(1) Claimant/counter-defendant: Seller
(2) Defendant/Counter-claimant: Buyer
Place of arbitration:
In 1994, the parties concluded three contracts for the sale of a product according to certain contract specifications. The buyer paid 90% of the price payable under each of the contracts upon presentation of the shipping documents, as contractually agreed.
The product delivered pursuant to the first and third contracts met the contract specifications. The conformity of the second consignment was dispute prior to its shipment. When the product was again inspected upon arrival, it was found that it did not meet the contract specifications. The product was eventually sold by the buyer to third parties at considerable loss, after having undergone a certain treatment to make it more saleable.
The seller initiated arbitration proceedings to recover the 10% balance remaining due under the contracts. The buyer filed a counterclaim alleging that the seller's claim should be set off against the amounts which the buyer estimates to be payable to the buyer by the seller, i.e., the direct losses, financing costs, lost profits and interest.