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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
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Monday, 09 November 15
INDIAN THERMAL COAL IMPORTS SURGED 18%; COKING COAL 6.31% DURING APRIL-OCTOBER: BUSINESS-STANDARD
Indian thermal coal imports surged 18% at the country's top 12 major ports to 55.90 million tonnes (MT) in the first seven months of the curren ...
Sunday, 08 November 15
THE FREIGHT MARKET KEEP DROPPING THIS WEEK - VISTAAR
COALspot.com: The freight market keep dropping this week.
The BDI down 12.48 percent week on week and closed at 631 points on 6 November 2015. ...
Sunday, 08 November 15
CAPESIZE FREIGHT RATES IN AUSTRALIA-CHINA ROUTES OVER 50% CHEAPER THAN BRAZIL-CHINA ROUTE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
China’s mining and steel industries are facing tectonic shifts over the past couple of years, with the country’s limiting of coal use, ...
Friday, 06 November 15
COAL PRODUCTION IN THE U.S. FELL SHARPLY FOR THE WEEK ENDING OCTOBER 31
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 16.6 million shor ...
Thursday, 05 November 15
Q2'16 INDO THERMAL COAL SWAP CONTRACT FOB INDONESIA FALLS TO $39.90/T
COALspot.com: Indonesian coal swap for delivery Q4 2015 declined month on month and week over week. Price of coal seen no improvements this past we ...
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Showing 2726 to 2730 news of total 6871 |
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- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- Attock Cement Pakistan Limited
- Eastern Energy - Thailand
- Latin American Coal - Colombia
- Aditya Birla Group - India
- Energy Development Corp, Philippines
- Salva Resources Pvt Ltd - India
- Economic Council, Georgia
- Semirara Mining and Power Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Interocean Group of Companies - India
- Jaiprakash Power Ventures ltd
- Kalimantan Lumbung Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Kideco Jaya Agung - Indonesia
- Iligan Light & Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Dalmia Cement Bharat India
- Heidelberg Cement - Germany
- Romanian Commodities Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Alfred C Toepfer International GmbH - Germany
- Australian Coal Association
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Meralco Power Generation, Philippines
- Rio Tinto Coal - Australia
- Mjunction Services Limited - India
- ASAPP Information Group - India
- Directorate General of MIneral and Coal - Indonesia
- London Commodity Brokers - England
- Bukit Baiduri Energy - Indonesia
- Uttam Galva Steels Limited - India
- SMC Global Power, Philippines
- CIMB Investment Bank - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Sical Logistics Limited - India
- Bhushan Steel Limited - India
- Antam Resourcindo - Indonesia
- Electricity Authority, New Zealand
- Borneo Indobara - Indonesia
- Barasentosa Lestari - Indonesia
- McConnell Dowell - Australia
- Ministry of Finance - Indonesia
- Straits Asia Resources Limited - Singapore
- Carbofer General Trading SA - India
- IEA Clean Coal Centre - UK
- Pipit Mutiara Jaya. PT, Indonesia
- Petron Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Sinarmas Energy and Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Kepco SPC Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Siam City Cement - Thailand
- Ambuja Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Central Electricity Authority - India
- Indonesian Coal Mining Association
- Savvy Resources Ltd - HongKong
- Trasteel International SA, Italy
- OPG Power Generation Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- LBH Netherlands Bv - Netherlands
- India Bulls Power Limited - India
- Bulk Trading Sa - Switzerland
- Kapuas Tunggal Persada - Indonesia
- Merrill Lynch Commodities Europe
- Grasim Industreis Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Ind-Barath Power Infra Limited - India
- Sindya Power Generating Company Private Ltd
- Minerals Council of Australia
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- Medco Energi Mining Internasional
- Coastal Gujarat Power Limited - India
- SMG Consultants - Indonesia
- The Treasury - Australian Government
- Indika Energy - Indonesia
- Energy Link Ltd, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Gujarat Mineral Development Corp Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- Marubeni Corporation - India
- PTC India Limited - India
- Intertek Mineral Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Therma Luzon, Inc, Philippines
- Formosa Plastics Group - Taiwan
- Australian Commodity Traders Exchange
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Riau Bara Harum - Indonesia
- Commonwealth Bank - Australia
- Bayan Resources Tbk. - Indonesia
- Bhatia International Limited - India
- Vizag Seaport Private Limited - India
- Eastern Coal Council - USA
- GVK Power & Infra Limited - India
- Pendopo Energi Batubara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- ICICI Bank Limited - India
- Parry Sugars Refinery, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Coalindo Energy - Indonesia
- Standard Chartered Bank - UAE
- Indian Energy Exchange, India
- Kartika Selabumi Mining - Indonesia
- New Zealand Coal & Carbon
- Global Coal Blending Company Limited - Australia
- Tata Chemicals Ltd - India
- Sakthi Sugars Limited - India
- Global Green Power PLC Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Africa Commodities Group - South Africa
- Posco Energy - South Korea
- Bukit Makmur.PT - Indonesia
- Thiess Contractors Indonesia
- Madhucon Powers Ltd - India
- TeaM Sual Corporation - Philippines
- Kumho Petrochemical, South Korea
- Power Finance Corporation Ltd., India
- Agrawal Coal Company - India
- Cement Manufacturers Association - India
- Kobexindo Tractors - Indoneisa
- Meenaskhi Energy Private Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Essar Steel Hazira Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Orica Mining Services - Indonesia
- Leighton Contractors Pty Ltd - Australia
- The University of Queensland
- Malabar Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Larsen & Toubro Limited - India
- Bharathi Cement Corporation - India
- Altura Mining Limited, Indonesia
- Coal and Oil Company - UAE
- Karbindo Abesyapradhi - Indoneisa
- Samtan Co., Ltd - South Korea
- Indo Tambangraya Megah - Indonesia
- Maheswari Brothers Coal Limited - India
- Indian Oil Corporation Limited
- Sree Jayajothi Cements Limited - India
- Singapore Mercantile Exchange
- Directorate Of Revenue Intelligence - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- PNOC Exploration Corporation - Philippines
- Globalindo Alam Lestari - Indonesia
- Tamil Nadu electricity Board
- Manunggal Multi Energi - Indonesia
- VISA Power Limited - India
- Star Paper Mills Limited - India
- White Energy Company Limited
- Chamber of Mines of South Africa
- Global Business Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Xindia Steels Limited - India
- Vedanta Resources Plc - India
- Anglo American - United Kingdom
- Goldman Sachs - Singapore
- Planning Commission, India
- Thai Mozambique Logistica
- MS Steel International - UAE
- Billiton Holdings Pty Ltd - Australia
- GMR Energy Limited - India
- CNBM International Corporation - China
- GAC Shipping (India) Pvt Ltd
- Mercator Lines Limited - India
- Binh Thuan Hamico - Vietnam
- Miang Besar Coal Terminal - Indonesia
- Port Waratah Coal Services - Australia
- Independent Power Producers Association of India
- Baramulti Group, Indonesia
- Ministry of Mines - Canada
- Vijayanagar Sugar Pvt Ltd - India
- Wood Mackenzie - Singapore
- Electricity Generating Authority of Thailand
- Orica Australia Pty. Ltd.
- Banpu Public Company Limited - Thailand
- Ministry of Transport, Egypt
- Aboitiz Power Corporation - Philippines
- Edison Trading Spa - Italy
- Oldendorff Carriers - Singapore
- Semirara Mining Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Central Java Power - Indonesia
- Kaltim Prima Coal - Indonesia
- Sojitz Corporation - Japan
- Asmin Koalindo Tuhup - Indonesia
- Makarim & Taira - Indonesia
- Karaikal Port Pvt Ltd - India
- Indogreen Group - Indonesia
- Mercuria Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Lanco Infratech Ltd - India
- Price Waterhouse Coopers - Russia
- Mintek Dendrill Indonesia
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Petrochimia International Co. Ltd.- Taiwan
- San Jose City I Power Corp, Philippines
- PowerSource Philippines DevCo
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