Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

A1 FERRO COMMODITIES CORP., S.A. v. TUBE CITY IRON

January 10, 1990

A1 FERRO COMMODITIES CORP., S.A., Plaintiff,
v.
TUBE CITY IRON And METAL COMPANY, Defendant



The opinion of the court was delivered by: DUBOIS

 JAN E. DUBOIS, UNITED STATES DISTRICT JUDGE

 Plaintiff, A1 Ferro Commodities Corp., S.A. ("A1 Ferro"), instituted this action against the defendant, Tube City Iron and Metal Company ("Tube City"), *fn1" for breach of contract relating to the sale of 8500 metric tons of scrap steel. A1 Ferro claims that Tube City breached the contract by failing to nominate a vessel to take delivery of the scrap and thus forcing A1 Ferro to sell the scrap to another buyer at a net loss to A1 Ferro of $ 115,942.

 Tube City filed a counterclaim against A1 Ferro alleging that A1 Ferro breached the contract by not accepting Tube City's nomination of a vessel. Tube City claims that A1 Ferro deprived Tube City of resale profits on the scrap of $ 104,315.

 The Court held a non-jury trial in the case which concluded on September 28, 1989. For the reasons set forth in the following findings of fact and conclusions of law pursuant to Fed. R. Civ. P. Rule 52(a), the Court finds in favor of A1 Ferro and against Tube City in the amount of $ 71,535, and against Tube City on its counterclaim.

 I. FINDINGS OF FACT -- LIABILITY

 A1 Ferro is a company organized and existing under the laws of Switzerland with its principal place of business in Zug, Switzerland. A1 Ferro is in the business of purchasing and selling scrap metals. Tube City is a Delaware Corporation with its principal place of business in Glassport, Pennsylvania. Tube City is also in the business of purchasing and selling scrap metals.

 On or about September 30, 1987, A1 Ferro and Tube City entered into an Agreement (the "Agreement") under which Tube City agreed to purchase from A1 Ferro approximately 8,500 metric tons of scrap steel at the price of $ 115.00 per metric ton. *fn2" Under the Agreement, A1 Ferro and Tube City provided for delivery of the scrap to Tube City at the port facilities of Patrick J. Craenhals, et Fils ("Craenhals") in Antwerp, Belgium. Craenhals is a Belgian company which specializes in, inter alia, scrap processing and recycling. The Agreement set the delivery date of the scrap as "End October/Early November 1987". The Agreement specifically required that, prior to the delivery date, Tube City nominate a vessel to A1 Ferro to load the scrap.

 Under the terms of the Agreement, Tube City, to nominate a vessel, had to provide A1 Ferro with the vessel's name, "characteristics", "lay days", and a request for "stem". (See Special Conditions #2 of the Agreement). A vessel's "characteristics" include the vessel's class, length, width, draft, size and number of holds, and size and number of hatches; "lay days" are the dates on which the vessel may be in port to load the goods; and a request for "stem" is a request for the shipper's commitment to accept and load the vessel some time during the proposed lay days.

 In early October, 1987, Tube City informed A1 Ferro that Tube City had inspected the scrap at Craenhals' facilities and found the scrap to conform to the Agreement. Later in October, 1987, Tube City and A1 Ferro worked out and confirmed Tube City's financing (i.e. a letter of credit) for the scrap. Towards the end of October, 1987, A1 Ferro and Tube City began to exchange telexes concerning the nomination of a vessel.

 On October 23, 1987, Jose A. Castillo, A1 Ferro's agent throughout the transaction who was based in Madrid, Spain, sent a telex to Harry Humphreys, an officer of Tube City, stating that the scrap was ready for "prompt shipment" and A1 Ferro awaited Tube City's nomination of a vessel. Mr. Humphreys telexed a reply to Mr. Castillo on October 26, 1987, that Tube City was in the market for a vessel. In response, Mr. Castillo telexed Mr. Humphreys on October 26, 1987, that the berth was "presently available for loading" and A1 Ferro awaited Tube City's nomination of a vessel.

 The parties next communicated concerning the matter when Mr. Castillo and Mr. Humphreys met by chance in Zurich, Switzerland in early November, 1987. Mr. Castillo was in Zurich attending a convention for scrap metal dealers. Mr. Humphreys, while not registered at the convention, arrived in Zurich on the evening of November 3, 1987. The following day, November 4, 1987, Mr. Humphreys met with Mr. Castillo in the lobby of the hotel where the convention was being held.

 During the meeting in the lobby, Mr. Humphreys showed Mr. Castillo a copy of one of two telexes concerning a ship which Tube City had been trying to obtain. Both telexes named a vessel, the M.V. Anezina. However, one of the telexes did not set forth proposed "lay days for stem". See Plaintiff's Exhibit 13. The other telex did not set forth the "characteristics" of a vessel. See Defendant's Exhibit "15" (Stamp 00084).

 Mr. Humphreys and Mr. Castillo did not discuss the matter further in Zurich. Mr. Castillo left for Madrid on the evening of November 4, 1987. Mr. Humphreys left for Rotterdam on the morning of November 5, 1987.

 Mr. Castillo sent Tube City a telex from Madrid on the evening of November 4, 1987, asking Tube City for a nomination, including a vessel's name and "lay days". No one from Tube City responded to Mr. Castillo's November 4, 1987 telex.

 On November 9, 1987, Mr. Castillo sent a telex to Tube City asking Tube City for a nomination. On November 10, 1987, Mr. Humphreys sent Mr. Castillo a telex stating that Tube City intended to take delivery of the scrap and suggested a two-week delay in fixing a vessel for loading.

 On November 11, 1987, Mr. Castillo advised Mr. Humphreys by telex that A1 Ferro would ask its shippers to delay the shipping date until "November 17/24". Mr. Castillo added that Tube City would have to extend its letter of credit with its bank, under which Tube City expected to pay for the scrap.

 The following day, November 12, 1987, Mr. Castillo informed Mr. Humphreys by telex that the shipping date could be extended to the end of November, 1987. Mr. Castillo also reminded Tube City to extend its letter of credit with its bank.

 On November 18, 1987, Mr. Castillo sent a telex to Mr. Humphreys requesting Tube City's nomination. Mr. Castillo stated in the telex that Tube City's delays were causing serious problems for the shippers (Craenhals) in tying up the port facilities. The telex also stated that Craenhals had to load the goods by "end November, latest 4th December".

 On November 19, 1987, Mr. Castillo sent a follow-up telex to Mr. Humphreys stating that Tube City had to immediately nominate a vessel. Mr. Castillo added that Craenhals had "serious" storage expenses, which Tube City would have to pay. Mr. Humphreys replied to Mr. Castillo by telex on November 19, 1987, that Tube City was in the market for a vessel and would keep A1 Ferro advised as to its progress.

 On November 24, 1987, Mr. Castillo sent a telex to Mr. Humphreys which stated, in part: "It is essential Tube City declare in this week a vessel to load this cargo, as otherwise and definitively the sellers/shippers will consider the contract defaulted. . . ." Neither Mr. Humphreys, nor any other representative from Tube City, responded to Mr. Castillo's November 24, 1987 telex.

 In a telex dated November 30, 1987, Mr. Castillo told Mr. Humphreys that Tube City had to take immediate action to accept the steel or else face legal action. A1 Ferro received no response to ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.