Bunge Corp v Tradax Export SA

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Bunge Corporation v Tradax SA
Royal Coat of Arms of the United Kingdom.svg
Court House of Lords
Full case name Bunge Corporation, New York (Original Appellants and Cross- Respondents) v. Tradax Export S.A., Panama (Original Respondents and Cross-Appellants)
Decided May 7, 1981 (1981-05-07)
Citation(s) [1981] UKHL 11, [1981] 1 WLR 711, [1981] 2 All ER 513
Case opinions
Lord Wilberforce, Lord Scarman, Lord Lowry, Lord Roskill
Court membership
Judge(s) sitting Lord Wilberforce, Lord Fraser, Lord Scarman, Lord Lowry, Lord Roskill
Keywords
Termination, condition

Bunge Corporation v Tradax Export SA [1981] UKHL 11 is an English contract law case, concerning the right to terminate performance of a contract.

Facts[edit]

Bunge Corp sued Tradax SA for wrongful termination of its agreement to supply Bunge with 5,000 tons of soya bean meal on the basis that giving notice four days late for loading the ship was not so bad. The soya bean meal was going on three shipments from a port in the Gulf of Mexico nominated by Tradax and on a ship nominated by Bunge. One of the shipments was to be during June 1975. Clause 7 said Bunge was to ‘give at least 15 days consecutive notice’ of the readiness of the ship for loading (i.e. which at the time mean 13 June). Bunge gave notice on 17 June. Tradax argued this was a breach and purported to terminate and recover damages for the difference between the contract price and the market price (which had just fallen).

Judgment[edit]

The House of Lords held that proper construction of the contract meant clause 7 was a condition, so Tradax had been entitled to terminate. The contract had to be construed to give effect to the parties' intentions, and although because it allows the right to terminate one would not quickly hold that in mercantile contracts agreements contained conditions, this one did. Lord Wilberforce said the following.

Lord Scarman and Lord Roskill concurred.

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