SEAGRAIN LLC V GLENCORE GRAIN BV

[2013] EWHC 1189 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Blair, 10 May 2013

Sale of goods - Shipment of wheat from Ukraine - Export ban - Non-performance of a contract of sale - Whether sellers excused from performance - GAFTA prohibition clause - Meaning of executive act - Whether executive act including partial restriction of export - Causation

This was the appeal of a GAFTA arbitration concerning the proper construction and application of the GAFTA Prohibition Clause. The appellant sellers Seagrain LLC and the respondent buyers Glencore Grain BV had entered into a contract dated 6 July 2010 for the sale of 3,000 mt 10 per cent more or less at sellers' option of feed wheat of Ukrainian or Russian origin c&f free out, one safe port, one safe berth, Haifa or Ashdod. Shipment was from 15 to 31 August 2010 inclusive at sellers' option. The contract incorporated the GAFTA 48 contract form, including the GAFTA Prohibition Clause. At this time, Russian wheat was subject to an export ban and sellers cited Ukrainian customs imposing controls, in particular a letter of 2 August 2010, 13 days before the beginning of the shipment period, requiring all customs samples to be sent to one laboratory.