Commercial Disputes Weekly – Issue 2112 July 2024

Maritime
In a dispute arising out of contracts for the sale of three second-hand ships, the Court of Appeal has concluded that the buyer was unable to take advantage of their failure to open a bank account to avoid liability for the deposit debt. The buyer failed to provide documentation to enable a bank account to be opened into which it would pay the deposit. This was a condition precedent to its debt obligation and it could not rely on its own breach of contract to avoid the obligation. This was presumed to be the agreed contractual intention between the parties. The court rejected the conclusion of the lower court that the seller’s proper remedy was in damages, which would require proof of loss and causation, rather than enforcement of the debt. The buyer was liable to pay the deposit because it had become due.
King Crude Carriers SA and others v Ridgebury November LLC and others [2024] EWCA Civ 719, 27 June 2024

Insurance – Interest on Damages
The Court of Appeal has concluded that it was able to order interest on damages in personal injury claims governed by Spanish law at the rate set out in Spanish legislation. The claimants were all domiciled in England and therefore able to bring their claims before the English Courts. The claim under Spanish law could be brought directly against the insurers. The issue was whether payment of interest was a matter of procedural law under the Rome II Regulation. The court decided that the interest payable was a matter of substantive law of the claim (namely Spanish law) and so governed by the Spanish Insurance Contract Act 50/1980. It was not a question of procedural (and therefore English) law.
Mapfre Espana Compania de Seguros y Reaseguros SA v Nicholls [2024] EWCA Civ 718, 27 June 2024

Arbitration – Insolvency
The Privy Council has held that winding up proceedings did not have to be stayed for arbitration of the dispute, where the debt was not genuinely in issue. The lower courts had established that the substantial debt was not genuinely disputed and beyond further challenge, although the company that owed the debt continued to deny this. The contract out of which the debt arose contained an arbitration clause. The Privy Council decided that a narrower definition of ‘disputed debt’ was applicable which required it to be genuinely disputed on substantial grounds, rather than simply not admitted by the company with no foundation for such denial. In reaching that conclusion, it upheld the decision of the BVI courts and concluded that earlier English Court of Appeal authority was wrongly decided. It refused to stay the winding up proceedings in favour of arbitration.
Sian Participation Corp v Halimeda International Ltd [2024] UKPC 16, 19 June 2024

Group Litigation – Authority
The Technology and Construction Court has concluded that solicitors who brought claims on behalf of 620,000 claimants in relation to the collapse of the Fundão Dam in Southeast Brazil had been properly authorised. The claimants had given instructions to the solicitors by filling in a questionnaire with details of their losses. Some of the questionnaires contained express wording authorising the solicitors to bring claims and some did not, but that did not matter. The claimants would not have filled in the details if they did not want a claim brought on their behalf. And the absence of a full retainer agreement did not mean the solicitors had no authority.
Cunha da Silva v BHP Group (UK) Ltd [2024] EWHC (TCC), 27 June 2024 (judgment not yet publicly available)

Should you wish to discuss any of these cases in further detail, please speak with a member of our London dispute resolution team below, or your regular contact at Watson Farley & Williams: