GCA Ratifies Changes to Its Contract Terms & Conditions
At the Green Coffee Association (GCA) special meeting of the membership held in November, the following changes to the GCA Contract Terms and Conditions were ratified by the GCA voting membership:
Insolvency or Financial Failure of Buyer or Seller
If, at any time before the contract is fully executed, either party to the contract, shall meet with creditors because of inability generally to make payment of obligations when due, or shall suspend such payments, fail to meet his general trade obligations in the regular course of business, shall file a petition in bankruptcy or, for an arrangement, shall become insolvent, or commit an act of bankruptcy, then the other party may at his option, expressed in writing, declare the aforesaid to constitute a breach and default of this contract, and may, in addition to other remedies, decline to deliver further or make payment or may sell or purchase for the defaulter’s account, and may collect damage for any injury or loss, or shall account for the profit, if any, occasioned thereby by such sale or purchase. In any such event, the calculation of damages to either party shall account for any injury or loss, or shall account for the profit, if any, occasioned by such non-performance, default or termination.
In the case of the Insolvency or Financial Failure of Buyer or Seller clause, [whose provision states: “…may sell or purchase for the defaulter’s account, and may collect damage for any injury or loss, or shall account for the profit, if any, occasioned by such sale or purchase.”] the requirement is to account for the loss or profit, based on the then current market, regardless of whether an actual purchase or sale is executed. This is consistent with the practice and custom of the trade.
This clause is subject to the provisions of (11 USC 365 (e) 1) if invoked. The remainder of the GCA Contract Terms and Conditions remain unchanged.
The complete Contract Terms and Conditions can be found on the GCA website: www.greencoffeeassociation.org/professionalresources/contract_terms_conditions.
The New York, New York-based Green Coffee Association is a trade association that provides resources and other benefits for individuals and companies dealing with the export, transport, storage, insuring, financing, importing, trading and/or roasting of green coffee. For more information on the GCA, visit: www.greencoffeeassociation.org.