Case Study On Business Law

Submitted By chengyangsfy
Words: 425
Pages: 2

Business Law
Interesting Problem

On June 1, 2012, al Qaeda releases the following message to al Jezeera and the international press: “We are planning extraordinary action to retaliate against the wicked so-called Western democracies. We will confound international trade, and bring the Western imperialist regimes to their knees. We will use chemical and biological weapons. If, to achieve our goal, we must destroy the commercial infrastructure, including bridges, canals, and tunnels, we will do so.” On June 3, 2013, Oil’s Well Company, a Texas-based U.S. Corporation, which drills for crude in Kuwaiti oil fields and ships out of a Kuwaiti port, enter into a written contract with Petrochem Corp., a British refiner and retail seller of gasoline. The contract provides in part: “Oil’s Well agrees to ship to Petrochem 1 million barrels of light sweet crude at $100 per barrel. Delivery will be made in Liverpool by tanker on September 30, 2013. Oil’s Well will bear the expense of shipment.” Both parties understand implicitly that the tanker will pass through the Suez Canal, because this route is by far the shortest, and in all previous contracts between Oil’s Well and Petrochem (there have been 25), shipment was made via the Suez Canal. Although the contract does not so specify, the cost of shipping from Kuwait to Liverpool will be about $1 million. The parties’ contract states that Texas law will apply. On June 5, 2013, massive explosions rock the Suez Canal reducing it to rubble. Al Qaeda takes responsibility for the attack on the canal. Engineers predict that shipping through the canal will not resume for at least one year, the amount of time needed to effect necessary repairs. Oil’s Well tries to renegotiate terms with