Commercial Disputes Weekly – Issue 22412 November 2024

Maritime
The Court of Appeal has confirmed the lower court conclusion that a cargo claimant did not have to give credit for the salvage sale of the damaged cargo in its claim against the shipowner. It was established law that a bill of lading holder recovered damages for damaged cargo based on the difference between the sound and damaged arrived value of the cargo, without giving credit for any payment under a sale contract. The fact that the respondent was original seller of the cargo and assignee of the bill of lading holder’s rights did not change this position.  Such payments were collateral to the shipowner’s breach of contract and arose from the parties’ contractual relationship. The prices under the original and salvage sale contracts were simply evidence of the sound and damaged values of the cargo.
AMS Ameropa Marketing and Sales AG and another V Ocean Unity Navigation Inc (THE “DORIC VALOUR”) [2024] EWCA Civ 1312, 1 November 2024

Contract Interpretation – Liability Caps
Following a Technology and Construction Court finding that Rolls-Royce had validly terminated the contract for Topalsson to design, build and implement digital visualisation software, the Court of Appeal has considered the interplay of contractual liability caps and set off. It concluded that Topalsson’s liability for €8m of damages would be limited to €5m as per the contractual liability cap, before setting off the sum of €800,000 that was owed by Rolls-Royce to Topalsson as contractual payments. The court also held that the contractual right to interest for late payment did not fall within the contractual liability cap as it was the “sole and substantial remedy” for late payment and if it fell within the cap, it would disincentivise prompt payment.
Topalsson GmbH v Rolls-Royce Motor Cars Ltd [2024] EWCA Civ 1330, 5 November 2024

Summary Judgment – Loan Acceleration
The Commercial Court has granted summary judgment in favour of a financing bank after it correctly accelerated the loan. The defendants had put forward no evidence to support allegations that the amount claimed was in excess of the sum owing under the loan. It also rejected a suggestion that the fact that the Nigerian guarantor was in liquidation meant the proceedings should be stayed. The claimant bank could enforce the judgment against the guarantor in other jurisdictions or take part in the Nigerian insolvency proceedings.
African Export-Import Bank v Imperium Capital Partners PLC [2024] EWHC (Comm), 1 November 2024 (Judgment not yet publicly available)

Construction – Conditions Precedent
The Scottish Court of Session has handed down a decision on the interpretation of wording of a Scottish standard building contract that uses the same wording as the JCT standard form contract. The wording of the relevant conditions clearly required the contractor to comply with certain notice provisions in relation to claims for certain direct losses and expenses. The requirements included time limits and specified information to be provided. Those provisions were a condition precedent to the employer’s liability to reimburse the contractor, with the effect that non-compliance would mean that the contractor had no entitlement to reimbursement.
FES Ltd v HFD Construction Group Ltd [2024] CSIH 37, 25 October 2024

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: