Lloyd's Shipping & Trade Law

Global Process Systems Inc v Syriakat Takaful Malaysia Berhad [2009] EWHC 637 Comm

The recent Commercial Court decision of Mr Justice Blair in The ‘Paragon’ is the corollary of the favouritism for legal certainty over freedom of contract by the House of Lords’ majority in The ‘Achilleas’. But, for the charter in The ‘Paragon’ the law was not certain at the time the charter was agreed with regard to the recoverability of loss of profit on a follow-on charter because the charter was agreed before The ‘Achilleas’ went to court. In such circumstances there was more latitude for this risk to be dealt with as an element of a genuine pre-estimate for the liquidated damages clause. From that perspective there was considerably less scope to argue that the clause provided for damages that are extravagant and unconscionable and thereby an unenforceable penalty.

Petroplus Marketing AG v Shell Trading International Ltd [2009] EWHC 1024 (Comm) AND Port of Tilbury v Stora Enso [2009] EWCA Civ 16