Common use of Quality Disputes Clause in Contracts

Quality Disputes. (1) The quality of Fuel Delivered by Seller to the Companies’ Nominated truck(s) shall be determined on the basis of a volumetric weighted average composite of samples drawn by an Independent Inspector or Seller representative from Seller’s Nominated terminal issuing tank(s) after the completion of each bulk receipt into such terminal tanks in such a manner as to be representative of the volume of the tank inventory from that time until the time of the next bulk receipt. Such samples of Fuel shall be divided into a minimum of two (2) parts one of which shall be sealed and dated and retained by Seller, or an Independent Inspector at the option of Seller, for a period of not less than three (3) months. (2) The quality of Fuel Delivered by Seller to the Companies’ Nominated Barge or by Seller to the Harbor terminal piping or by Seller from its Nominated Barge to the Companies’ Nominated terminal shall be determined on the basis of a volumetric weighted average composite of samples drawn by an Independent Inspector or Seller representative from Seller’s Nominated terminal or Refinery issuing tank(s) in such a manner as to be representative of the volume of the tank inventory. Such tank samples of Fuel shall be divided into a minimum of two (2) parts one of which shall be sealed and dated and retained by Seller, or an Independent Inspector at the option of Seller, for a period of not less than three (3) months. The quality of the “vessel composite sample” for Diesel and IFO Delivered by Seller to Companies’ Nominated Barge at Kalaeloa ▇▇▇▇▇▇’▇ Point Harbor shall also conform to the Specifications in Exhibit A for “Confirmation Test Items”. A “vessel composite sample” shall be drawn by an Independent Inspector separately for all Diesel and IFO Delivered by Seller to the Companies’ at this location in such a manner as to be representative of the volume delivered. If the Companies’ laboratory results of the vessel composite sample result in any items out of Specification, then the Seller will test their vessel composite sample for the full Specification and remedy any Specification deviation following Section 6.5(b)(4). Such “vessel composite sample” shall be divided into three (3) parts one which will be sealed and dated and retained by the Independent Inspector for a period of not less than (3) months for any quality discrepancies, one part for Companies’ designated laboratory for testing and one part for Chevron laboratory for confirmation testing. (3) If Seller or the Companies have reason to believe that the quality of Fuel stated for a specific Delivery fails to conform to the Specifications in Exhibit A, of this Contract, that Party shall within five (5) days after the later of the date of the completed Certificate of Quality or the date of the final determination of quality, present the other Party with documents supporting such determination and the Parties will confer, in good faith, on the causes for the discrepancy and shall proceed to correct such causes and adjust the quality, if justified, for the Delivery in question. In the event of an unresolved difference between Seller and the Companies, the sealed part of the representative sample in the possession of the Independent Inspector shall be provided to an independent laboratory for an official determination, which shall be final. Seller and the Companies shall share equally the cost for such independent laboratory determination. (4) If the quality of the Fuel received by the Companies fails to conform to the quality Specifications in Exhibit A, of this Contract, the Companies and Seller shall attempt to minimize the impact of any quality problem. […] Seller may attempt to remedy the quality problem by Delivering higher quality Fuel in a timely manner to produce a Specification quality blend in the Companies’ storage tank(s) at the Companies’ Receiving Facility. If all such and similar efforts fail to resolve the quality problem, then the Companies may return non-Specification Fuel to Seller, in which case Seller shall replace the non-Specification Fuel by Delivering an equal volume of the Companies’ verified on-Specification Fuel to the Companies in a timely manner. Notwithstanding the preceding, the Companies shall always have the right to refuse Delivery of any Fuel with prior written notice to Seller or its permitted agents if the Companies in good faith shall have reason to believe that the Fuel does not meet the Specification. […] (5) All reasonable costs and expenses, including testing, transportation, re-refining, and handling costs incurred in returning, replacing or otherwise correcting off-specification Fuel shall be the responsibility of the Seller.

Quality Disputes. (1) The quality of Fuel the Product sold and Delivered by Seller to the Companies shall be as stated on Seller’s Certificate of Quality for such Product. The quality of the Product in the Companies’ Nominated truck(s) nominated truck or in Seller’s nominated truck delivered to the Companies’ Receiving Facilities shall be determined on the basis of a volumetric weighted average composite of samples drawn by an the Independent Inspector or Seller representative from Seller’s Nominated nominated terminal issuing tank(s) after the completion of each bulk receipt into such terminal tanks in such a manner as to be representative of the volume of the tank inventory from that time until the time of the next bulk receipt. Such samples of Fuel the Product shall be divided into a minimum of two (2) parts one of which shall be sealed and dated and retained by Seller, or an Independent Inspector at the option of Seller, for a period of not less than three forty five (345) monthsDays. (2) The quality of Fuel the Product sold and Delivered by Seller to the Companies shall be as stated on Seller’s Certificate of Quality for such Product. The quality of the Product in the Companies’ Nominated Barge nominated barge, the harbor terminal piping, or by Seller to the Harbor terminal piping or by Seller from its Nominated Barge Seller’s nominated barge to the Companies’ Nominated nominated terminal shall be determined on the basis of a volumetric weighted average composite of samples drawn by an the Independent Inspector or Seller representative from Seller’s Nominated nominated terminal or Refinery issuing tank(s) in such a manner as to be representative of the volume of the tank inventory. Such tank samples of Fuel the Product shall be divided into a minimum of two (2) parts parts, one of which shall be sealed and dated and retained by Seller, Seller (or an Independent Inspector at the option of Seller, ) for a period of not less than three forty five (345) months. The quality of the “vessel composite sample” for Diesel and IFO Delivered by Seller to Companies’ Nominated Barge at Kalaeloa ▇▇▇▇▇▇’▇ Point Harbor shall also conform to the Specifications in Exhibit A for “Confirmation Test Items”. A “vessel composite sample” shall be drawn by an Independent Inspector separately for all Diesel and IFO Delivered by Seller to the Companies’ at this location in such a manner as to be representative of the volume delivered. If the Companies’ laboratory results of the vessel composite sample result in any items out of Specification, then the Seller will test their vessel composite sample for the full Specification and remedy any Specification deviation following Section 6.5(b)(4). Such “vessel composite sample” shall be divided into three (3) parts one which will be sealed and dated and retained by the Independent Inspector for a period of not less than (3) months for any quality discrepancies, one part for Companies’ designated laboratory for testing and one part for Chevron laboratory for confirmation testingDays. (3) If Seller or the Companies have reason to believe that the quality of Fuel stated for the Product in a specific Delivery fails to conform to the Specifications as provided in Exhibit AArticle IV (Quality), of this Contractthe Companies shall, that Party shall within five (5) days Days after the later of the date of the completed Certificate of Quality is received by the Companies or the date of the final Companies receipt of the Companies’ determination of quality, present the other Party Seller with documents documentation supporting such determination and the Parties will confer, in good faith, on the causes for the discrepancy. If the discrepancy and is attributable to Seller, Seller shall proceed to correct such causes and adjust the quality, if justified, quality for the Delivery in question. In the event of an unresolved difference between Seller and the CompaniesCompanies as to the quality of the Product, the sealed part sample of the representative sample Product in question that is in the possession of the Independent Inspector shall be provided to an independent laboratory for an official determinationindependent determination of quality (“Independent Determination”), which Independent Determination shall be finalbinding on the Parties. Seller and the Companies shall share equally be solely responsible for the cost for such independent laboratory determination. (4) If Independent Determination in the event that it is determined that the quality of the Fuel received by the Companies fails to Product in question does not conform to the quality Specifications in Exhibit A, of this Contract, the Companies and Seller shall attempt to minimize the impact of any quality problem. […] Seller may attempt to remedy the quality problem by Delivering higher quality Fuel in a timely manner to produce a Specification quality blend in the Companies’ storage tank(s) at the Companies’ Receiving Facility. If all such and similar efforts fail to resolve the quality problem, then the Companies may return non-Specification Fuel to Seller, in which case Seller shall replace the non-Specification Fuel by Delivering an equal volume of the Companies’ verified on-Specification Fuel to the Companies in a timely manner. Notwithstanding the preceding, the Companies shall always have the right to refuse Delivery of any Fuel with prior written notice to Seller or its permitted agents if the Companies in good faith shall have reason to believe that the Fuel does not meet the Specification. […] (5) All reasonable costs and expenses, including testing, transportation, re-refining, and handling costs incurred in returning, replacing or otherwise correcting off-specification Fuel shall be the responsibility of the SellerSpecifications.