Case concerned the proper execution of an energy sale-purchase agreement

Our firm has represented an independent electricity supplier before the Court of Appeal of Lithuania.

The case concerned the proper execution of an energy sale-purchase agreement, as well as the procedure which should be used in order to utilize a bank guarantee. The terms of the agreement stated that the contract shall have effect for a period of one year, unless the buyer requests and extension of the term by submitting a delivery schedule for the next year. The client, an independent electricity supplier, met its obligations under the contract and the contract ended, because the buyer did not submit the required delivery schedule. The dispute arose when the buyer obliged a third party (the guarantor, a bank) to cover its alleged losses under the terms of guarantee. The buyer claimed that the term of the contract had been extended and the contract was allegedly breached by the client, arguing that the delivery schedule for the previous year should be applicable to the next year as well. The case was examined in the Court of Appeal of Lithuania.