Serena is the head of sales for the Australian Wheat Board (AWB) in June 2022 she negotiated a contract of sale with Torben acting for Iceland Bakers Pty Ltd based Iceland for the sale of 150 ton of high-quality wheat. The contract contained the following terms:
1. The International Convention for the Sale of Goods would apply to the contract except as specifically modified by the contract.
2. The buyer would accept a 10% variation in the quantity of the wheat, as shrinkage may occur in the course of transit.
3. International Commercial Term FOB would apply to the contract.
4. The buyer would enter into a contract of carriage with a reputable cargo carrier and advise the seller of the name of the ship, date and time of loading.
Torben, advised Serena that the goods were to be loaded on to a vessel (Emu 2) belonging to Emu Shipping Limited at the Port of Newcastle on 1 July 2022.
Prior to being available for loading the Emu Shipping Limited discovered that there was a large rust area in the hull of the vessel. Emu Shipping Limited had neither the time of the money to carry out repairs. Due to the tranquil seas between Australia and Iceland in July, Emu Shipping Limited determined that it would be safe to make the journey.
The wheat was loaded at the Port of Newcastle on 1 July as agreed by the parties.

On 5 July 2022 as the Emu 2 sailed past the coast of Sri Lanka it was intercepted by a radical group known as “Feed the Hungry”. Members of this group boarded the vessel and forced it to dock in a deep-water port on a small off shore island where half the wheat was unloaded. Feed the Hungry distributed this wheat to Sri Lanka bakers to make bread during the economic crisis. On leaving the deep-water port after being released by Feed the Hungry the Emu 2 collided with a whale this resulted in the rust giving way and water entering the hull causing the captain to return to the small island deep water port where he gave away the remainder of the wheat and engaged a local firm to repair the Emu 2.

After repairs were completed, Emu 2 returned to Newcastle. AWB has sought payment from Iceland Bakers Pty Ltd for the wheat which it has not received.

Advise Torben whether he has any cause of action against either AWB the seller of the goods or Emu Shipping Limited the carrier for breach of contract.

Answer rating: 100% (QA)

Torben will be taken to court by the seller of the goods This is called The Action in Contract In this case Torben cannot sue to recover the debt beca... View the full answer