With regard to the first legal issue, because no agreement was made between the parties either as prior verbal agreements in interpreting the contract and upon writing of the contract, and on the use of any trade terms regarding the delivery of goods and on the passage of risk, Articles 31, 32 and 67of the United Nations Convention on Contracts for the International Sale of Goods (CISG) applies. According to Article 31, which outlines the obligations of the seller:
Thus, Mellow, upon delivering the wine to S.S. Minnow for delivery to Ambrosia and identifying it as belonging to Tippler with the appropriate shipping documents and markings has concluded his end of the transaction and the risk, as outlined in Article 67 stating that:
(1) If the contract of sale involves carriage of the goods and the seller is not bound to hand them over at a particular place, the risk passes to the buyer when the goods are handed over to the first carrier for transmission to the buyer in accordance with the contract of sale. (Article 67),
has passed to Tippler. ...
Thus, the lack of terms of trade in the contract makes Tippler's defence, stating that the risk has not passed, to have little chance for success because Mellow concluded his obligations to the contract upon delivering the shipment to S.S. Minnow in Small Port. Furthermore, the fact that the goods were lost at sea indicates that the damage occurred after the risk was passed, strengthening Mellow's case.
However, even though Tippler's defence is weak with little chance for success, Grape, the country where Mellow filed the lawsuit, has no jurisdiction over the case. While the contract between the two parties was not clear in identifying the terms of trade for the transaction, it was clear in stating that disputes regarding the transaction will be heard in the courts of Ambrosia designating the CISG as its governing law. This accords the jurisdiction for the case to courts in Ambrosia and not Grape. Furthermore, since no place of delivery was properly ascertained, there is no definite place of performance that can be identified, aside from the one mentioned in the contract to choose the appropriate court. Mellow's action of filing a suit in Grape instead of Ambrosia can then be considered as a substantial breach of contract due to the fact that although the contract was meant to guide the parties' actions relating to the transaction, it, at the time of signing, ended up being less of a contract for a transaction regarding sales, and more of one regarding dispute settlement. Thus, Tippler can then use this to avoid the contract on the basis of a breach of contract on the part of Mellow.
Thus, it is advisable for Tippler to withdraw from the litigation and disregard Mellow's lawsuit by virtue of the fact that Grape, the country