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Claimant: Mediterraneo Exquisite Supply Co (‘Exquisite’)


Paragraphs of Plaintiff Statement of Claim / Facts as Agreed:

1 -4 Agreed

5-8 [no knowledge] Business relationships between Exquisite and related entities not in dispute. ‘High ethical’ standards of Exquisite not subjectively known according to respondent (probably irrelevant).

9 – Discussions occurred regarding child labour audit, no knowledge as to satisfactory outcome of audit or underlying concerns.

10 – No knowledge of other contractors or basis of acceptance.

11 – 13 Agreed: Both parties had subjective knowledge of contract date, of shipping times and distribution time-frames, along with the necessity of having product in store by the relevant date to align with advertising spend and seasonal marketing conditions.

14 – Dispute as to whether amendment to the contract date was agreed or even discussed directly. Claimant submits that actual amendments to be made specifically to shipping order and letter of credit. Respondent submits that ‘all paperwork’ would be amended to reflect new date but did not expect to receive physical written amendments on the basis that oral amendments were valid and enforceable under CISG.

15 – Agreed: Shipping contract amended, letter of credit amended.

16 – 22 [no knowledge] Shipping dates and retail deliveries: No real dispute, facts should be accepted.

23 – Agreed, issue as to letter advising avoidance of contract arriving on 10th of March. Probably immaterial.

24 – 29: Breach denied, refusal to take back stock. Sale of remaining stock. No dispute as to facts of delivery, sale prices, or outcome of suits by related entities but no subjective knowledge by respondent.

30 – 31: CISG applies without reservation according to clause of contract. UNIDROIT Principles fill gaps.

33- 38: Substantive legal claims rejected by respondent.


  1. Incorporation of amended contract date
  2. Was article 20 of contract valid to displace Mediterraneo art 96 reservation? Does article 12 operate to prevent the parties from derogating from the effect of the reservation purportedly effected by clause 20 of the contract?
  3. If clause 20 is ineffective, is Exquisite estopped from relying on article 12 by the operation of art 29(2) regarding reliance by Equatoriana?
  4. If clause 20 is effective, then was there a valid amendment as a question of fact?
  • Child Labour and Fundamental Breach:
  • Was ‘highest ethical standards’ incorporated in the contract?
  • Was ‘highest ethical standards’ sufficiently certain?
  • Did Equatoriana breach this term?
  • If so, was the breach fundamental?
  • Was the breach and its result objectively foreseeable by the respondent?

Issue A


We submit that art 20 of the contract could not operate to displace the reservation under art 96 of CISG. Article 12 of CISG specifically prevents such a derogation. In the alternative, if writing was not required then we submit that the contract was not orally amended. The respondent may attempt to rely on the operation of art 29(2) and claim that regardless of any variation in the contract, that the respondent was led by the plaintiff’s statements and conduct into reliance on a new agreed delivery date. Both of these issues are dealt with together.

2 and 3:

Unidroit Principles:

Art 3.1.2 – No need for consideration, mere agreement is sufficient for modification.

Art 4.2 Relevant to construing the meaning of acts and statements and whether they have modified contractual terms.

Art 4.3 – How to get at the intention, nature of contract relevant as is preliminary negotiations.

At 4.6 Contra Preferentum Rule – Respondent bears the onus of showing that the contract was modified, despite lack of writing.

We submit that the subject matter of the discussions should be characterised as involving practical arrangements for late delivery, not variation of contract. Given that the subject matter of late delivery is already adequately dealt with in contract through the provision for liquidated damages, it is unlikely that the parties objectively intended to vary the contract merely in contemplation of late delivery.

Consideration is not relevant to valid formation of contract or variations. However, we submit that lack of consideration is relevant to ascertaining the plaintiff’s subjective and objective intention. The plaintiff was a sophisticated commercial entity dealing with another commercial entity at arms’ length, so it would be extraordinary to conclude that their intention were to unilaterally forego their legal rights and to do so without any form of compensation. Performance of the already concluded contract was not such a form of compensation, as this was also a pre-existing legal right for the plaintiff. The plaintiff would have had the right to damages for non-performance if Equatoriana unilaterally refused to perform the contract at the point that late delivery was discussed.

Even if the respondent had relied on a belief induced by the plaintiff that a new delivery date had been agreed outside of any contractual variation, they would still be required to show how that reliance led to detriment to the respondent. We submit that the respondent was not in a position to avoid performance of the contract or to take any other course of action regardless of their reliance on a new delivery date. No detriment to the respondent could have arisen.

Child Labour and Fundamental Breach (Art 25)

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