunded to the Buyer. Notice of the request for cancellation of contract is in all cases to be made to the Seller within 48 (forty-eight) hours after the time of arrival of the steamer at Avonmouth, otherwise the delivery shall be deemed as having been accepted by the Buyer.

After signing the contract , our corporation, through a forwarding agent, hired a vessel whose nationality is Sweden. The vessel started out on its voyage after loading on Oct. 5, 2006, and it was estimated that it would arrive at the destination on Dec. 2, 2006 if everything is in order.

Unfortunately, during the voyage, an engine of the vessel stopped working. Our corporation sent a towboat to drag the vessel forward considering the large amount of the shipments. But after the vessel's arrival at Avonmouth it was several hours later than the stipulated time of delivery (Dec. 2,2006) in the contract. Seeing the price of walnut was falling down in the local market,the Buyer notified our corporation that he refused to take delivery of the goods. Our company had to ask some agents to help sell all the goods on the spot in order to reduce the damage.

In this transaction,the loss of our party suffered was about USD600 000.

Questions :

(1) For walnuts are seasonal merchandises, usually they are sold before Christmas day. When exporting this kind of' goods ,what factor do you think is very important？

(2) In this case , the nature of the contract has changed from the Shipment Contract to Arrival Contract , why？

(Translate the case into Chinese and then answer the question)

Helpful hint: Some clauses of this contract change the characteristics of CIF contract.