- •30 March – 5 april
- •Table of contents
- •Index of Authorities......................................................................................................... I
- •Index of Cases & Awards............................................................................................... V
- •I. The nature of the relationship between dr. Mercado and the presiding arbitrator gives rise to a conflict of interest and dr. Elisabeth mercado is to be dismissed from this arbitration
- •VII. Claimant is under no obligation to restitute full damages under article 74 cisg on the strength of dispositive construction of this article.
- •Index of authorities, cases and awards
- •Abbreviations
- •Statement of facts
- •Summary of arguments
- •Arguments
- •I. The nature of the relationship between dr. Mercado and the presiding arbitrator gives rise to a conflict of interest and dr. Elisabeth mercado is to be dismissed from this arbitration
- •II. It is legally possible to remove Dr. Mercado from the present arbitration.
- •III. If claimant does not agree to remove dr. Mercado we are, indeed, forced to challenge the presiding arbitrator.
- •IV. The respondent did not breach the contract fundamentally
- •V. Respondent should be excused from liability under the article 79 due to impossibility to overcome and foresee the impediment
- •VI. Respondent should be excused from liability under the article 79 (2)
- •VII. Claimant is under no obligation to restitute full damages under article 74 cisg on the strength of dispositive construction of this article.
Statement of facts
On 26 may 2010, Equatoriana Control Systems, Inc (hereafter “Control Systems”) entered into the contract with Mediterraneo Elite Conferences Services, Ltd (hereafter “Elite”), company operating high-end venues. Control systems was to supply, install and configure the master control system on the recently purchased yacht, the M/S Vis, for use as a conference venue for Worldwide Corporate Executives Association (hereafter “Corporate Executives”), an organization of top level corporate executives, planned on 12 – 18 February 2011.
Manufacture of the processing units, the core element in the overall control system, was to be done by Oceania Specialty Devices, incorporated in Oceania (hereafter “Specialty Devices”). Specialty Devices had designed the processing units to use the D-28 “super chip” recently announced by Atlantis High Performance Chips, incorporated in Atlantis (hereafter “High Performance”).
On 13 September 2010 Control Systems telephoned Elite and then confirmed in writing that the production of the D-28 chips had ceased by virtue of a fire at the High Performance production facility on 6 September 2010 and was expected to be continued about 24 October 2010. Consequently, the processing units for the control systems would not be available to it until at least late, in turn, the delivery of the control systems could not be expected before the middle of January 2011, with installation, configuration and verification to take another ten weeks.
High Performance had a limited supply of the chips in its warehouse which was supplied Atlantis Technical Solutions, a regular customer of High Performance.
When it became evident that the M/S Vis would not be available on time Elite chartered an appropriate substitute yacht, the M/S Pacifica Star, at a cost of USD 404,000 plus port and handling fees of USD 44,000. The standard brokerage commission was 15 % of the rental cost, USD 60,600. In addition, Elite paid the broker a USD 50,000 success fee on top of the commission.
Additionally, Elite made an ex gratia payment of USD 112,000 to Corporate Executives
On 2 November 2010 the D-28 chips became available to Specialty Devices, on 29 November 2010 it completed the processing units and shipped them to Control Systems.
The control system was delivered by Control Systems to the M/S Vis on 14 January 2011. Installation, configuration and verification were completed on 11 March 2011. Payment of the full contract price of USD 699,950 was made by Elite to Control Systems via the Mediterraneo National Bank on 21 March 2011.
On 14 April 2011 and in the subsequent correspondence Elite has been trying to assign the responsibility for the costs arising out of the delay in the installation of the master control system which happened by virtue of the fire on High Performance warehouse. Control Systems, naturally, denied its responsibility for the malfaction of the whole supply chain occurred in consequence of the impediment.