Shipping Contract Disputes

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A recent contract dispute demonstrates the need to secure expert shipping law advice as soon as possible, particularly if the contract in question contained a jurisdiction clause, which can affect both the outcome of the case and any damages awarded.

Do you need expert advice on shipping law regarding a contractual dispute? Maritime law experts ParrisWhittaker are ready to advise.
If you are involved in the maritime and shipping industry, you know that contract disputes can have a crippling effect on your business. The swift and incisive resolution of such disputes are essential to a thriving business – and award-winning Bahamas law firm ParrisWhittaker is available to help.
A recent contract dispute demonstrates the need to secure expert shipping law advice as soon as possible, particularly if the contract in question contained a jurisdiction clause, which can affect both the outcome of the case and any damages awarded.

Jurisdiction issues

In this case, the contract in question was a contract of affreightment (COA) which contained an English law and jurisdiction clause.

The contract involved the transport of six shipments of coal from Richards Bay to India during a period from 2011-2012. When the Defendant (the Charterers) did not comply fully with the terms of the COA, the Claimant (the Owners) brought a breach of contract claim. The Defendant then responded with proceedings in India, attempting to secure an anti-suit injunction to put an end to the breach of contract action.

After two years, the Indian proceedings were dismissed, because of the key English law and jurisdiction clause in the original COA.

Damages calculation

When it came to calculating the appropriate damages to be awarded, a number of factors were taken into consideration. The Claimant had incurred considerable costs because of the breach of contract and the proceedings in India. In addition, prior to action being brought for breach of contract, the Claimant had given the Defendant an ‘extension of time to perform’, in order to assist the Defendant with meeting its obligations. The Court awarded damages based on the market price at the time of the expiry of the extension. A further consideration was whether the Claimant could have found a replacement shipment of coal to offset against their loss at the time of the breach. Since there had been no available market at that time, this was reflected in the damages awarded.

The ruling clarifies the position regarding those who have incurred legal costs in foreign jurisdictions under circumstances when the counterparty has breached a jurisdiction clause. It also demonstrates the importance of taking into consideration factors such as extensions of time to perform when calculating damages.

How can we help?

At ParrisWhittaker, our award-winning lawyers have many years’ expertise in maritime and shipping law, including representing clients in complex contract disputes involving jurisdiction clauses. If you are looking for expert, incisive legal advice on this or any other matter, do not hesitate to contact us now, so we can begin working on your behalf.

¹ Swissmarine Services SA v Gupta Coal India Private Limited [2015] EWCA 265 (Comm)