Legrant settled the $100K dispute under washout agreement in GaftaNovember 5, 2019 · News
Legrant law company represented the interests of a foreign grain trader in Gafta arbitration.
Legrant’s client was buying wheat on FOB terms. The contract was governed by English law and incorporated Gafta 125 arbitration clause.
Before the commencement of the delivery period, the Seller informed on their inability to fulfill the contract. Following the negotiations, a washout agreement was concluded, whereby the Seller undertook to compensate the Buyer 100 000 US dollars as damages for the breach of the contract.
Despite the parties agreed on the amount and procedure for reimbursement of damages, the Seller failed to cover the debt and further has simply vanished.
Legrant’s lawyers have analyzed the contracts and filed a claim to Gafta.
Since the Sole arbitrator had been agreed, the client paid 8,000 pounds of deposit instead of stipulated 13 000 in case of considering dispute by 3 arbitrators.
Shortly upon filing a claim to arbitration, the Seller has started to perform the payments voluntarily.
Legrant’s lawyers have asked the arbitrator to suspend the proceedings. The claim was withdrawn upon complete recovery of the debt and 7,600 pounds of the deposit were returned to the client. Thus, the total cost of arbitration was only 400 pounds.