Mercuria Energy Trading Pte Ltd & Anor v Citibank NA & Anor

Mercuria Energy Trading Pte Ltd & Anor v Citibank NA & Anor

Citi's tender of endorsed warehouse receipts without attornment by the warehouse operators did not constitute valid delivery under the Master Agreements or the Sale of Goods Act 1979. Citi was not entitled to judgment for the price, and Mercuria had a defence by way of circuity of action. The BFE Notices were valid and effective, and Citi retained the right to terminate the Master Agreements. Mercuria was entitled to damages for non-delivery in respect of Transaction 6 but not restitution, as it had not terminated the contract.

Parties
Claimant: Mercuria Energy Trading Pte Ltd; Claimant: Mercuria Energy Group Ltd; Defendant: Citibank NA; Defendant: Citigroup Global Markets Ltd
Jurisdiction
England and Wales
Judgment Date
22 May 2015
Procedural Posture
Commercial Contractual Dispute / Judgment After Trial
Outcome
Declarations and orders as per judgment; parties to agree final order. Citi not entitled to price; Mercuria entitled to damages for non-delivery in Transaction 6; Citi entitled to terminate Master Agreements.
Legal Topics
Sale of Goods, Delivery of Goods, Repos, Warehouse Receipts, Breach of Contract, Damages, Termination of Contract
Commercial Law Contract Law Banking and Finance Sale of Goods Delivery of Goods Repos Warehouse Receipts Breach of Contract +2 more

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Parties

Mercuria Energy Trading Pte Ltd

Claimant

Mercuria Energy Group Ltd

Claimant

Citibank NA

Defendant

Citigroup Global Markets Ltd

Defendant

Procedural Posture

Commercial Contractual Dispute / Judgment After Trial

Legal Issues

  1. 1 Whether Citi made valid delivery of metal under the Master Agreements by tendering endorsed warehouse receipts without attornment by warehouse operators
  2. 2 Whether Citi could satisfy its delivery obligations by assigning rights under clause 7.2(B)
  3. 3 Whether Mercuria was entitled to restitution or damages for non-delivery

Ratio Decidendi

Citi's tender of endorsed warehouse receipts without attornment by the warehouse operators did not constitute valid delivery under the Master Agreements or the Sale of Goods Act 1979. Citi was not entitled to judgment for the price, and Mercuria had a defence by way of circuity of action. The BFE Notices were valid and effective, and Citi retained the right to terminate the Master Agreements. Mercuria was entitled to damages for non-delivery in respect of Transaction 6 but not restitution, as it had not terminated the contract.

Court Disposition

Declarations and orders as per judgment; parties to agree final order. Citi not entitled to price; Mercuria entitled to damages for non-delivery in Transaction 6; Citi entitled to terminate Master Agreements.

Orders

  • Declaration that Citi did not make valid delivery by tendering endorsed warehouse receipts without attornment
  • Declaration that Citi is not entitled to judgment for the price of the metal