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Moot Problem

The document outlines an agreement between Reager Corporation and Platinum Construction for the sale of 5 trucks. Platinum was to arrange transport from Reager's facilities in Delhi and Jamshedpur to Bangalore. Flywards Transporters delivered the first shipment but the second was delayed in Jamshedpur due to Platinum's liquidation. It is now stored at Shakti Warehousing. Reager filed an injunction to remove the goods, which Flywards and Shakti oppose as they are not Platinum's agents. Key issues for the court are the agency status of Flywards and Shakti, whether Reager still possesses the goods, and if Reager has rights as an unpaid seller.

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Brinda Sharma
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68 views2 pages

Moot Problem

The document outlines an agreement between Reager Corporation and Platinum Construction for the sale of 5 trucks. Platinum was to arrange transport from Reager's facilities in Delhi and Jamshedpur to Bangalore. Flywards Transporters delivered the first shipment but the second was delayed in Jamshedpur due to Platinum's liquidation. It is now stored at Shakti Warehousing. Reager filed an injunction to remove the goods, which Flywards and Shakti oppose as they are not Platinum's agents. Key issues for the court are the agency status of Flywards and Shakti, whether Reager still possesses the goods, and if Reager has rights as an unpaid seller.

Uploaded by

Brinda Sharma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Moot Problem

1. Reager Corporation (hereinafter known as the vendor) is a truck manufacturing company


having registered office at New Delhi and entered into an agreement with Platinum
Construction Group Corporation (hereinafter known as the vendee) having its registered
office in Bangalore on 16.06.2019 for the sale of 5 Northwest Trucks for a sum of INR
250,00,000 whereby it was agreed that the packages will be lifted in not more than two
consignments and that the payment of the total amount of INR 250,00,000 will be bifurcated
into two payments corresponding to the approximate value of the consignments shipped.

2. Clause 3 of the agreement stipulates that the vendee shall take delivery or arrange to take
delivery by deputing an "approved transporter" in respect of 2 trucks from Delhi and 3 trucks
from the vendor from Jamshedpur on free-on board basis. The agreement defines 'approved
transporter' to mean any transporter having demonstrated the capacity to transport part of the
package from Delhi and Jamshedpur by the vendee. It was also stipulates that the packages
shall be removed/lifted from the date of receipt of the acceptance certificate by the vendor. It
specifically stipulates that the vendor shall not be liable for the safe custody thereof from that
date.

3. Clause 6 of the said agreement relates to transport. It stipulates that the vendee shall, at its
own expense, enter into a contract with an approved transporter for the transport of the
packages from the vendor's premises at Delhi and Jamshedpur to office of the vendee for
taking the packages to Bangalore. The vendor was also required to provide free ingress and
egress to the approved transporter at all reasonable times and to arrange for all
passes/permits, security clearances etc., if required.

4. Clause 7 specifically stipulated that the title in the goods would only pass to the vendee
once the full payment of INR 250,00,000 under the said agreement is received by the vendor
upon the delivery of the package FOB at Jamshedpur for shipment to Bangalore. Clause 13 is
the arbitration Clause which provides for arbitration in respect of disputes between the
vendor and the vendee.

5. Flywards Transporters who was the approved transporter having its registered office in
New Delhi lifted the trucks from New Delhi and delivered the same to the vendee. The
second consignment was lifted from Jamshedpur for shipment at Bangalore by Flywards.
The vendee has apparently gone into liquidation and an official liquidator has been appointed
in Bangalore. So, Instead of taking the goods for shipment to Bangalore, because there were
certain delays on account of the vendee the same had been temporarily moved by Flywards
to a warehouse owned by Shakti Warehousing Corporation in Jamshedpur. The said goods
were warehoused at Shakti Warehousing Corporation on or around 26.12.2019. Since then
the second shipment is lying at the said warehouse. Nobody has come forward to receive the
goods on behalf of the respondent.

6. The matter went into arbitration. During the pendency of the arbitral proceedings, the
vendor filed petition in Delhi High Court under Section 9 of the Arbitration and Conciliation
Act, 1996 seeking interim measures of protection which include restraining the respondent or
its agents from alienating, encumbering, disposing of, selling, destroying, etc., the goods in
question and in allowing the petitioner to remove the said goods from the warehouse of
Shakti Warehousing Corporation and shift the same to its premises at Jamshedpur and got ex
parte ad interim injunction against the vendee and transporters and warehousing corporation.
Flywards Transporters and Shakti Warehousing Corporation filed interim application seeking
vacation of said order against them on the ground that they are not the agents of the vendee
and the relationship between them and vendee is principal to principal basis and the petitioner
be directed to remove the goods after paying the said dues till the date of removal of the
goods and the payment of the pending bills in respect of warehousing of the goods in
question and to direct them to remove the goods from the warehouse immediately upon
making payment of the warehousing charges.

The Hon'ble High Court of Delhi decided to hear the matter and following issues need to be
considered:

1) Whether Flywards Transporters and Shakti Warehousing Corporation were agents of the
respondent/vendee or not?

2) Whether the petitioner/vendor is still in possession of the goods in question or had he


parted with possession? Did the property in the goods in question pass to the vendee?

3) Whether the petitioner be regarded as an unpaid seller having the right to any lien in
respect of the said goods or a right to stoppage of the said goods, if held to be in transit?

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