Sahn Ward Coschignano & Baker, PLLC Wins Decision in International Contract Dispute

Litigation

The Firm successfully opposed a plaintiff’s attempt to amend a complaint in a complex international contract dispute concerning the purchase and shipment of confectionary equipment involving European business entities.  Partners, Jon A. Ward, Esq. and Andrew M. Roth, Esq., and associate Joseph R. Bjarnson, Esq., represented the business entity being sued in the United States District Court for the Eastern District of New York by the plaintiff, a purchaser based in Switzerland, for, inter alia, breach of contract and breach of the implied covenant of good faith and fair dealing.

In GFE Global Finance & Engineering Ltd. v. ECI Limited (USA), Inc., et al., No. 12-CV-1801 (E.D.N.Y.), the plaintiff sought to amend its complaint, for the second time, to assert claims of breach of contract and breach of the implied covenant of good faith and fair dealing against ECI Limited (USA), Inc. (“ECI”) based on the allegation that ECI did not assist plaintiff in obtaining a copy of a bill of lading meant for plaintiff that ECI instead delivered to plaintiff’s agents, who were allegedly not acting with plaintiff’s authority or on its behalf.  In its previous complaints, plaintiff had asserted causes of action for breach of contract, specific performance and conversion based on similar facts.

The District Court denied plaintiff’s motion pursuant to Federal Rule of Civil Procedure 15(a)(2) for leave to amend its complaint on the grounds that plaintiff’s claims for breach of contract and breach of the implied covenant of good faith and fair dealing were futile.  Specifically, the District Court held that after ECI had delivered the bill of lading to plaintiff’s agent, as was contemplated under the contract and in prior dealings between the entities, ECI was not under further duty to supply plaintiff with a duplicate bill of lading after plaintiff’s agents failed to deliver the document to it.  The District Court noted that plaintiff could not point to any provision of the contract, or case authority, requiring ECI to take further actions, nor could plaintiff point to any allegation that ECI acted in bad faith by delivering the bill of lading to plaintiff’s agents, especially since plaintiff acknowledged that ECI had rightfully relied upon the agents’ apparent authority to act on plaintiff’s behalf at the time ECI delivered the bill of lading.  To read the Memorandum & Order, click here.

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Posted by Joseph R. Bjarnson