We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Monday, 25 January 16
SHOULD A DEFAULTING PARTY BE ENTITLED TO AN INNOCENT PARTY'S SAVING, FOLLOWING THEIR BREACH OF CONTRACT? - THE NEW FLAMENCO REVISITED
 KNOWLEDGE TO ELEVATE
This case was addressed by the club in our of January 2015, when the High Court decision became available. The background facts to the case are set out in detail in our earlier article, but to summarise briefly, the New Flamenco was time chartered to the charterer from February 2004 to November 2009. In breach of the charterparty terms, the charterer redelivered the ship two years early, in October 2007. Since there was no available charter market for a substitute fixture, the owner took the commercial decision to sell the ship in 2007. The owner subsequently commenced arbitration proceedings, claiming for the net loss of profit that they would have earned during the remaining two years of the charter. Later it became apparent, however, that due to the global financial crisis in late 2008 there was a significant difference in the value of the ship between late 2007 and late 2009 and the owner may well have benefitted from the early redelivery. Indeed, the sale price achieved by the owner was some $16.8m more than the value of the ship in November 2009. The owner’s claim for damages amounted to €7.6m, so if this benefit were to be taken into account then the owner’s claim would disappear in its entirety.
The London tribunal found that the sale was directly caused by the charterer’s early redelivery and, seeing no reason why capital savings should not be taken into account in considering the owner’s losses, the tribunal held that the charterer was entitled to the benefit. Whilst perhaps viewed as unfair by some, it should be remembered that it is normal practice when there is a breach of charter (voyage or time) for the court to take into account any income made on a mitigation voyage, and deduct this from the claim under the (wrongfully terminated) charter. So, why treat capital savings differently from savings in income?
Nevertheless, the High Court (on appeal from the tribunal) reversed this decision. The High Court held on the one hand that there was no need to treat savings in income differently from capital savings; however, on the other, the High Court held that there was no direct causal link between, here, the breach of time charter and the benefits obtained in the commercial sale of the ship. Instead, the High Court held that whilst the early redelivery may have ‘triggered’ the owner’s sale, the capital savings obtained by the owner arose from its own commercial decision to sell the ship. The charterer appealed this decision to the English Court of Appeal.
Court of Appeal decision
The Court of Appeal has, in its recent decision, unanimously overturned the High Court decision. In so doing, the owner’s claim for damages has failed in its entirety. In giving judgment, the Court of Appeal referred to the leading authority on mitigation British Westinghouse[2], confirming the important principle that where a measure taken by a claimant, in mitigation of loss and arising out of the consequences of a defendant’s breach in the ordinary course of business, results in a benefit to the claimant, that benefit is normally to be brought into account in assessing the claimant’s loss unless the measure is wholly independent of the relationship of the claimant and defendant.
Importantly, the Court of Appeal found that there was no available market for this ship upon its early redelivery and, in these circumstances, it was not easy to see why the benefit (if any) an owner obtained from selling the ship in question should not be brought into the calculation of permitted damages, especially when the benefit obtained from fixing the same ship on the spot market would have been taken into account. The absence of the available market was important as, if there had been an available market to re-fix the ship, then the owner’s decision in this case to instead sell the ship could arguably be said to have been independent of the contractual relationship between the parties and, therefore, should not be taken into account.
Conclusion
The overriding principle under English law, governing damages for breach of contract, is the compensatory principle i.e. the law attempts to put the injured party back in the position they would have been in had the contract been properly performed. Therefore, the usual measure of damages available to an owner when a charterer walks away from a contract is the amount of freight or hire which would have been earned, less running expenses, (the profit) less what the ship actually earned during that same period (the voyage(s) made in mitigation). The New Flamenco is not deviating from the compensatory principle. Indeed in this case the owner was compensated for his actual losses following the contract breach, which just happened to be none on this occasion.
However, each case will, as ever, turn on its particular facts which always need to be carefully considered. In the New Flamenco the important factor was the absence of an available market to re-charter the ship when it was redelivered to the owner early.
Source: The Standard Club
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Sunday, 06 December 15
DESPITE TEMPTING NEWBUILDING PRICES, CONTRACTING IN DRY BULK REMAINS LOW - BIMCO
The current newbuilding prices for dry bulk ships has dropped so much that they just passed the lows of 2012 heading downwards and are now at the l ...
Friday, 04 December 15
FOB INDONESIA COAL SWAPS ARE ALMOST FLAT OVER WEAK DEMAND
COALspot.com: Indonesian coal swaps for delivery Q1 2016 declined month on month and rose slightly week over week. Coal prices seen very margi ...
Friday, 04 December 15
COAL PRODUCTION IN THE U.S. FOR W/E NOVEMBER 28TH FELL SLIGHTLY FROM THE PREVIOUS WEEK
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 15.0 million shor ...
Friday, 04 December 15
MINING OUTLOOK WEAKENS FURTHER ON FALLING CHINESE DEMAND - FITCH
COALspot.com: Fitch Ratings' outlook for the global mining sector in 2016 is firmly negative, reflecting our view that Chinese demand will cont ...
Thursday, 03 December 15
DRY BULK: THERMAL COAL LOWER USAGE UNDER A POTENTIAL NEW CLIMATE DEAL WILL ADVERSELY IMPACT THE MARKET'S RECOVERY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
In direct contrast to the tanker market, the dry bulk one has seen demand for key commodities, such a coal, dwindling down over the course of the p ...
|
|
|
Showing 2671 to 2675 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Mintek Dendrill Indonesia
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
- Attock Cement Pakistan Limited
- Dalmia Cement Bharat India
- Kapuas Tunggal Persada - Indonesia
- ASAPP Information Group - India
- Uttam Galva Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Heidelberg Cement - Germany
- Metalloyd Limited - United Kingdom
- PowerSource Philippines DevCo
- Sinarmas Energy and Mining - Indonesia
- Intertek Mineral Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Krishnapatnam Port Company Ltd. - India
- Bharathi Cement Corporation - India
- Sree Jayajothi Cements Limited - India
- Billiton Holdings Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kobexindo Tractors - Indoneisa
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- Kalimantan Lumbung Energi - Indonesia
- GAC Shipping (India) Pvt Ltd
- Sical Logistics Limited - India
- Directorate Of Revenue Intelligence - India
- Semirara Mining and Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Cement Manufacturers Association - India
- GVK Power & Infra Limited - India
- Gujarat Sidhee Cement - India
- Renaissance Capital - South Africa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Interocean Group of Companies - India
- Videocon Industries ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- AsiaOL BioFuels Corp., Philippines
- Sojitz Corporation - Japan
- GMR Energy Limited - India
- Deloitte Consulting - India
- Planning Commission, India
- Sakthi Sugars Limited - India
- ICICI Bank Limited - India
- Central Electricity Authority - India
- Timah Investasi Mineral - Indoneisa
- SMG Consultants - Indonesia
- SN Aboitiz Power Inc, Philippines
- New Zealand Coal & Carbon
- Miang Besar Coal Terminal - Indonesia
- Eastern Energy - Thailand
- Goldman Sachs - Singapore
- Banpu Public Company Limited - Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Energy Development Corp, Philippines
- Electricity Generating Authority of Thailand
- Eastern Coal Council - USA
- Ministry of Transport, Egypt
- Global Coal Blending Company Limited - Australia
- South Luzon Thermal Energy Corporation
- Mercuria Energy - Indonesia
- Bhushan Steel Limited - India
- Mercator Lines Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Simpson Spence & Young - Indonesia
- Romanian Commodities Exchange
- Australian Coal Association
- Star Paper Mills Limited - India
- Thai Mozambique Logistica
- Bhoruka Overseas - Indonesia
- Meralco Power Generation, Philippines
- Thiess Contractors Indonesia
- International Coal Ventures Pvt Ltd - India
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- Chamber of Mines of South Africa
- Jindal Steel & Power Ltd - India
- Port Waratah Coal Services - Australia
- Rio Tinto Coal - Australia
- Standard Chartered Bank - UAE
- Indogreen Group - Indonesia
- Indika Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Indonesian Coal Mining Association
- Edison Trading Spa - Italy
- CNBM International Corporation - China
- White Energy Company Limited
- Medco Energi Mining Internasional
- Bayan Resources Tbk. - Indonesia
- Energy Link Ltd, New Zealand
- Latin American Coal - Colombia
- Ambuja Cements Ltd - India
- The University of Queensland
- Wilmar Investment Holdings
- Antam Resourcindo - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kumho Petrochemical, South Korea
- CIMB Investment Bank - Malaysia
- Commonwealth Bank - Australia
- Sarangani Energy Corporation, Philippines
- Economic Council, Georgia
- VISA Power Limited - India
- Siam City Cement - Thailand
- PetroVietnam Power Coal Import and Supply Company
- Orica Australia Pty. Ltd.
- Kaltim Prima Coal - Indonesia
- Salva Resources Pvt Ltd - India
- Ministry of Mines - Canada
- Meenaskhi Energy Private Limited - India
- Bulk Trading Sa - Switzerland
- Siam City Cement PLC, Thailand
- Asmin Koalindo Tuhup - Indonesia
- Kepco SPC Power Corporation, Philippines
- Bhatia International Limited - India
- Australian Commodity Traders Exchange
- Aditya Birla Group - India
- Cigading International Bulk Terminal - Indonesia
- Georgia Ports Authority, United States
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- Carbofer General Trading SA - India
- Bangladesh Power Developement Board
- Bahari Cakrawala Sebuku - Indonesia
- Central Java Power - Indonesia
- Straits Asia Resources Limited - Singapore
- Madhucon Powers Ltd - India
- Independent Power Producers Association of India
- Parliament of New Zealand
- Essar Steel Hazira Ltd - India
- Semirara Mining Corp, Philippines
- Borneo Indobara - Indonesia
- Price Waterhouse Coopers - Russia
- Maheswari Brothers Coal Limited - India
- Tamil Nadu electricity Board
- Kartika Selabumi Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Xindia Steels Limited - India
- LBH Netherlands Bv - Netherlands
- Power Finance Corporation Ltd., India
- Lanco Infratech Ltd - India
- Merrill Lynch Commodities Europe
- Barasentosa Lestari - Indonesia
- Kideco Jaya Agung - Indonesia
- Orica Mining Services - Indonesia
- Indian Energy Exchange, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- McConnell Dowell - Australia
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Rashtriya Ispat Nigam Limited - India
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Marubeni Corporation - India
- Mjunction Services Limited - India
- Ministry of Finance - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Jaiprakash Power Ventures ltd
- Baramulti Group, Indonesia
- Grasim Industreis Ltd - India
- Ind-Barath Power Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- Binh Thuan Hamico - Vietnam
- Therma Luzon, Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vizag Seaport Private Limited - India
- Coastal Gujarat Power Limited - India
- Makarim & Taira - Indonesia
- Oldendorff Carriers - Singapore
- Minerals Council of Australia
- PNOC Exploration Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Trasteel International SA, Italy
- Coalindo Energy - Indonesia
- PTC India Limited - India
- Global Green Power PLC Corporation, Philippines
- Singapore Mercantile Exchange
- Anglo American - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Petron Corporation, Philippines
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- Savvy Resources Ltd - HongKong
- Iligan Light & Power Inc, Philippines
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- The State Trading Corporation of India Ltd
- Coal and Oil Company - UAE
- Petrochimia International Co. Ltd.- Taiwan
- SMC Global Power, Philippines
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- The Treasury - Australian Government
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- Bukit Makmur.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- IHS Mccloskey Coal Group - USA
- Globalindo Alam Lestari - Indonesia
|
| |
| |
|
