Commercial Disputes Weekly – Issue 23228 January 2025

Maritime – Limitation of liability
The Admiralty Court has struck out parts of Stema UK’s defence in which it claimed to be entitled to limit its liability under Article 1(4) of the Convention on Limitation of Liability for Maritime Claims 1976, in relation to a claim made against it arising from damage to electricity cables. The Court of Appeal had previously made an order that Stema UK was “not entitled to limit its liability…pursuant to section 185 of the Merchant Shipping Act…and is not entitled to a general limitation decree in the form of ADM19 or at all”. Where an order is unambiguous, there is no room for construction. This order was broad and clear in declaring that a general limitation decree was not available.  Although the other arguments then became contingent, the court indicated that Stema UK was also debarred by cause of action estoppel from applying again for a limitation declaration and that it could and should have raised the Article 1(4) points earlier, such that it was an abuse to raise the points now.
Réseau De Transport D’́Électricité and others v Stema Shipping (UK) Limited and others [2025] EWHC 73 (Admlty), 20 January 2025

Damages – Mitigation
A company obtained a judgment in its favour for negligence and breach of fiduciary duty by the defendants that resulted in a significant delay in a development scheme that it had planned. It appealed against the sum of damages awarded. The Court of Appeal dismissed the appeal, holding that the first instance judge had been correct to reduce the damages by £2.5m to reflect the fact that although the scheme was delayed, it was ultimately more profitable than the original scheme. Claimants are obliged to take reasonable steps to mitigate their loss and any benefits or losses caused by the mitigation efforts were taken into account. The company was right to pursue the revised scheme to mitigate their loss and could recover the increased costs, in addition to the loss of chance of rental income from the original scheme. However, the court was also entitled to deduct the increased profit from the revised scheme.
Barrowfen Properties v Patel and others [2025] EWCA Civ 39, 23 January 2025

Insurance – Jursidiction
The Commercial Court was required to decide the appropriate forum for a dispute as to whether a reinsurer had rescinded and avoided the policy of reinsurance due to misrepresentation of the value of the insured premises. The options were policy documents, known as Market Reform Contracts (“MRC”), signed by the reinsurer that provided for English law and jurisdiction, and Facultative Certificates (“FC”) that are commonly used in the US market and provided for New York law and arbitration. The FC operated as an amendment to the MRCs. The court held that a “Confusion Clause” in the FCs gave precedence to the terms of the MRC if there was confusion or inconsistency. The jurisdiction clauses were irreconcilable and therefore the English law and jurisdiction clause in the MRC prevailed.
Tyson International Company Ltd v GIC RE, India Corporate Member Ltd (sued as the sole corporate member for Syndicate 1947 at Lloyd’s of London for the 2021 and 2022 years of account) [2025] EWHC 77 (Comm), 21 January 2025

Freezing injunction – Charge on property
The applicant company sought an order permitting the sale of two properties that potentially fell within a freezing injunction obtained against two related companies. The relevant properties were subject to a charge in favour of Victoria Capital Trust (“VCT”) as security relating to a facility agreement. VCT appointed receivers to realise its security. The judge held that whether or not the related company had any beneficial interest in the properties, which was in doubt, the VCT Charge took priority. As a result, even if the properties fell within the scope of the freezing injunction, that would be of no benefit to the respondents. The injunction was varied to clarify that the receivers were permitted to deal with and dispose of the properties.
Click Above Corben Mews Limited and others v 381 Southwark Park Road RTM Company Limited and others [2025] EWHC 105 (TCC), 23 January 2025

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: