Legal Aspects of International Trade and Enterprise Allegheny Technol

Question: Discuss about theLegal Aspects of International Trade and Enterprisefor Allegheny Technologies. Answer: Treibacher Industries, A.G. v. Allegheny Technologies, Inc Issue Relate to the case An Austrian seller entered into a series of contract with a buyer who is located in Alabama, (US) to purchase a chemical compound as a consignment. The contract has mentioned the specified amount of quantity to be delivered. As per the contract the buyer purchased the entire amount which was delivered by the supplier. However the buyer denied returning the unused compound to the supplier. The buyer denied on the two terms of the contract which states that it will not take any additional delivery of compound will not pay for the unused compound. Meanwhile the buyer found a seller who was selling the compound at a very low price. Later the seller filed suit against the party to recover the loss which was caused during the contract (CISG, 2016). In the above mentioned issues there was a dispute in between the parties regarding the term consignment. The buyer argued that no sale has occurred until the goods are consumed by them. Whereas the buyer argued that the buyer has an obligation to pay for the delivered item (Ferrari, 2008). Applicable International Law United Nations Convention on Contracts for the International Sale of Goods (Vienna, 1980) (CISG) The purpose of the law is to provide a fair platform while making an international contract. CISG safeguards both the parties while making commercial exchange of goods. The formation of contract of sale is the backbone for development. Hence it is necessary to adopt a universal law to safeguard the interest of the multi-parties to the contract (Treibacher Industries, A.G. v. Allegheny Technologies, 2006). The adoption of the CISG helps in providing a modern, uniform legislation on international platform when the goods are sold across the border. The law provides a balance in between the interest of both the parties to the contract. It mitigate the scope of the private applicable law and provides a common medium to avoid the problems which are caused while formation of the contract. It governs the international sales of goods between the private parties excluding the sale of services and consumers. It applies to those parties who are living in two different countries. This act provides a common procedure regarding the breach of contract (Burnett and Bath, 2009). The aggrieved party needs the support in claiming the damages due to breach of contract between the parties. It is essential that the written contract should be formed in between the parties while making international contracts (Honnold, and Flechtner, 2009). The act applies only to the international transactions and avoids the applicability of the private international law. The contracts which do not fall under the scope of the CISG are regulated by the domestic law (Folsom ET al.2013). As a Plaintiff Treibacher has 6 complaints against TDY which are: Firstly there was a breach of contract as per the United Nations Convention On Contracts For The International Sale Of Goods, Secondly there was an anticipatory breach of contract in between the parties under the same law, Thirdly there was a breach of contract by the party under the Alabama law where the plaintiff was operating its business, there was a claim against the party under the Alabama law regarding , money owned and unjust enrichment, the plaintiff has a conversion claim as mentioned in the Alabama law. Lastly there was a misrepresentation by Treibacher regarding acceptance and payment for the goods (Leisinger, 2007). In the given case law the buyer misinterpreted the definition of the term consignment where the delivery term was mentioned in both the contract (DiMatteo, 2014). The plaintiff appealed on the ground of finding clear error in factual information which are false as per the article9 (2) which states that parties are bound by the term customary usage of the goods. It depends on the term which was defined by the contract as per the relation confined by the law. The defendant cannot deny on the fact that he has not consumed the goods which doesnt create any obligation on the party to pay the amount mentioned in the contract. It is obligatory on his part to mitigate the damages caused in the contract (Ferrari, 2011). Secondly, Article 9(2) has mentioned that the parties are considered to form a contract until and unless it is made applicable in the contract which is directly related with the International trade. The article is concerned with the terms and conditions to be considered while forming the contract. The plaintiff can argue in the court on the ground of the redemption given in the article which is regarding his support. In case of international trade the UNICTRAL law is applicable between the parties to bind the contractual relationship in case of any dispute which may occur in future date (August, Mayer and Bixby,2013). CISG governs the conduct of the party is essential while defining the relationship of the party with others. A statue should be interpreted in the manner it gives the relevant effect to the definition. The defendant tried to misinterpret the statue to give a false meaning to the article. Whereas article 8 of the CISG governs the conduct of the party is essential while defining the relationship in between the parties. The intention of the buyer was to breach the contract without informing the seller which was again an ultra vires act. Article8 (3) deals with the customary behavior in between the parties is essential to define the terms and conditions between the parties. Moreover the article protects the interest of the plaintiff while claiming the loss caused due to breach of contract. The plaintiff can argue on the ground that the from the period of 1993 and 2000 a series of contract were signed in between the parties TDY has kept the material which was received by the Treibacher as separate consignment book. Every time when the material is withdrawn from t he books it was mentioned in the consignment books and the invoice was sent to seller. At the last of the month TDY pays for the complete amount of goods which are withdrawn from the lot. This defines the customary usage an action between the parties for the period of 7 years. I the course of business in between the parties the conduct has defined the relationship in between the parties which specifies the dealing in between the parties has necessarily created the customary relationship which cannot be breached on the terms misinterpreting the term consignment. The parties course of dealing define the In the case law of Cf. Gonzalez v. McNary it was stated by the court that the meaning of statue should be constructed to give effect to the provision of the law so that it does not become inoperative and insignificant. In the given case law the defendant tried to defeat the statue which is necessarily too serve his mean purpose. It gives power to the Article (3) and 9(1) to highlight the customary dealing while dealing in regular course (Andersen and Zeller, 2010). In the case law of Newell v. Prudential Ins. Co the CISG has defined the contractual relationship in between the parties by defining the course of dealing in between them. There was no clear error in the formation of the contract in between the parties. The plaintiff has sufficient sources to appeal in the court of law. The court has defined the de novo relationship in between the parties while dealing with the various terms and conditions (Oceana, 2008). In the given case law of Bunge Corp. v. Freeport Marine Repair, Inc. it was stated by the court in the support of the plaintiff that the defendant has a duty to mitigate the damages which are caused during t he occurrence of the loss. This case has played a significant role in claiming the losses which the plaintiff has faced due to the breach of contract. Here the intention of the defendant caused a breach of contract which brings him under the obligation to pay the loss caused to the plaintiff. It was clear that he purposefully waived the clauses which were mentioned in the contract, to buy the goods from the other buyer at a low cost. The plaintiff have ample of evidences to proof in the court that the defendant has intentionally waived the context of the clause which was carried in between them since seven years. In the case if the contract term s are not mentioned clearly in the contract than the customary usage is treated as the contractual term. Both the companies were dealing with each other which make it clear that the purpose of the contract is related with the customs which are formed during the enforcement of contract. The meaning of consignment is under the preview that the actual sale has occurred in between the parties (Gillette and Walt, 2015). It is obligatory at the part of the defendant to pay the delivery charges to the plaintiff. The general principal of UNICIRAL is to mitigate the damages which are caused while making a contract in between the two parties. Summary of the Case Law The case law arise due to the contract which was executed in November and December of the year 2000, where Treibacher Industries, AG ("Treibacher"), an Austrian vendor of hard metal powders, settled to trade particular amount of tantalum carbide ("TaC"), a hard metal powder, to TDY Industries, Inc. ("TDY") for delivery to "consignment." After receiving a particular amount of the powder the defendant refused to take the delivery of the balanced goods. In a letter to the company it stated that it has no further obligation to buy or to pay (Meiners et al.2011). The defendant has purchased an amount of TAC from another vendor at a very low price. Hereby the plaintiff filed a case against the defendant to seek the damages which were caused due to breach of contract. Here the district court gave the decision rule under the United Nations convention on contracts for the international sale of good. Here the court has emphasized on the customary usage in between the parties as the parties were dealing with each other from a very long time. Further the court passed a judgment against TDY, which provides a compensatory benefit to Treibacher for $ 5,327,042.85 including the interest (Goode, ET al.2007) After the appeal made by TDY, the final court passed a judgment reviewing the decision of the district court. The court has stated that the district court has properly evaluated the contract under the CISG as per the dealings in between the parties. The meaning of the consignment was clearly mentioned in the contract which establishes the relationship in between both the parties to the contract. Here the c court affirmed the decision passed by the district court on the ground of CISG (Glinas, 2016). Conclusion It is clearly mentioned in the CISG regarding the contractual relationship in between the parties while entering into a contract across the border. In this case it was established by the court that if the terms of the contract are not clear than the customary usage in between the parties will be used in future dealings. The district court didnt commit any mistake while charging damages on the defendant. It is mentioned in the act that it is the responsibility of the defendant to mitigate the losses which are caused during the contract. In this particular case it was clear that the intention of TDY was to waive the payment for the goods they have consumed. It creates an obligation over the party to follow the guidelines which are mentioned in the act. The meaning of consignment should not be misinterpreted for the benefit of oneself. Under the international contract it is obligatory to follow the customary relationship in between the parties. Here the parties were dealing with each ot her for a period of 7 year in that case it is necessary to read the case law as per the law which is mentioned. References Andersen, C. and Zeller, B. (2010).Practitioner's Guide to the CISG. Juris Publishing, Inc. August, R., Mayer, D. and Bixby, M. (2013). International Business Law. Pearson EducationBurnett,R. and Bath,V.(2009). Law of International Business in Australasia. Federation Press DiMatteo,L.(2014). International Sales Law: A Global Challenge. Cambridge University Press Ferrari, F. (2008). The CISG and its Impact on National Legal Systems. Walter de Gruyter Ferrari, F. (2011). Contracts for the International Sale of Goods: Applicability and Applications of the 1980 United Nations Convention.Martinus Nijhoff Publishers Folsom, R. et al. (2013). Principles of International Business Transactions, 3rd (Concise Hornbook Series). West Academic Glinas, F.2016. Trade Usages and Implied Terms in the Age of Arbitration. Oxford University Press Gillette, C. and Walt, S. (2015). Sales Law, Domestic and International Concepts and Insights. West Academic Goode, R. et al. (2007). Transnational Commercial Law: Text, Cases and Materials. OUP Oxford Honnold,J. and Flechtner,H.(2009). Uniform Law for International Sales Under the 1980 United Nations Convention.Kluwer Law International Leisinger, B. (2007). Fundamental Breach Considering Non-conformity of the Goods. sellier. European law publ. Meiners, R. et al.(2011). The Legal Environment of Business. Cengage Learning Oceana, (2008). American International Law Cases: Fourth series Volume 7 of American International Law Cases: Fourth Series, 2006-. Oceana Treibacher Industries, A.G. v. Allegheny Technologies, (2006). (Online). Available at: https://www.unilex.info/case.cfm?pid=1do=caseid=1136step=FullText (Accessed on: 07/10/16) United Nations Convention on Contracts for the International Sale of Goods (Vienna, 1980) (CISG),(2016).(Online). Available at: https://www.uncitral.org/uncitral/en/uncitral_texts/sale_goods/1980CISG.html (Accessed on: 07/10/16)