FAL Oil Co Ltd and Anr v Petronas Trading Corporation Sdn Bhd - Court of Appeal (Judge, Buxton and Mance LJJ) - 7 July 2004

Sale of goods - Oil cargo received during ship to ship transfer - Oil found to be contaminated with water when discharged from receiving vessel - Whether contamination occurred on transferring vessel or receiving vessel - Whether purchasers of oil liable to pay demurrage under sale contract

The claimant sellers agreed to sell to the defendant buyers ("Petronas") a cargo of high viscosity oil on C&F terms. There were two issues in the case. The first related to liability for the contamination of the oil by water. The second related to demurrage.