PT BERLIAN LAJU TANKER TBK V NUSE SHIPPING LTD

[2008] EWHC 1330 (Comm), Queen’s Bench Division, Commercial Court, Mr Justice Christopher Clarke, 16 June 2008

Ship sale – Relation between consecutive contracts – Construction of contract for the sale of a ship on the Norwegian Sale Form 1993 - How and where buyers obliged to pay the purchase price – Whether payment “in full” could include release of deposit to a different bank – Whether arbitrators erred in law – Norwegian Sale Form 1993, clauses 1-3, 5, 8, 9, 13

The case concerned the sale transaction on the Norwegian Sale Form 1993 (NSF) in respect of the ship Aktor. Buyers had deposited 10 per cent of the purchase price in an account held jointly with sellers in an account in Singapore. Sellers had nominated a bank in Greece. Buyers indicated their intention to effect part payment by releasing the 10 percent, which sellers accepted as repudiation of the contract asserting that full payment was to be effected to the bank in Greece. The resulting arbitration was appealed on three points of law. In the end all that was at issue was payment of the deposit, equalling 10 percent of the purchase price. The buyers argued that 1) under the MOA they were not bound to pay any part of the purchase price in Greece; or 2) they were only obliged to pay 90 per cent of the purchase price in Greece, the place of payment of the remaining 10 per cent being in Singapore; or 3) if the buyers were obliged to pay 100 per cent of the purchase price in Greece, payment in Greece was not a condition of the contract but only an innominate term, breach of which did not go to the root of the contract.