Rhodia International Holdings Ltd. Rhodia UK Ltd. v Huntsman International Llc

Rhodia International Holdings Ltd. Rhodia UK Ltd. v Huntsman International Llc

Huntsman breached Clause 15.1.2 of the SPA by failing to provide a parent company guarantee or direct covenant as reasonably required by Cogen for novation of the Energy Supply Contract. The notice served under Clause 15.1.4 was invalid due to non-compliance with reasonable endeavours obligations. Huntsman remained...

Source-derived case information.

Parties
Claimant: Rhodia International Holdings Limited; Claimant: Rhodia UK Limited; Defendant: Huntsman International LLC
Jurisdiction
England and Wales
Judgment Date
21 February 2007
Procedural Posture
Commercial Contract Dispute / Judgment on Liability Only
Outcome
Judgment for Claimants on liability; Huntsman found in breach of SPA obligations.
Legal Topics
Sale and Purchase Agreement, Novation, Reasonable Endeavours, Parent Company Guarantee, Indemnity, Restricted Contracts
Contract Law Commercial Law Sale and Purchase Agreement Novation Reasonable Endeavours Parent Company Guarantee Indemnity Restricted Contracts

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Parties

Rhodia International Holdings Limited

Claimant

Rhodia UK Limited

Claimant

Huntsman International LLC

Defendant

Procedural Posture

Commercial Contract Dispute / Judgment on Liability Only

Legal Issues

  1. 1 Did Huntsman use reasonable endeavours to obtain Cogen's consent to novation of the Energy Supply Contract?
  2. 2 Was Huntsman's notice under Clause 15.1.4 of the SPA valid?
  3. 3 Did Huntsman remain under an obligation under Clause 15.1.3 of the SPA?

Ratio Decidendi

Huntsman breached Clause 15.1.2 of the SPA by failing to provide a parent company guarantee or direct covenant as reasonably required by Cogen for novation of the Energy Supply Contract. The notice served under Clause 15.1.4 was invalid due to non-compliance with reasonable endeavours obligations. Huntsman remained obligated under Clause 15.1.3(b) to perform Rhodia's obligations under the Energy Supply Contract.

Court Disposition

Judgment for Claimants on liability; Huntsman found in breach of SPA obligations.

Orders

  • Huntsman found in breach of Clause 15.1.2 of the SPA.
  • Notice served by Huntsman on 5 March 2004 under Clause 15.1.4 declared invalid.