Twenty-Ninth Annual

Willem C. Vis International Commercial Arbitration Moot 28th

March – 3rd April 2022 in Vienna, Austria

MEMORANDUM FOR CLAIMANT

Asian Arbitration Institution Case No: AIAC/INT/ADM-123-2021

On behalf of CLAIMANT against RESPONDENT 1 and RESPONDENT 2

Counsel for CLAIMANT

 MEMORANDUM FOR CLAIMANT

TABLE OF CONTENTS

TABLE OF ABBREVIATIONS ......................................................................................... I

STATEMENT OF FACTS.......................................................................................................1

INTRODUCTION....................................................................................................................2

PART I:- .Have the Parties validly agreed on the jurisdiction of the Arbitral
Tribunal?...............................................................................................................................3
1.1 Danubian Law Determines JAJA BIOFUEL LTD’S Consent to the
Arbitration Agreement.........................................................................................................3
1.2 When determining the Corporate Personality of JAJA BIOFUEL LTD, Danubian
Law recognizes Principles of International Law................................................................3
1.3 JAJA BIOFUEL LTD Does Not Have to Be Bound by the Contract in Order to Be
Bound by the Arbitration Agreement.................................................................................3
1.4. JAJA BIOFUEL LTD EXPRESSED CONSENT TO ARBITRATE.......................4
1.5. JAJA BIOFUEL LTD’ CONDUCT IMPLIES CONSENT TO BE BOUND TO
THE ARBITRATION AGREEMENT...............................................................................5
PART II: What is the law governing the Arbitration Agreement?..................................7
The Law of Danubia should govern the Arbitration Agreement.........................................7
2.1) The law of Danubia follows the three-step test to determine the law of arbitration
agreement.............................................................................................................................7
2.2) The Express law chosen by the parties.........................................................................8
2.3) The implied law that indicates their choice and intention............................................8
2.4) The practices established between the parties and usages...........................................9
2.5) Reasonableness.............................................................................................................9
2.6) The law to which there is a real and close connection to the arbitration...................10
2.7) Se¶bility.....................................................................................................................11
2.8) Free-standing agreement.............................................................................................12
PART III: IS THE CISG APPLICABLE TO THE CONCLUSION OF THE
ARBITRATION AGREEMENT IN THE EVENT IT IS GOVERNED BY THE LAW
OF MEDITERRANEO?.....................................................................................................13
3.1 Scope of Application of CISG.....................................................................................13
3.2 Doctrine of Se¶bility...................................................................................................14
3.3 Law of the Seat............................................................................................................16
 MEMORANDUM FOR CLAIMANT

PART IV: HAVE THE PARTIES CONCLUDED A CONTRACT IN 2020?..............17

4.1 The conduct of the parties is sufficient to show that the contract is concluded..........17
4.2 The parties are bound by practices which they have established between themselves.
...........................................................................................................................................18
4.3 Contract was concluded when the Respondent accepted the proposal........................18
4.4 Respondent has shown acceptance to the contract by its conductance.......................19
4.5 Respondent intent was clear to show the conclusion of contract................................20
4.6 Respondent has breached the contract.........................................................................20
4.7 Respondent has to provide compensation for damages to the claimant......................21
4.8 CLAIMANT Made The Last Shot Doctrine And Therefore Its General Conditions
Govern The Contract.........................................................................................................22
4.9 The Burden Of Proof Of Breach Of Contract Rests With RESPONDENT................22
PART V:- IF A CONTRACT WAS CONCLUDED WERE CLAIMANT’S
GENERAL CONDITIONS OF SALE VALIDLY INCLUDED INTO THAT
ALLEGED CONTRACT?.................................................................................................23
5.1 CLAIMANT’S general conditions of sale were included in line with the practice
established between the CLAIMANT and the RESPONDENT.......................................23
5.2 The contract is based on standard terms and conditions..............................................25
5.3 CLAIMANTS General conditions of sale have remained unchanged........................27
5.4 CLAIMANT’S General conditions of sale have been validly included in the contract.
...........................................................................................................................................27
REQUEST FOR RELIEF......................................................................................................28

TABLE OF LEGISLATION AND RULES.........................................................................III

CERTIFICATE OF VERIFICATION ..................................................................... XXXVII

TABLE OF ABBREVIATIONS
ABBREVIATION REFERENCE

AC                                           Advisory Council

AIAC                                       Asian International Arbitration Centre

 MEMORANDUM FOR CLAIMANT

Art/Arts                                Article/Articles

BALCO                                   Bharat Aluminium Company

Bulbank                                   Bulgarian Foreign Trade Bank

C                                              Claimant

CISG                                        United Nations Convention on Contracts for the International

Sale      

                                                 of Goods, 11 April 1980

Co.                                           Company

Corp.                                        Corporation 

D                                              Defendant           

ed/eds                                       Editor/editors

edn                                            Edition

Ex C                                          CLAIMANT’s Exhibit No 

Ex R                                       RESPONDENT’s Exhibit No

FTAC                                        Foreign Trade Arbitration Commission

HC                                            High Court

ibid.                                           ibidem (in the same place)

ICC                                           International Chamber of Commerce

Labs.                                         Laboratories

Ltd.                                            Limited
 MEMORANDUM FOR CLAIMANT

No                                              Number

NoA                                           CLAIMANT’s Notice of Arbitration

NYC                                          New York Convention

Ors                                             Others 

p/pp/pg                                       Page/Pages

¶/¶s                                   ¶graph/¶graphs

Pharma.                                      Pharmaceuticals

RNoA                                         RESPONDENTS’ Answer to Notice of Arbitration

SC                                               Supreme Court

sec/secs                                       Section/Sections

SNE                                             Sojuznefteexport

UNCITRAL                                 United Nations Commission on International Trade Law

PICC UNIDROIT

U.S.                                               United States

U.S.S.R.                                        Union of Soviet Socialist Republics

v                                                versus
 MEMORANDUM FOR CLAIMANT

STATEMENT OF FACTS

ElGuP plc (‘CLAIMANT’) is a Mediterraneo-based company which is one of the largest

producers of RSPO-certified palm oil and palm kernel oil based in Mediterraneo. JAJA
Biofuel Ltd (‘RESPONDENT’) is based in Equatoriana and is a well-established producer of
biofuel based in Equatoriana. RESPONDENT was acquired in late 2018 by Southern
Commodities, a multinational conglomerate engaging in all kinds of commodities and their
derivates with its headquarters in Ruritania.

On December 2018 European Union revised its Renewable Energy Directive (RED II) due to
which CLAIMANT’S customer terminated the long-term supply agreement in January 2020
allegedly for cause. Due to which Claimant had to find a customer for 2/3 of its production of
certified palm oil on short notice.

On 28 March 2020 Mr Chandra used the Palm Oil Summit to approach Ms Bupati who had
been appointed a year before as the Head of Purchasing for RESPONDENT. She had
concluded numerous contracts with CLAIMANT for palm kernel oil. There Mr Chandra and
Ms Bupati managed to settle all commercial terms in their negotiations and was agreed that
Ms Bupati would get back to Mr Chandra with a definitive offer within the next three days.

On 1 April 2020 the respondent sent an email ordering 20,000t of RSPO-certified palm oil

per annum for the years 2021 - 2025 to be delivered in up to six instalments per annum,
delivery starting in January 2021 which was exactly the commercial terms agreed between the
Parties at the Palm Oil Summit.

On 9 April 2020 the CLAIMANT sent the contract to the RESPONDENT to get it signed. In
addition to that the Arbitration clause was mentioned in the CLAIMANT’S General
Conditions of Sale, which was attached in the mail sent to the RESPONDENT also
mentioning explicitly that Contract would be governed by the law of Mediterraneo.

On 3 May 2020 the RESPONDENT contacted the CLAIMANT to set up a meeting to discuss
issues concerning the letter of credit, which the RESPONDENT was required to open under
the Contract. There was also a mention of atleast adding a reference of the UNCITRAL
Transparency Rules by the RESPONDENT.

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On 29 October 2020 CLAIMANT learned from an article in Commodities News that

RESPONDENT allegedly had stopped all further negotiations with CLAIMANT and that it
was reconsidering its palm oil-based biofuel activities.

On 30 October 2020 Claimant received a letter from Ms. Youni Lever about the termination
of any further negotiations on the delivery of palm oil and additionally renounced all existing
contractual relations, allegedly due to information about Claimant’s infringements of basic
RSPO standards. Over the Course of next month there were several round of negotiations with
respondent COO, Mr. Fotearth to no avail and even the mediation effort between the parties
failed.

On 14 August 2021, CLAIMANT initiates arbitration at the Asian Arbitration Institution

against RESPONDENT, which consents to join the proceedings. In RESPONDENTS’
Answer to the Notice of Arbitration (‘RNoA’), they request Arbitral Tribunal lacks
jurisdiction. CLAIMANT object to this request.

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 MEMORANDUM FOR CLAIMANT

INTRODUCTION

1. JAJA BIOFUEL LTD actively participated in the negotiation process, determining the
content of the Contract, thereby expressly consenting to the contract which in turn
consented to the arbitration agreement. The consent of JAJA BIOFUEL LTD can also be
implied from their conduct. The behaviour of JAJA BIOFUEL LTD confirms their
intention to be bound, refuting their present claims that they didn’t wish to continue. This
conduct shows an implied consent to the Arbitration Agreement. (Part I)
2. In conclusion, the law of Danubia should govern the arbitration agreement as it satisfies
all the criteria of the three-fold test, set out for determining the governing law of the
arbitration agreement and the UNIDROIT Rules. Further, even if the court were to
consider that there was no explicit or implied law decided by the parties, the law of the
seat of the arbitration, i.e. Danubia would apply. It is so because following the Doctrine of
Separability and the concept of a free-standing arbitration agreement, the law of the seat
would be considered more appropriate. (Part II)
3. CLAIMANT’S General Conditions of Sale were validly included in the contract as the
RESPONDENT had placed an order without objecting to them, which was in line with the
practice established between the CLAIMANT and the RESPONDENT as the General
Conditions were known to the RESPONDENT due to prior dealings with the
CLAIMANT. The terms and conditions are standard terms that have remained unchanged
and unobjected. When the RESPONDENT places an order, it is implied that they accept
the terms and conditions. (Part III)
4. When Claimant approached Ms. Bhupati at the Palm Oil summit for a long-term
commitment Ms. Bupati showed great interest in purchasing the entire available
production, Mr. Chandra and Ms. Bupati managed to settle all commercial terms in their
negotiations at the Palm Oil Summit, it was agreed that Ms. Bupati would get back to Mr
Chandra with a definitive offer within the next three days which she indeed returned when
she sent the mail to Claimant including the commercial terms which was agreed between
the parties the contract was concluded between the parties. This shows that the
Respondent accepted the offer made by claimant thus concluding the contract. (Part
5. The Scope of CISG as defined in it’s Part 1, clearly shows that arbitration agreements are
out of its purview. Further, the doctrine of separability, as established by case laws and
affirmed by international trade laws and rules, shows that the arbitration agreements exists

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 MEMORANDUM FOR CLAIMANT

as an entity, separate from the original agreement and thus will be out of scope of the
CISG even in the event that it may be applicable on the main contract. Additionally,
Danubia being the seat of Arbitration, CISG will not be applicable to the arbitration
agreement as per the rules laid down in the New York Convention as Danubia is not a
signatory to it. Thus, the CISG will not be applicable to the Arbitration Agreement and
subsequently it’s conclusion. (Part V)

PART I:- .Have the Parties validly agreed on the jurisdiction of the Arbitral Tribunal?

1.1 Danubian Law Determines JAJA BIOFUEL LTD’S Consent to the Arbitration
Agreement

1.1.1 In the first approach, where JAJA BIOFUEL LTD is being joined as a consenting
party, there are two forms: express and implied consent. When a party has explicitly
stated its intention to be bound by an arbitration agreement, it is to be considered to
be express consent. When a party has not explicitly given its consent, but has behaved
in a manner befitting a party meaning to be bound, this is implied consent [BORN,
p.1150]. In either case, when considering joining parties, the question is not of
extending the agreement to third parties, but instead recognizing the joined parties as
principal contractual parties [BORN, p.1139][PO.1 ¶3; PO.2 (13), ¶13].

1.2 When determining the Corporate Personality of JAJA BIOFUEL LTD, Danubian
Law recognizes Principles of International Law

1.2.1. In the second approach, the multinational nature of the parties involved in this case
invites the application of Principles of International Law. Applying only principles of national
law would impair the Arbitral Tribunal’s mandate to resolve the dispute whilst taking into
consideration the international nature of the litigation. Therefore, the issue of parties, when
the party to be joined is engaged in international commerce, must be resolved according to
rules specific to situations of this kind. It is for such cases that Principles of International Law
work as a gap filler. These principles include the Arbitral Estoppel and Good Faith.
[Thompson CSF SA v. AM Arb. Association 64 f.3d 125 130 (2nd circuit); Merril Lynch Inv.
Managers v. Optibase Ltd. 337 F.3d 125, 130 (2nd circuit 2003); Interocean Shipping Co. v.
National Shipping; Trading Corp. 523 F.2d 527, 539 (2nd Circuit 1975)][BORN pp. 1134-

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 MEMORANDUM FOR CLAIMANT

1139,1166,1193; BREKOULAKIS p.150][ Adams & Ors v. Cape Industries plc. & Anor
(1990) BCC 786 (CA)].

1.3 JAJA BIOFUEL LTD Does Not Have to Be Bound by the Contract in Order to Be
Bound by the Arbitration Agreement

1.3.1. The differentiation of the substantive contract and the arbitration agreement are very
important factors when determining to what JAJA BIOFUEL LTD have consented to and
where. The principle of separation states that a party does not need to be bound by the
substantive contract in order to be bound by the arbitration agreement. The substantive
contract does not even have to be valid to allow for arbitration. This rule is enshrined in
Article 7(1) Option 1 Model Law but is also a generally observed rule [BORN pp. 310, 411;
National Power corp. v. Westinghouse DFT 119 II 380,384].

1.3.2. As the Arbitration Agreement is a part of the substantive contract, consent to the
contract will also give consent to the Arbitration Agreement as according to the principle
above [Ex. C4]. However, it is also possible for JAJA BIOFUEL LTD not to be a party to all
aspects of the contract, and just be a party to the Arbitration Agreement, as well as an even
more minimalist approach where JAJA BIOFUEL LTD is not even a party to the contract at
all but is bound by the Arbitration Agreement.

1.3.3. The Model Law determines the validity of the Arbitration Agreement and its scope
[SCHUMACHER, p. 54; SCHWAB & WALTHER, p. 383; REDFERN & HUNTER, ¶2:89-
2:90]. Pursuant to Article 7 (1)(2) of the Model Law (option 1, as adopted by Danubia), an
arbitration agreement comprises of an agreement between the parties to submit to arbitration
all or certain disputes arising out of a defined legal relationship between them.

1.3.4. CLAIMANT and RESPONDENT chose to include an arbitration clause in the written
contract, by mentioning General Principle fulfilling the requirements of PICC and NYC [Ex.
C4]. The Article 7(3) of the Model Law concerns the definition of the form of the Arbitration
Agreement and not the problem whether the parties have indeed reached a valid agreement to
arbitrate. The latter issue is to be dealt with by national legislation [BINDER, p.115; A/61/17,
¶ 153].

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 MEMORANDUM FOR CLAIMANT

1.4. JAJA BIOFUEL LTD EXPRESSED CONSENT TO ARBITRATE

1.4.1. JAJA BIOFUEL LTD rejects any obligation to the Arbitral proceedings, as JAJA
BIOFUEL LTD is not a contracting party and is therefore not obligated to arbitrate. This
rejection is unfounded, as JAJA BIOFUEL LTD did give consent by concluding the contract
and not rejecting the contract within the specified time and thus became a contracting party.
1.4.2. Under the contract law of Danubia, the PICC, the freedom of contract principle is
enshrined in Art. 1.1. This principle allows a party to choose whether or not to enter into a
particular contract. However, after consenting to a contract, a party is not free to ‘just’ revoke
their consent. The PICC allows a contractual obligation to be formed (concluded) by way of
acceptance of an offer or by conduct. [Art. 2.1.1 PICC]. Whilst the exact moments of offer
and acceptance may be harder to define in complex arrangements, it is easier to determine
from conduct when a set of terms have been (at least) notionally agreed upon by the parties
[PICC p.36].

1.4.3. JAJA BIOFUEL LTD actively participated in the negotiation process, determining the
content of the Contract [NOA ¶ 6]. Once the content was agreed upon, JAJA BIOFUEL LTD
accepted the contract, thereby expressly consenting to the contract [NOA ¶ 6]. This behaviour
fulfils the requirements of a contracting party under the substantive law of the contract. JAJA
BIOFUEL LTD consented to the arbitration agreement by assenting to the contract.

1.4.4. Contrary to Respondent’s statement, the use of term “General Principle” was not
supplied by RESPONDENT but by Mrs. Bhupati and had never been used before in the past
contract [RNOA ¶ 15]. When interpreting the term “General Principle”, it should be done so
in CLAIMANT’s favour.

1.4.5. Therefore, the “General Principle” can be interpreted as expressing consent for JAJA
BIOFUEL LTD to be part of any future arbitration.

1.5. JAJA BIOFUEL LTD’ CONDUCT IMPLIES CONSENT TO BE BOUND TO

THE ARBITRATION AGREEMENT

1.5.1. The consent of JAJA BIOFUEL LTD can also be implied from their conduct. The
behaviour of JAJA BIOFUEL LTD confirms their intention to be bound, refuting their present
claims that they didn’t wish to continue. This conduct shows an implied consent to the
Arbitration Agreement. [NOA ¶ 6].

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 MEMORANDUM FOR CLAIMANT

1.5.2. In order for a party to be bound by implied consent there must be an intention to be
bound, supported by a substantial involvement entailing the active participation in both the
negotiation and performance of the contract [STEINGRUBER, §5.14; PARK, ¶ 1.13, ITT v
Amerishare; ICC 4504] [ICC 6519 ¶ 1065; ICC 9771; ICC 11160; ICC 7155, ICC 9517; ICC
4131]. These criteria should be examined by using the substantive Danubian contract law
[Arts. 4.1, 4.2 & 4.3 PICC].

1.5.3. The conduct of JAJA BIOFUEL LTD suggests an intention counter to its statement that
it did not wish to be bound by the contract. On 1 April, 2020, the negotiations of the future
Contract were initiated between CLAIMANT and RESPONDENT, by the request of JAJA
BIOFUEL LTD [NOA ¶10; Ex. C1 ¶6].

1.5.4. Applying the standard of reasonableness from Articles 4.1 and 4.2 of the PICC, it
becomes clear that this active participation in negotiation of the contract suggests common
intention of the parties to by bound by the agreement at issue. The conduct of JAJA
BIOFUEL LTD during the negotiations was sufficient to express their agreement to arbitrate.

1.5.5. In addition, RESPONDENT itself refers to past relationship and practices between her
and CLAIMANT [Ex. R3 ¶3]. This reference falls under one of the circumstances from
Article 4.3 of the PICC, namely the practices established by the parties.

1.5.6. (I)The Applicable Law

To determine the applicable law, two possibilities must be examined. First, we will argue that
the law chosen in the Arbitration Agreement must be used. If one has not been expressly or
implicitly chosen, then the applicable law is the law of the seat of arbitration. Secondly, the
legal relationship between the third party and one of the signatory parties is examined. This
serves to ensure no third party may be brought into extremely unfavourable conditions by the
signatories.

Danubian law is explicitly stated as the choice of law for the Contract and the Arbitration
Agreement [NOA, ¶14]. As the seat of arbitration, Danubian law would also be used under
the criteria of the BGH. Danubian Law should be applied to the Arbitration Agreement.

1.5.7. (II)The Form Requirement is Fulfilled

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 MEMORANDUM FOR CLAIMANT

To determine the form requirements of an arbitration agreement for signatory parties of the
New York Convention, Article II(1) of the convention must be inspected. In the BGH case,
the law in which the tribunals’ award on a joinder would need to be enforced was New Delhi,
India. India recognizes the doctrine [Rakesh S. Kathotia & Anr. v Milton Global Ltd. & Ors].
Therefore, the form requirement was met.

1.5.8 (III)Policy

The BGH ruling stated that an arbitral tribunal shouldn’t be dissuaded from applying the
Group of Companies doctrine based on its incompatibility with national law. The German
Supreme Court’s ruling reflects an arbitration friendly stance whereby the doctrine did not
necessarily have to be adopted in the German national law provided it did not violate public
policy. It was concluded that when it is merely inapplicable with German law, the doctrine
may still be used if it is accepted in the jurisdiction of enforceability.

Similar to Germany, Danubian law maintains a strong belief in the principle of party
autonomy within its national jurisdiction. Danubian contract law allows the adoption of
transnational principles. The doctrine’s applicability must be analysed on a case by case basis
to ensure its compliance with national public policy.

PART II: What is the law governing the Arbitration Agreement?

The Law of Danubia should govern the Arbitration Agreement.

Respondent claims that the Arbitration Agreement is governed by the law of Mediterraneo
and not by the law of Danubia. [Pg. 27, sec 14]

Contrary to the above claim the Arbitration Agreement is governed by the law of Danubia.

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 MEMORANDUM FOR CLAIMANT

2.1) The law of Danubia follows the three-step test to determine the law of arbitration
agreement

2.1.1) The Court in the Sulamérica Cia Nacional de Seguros SA and ors v Enesa Engenharia
SA and ors, came up with a three-tiered step-wise enquiry to be followed for the
determination of the proper law of arbitration agreement setting hierarchy between the three
tests:

 The express law chosen by the parties(2.2); or, 

 The implied law that indicates their choice and intention; or, (2.3)
 The law to which there is a real and close connection to the arbitration. (2.6)

2.1.2) It is pertinent to note that these laws must be seen in a way of a hierarchical inquiry
which needs to be followed in a step-wise manner. The inquiry must be to look into the
express choice of the parties first. All the three steps have been met by the law of Danubia.

2.2) The Express law chosen by the parties

2.2.1) According to Part (2) of the Art 2.1.11 of the PICC Rules, “However, a reply to an
offer which purports to be an acceptance but contains additional or different terms which do
not materially alter the terms of the offer constitutes an acceptance, unless the offeror, without
undue delay, objects to the discrepancy. If the offeror does not object, the terms of the
contract are the terms of the offer with the modifications contained in the acceptance.”

2.2.2) The Claimant had included the arbitration clause in their General Conditions of Sale
[Pg. 6, sec 14], which was provided to the Respondent as an attached document in the mail
containing the Contract documents [Ex C4, ¶ 3]. Thus, the offer regarding the Arbitration
agreement was provided by the Claimant to the Respondent.

2.2.3) Consequently, when Ms. Bupati’s assistant, Ms. Fauconnier , held discussion with Mr.
Forrest Rain in early May 2020, in addition to the letter of credit she wanted to know whether
the Claimant could amend the arbitration section in clause 7 by adding at least a reference to
the UNCITRAL Transparency Rules. [Ex C5, sec 5].

2.2.4) Therefore, recognizing the fact that there is an expressed acceptance of the Arbitration
clause by the Respondent, as by applying the above law we can see that there was an

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 MEMORANDUM FOR CLAIMANT

acceptance to the arbitration clause and hence the law of Danubia, as the modification to the
offer did not materially alter the terms of the offer.

2.3) The implied law that indicates their choice and intention

2.3.1) Art 5.1.1 of the UNIDROIT Rules states that “The contractual obligations of the parties
may be expressed or implied.” In addition to that, Art 5.1.2 of the act states from where these
Implied obligations stem from, “a) the nature and purpose of the contract; (b) practices
established between the parties and usages (2.4); (c) good faith and fair dealing; (d)
reasonableness (2.5).”

2.4) The practices established between the parties and usages

2.4.1) According to Art 2.1.19 of the PICC Rules,” (1) Where one party or both parties use
standard terms in concluding a contract, the general rules on formation apply, subject to Art
2.1.20 - 2.1.22. (2) Standard terms are provisions which are prepared in advance for general
and repeated use by one party and which are actually used without negotiation with the other
party.

2.4.2) Mr. James Chandra and Ms. Bupati, had been in contact with each other regarding
negotiations between 2010-2018 [ Ex C1, sec 2]. Accordingly, they were familiar with each
other’s practices and business obligations. Ms. Bupati was informed of the change of the
original arbitration clause from the FOSFA/PORAM 81, by the AIAC model clause by the
Claimant in 2016 [Ex C1, sec 4].

2.4.3) The above arbitration clause falls under the category of being a standard term according
to the UNIDROIT Rules and also that there was an implied obligation from the practices
established between the parties.

2.5) Reasonableness

2.5.1)  According to the Claimant both the parties went ahead with the agreed upon AIAC
Mediation Rules for a mediation settlement [ Pg.6, sec 11].

2.5.2)Claimant’s General Conditions of Sale, which have been included into the Contract
contain in Art 9 the following arbitration clause:

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 MEMORANDUM FOR CLAIMANT

 “Any dispute, controversy or claim arising out of or relating to this contract, or the breach,
termination or invalidity thereof shall be settled by arbitration in accordance with the AIAC
Arbitration Rules.

The seat of arbitration shall be Danubia.

The language to be used in the arbitral proceedings shall be English.

This contract shall be governed by the substantive law of Danubia.

Before referring the dispute to arbitration, the parties shall seek an amicable settlement of that
dispute by mediation in accordance with the AIAC Mediation Rules as in force on the date of
the commencement of mediation.” [Pg. 6, sec 14]

2.5.3) Thus, after applying the PICC Rules, it is reasonable to believe that by agreeing to
mediate under the AIAC Mediation Rules, which was a part of the Arbitration Clause, the
Respondent has implied that it had knowledge of the changed Arbitration agreement and this
action showed their intention to be governed by the substantive law of Danubia.

2.6) The law to which there is a real and close connection to the arbitration.

2.6.1) In the case of Longmore LJ in C v D [2007] which said:

"The question then arises whether, if there is no express law of the arbitration agreement, the
law with which that agreement has its closest and most real connection is the law of the
underlying contract or the law of the seat of the arbitration. It seems to me that …the answer
is more likely to be the law of the seat of the arbitration than the law of the underlying
contract."

2.6.2) Even if we were to consider that no express law has been chosen by the parties or there
is no implied choice of law either, the law of the seat of the arbitration or the law of Danubia
would apply to the arbitration agreement, as it has the closest and most real connection to the
arbitration.

2.6.3) The Court in Sulamérica Cia Nacional de Seguros SA and ors v Enesa Engenharia SA
and ors held that, in the circumstances of the case, the arbitration agreement had its closest
and most real connection with the law of the place where the arbitration was to be held, which

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 MEMORANDUM FOR CLAIMANT

would exercise the supporting and supervisory jurisdiction necessary to ensure the
effectiveness of the arbitral procedure.

2.6.4) Thus, since the lex arbitri – generally reflected in the arbitration laws of the seat –
tends to have the closest connection with the arbitral proceeding, the substantive law of the
seat tends to be the best suited to govern the arbitration agreement if we were to consider that
the parties fail to choose one. This conclusion matches the rationale behind the New York
Convention when Art V(1)(a) was drafted, which states, ‘Recognition and enforcement of the
award may be refused, at the request of the party against whom it is invoked, only if that
party furnishes to the competent authority where the recognition and enforcement is sought,
proof that:

(a) The parties to the agreement referred to in article II were, under the law applicable to
them, under some incapacity, or the said agreement is not valid under the law to which the
parties have subjected it or, failing any indication thereon, under the law of the country
where the award was made.’
2.6.5) In the absence of an express choice of law that should govern the Arbitration
Agreements, the Claimant concludes that the applicable law is the law of Danubia, which as
the law of the seat is the law most closely connected to the Arbitration Agreements.

2.6.6) Alternatively, even if we were to consider that there is no express choice of a law for
the arbitration agreement, the law of the seat of the arbitration would apply. The arbitration
clause is considered to be se¶te from the contractual agreement (2.7) and the choice of law in
case of a free-standing arbitration agreement.(2.8)

2.7) Se¶bility

2.7.1) The court in  Sulamérica Cia Nacional de Seguros SA and ors v Enesa Engenharia SA
and ors opined that:

In determining the proper law of an arbitration agreement, the doctrine of se¶bility must
always be borne in mind. That doctrine holds "that an arbitration agreement forming part of
a substantive contract is se¶ble, in the sense that it has an existence se¶te from that of the
contract in which it is found"

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 MEMORANDUM FOR CLAIMANT

2.7.2) In the Bulbank case the SC of Sweden held that the arbitration agreement was valid
under the law of the seat of arbitration, Swedish law, stating that “ ...no particular provision
concerning the applicable law for the arbitration agreement itself was indicated [by the
parties]. In such circumstances the issue of the validity of the arbitration clause should be
determined in accordance with the law of the state in which the arbitration proceedings have
taken place, that is to say, Swedish law.” The SC thus ignored the parties’ choice of Austrian
law to govern the underlying contract, considering that the arbitration clause ought to be
treated as a se¶te agreement subject to a se¶te law.

2.7.4) The Claimant contends that the Arbitration Agreements are se¶te and distinct from the
Sale Contract and are capable of subsisting irrespective of the validity of the Contract, as
applying the above ruling they are se¶ble and hence can be subject to a system of law that is
different from the substantive law of Mediterraneo underlying the contract.

2.8) Free-standing agreement

2.8.1) In BCY v BCZ [2016], the Singapore HC clarified the position in relation to the law
applicable to the arbitration agreement where such choice is absent. Hence,with respect to
‘freestanding’ arbitration agreements, the Court concluded that “ if there is no express choice
of law of the arbitration agreement, the law of the seat would most likely govern the
arbitration agreement”.

2.8.2) Barring any express choice by the parties, the law governing the arbitration agreement
which is freestanding is the law of the seat and the law governing the arbitration agreement
contained in a substantive contract is the law of the substantive contract.

2.8.3) In the present instance, the arbitration agreement was included in the Claimant’s
General Conditions of Sale, which was not a part of the main contract[ C4, ¶ 3].

2.8.4) Therefore applying the above judgement, we can conclude that in the absence of a
choice of law for a free-standing arbitration clause, the law of the seat of arbitration would
take supremacy.

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PART III: IS THE CISG APPLICABLE TO THE CONCLUSION OF THE

ARBITRATION AGREEMENT IN THE EVENT IT IS GOVERNED BY THE LAW
OF MEDITERRANEO?

3.1 Scope of Application of CISG

3.1.1 Article 1 of the CISG talks about the contracting states. It states that the CISG applies to
contracts for the sale of goods between parties whose places of business are in different
contracting states. It also applies when the rules of private international law lead to the
application of the law of a contracting state. It is important to note that the CISG is a set of
rules for business not consumer contracts

3.1.2 Article 3 of the CISG considers contracts for the supply of goods to be manufactured or
produced to be contracts for the sale of goods, unless the buyer undertakes to supply a
substantial part of the materials necessary for the manufacture or production (Article 3 (1)
CISG). Under Article 3(2) CISG the Convention mentions it does not apply to mixed
contracts in which labour or other services are involved if the labour or other services form
the preponderant part of the obligations of the party who furnishes the goods.

3.1.3 The interpretation of these articles explicitly provides that CISG is applicable only to
contracts of sale. Hence, even though an arbitration clause is incorporated into a contract
which is governed by CISG, the arbitration clause and the main contract are se¶te due to the
‘Doctrine of Se¶bility’. This means there is no automatic application of the law governing
the substantive part of the contract to the arbitration agreement since it is se¶ble from the rest
of the contract.  Thus, an arbitration clause cannot be governed by the CISG unless there is an
express agreement between the parties to the contract to this effect. Thus, an arbitration clause
clearly constitutes a se¶te contract altogether.    

3.1.4 Additionally the areas which are explicitly covered by the CISG are listed in Article 4 of
the Convention. These areas are – (i) formation of contract, and, (ii) rights and obligations of
the seller and buyer. On the other hand, the issues including transfer of property and validity
of the original contract are not governed by CISG. 

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 MEMORANDUM FOR CLAIMANT

3.1.5 The issue of validity of the contract, as mentioned in the Article 4(a), has been
interpreted by the US District Court in the Geneva Pharma. Tech v. Barr Labs., to mean “any
issue by which the domestic law would render the contract void, voidable, or enforceable”.  

3.1.6 Thus, it can be inferred that the issue of scope of application of the CISG rests with the
national laws of the Contracting States. In this case, the Law of Mediterraneo as
acknowledged by the Respondent in their letter dated 1st April 2021, where they
acknowledged that the Claimant’s new policy was for the Claimant’s sale contracts to be
submitted to Mediterranean law. Thus, with the application of the laws of Mediterraneo, the
arbitration agreement and its conclusion will be out of scope of the CISG, as being elaborated
further

3.2 Doctrine of Se¶bility

3.2.1 The doctrine of se¶bility was first articulated by the U.S. Supreme Court in Prima Paint Corp. v.
Flood & Conklin Manufacturing Co. It says that the arbitration clause in a contract is considered to be
se¶te from the main contract of which it forms part and as such survives the termination, breach and
invalidity of that contract.                                                                                                            
Se¶bility thus ensures that when a party claims that there has been a total breach of the contract by the
other, the contract is not destroyed for all purposes. Instead, it survives for the purpose of measuring
the claims arising out of the breach and the arbitration clause survives for determining the mode of
their settlement.

3.2.2 In Prima Paint Corp v. Flood & Conklin Manufacturing Co. the Court ruled that arbitration
clauses can be ‘se¶ble’ from the contracts in which they are included. 

3.2.3 The plaintiff in Prima Paint Corp brought an action to rescind a contract on the grounds that the
contract has been fraudulently induced. The defendant moved to stay the court action, invoking the
contract’s arbitration clause and contending that an arbitrator, and not a court, should decide whether
the contract was valid. 

3.2.4 The Supreme Court concluded that because the plaintiff was challenging the underlying contract
generally rather than the arbitration clauses specifically, arbitration of plaintiff’s fraudulent
inducement claims were required. 

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 MEMORANDUM FOR CLAIMANT

3.2.5 And held that the arbitration clause in the agreement was se¶ble from the rest of the
agreement; and that the allegations as to the validity of the agreement in general, as opposed to the
arbitration clause in particular, were to be decided by the arbitrator.

3.2.6 In SNE v. JOC Oil Ltd., SNE was a foreign trade organization established under the laws of the
former U.S.S.R. In 1976, SNE entered into various agreements to sell quantities of oil to JOC Oil
Limited (JOC), a Bermuda based company. The purchase agreements incorporated SNE’s standard
conditions, which contained the following arbitration clause:

3.2.7 “All disputes or differences which may arise out of this contract or in connection with it are to be
settled, without recourse to the general Courts of Law, in the Commission of the U.S.S.R. Chamber of
Commerce and Industry in Moscow, in conformity with the rules of procedure of the above
Commission.”

3.2.8 JOC took delivery of 33 oil shipments, worth approximately $100 million, without paying for
them. Following JOC’s non-payment, SNE initiated arbitration under the arbitration clause set forth
above. 

3.2.9 JOC replied, in part, by claiming that the purchase agreement had not been executed by two
authorized representatives of SNE and accordingly was void under Soviet law. JOC also alleged that,
as a consequence, the arbitral tribunal lacked competence to adjudicate the dispute because the
arbitration clause was void. 

3.2.10 SNE claimed that the sales agreement was not void and that, even if it were, the arbitration
clause was se¶ble and the law applicable to that agreement did not require two signatures to be valid.

3.2.11 As a result the arbitral tribunal held that the Commission has recognized that an arbitration
agreement (arbitration clause) is a procedural contract, independent from the material-legal
contract and that therefore the question as to the validity or invalidity of this contract does not affect
the agreement of the parties about the submission of the existing dispute to the jurisdiction of the
FTAC. 

Se¶bility is incorporated in other international statutes and rules as well:

3.2.12 The UNCITRAL Model Law on international commercial arbitration in Article 16(1) states
that:

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 MEMORANDUM FOR CLAIMANT

The arbitral tribunal has the power to rule on its own jurisdiction and to resolve the issues including
any objections related to the validity of the agreement or disputes arising out of the Arbitration
agreement. But when an arbitration clause is included in a contract, it shall be considered se¶te and
shall be treated as an independent agreement.

3.2.13 Even the ICC Rules of Conciliation and Arbitration, 1975 give the provision for doctrine of
se¶bility under Article 8(4) under the heading ‘effect of the agreement to arbitrate’. This article states
that:

Just because of a claim that a contract is null and void; the arbitrator shall not cease to have the
jurisdiction to decide a certain matter through arbitration. Even though the contract itself is invalid, he
shall continue to have jurisdiction to adjudicate the pleas and claims and to determine the rights of the
parties.                       

3.2.14 The scope of this article is wide and far-reaching. For the purpose of ruling on its validity, it
provided for the se¶bility of arbitration agreement in a contract and it also empowered the arbitrators
to determine the rights of the parties even after a determination that the main contract is non-existent
or null and void.

3.3 Law of the Seat

3.3.1 The Seat of Arbitration determines the applicable law governing the Arbitration
including the procedural aspects. When the parties specify an applicable law for the
Arbitration agreement, that law governs the Arbitration.

3.3.2 The Supreme Court of India in its decision given in the case of BALCO Ltd. v. Kaiser
Aluminium Technical Service Inc. held that the choice of another country as the Seat of
Arbitration inevitably imports an acceptance that the law of that country relating to the
conduct and supervision of Arbitrations will apply to the proceedings.

3.3.3 Article V 1 A of the New York Convention on the Recognition and Enforcement of
Foreign Arbitral Awards states that the recognition and enforcement of the award may be
refused, at the request of the party against whom it is invoked, only if that party furnishes to
the competent authority where the recognition and enforcement is sought, proof that the
parties to the agreement referred to in article II were, under the law applicable to them, under
some incapacity, or the said agreement is not valid under the law to which the parties have
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subjected it or, failing any indication thereon, under the law of the country where the award
was made. 

3.3.4 Danubia being the seat of arbitration as agreed upon by both parties [Ex R4, Art 9] is not
a contracting State to the CISG (PROCEDURAL ORDER NO. 1 of 8 October 2021, ¶ 3).
Thus, CISG will not be applicable to the arbitration agreement, and consequently its
conclusion.

PART IV: HAVE THE PARTIES CONCLUDED A CONTRACT IN 2020?

4.1 The conduct of the parties is sufficient to show that the contract is concluded

4.1.1 Article 2.1.1 of PICC Principle states that a contract may be concluded either by the
acceptance of an offer or by conduct of the parties that is sufficient to show agreement, given
that when Claimant approached Ms. Bhupati at the Palm Oil summit for a long-term
commitment Ms. Bupati showed great interest in purchasing the entire available production of
palm oil from Claimant from 2021 onwards for five years and in principle, Mr Chandra and
Ms. Bupati managed to settle all commercial terms in their negotiations at the Palm Oil
Summit, it was agreed that Ms. Bupati would get back to Mr Chandra with a definitive offer
within the next three days which she indeed returned when she sent the mail to Claimant
including the commercial terms which was agreed between the parties the contract was
concluded between the parties.

This shows that the Respondent accepted the offer made by claimant thus concluding the
contract.

4.2 The parties are bound by practices which they have established between themselves.

4.2.1 Article 1.9.1 and 1.9.2 of PICC Principles states that “A practice established between
the parties to a particular contract is automatically binding, except where the parties have
expressly excluded its application” there is a practice between the Parties that unless
Respondent objects to the contractual documents within a reasonable period of time, a
contract is concluded with the terms of the contractual documents. 

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4.2.2 The practice established with Ms. Bupati in claimant’s previous contracts was that
unless Ms. Bhupati objected to the terms of the contract documents within a week she
accepted them.

4.2.3 That practice also extends to the inclusion of the General Conditions of Sale even if one
would not consider the clear reference to the General Conditions of Sale to be sufficient in
itself to make them part of the contract.

4.2.4 Article 1.9.6 of PICC states that Usages prevail over the Principles meaning both
courses of dealing and usages, once they are applicable in a given case; prevail over
conflicting provisions contained in the Principles. The reason for this is that they bind the
parties as implied terms of the contract as a whole or of single statements or other conduct on
the part of one of the parties. 

4.3 Contract was concluded when the Respondent accepted the proposal

4.3.1 Article 2.1.2 of PICC states that A proposal for concluding a contract constitutes an
offer if it is sufficiently definite and indicates the intention of the offeror to be bound in case
of acceptance. When the claimant approached Ms. Bhupati at Palm oil summit it was evident
from the conduct between the parties that if offer was accepted the contract would be
concluded at the summit so when it was agreed that Ms. Bhupati would get back to Mr.
Chandra with a definitive offer within the next three days which she indeed returned when she
sent the mail to Claimant including the commercial terms which was agreed between the
parties the contract was concluded between the parties.

4.3.2 This Article lays down two requirements: the proposal must (i) be sufficiently definite to
permit the conclusion of the contract by mere acceptance and (ii) indicate the intention of the
offeror to be bound in case of acceptance meaning which the parties completely fulfilled. A
proposal addressed to one or more specific persons is more likely to be intended as an offer
than is one made to the public at large which here claimant only made the offer to Ms.
Bhupati.

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 MEMORANDUM FOR CLAIMANT

4.4 Respondent has shown acceptance to the contract by its conductance.

4.4.1 Article 2.1.6 of PICC states about the mode of acceptance which says if, by virtue of the
offer or as a result of practices which the parties have established between themselves or of
usage, the offeree may indicate assent by performing an act without notice to the offeror, the
acceptance is effective when the act is performed for which the Respondent has shown the
acceptance of contract by established practice i.e. First she didn’t object to the contract that
was send within a week which was parties’ established practice; Secondly she also sent the
mail requesting the first order and also sending the guidelines which were discussed at the
summit and thirdly when asked about the returning of signed copy of contract which was
completely just formal requirement it was not necessary, Respondent’s response was that she
will look into that. To this point the Respondent has not even shown a single instance where
there is an intent to discontinue the contract.

4.4.2 Article 2.1.7 of PICC and Article 18(2) and Article 18(3) of CISG talks about the time
of acceptance An offer must be accepted within the time the offeror has fixed or, if no time is
fixed, within a reasonable time having regard to the circumstances, including the rapidity of
the means of communication employed by the offeror. An oral offer must be accepted
immediately unless the circumstances indicate otherwise. In this case reasonable time was one
week because of the parties established practices.

4.5 Respondent intent was clear to show the conclusion of contract.

4.5.1 Article 1.2.1 and 1.2.2 of PICC Principle state that Contracts as a rule not subject to
formal requirements and even statements of intent made by parties either in the course of the
formation or performance of a contract or in other context. It specifies that since modern
means of communication, many transactions are concluded at great speed and by a mixture of
conversations, telefaxes, paper contracts, e-mail and web communication. On 1 April 2020
Ms. Bhupati had made the initial order by sending the mail and also included the detail in that
email for specifying how the delivery will be made for the period of 5 years thus showing the
cleat intent of conclusion of contract.

4.5.2 If the respondent wanted the inclusion of general principle or also redraw the whole
contract then the parties might not have only sent the order’s detail on email but also have

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 MEMORANDUM FOR CLAIMANT

clarify their intention other it will be assume that Ms. Bhupati is following the common set of
established practice. Not once in their meet Ms. Bhupati had mentioned these intention.

4.6 Respondent has breached the contract

4.6.1 ARTICLE 3.2.11 of PICC (Notice of avoidance) The right of a party to avoid the
contract is exercised by notice to the other party. 1. The requirement of notice This Article
states the principle that the right of a party to avoid the contract is exercised by notice to the
other party without the need for any intervention by a court. 

4.6.2 ARTICLE 7.3.2 of PICC (Notice of termination) (1) The right of a party to terminate
the contract is exercised by notice to the other party. (2) If performance has been offered late
or otherwise does not conform to the contract the aggrieved party will lose its right to
terminate the contract unless it gives notice to the other party within a reasonable time after it
has or ought to have become aware of the offer or of the nonconforming performance. In the
present case the respondent neither informed nor give notice to the respondent about the
termination of contract so any non-performance on the part of respondent would amount to
the breach of contract.

4.6.3 Also  ART 25 CISG states that fundamental breach is applicable ‘unless the party in
breach did not foresee and reasonable person of the same kind in the same circumstances
would not have foreseen such a result as claimant could not have foreseen the breach by
respondent. Had CLAIMANT intentionally derogated from the terms of the Contract and in
particular Article 5, it would be right for RESPONDENT to allege fundamental breach and
seek to avoid the contract. But as it has been demonstrated above, it was RESPONDENT who
has avoided the contract

4.6.4 The opposite is true for RESPONDENT. It is not reasonable to suggest that
RESPONDENT was surprised by CLAIMANTS actions. In light of the practices established
between the Parties, the General Condition cannot be regarded as not mentioned for the
RESPONDENT. 

4.6.5. Under the contract RESPONDENT was entitled to expect General Condition of sale,
however, and as demonstrated above, RESPONDENT through its own established practice 
agreed to accept delivery terms which were subsequently agreed by CLAIMANT. Therefore

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 MEMORANDUM FOR CLAIMANT

there was no breach. Even if it was accepted by the Tribunal that the contract term was
breached it is submitted here that there would be no substantial effect caused by such breach.
The nature of the contractual obligation to make delivery and to make delivery by sea to
Oceanside, Equatoriana has not changed. Art 60 GISG defines the buyer’s obligations to take
delivery. CLAIMANT has not obstructed delivery or the taking over of the goods.

4.6.7. Further, RESPONDENT has not evidenced any monetary loss as a result of the claimed
breach. The inclusion of General Condition has only a minor effect on the overall contract
value.  It is hard to consider that such detriment would substantially deprive RESPONDENT
of what he was entitled to expect under the Contract. 

4.7 Respondent has to provide compensation for damages to the claimant

4.7.1 ARTICLE 3.2.16 of PICC (Damages) Irrespective of whether or not the contract has
been avoided, the party who knew or ought to have known of the ground for avoidance is
liable for damages so as to put the other party in the same position in which it would have
been if it had not concluded the contract. Since the claimant had showed that the contract was
established but it was Respondent who had avoided the contractual obligation and breached
the contract and Respondent’s intention to breach the contract was not even informed to the
claimant within the reasonable time even when the claimant asked for the return of signed
contract so it was respondent who breach the contract and that is why the claimant is entitled
to receive the the damages that he has suffered due the breach of this contract.

4.8 CLAIMANT Made The Last Shot Doctrine And Therefore Its General Conditions
Govern The Contract. 

4.8.1. Under the PICC principle in its article 2.1.22 (Battle of forms): the final document, sent
prior to fulfilling the contract, is the contract, also known as the last shot doctrine. 

4.8.2. The battle of forms: Two persons intending to contract but tendering differing form
contracts rendering the conclusion as to the terms of the contract, or a determination as to
whether there was a contract, difficult [Duhaime's Law Dictionary]

4.8.3.Applying that to our case, CLAIMANT has made the final changes or the last shot
doctrine to the contract which means its general conditions are the applicable ones not
RESPONDENT [CLAIMANT’S EXHIBIT C5,pg 17, ¶ 1] 
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 MEMORANDUM FOR CLAIMANT

4.8.4. In the Butler Machine Tool Co case, Justice Lord Denning asserted that a contract will
exist “as soon as the last of the forms is sent and received without objection “ [the Butler
Machine Tool Co case 

4.8.5. CLAIMANT was the party who made the final changes to the contract and
RESPONDENT did not reject it. Therefore, CLAIMANT’S general conditions are the
applicable conditions on the contract.

4.9 The Burden Of Proof Of Breach Of Contract Rests With RESPONDENT. 

4.9.1. RESPONDENT should prove that CLAIMANT did not adhere with its obligations
under the contract since RESPONDENT claimed that the goods were non-conforming.
[Response to Notice of Arbitration, pg 26, ¶ 21]. 

4.9.2. Maxims ei qui affirmat non ei qui incumbit probation (burden of proof is on the one
who declares, not on one who denies) [KURKELA, Matti S.SNELLMAN Hannes pg
123]RESPONDENT claimed that the use of Palm Oil not in a compliance with the accepted
sustainability standards of RSPO and therefore CLAIMANT breached contract 1257 which
caused an immediate termination of it [CLAIMANT'S EXHIBIT c10, pg 22] .And further
claimed that CLAIMANT did not adhere with the RESPONDENT's code of conduct
[CLAIMANT'S EXHIBIT c6, pg 18, ¶ 3] 

4.9.3. RESPONDENT then without setting any solid proofs terminated the contract directly
[CLAIMANT'S EXHIBIT c10, pg 22]. This direct termination with no proper notice is not in
line with Art. 7.3.2 Of the PICC Principles, meaning RESPONDENT did not adhere to its
legal obligations.

PART V:- IF A CONTRACT WAS CONCLUDED WERE CLAIMANT’S GENERAL

CONDITIONS OF SALE VALIDLY INCLUDED INTO THAT ALLEGED
CONTRACT?

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 MEMORANDUM FOR CLAIMANT

5.1 CLAIMANT’S general conditions of sale were included in line with the practice
established between the CLAIMANT and the RESPONDENT.

5.1.1 As per Art 1.8 of PICC Principles 2016, a party cannot act inconsistently with an
understanding it has caused the other party to have and upon which that other party
reasonably has acted in reliance to its detriment. It imposes a responsibility on a party not to
occasion detriment to another party by acting inconsistently with an understanding concerning
their contractual relationship which it has caused that other party to have and upon which that
other party has reasonably acted in reliance. [Art 1.8 PICC  Principles 2004]

5.1.2 Art 1.9 of PICC Principles 2016 states that the parties are bound by any usage to which
they have agreed and by any practices that they have established between themselves. As per
Art 5.1.2 of PICC Principles 2016, there is an implied obligation upon parties which stems
from practices established between the parties and usages.

5.1.3 In Société Calzados Magnanni v. SARL Shoes General International, although the seller
denied the very existence of a contract of sale and relied on Art 18 (1) of CISG, according to
which silence or inactivity does not in itself amount to acceptance, the Court held that the
contract had indeed been concluded, even in the absence of any express acceptance on the
part of the seller. The Court referred to the practice of previous years, the seller having always
fulfilled the company’s orders without expressing its acceptance. Moreover, the seller did not
produce, in reply to the many letters of claim from the buyer, any document stating that it had
not received any order. 

5.1.4 In the present case, there is a practice between the Parties that unless the
RESPONDENT objects to the contractual documents within a reasonable period of time, a
contract is concluded with the terms of the contractual documents. [NoA, ¶ 19] 

5.1.5 That practice also extends to the inclusion of the General Conditions of Sale even if one
would not consider the clear reference to the General Conditions of Sale to be sufficient in
itself to make them part of the contract. In the present case, given that Ms Bupati had been
provided with a copy of the General Conditions of Sale in her function as the main purchase
manager of Southern Commodities and should thus have been aware of their content, it would
be a mere formality to require that such terms must be made available to her again [NoA, ¶

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20]. When the RESPONDENT places an order, it is implied that they have accepted the terms
and conditions.

5.1.6 In Interland Chemie BV v. Tessenderlo Chemi BV, the buyer argued that he is not bound
by the terms and conditions of the contract since he did not explicitly agree to them. However,
the Court dismissed the buyer's claim as the practices established between the parties had to
be considered. 

5.1.7 In an Arbitral Award, the Netherlands Arbitration Institute stated that the fact that the
buyer had on several occasions signed the faxed copy of the order confirmation containing
standard contract forms established a practice between the buyer and the seller, a practice “the
buyer has not deviated from once nor has the buyer informed the seller after receipt of the
general conditions that it did not wish the application of these conditions or wished to apply
its own general conditions, if any.” This led the court to state that the seller’s standard
contract terms had become part of the contract, since, by not informing the seller that it did
not accept the general conditions, the buyer created in any case the expectation that it agreed
to the application of the general conditions. In the present case, the RESPONDENT did not
inform the CLAIMANT that they were unwilling to accept the general conditions, therefore, it
is a reasonable assumption that the conditions were accepted.

5.2 The contract is based on standard terms and conditions.

5.2.1 Standard terms are included in the contract where the parties have expressly or
impliedly agreed to their inclusion at the time of the formation of the contract and the other
party had a reasonable opportunity to take notice of the terms. Amongst others, a party is
deemed to have had a reasonable opportunity to take notice of the standard terms:

a. Where the parties have had prior agreements subject to the same standard terms;
b. Where the terms are attached to a document used in connection with the formation of
the contract or printed on the reverse side of that document;
c. Where the terms are available to the parties in the presence of each other at the time of
negotiating the contract;

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 MEMORANDUM FOR CLAIMANT

d. Where, in electronic communications, the terms are made available to and retrievable
electronically by that party and are accessible to that party at the time of negotiating the
contract. [CISG-AC Opinion No. 13]

5.2.2 It is a common feature of the modern mass production economy that contracts for the
manufacturing, distribution and delivery of products and services are governed by the
standard terms and conditions of one of the parties. [Raiser Allgemeinen
Geschäftsbedingungen 26 ff; Wolf, Horn and Lindacher AGB-Gesetz Einl par1; Eiselen
Standaardbedinge 1; Hondius Standaardvoorwaarden 123; Kötz "Allgemeine
Geschäftsbedingungen" A23-24; Heinrichs Palandt par 1-3; Slawson 1971 Harv LR 529]

5.2.3 A decision held that a seller’s standard terms were incorporated into the contract where
the buyer was familiar with those terms from the parties’ prior dealings. [Oberster
Gerichtshof, 7Ob 301/01t ] In the present case, Ms. Bupati was well aware of the standard
terms and general conditions of sale due to prior dealings.

5.2.4 As per Art 2.1.19 of PICC Principles 2016, standard terms are provisions which are
prepared in advance for general and repeated use by one party and which are actually used
without negotiation with the other Party.  

5.2.5 What is decisive is not their formal presentation (whether they are contained in a se¶te
document or in the contract document itself; whether they have been issued on pre-printed
forms or are only contained in an electronic file, etc.), nor who prepared them (the  party
itself, a trade or professional association, etc.), nor their volume (whether they consist of a
comprehensive set  of provisions covering almost all the relevant aspects of the contract, or of
only one or two provisions regarding, for instance, exclusion of liability and arbitration).
What is decisive is the fact that they are drafted in advance for general and repeated use and
that they are actually used in a given case by one of the parties without negotiation with the
other party. [Art 2.1.19, PICC Principles 2004]

5.2.6 The contents of the contract may be contained not only in the part specifically
negotiated and agreed on by the parties but also by reference to standard terms used by one of
the parties, framework contracts, standard industry contracts or a combination of the above.
[CISG-AC Opinion No. 13]

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 MEMORANDUM FOR CLAIMANT

5.2.7 Where the offeror has clearly communicated to the offeree that it wanted the agreement
to be subject to its standard terms then the standard terms should be applicable where the
offeree accepts the offer, unless the offeree clearly indicates that it does not agree to such
incorporation which Ms Bupati has clearly failed to do. The practice established with Ms
Bupati in previous contracts was that unless she objected to the terms of the contract
documents within a week, she accepted them [Ex C1, ¶ 14].

5.2.8 Where there is a clear and conspicuous reference to the incorporation of the standard
terms, there should in principle be no problem about the incorporation of the terms as
acceptance by the offeree of the offer based on such document, creates the reasonable
impression in the mind of the offeror that the offer has been accepted without any
modification. [Schmidt-Kessel in Schlechtriem/Schwenzer Commentary Art 8 § 52; Schmidt-
Kessel Case Commentary at Germany Supreme Court 2001; Austria Supreme Court 2003;
Filanto SpA v Chilewich Intern Corp 789 F Supp 1229, 1240 (SD NY 1992). Contra Magnus
"Wiener UN Kaufrecht" Art 14 § 41 Germany Supreme Court 2001; Netherlands Arbitration
Institute 2005; Magnus "Standard Contract Terms" 314]
 
5.2.9 On 1 April 2020, CLAIMANT received an email from Ms Bupati in which she placed
an order with exactly the same commercial terms CLAIMANT had offered asking him to
prepare the contract documents [Ex C1, ¶ 12], which was exactly in line with the
procedure the CLAIMANT and RESPONDENT  had established when she Ms Bupati still
working for Southern Commodities, the parent company of JAJA Biofuel [Ex C1, ¶ 13]..

5.3 CLAIMANTS General conditions of sale have remained unchanged

5.3.1 In the present case, for the contract documents, CLAIMANT always used their contract
template, which is a customized and simplified version of the FOSFA/PORAM 81 contract
form. Into this template, CLAIMANT inserted the previously agreed commercial terms
including the shipping and insurance terms. In the accompanying letter or email CLAIMANT
additionally provided for the application of their General Conditions of Sale, which were
known to Southern Commodities. [Ex C1, ¶ 4]

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 MEMORANDUM FOR CLAIMANT

5.3.2 The content of CLAIMANT’S General Conditions of Sale remained unchanged, with
the exception of the general Arbitration Clause in Art 9, where CLAIMANT replaced in 2016,
the original arbitration clauses from the FOSFA/PORAM 81 contract form by the AIAC
model clause. Ms Bupati was told about the switch to the AIAC when CLAIMANT was
negotiating a contract with her in 2016 [Ex C1, ¶ 4].

5.3.3 The offeror need not make the standard terms available to the other party where the
parties have had prior dealings subject to the same standard terms or where the offeree has
prior knowledge of the contents of the standard terms. [CISG-AC Opinion No. 13]

5.4 CLAIMANT’S General conditions of sale have been validly included in the contract.

5.4.1 On 1 April 2020, Ms Bupati sent an email ordering 20,000t of RSPO-certified palm oil
per annum for the years 2021 - 2025 to be delivered in up to six instalments per annum,
delivery starting in January 2021 [Ex C2]. These were exactly the commercial terms agreed
between the Parties at the Palm Oil Summit. [NoA, ¶ 6]

5.4.2 Mr Chandra had his assistant Mr Rain prepare the necessary contractual documents. In
line with the practice established with Ms Bupati in previous transactions, the Contract was
based on Claimant’s contract template into which the details of the offer were incorporated
[Ex C3]. 

5.4.3 On 9 April 2020, Mr Rain sent the Contract signed by Mr Chandra to Ms Bupati’s
assistant, Ms Fauconnier. The accompanying letter explicitly mentioned that the Contract
would be governed by the law of Mediterraneo and that the purchase would be subject to the
Claimant’s General Conditions. [NoA, ¶ 7]

5.4.4 An effective inclusion of general terms and conditions first requires that it must be the
intention of the offeror to include his terms and conditions into the contract. In addition, as the
Court of Appeals correctly assumed, the Uniform Sales Law requires the user of general terms

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 MEMORANDUM FOR CLAIMANT

and conditions to transmit the text or make it available in another way, which has been done
by the CLAIMANT in the accompanying letter. [CISG-AC Opinion No. 13]

5.4.5 In determining the intent of a party or the understanding a reasonable person would 
have  had, due consideration is to be given to all relevant circumstances of the case including
the  negotiations, any practices which the parties have established between themselves, usages
and any subsequent conduct of the parties. [Eiselen, Sieg]

5.4.6 In Roser Technologies, Inc. v. Carl Schreiber GmbH, one issue before the court was
whether the seller’s terms and conditions had been incorporated into the parties’ contracts.
The court found that standard conditions are incorporated by reference into a contract if they
do not result in surprise or hardship to the party against whom enforcement is sought. Also,
the Court found that standard conditions referenced by a party are incorporated into the
contract if the other party had reasonable notice of the attempted incorporation which was true
in the present case as the CLAIMANT had explicitly mentioned in the accompanying letter
that the contract would be governed by CLAIMANT’S General Condition of sale [NoA, ¶
7] and the RESPONDENT did not object to it.

REQUEST FOR RELIEF

In light of the above, Claimant asks the Arbitral Tribunal for the following orders:

1) To declare that the Arbitral Tribunal has jurisdiction to hear the case.

2) To declare that the Parties entered into a valid contract for the delivery of
20,000t/annum

of RSPO-certified palm oil for the years 2021 - 2025

3) To declare that Claimant’s General Conditions of Sale were validly included into that
Contract and exclude any termination of the Contract for temporary infringements of the

RSPO requirements before Claimant was given a suitable period of one month to
remove

such infringements by its suppliers.

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 MEMORANDUM FOR CLAIMANT

4) To declare that Respondent has not validly avoided the Contract either for mistake or
for a

fundamental breach of contract.

5) To order Respondent to compensate Claimant for the damages incurred for the failure
to

accept the deliveries of the quantities for the year 2021 in the amount of USD 200,000
plus

interest thereon.

6) To order Respondent to perform the Contract for the years 2022 - 2025.

7) To order Respondent to bear the costs of these arbitration proceedings, including the
cost

incurred by Claimant for legal representationCLAIMANT reserves the right to amend

its request for relief as may be required.

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 MEMORANDUM FOR CLAIMANT

TABLE OF LEGISLATION AND RULES

CITED AS REFERENCE

BORN : Born, Gary B. 2009

International Commercial Arbitration. Alphen aan den Rijn : Kluwer

Law International, 2009

Cited in: ¶ -(1.1.1), (1.2.1),(1.3.1)

Thompson CSF case: Jurisdiction: United States

United States Court Of Appeals, Second Circuit

[Judgement of Aug 24, 1995]

                            Case No:  1565, Docket 94-9118

Available at: click here

                            Cited in: ¶ -(1.2.1),

Merril Lynch Case: Jurisdiction: United States

United States Court Of Appeals, Second Circuit

[Judgement of 18 July 2003]

                            Case No:  02-9195.

Available at: click here

                            Cited in: ¶ -(1.2.1),

Interocean case : Jurisdiction: United States

United States Court Of Appeals, Second Circuit

[Judgement of 24 June 1975]

                            Case No:  No. 223, Docket 74-1713.

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 MEMORANDUM FOR CLAIMANT

Available at: click here

                            Cited in: ¶ -(1.2.1),

Brekoulakis : Brekoulakis, Stavros L. 2010

Third Parties in International Commercial Arbitration. Oxford :

Oxford International Arbitration Series, 2010.

Available at : click here

Cited in: ¶ - (1.2.1),

Adams Case: Jurisdiction: United Kingdom

Court Of Appeals

[Judgement of 18 July 2003]

                            Case No:  1984 A No. 2597

Available at: click here

                            Cited in: ¶ -(1.2.1),

National Power Case: Jurisdiction: Swiss Federal Tribunal

 United States District Court for the District of New Jersey

[Judgement of Oct. 18, 1991]

                            Case No:  88-5150139 F.R.D. 50

Available at: click here

                            Cited in: ¶ -(1.3.1),

Schumacher : Schumacher, Hubertus. 2005.

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 MEMORANDUM FOR CLAIMANT

Unbestimmte Schiedsvereinbarungen und Dissens:

Anknüpfungsfragen bei internationalen Sachverhalten in der Judikatur

des OGH. [book auth.] Zeitschrift fur Schiedsverfahren. 2005.

Cited in: ¶ - (1.3.3),

SCHWAB : Schwab, Karl Heinz and Walter, Gerhard. 2005

Schiedsgerichtsbarkeit. Bern : Helbing & Lichtenhahn, 2005.

Available at : click here

Cited in: ¶ - (1.3.3),

REDFERN : Redfernl, Alan and Hunter, Martin J. 1995

Practice of International Commercial Arbitration. 3rd. Oxford : Oxford

Univeristy Press, 1995..

Available at : click here

Cited in: ¶ - (1.3.3),

BINDER : Binder, Peter. 2010

International Commercial Arbitration and Conciliation in UNCITRAL

Model Law Jurisdictions . Beccles : Sweet & Maxwell, 2010.

Available at : click here

Cited in: ¶ - (1.3.4),

Steingruber : Steingruber, Andrea. 2012

Consent in International Arbitration. Oxford : Oxford International

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 MEMORANDUM FOR CLAIMANT

Arbitration Series, 2012.

Available at : click here

Cited in: ¶ - (1.5.2),

Rakesh S. Case : :  Jurisdiction: Maharashtra

                             Bombay High Court    

                        [Judgement of 22 September, 2014]

Available at: click here

                            Cited in: ¶ -(1.5.7)

Sulamerica Case:        Jurisdiction: United Kingdom

                             England and Wales, Court of Appeal

                            [Judgement of 16 May 2012]

                            Case No:  A3/2012/0249

Available at: click here

                            Cited in: ¶ -(2.1.1), (2.6.3),(2.7.1)

Kababji Case:             Jurisdiction: United Kingdom

                            England and Wales, HC of Justice

                            [Judgement of 20/01/2020]

                            Case No: A4/2019/0944

                            Available at: click here 

C Vs. D Case:    Jurisdiction: United Kingdom

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 MEMORANDUM FOR CLAIMANT

                            England and Wales, HC of Justice

                            [Judgement of 28/06/2007]

                             Case No: 2007 FOLIO 540

                             Available at: click here   

Cited in: ¶ (2.6.1)

BCY Vs.  Jurisdiction: Singapore HC

 BCZ Case  :               [Judgement of 9/11/2016

                          Case No: 502

                              Available at: click here                             

Cited in: ¶ (2.8.1)

Bulbank Case:            Jurisdiction: Swedish SC

                                  [Judgement of 27 October 2000]

                                    Case No: T1881–99

                                Available at: click here                      

              Cited in: ¶ (2.7.2)

Redfern/Hunter:      Redfern A, Hunter M, Blackaby N, and Partasides C, Redfern and

                        Hunter on International Arbitration (6th edn, Oxford University 
Press
2015)
                     Cited in: ¶ (2.7.2)

NYC:                      United Nations Commission on International Trade Law,

Convention on the Recognition and Enforcement of Foreign

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 MEMORANDUM FOR CLAIMANT

Arbitral Awards

(New York,1958)

                                Cited in: ¶ (2.6.4)

UNIDROIT
Principles  : International Institute for the Unification of Private Law
                                 UNIDROIT Principles on International Commercial Contracts

                                  (2016)
                                  
Available at:   click here

                                  Cited in ¶s: (1.4.2), (1.5.2), (1.5.4), (1.5.5) (2.2.1), (2.3.1), (2.4.1),

(5.1.1), (5.1.2), (5.2.4)

CISG : United Nations Convention On Contracts For The International Sale Of

Goods

(1980)

Available at : click here

Cited in: ¶ (3.1.1) (3.1.2) (3.1.3)

Geneva Jurisdiction: United States of America

Pharmaceuticals US District Court for the Southern District of New York

Tech v. Barr Lab:  Judgement of May 10, 2002

Case No: 201 F. Supp. 2d 236

Available at: click here

Cited in: ¶ (3.1.5)

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 MEMORANDUM FOR CLAIMANT

Prima Paint

Corporation case : Jurisdiction: United States of America

US Supreme Court

Judgement of June 12, 1967

Case No: 388 U.S. 395

Available at: click here

Cited in: ¶ (3.2.1)

Sojuznefteexport case: Jurisdiction: Bermuda

Court of Appeal of Bermuda

Judgement of July 9, 1984

Case No: 109/1980

Cited in: ¶ (3.2.6)

UNCITRAL : United Nations Commission on International Trade Law,

UNCITRAL Model Law on International Commercial Arbitration (amend.

2006)

Available at: click here

Cited in: ¶ (3.2.12)

ICC : International Chamber of CommerceRules of Conciliation and

Arbitration (1975)

Avilable at: click here

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 MEMORANDUM FOR CLAIMANT

Cited in: ¶ (3.2.13)

Bharat Aluminium case: Jurisdiction: India Supreme Court of India

Judgement of September 6, 2012

Case No: Civil Appeal 6284 of 2004

Available at: click here

Cited in: ¶ (3.2.2)

UNICITRAL F: United Nations Commission on International Trade Law Convention

on the Recognition and Enforcement of Foreign Arbitral Awards

(1958)

Available at: click here

Cited in: ¶ (3.3.3)

Société Calzados case:  Jurisdiction:  France

 Court of Appeal of Grenoble
[Decision on 21 October 1999]
Case No: CLOUT case 313
Available at: click here
Cited in ¶: (5.1.3)

Interland Chemie caase:          Jurisdiction: Netherlands

Rechtbank Breda
[Decision on 23 May 2007]

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 MEMORANDUM FOR CLAIMANT

Case No: 160136 / HA ZA 06-826

Available at: click here
Cited in ¶: (5.1.6)

7Ob 301/01t                                 Jurisdiction: Austria

Oberster Gerichtshof 
[Decision on 14 January 2002]
Case No: CLOUT case 541
Available at: click here
Cited in ¶: (5.2.3)

Roser Technologies case        :Jurisdiction: United States of America

District Court for the Western District of Pennsylvania

[Decision on 10 September 2013]

Case No: CLOUT case 1744

Available at: click here
Cited in ¶: (5.4.6)

Filanto SpA case :                    Jurisdiction: United States of America

United States District Court, S.D. New York

[Decision on April 14, 1992]
Case No: 91 CIV 3253 (CLB)
Available at: click here
Cited in ¶: (5.2.8)

Arbitral Award : Jurisdiction: Netherlands

Netherlands Arbitration Institute

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 MEMORANDUM FOR CLAIMANT

10 February, 2005 Published  at  Yearbook  Comm,  Arb'n 

XXXII,  Albert  Jan  van  den  Berg,  ed.  (Kluwer  2007) 
93106

Available at: click here

Cited in ¶: (5.1.7)

Schmidt-Kessel, Art. 8       :   Schmidt-Kessel, Art 8 

In Schlechtriem, Peter / Schwenzer, Ingeborg (eds.) 

Commentary on the UN Convention on the International Sale of

Goods (CISG) 
4th edition, Oxford University Press (2016) 
Cited in ¶: (5.2.8) 

CISG-AC Opinion No. 13  :     Professor Sieg Eiselen (rapporteur)

CISG-AC Opinion No. 13, Inclusion of Standard Terms under

the CISG
Adopted by the CISG Advisory Council following its 17th
meeting, in Villanova, Pennsylvania, USA (20 January 2013)
Available at:  click here
Cited in ¶s: (5.2.1), (5.2.5), (5.3.3), (5.4.4) 

Wolf, Horn and Lindacher AGB-Gesetz Einl par1

: Eiselen, Sieg, and Sebastian K Bergenthal

“The Battle of Forms: A Com¶tive Analysis”
The Com¶tive and International Law Journal of Southern
Africa

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 MEMORANDUM FOR CLAIMANT

39 no. 2 (2006) 214–40

Available at: click here
Cited in ¶: (5.2.2)

Slawson 1971 Harv LR 529   : Slawson WD

“Standard form contracts and the

democratic control of lawmaking power”
1971 Harv LR 529
Cited in ¶: (5.2.2)

Eiselen, Sieg       : “The Requirements for the Inclusion of

Standard Terms in International Sales Contracts” (April 19,
2011)
Potchefstroom Electronic Law Journal
Vol. 14, No. 1, 2011
Available at: click here
Cited in ¶: (5.4.5) 
 

UNIDROIT 2004                   : International Institute for the Unification of Private Law

UNIDROIT Principles on International Commercial

contracts (2004)     

Available at:  click here

Cited in ¶s: (5.1.1), (5.2.5)
 

XIII