QUESTION A (20 points)

Parties:

• ExtraPlus - buys zinc (residence - San Francisco)

• Resources Managemen Inc. - sells zinc (Representative office - New York)

• Third party - TD Bank (did not execute the letter of credit)

Terms of the Contract:

- RMI sells ExtraPlus 100,000 tons of zinc on terms - c.i.f. San Francisco, cash against documents at a price
of $ 1000 per ton.

- Delivery will take place in two equal batches, which are paid after shipment upon submission of
documents

- For payment ExtraPlus opened an irrevocable letter of credit providing for payment against documents in
New York City. The letter of credit was opened by the Bank of America in San Francisco and confirmed by
TD Bank, in which RMI has a bank account.

- The parties agreed to resolve possible disputes in the Paris Arbitration

- After the shipment of the first batch of goods, RMI received funds from the Bank by providing it with
documents.

- After the shipment of the second consignment on May 1, the Bank was informed by the Buyer that only
half of the material loaded on the vessel in Namibia for the second shipment was zinc, with the other half
being "useless rubbish", a material bearing some physical resemblance to zinc. Due to the fact that the
bank refused to make payment under an irrevocable letter of credit at the request of the Seller, who
provided an identical package of documents before which the payment was made for the first time.

- RMI initiated two lawsuits:

1) August 1 to the Chamber of Commerce in Paris against ExtraPlus

2) August 10 to the Federal District Court for the Southern District v. TD Bank

- ExtraPlus on August 15 initiated a lawsuit against RMI in the United States District Court for the Northern
District of California. RMI has moved for dismissal

Explain the likely outcome in each proceeding and provide an analysis for each of the arguments.

Lawsuits and issues

1) The subject of the claim was the defendant's violation of the terms of the contract. The lawsuits involved
damages and performance. I am convinced that this lawsuit will be the only one possible for violating the
terms of the main contract. In most arbitration clauses, the parties agree not to sue each other. Instead,
they will resolve their disputes through the arbitration process to avoid litigation. Also, if the parties have
provided for the use of arbitration in the contract, its decision will be binding and enforceable. Therefore,
based on this condition of the contract, I am convinced that the ExtraPlus Claim will be declared
inadmissible as contrary to the terms of the contract.

2) - Did RMI have the right to sue TD Bank in the Federal District Court for the Southern District?

Here we have to turn to Business Corp. New York State Law § 1301. “A foreign corporation may not do
business in New York without such authorization. Moreover, a foreign corporation, not authorized to do
business in New York, may not have another party in New York. " Instead, RMI's principal place of business
is New York, where the company operates and has a commercial presence, and therefore has the right to
seek redress in a court of law.

- Did the bank have the right to refuse to execute the letter of credit?

As a general rule, a bank may not refuse to pay under an irrevocable letter of credit if it has been provided
with all the documents required by the letter of credit. Also, the bank has no right to change the terms of
the irrevocable letter of credit without the consent of the parties. However, in Sztejn v Henry Schroder
Banking Corp., the court explicitly states that a refusal to pay may be acceptable if the bank has evidence of
fraud - “No hardship will be caused by allowing the bank to refuse payment where the merchandise is not
merely inferior in quality but consists of worthless rubbish », and therefore most likely, this lawsuit against
the bank will be decided not on the basis of the plaintiff.

QUESTION B (10 points)

In accordance with paragraph 1 of Art. 10 of the Hague Convention on the Law Applicable to Contracts of
International Sale, 1986, the recognition of the existence and substantive validity of the parties' consent to
the choice of applicable law is determined in accordance with the lex voluntatis principle. which will
eliminate misunderstandings in determining jurisdiction in resolving the dispute. Choice clauses "are prima
facie and should be applied unless the opposing party shows that the performance is unfounded in the
circumstances.

Also, I would recommend the use of English to conclude the text of the contract, as it has the status of an
official language in both countries and is understandable to the parties, and also contains sufficient case
law to resolve such disputes.

I propose the following wording in the agreement, which will provide for the application of New York State
law and will allow Gibson & Gibson to resolve disputes at home.

This agreement and all matters arising out of or relating to this agreement, and all claims, causes of action,
disputes, or matters in dispute between the parties to this agreement — whether sounding in contract,
tort, statute, regulation, or otherwise, and including but not limited to those arising out of or relating to this
agreement — shall be governed by, construed, interpreted, and enforced in accordance with the
substantive and procedural laws of the State of New York, taking into account international norms.

QUESTION C (10 points)

I consider that the party was entitled to apply to the French court because, in addition to the guarantees of
French procedural law, it provides for the resident's right to judicial protection at the place of registration
and the case law of international contracts. Thus, in the ECJ decision of 09 June 2011 (case no. C-87/1) the
court noted that the Regulation must be determined independently of the rules of national law with
reference to the provisions of the applicable contract. If this method is not successful in determining the
applicable forum, then, in cases involving a distance sale (Versendungskauf), the final destination, i.e. the
place where the goods are physically handed over to the purchaser, controls. The ECJ thus held that, when
determining the place of delivery 'under the contract', not only explicit provisions regarding the delivery
destination must be considered, but also standard provisions and clauses generally recognized in
international trade and commerce, which allow a clear determination of the delivery destination. In this
context, the ECJ referred to the Incoterms. Consequently, the parties' choice of the terms of delivery of the
CIF will directly affect the party's right to apply to the French court. Instead, D-term '(e.g. DAP / delivered at
place / delivered at named place of destination) will usually indicate a court venue at the location of the
purchase.