Sinason-Teicher Inter-American Grain Corporation v Oilcakes and Oilseeds Trading Company Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE DENNING |
| Judgment Date | 27 October 1954 |
| Judgment citation (vLex) | [1954] EWCA Civ J1027-2 |
| Court | Court of Appeal |
| Date | 27 October 1954 |
[1954] EWCA Civ J1027-2
In the Supreme Court of Judicature
Court of Appeal
Lord Justice Denning,
Lord Justice Birkett and
Lord Justice Morris
MR ASHTON, W. ROSKILL, Q. C. and the Hon. T. G ROCHE (instructed by Messrs Thomas Cooper & Co.) appeared on behalf of the Appellants (Sellers.).
MR EUSTACE W. ROSKILL, Q. C. and MR R. A. McCRINDLE (instructed by Messrs Richards, Butler & Co.) appeared on behalf of the Respondents (Buyers).
This arbitration arises out of a "switch transaction". An English Company, a Buyer, called Oilcakes & Oilseeds Trading Company, Ltd., bought 9,500 tons of Canadian seed barley from an American Company, Sinason-Teicher Inter American Grain Corporation, who were the Sellers. The contract provided that payment was to be in United States dollars. Atthe same time the English Buyers agreed to re-sell the barley to a German concern and under that contract payment was to be in sterling. In order to carry out the "switch transaction", the German concern was to give to the English Company a guarantee for the sterling, and the English Buyers to give a guarantee to the American Company for the dollars. As the transaction involved the exchange control, it could not be carried out except with the consent of the Bank of England. The essence of it was that the English Buyers were paying in dollars and re-selling to the Germans for sterling.
The contract between the American Seller and English Buyer was concluded on the 11th August, 1952. The goods were to be delivered c.i.f. Antwerp/Hamburg range. Shipment was to be October/November, 1952, and there was this clause as to payment; "Payment: Net cash against documents on first presentation in London. The Buyers will give the Sellers through their London Bank the guarantee that the documents will be taken up on first presentation". The contract contained no express provision as to the time when the English Buyers should give the Bank guarantee: and the question is when it should have been given. The American Sellers said that it should have been given at latest by 9th September, 1952, and that because it was not given by that time, they were entitled to and did cancel the contract on 10th September, 1952. The English Buyers said that they were not bound to give the guarantee by that date and that the cancellation by the American Sellers amounted to a repudiation of the contract.
I must say that the American Sellers, at the time they cancelled, had got a wrong view of the contract. They thought they had a right to be given the guarantee immediately after the making of the contract, which was certainly not the case. Their attitude is well shown by the cable of 9th September, 1952, which they sent to the German concern in which they said: "At sale Barley cargo August 11 agreement was immediate guarantee Hambros Bank. At Buyers request we granted deadline till 1st September,re-extended deadline till 5th September and at urgent request again until today", that is the 9th September. "Today instead of guarantee we receive cable from Hambros Bank that guarantee still dependent on Bank of England and further details will follow soonest. Consequently see ourselves compelled to...
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