- Cf. Acreage, Laws and Tax, a loose leaf service published and updated quarterly by Petroconsultants of London and Geneva.
- For example, an overlifter at “quarter way price” would purchase oil from the underlifter at tax paid cost plus one fourth of the difference between tax paid cost and posted price.
- For example, most agreements issued by governments or national oil companies, as well as oil and gas leases presented to royalty owners by oil companies in the United States.
- Examples include Model Form Operating Agreement AAPL 610 used in onshore operations in the United States, Model Form International Operating Agreement in preparation by the Association of International Petroleum Negotiators.
- For example Agreement between State X and State Y on the Joint Development of Petroleum in Areas of the Contintental Shelf and/or the Exclusive Economic Zone of the two Countries prepared by the British Institute of International and Comparative Law (1989).
- In his July 15, 1976 speech accepting his party's nomination for the office of President of the United States, Jimmy Carter called the income tax system of his country “a disgrace to the human race”.
- Series “Les Gens de Justice” which adorn many a lawyer's office walls.
- Contract reading scene from “A night at the Opera”.
- May and Butcher Ltd v. The King [1929] 2 KB 17; see particularly the judgment of Lord Denning, M. R. in Courtney Ltd v. Tolairi Bros Ltd [1975]1 W.L.R. 297; but, an agreement which created an obligation to sell and purchase goods at a price to be agreed was found to be an enforceable contract where the Court read into the contract an implied provision to trade at a reasonable price and construed the broad wording of the arbitration clause to mean that, failing agreement, the price should be determined by arbitration: Foley v. Classique Coaches Ltd. [1934] 2 KB 1; where an unenforceable agreement (for example an agreement to “overlift” crude oil at a price to be agreed) has been executed by one party in reliance thereon, some courts will imply a contract that in default of agreement a reasonable sum is to be paid: British Bank for Foreign Trade Ltd. v. Novimex Ltd. [1949] 1 All E.R. 155; Gregory v. Mighell [1811] 18 Ves. Jun. 328, Beer v. Bowden (Note) [1981]1 W. L. R. 522.
- Sudbrook Trading Estate Ltd. v. Eggleton [1983] A.C. 444; Smith v. Peters [1875] L. R. 20 Eq. 511.
- Richardson v. Smith [1870] L. R. 5 Ch.App.648.
- In recent years, the House of Lords, overruling long standing precedents as “not appropriate in present day conditions”, has held that English law does not allow a party to a contract to rely on the doctrine of frustration to his own advantage where the frustration is self-induced, as when a landlord refused to appoint a valuer in an effort to frustrate the tenant's option to purchase the property. Sudbrook Trading Eslate Ltd. v. Eagleton [1983] A. C. 444; Paal Wilson & Co. A/S v. Partendeerei Hannah Blumenthal [1983] 1 A.C. 854.
- Sudbrook Trading Estate Ltd. v. Eggleton, cited above.
- In those jurisdictions which still follow the ruling of the House of Lords in Agar v. Macklew [1825] 2 Sim. & St. 418 where the court refused to entertain a bill for specific performance of an agreement to refer to arbitration. At one point these jurisdictions included Australia, New Zealand, most provinces of Canada and most states of the United States.
- The courts of common law countries will generally not give effect to forfeiture or penalty provisions where a fairer alternative exists. Jobson v. Johnson [1989] 1 All E. R. 621 and CRA Ltd. v. New Zealand Goldfelds Investments Ltd. (Supreme Court of Victoria, March 10, 1989), both cases reported in (1990) 8 J.E.R.L., 63, 55. If it is expedient to insert a penalty or forfeiture clause in a contract one should note that, while it is not enforceable according to its terms “the strict legal position is not that such a clause is simply struck out of the contract… Strictly, the legal position is that the clause remains in the contract and can be sued on, but it will not be enforced by the court beyond the sum which represents, in the events which have happened, the actual loss of the party seeking payment” 1 All E. R. 633.
- Texas Eastern Corporation v. Enterprise Oil plc et al., High Court of Justice, Queen's Bench Division, June 19, 1989, appeal allowed Court of Appeal, Civil Division, July 21, 1989.
- Here again a model clause should not be incorporated “as is” without a full understanding of its history and legal implications. In particular creative drafting may be required to avoid review by local courts, or third state courts or by higher organs of the arbitration machinery. But see recent ICSID problems concerning nullification in Amco v. Indonesia, 1 Int. Arb. Rep. (1986) 601 and 649; and in Klockner v. Cameroon, XI Yearbook Commercial Arbitration (1986) 162.
- See article by the author “Bilingual Agreements in the Petroleum Industry,” (1986) 4 J.E.R.L. 188.
- The author's preference is to have the “State of X” as a party rather than the “Government” or an office holder. This reduces the risk that a successor government or office holder can repudiate the binding act of its predecessor.
Journal of Energy & Natural Resources Law
Volume 8, 1990 - Issue 1-4