A/S DAN BUNKERING LTD V F G HAWKES (WESTERN) LTD & ORS (THE "HOHEFELS")

[2009] EWHC 3141 (Comm), Queen's Bench Division, Commercial Court, Mrs Justice Gloster, DBE, 30 November 2009

Shipping - Contract - Guarantee - Authority to sign - Whether guarantee signed by someone having authority to do so - Express and implied authority - Course of dealing

The claimant sought the sum of US$458,630.87 for bunkers delivered to the merchant vessel Hohefels. The first defendant, a plywood merchant, had allegedly made out a guarantee in respect of the sum owed, but denied having signed it; the second defendant was the shipping agent that had ordered the bunkers; and the third defendant, Mr O, was the principal shareholder and director of the second defendant. If, as the first defendant purported, the guarantee was a forgery, the claimant sought damages from the second and third defendants for breach of warranty of authority, fraudulent or negligent misrepresentation and deceit. The second and third defendants did not acknowledge service or defend the claim. Gloster J found that there had been actual express or implied authority from Mr H to sign the guarantee. There were several documents in existence showing a signature similar to that on the guarantee and probably signed by the same person. It was likely that Mr H tolerated that Mr O signed documents on behalf of the first claimant. In those circumstances the evidential burden shifted to the first defendant to establish who had signed such documents. It was not entitled to shelter behind the bare submission that it was incumbent on the claimant to prove whose signature was on the document. This supported the claimant's case that the guarantee was signed with authority. There were further documents where Mr O had signed in his own name on behalf of the first claimant. There was therefore no doubt that on numerous occasions, Mr O was expressly authorised to enter into binding contracts on behalf of the first defendant. Although it was possible that he on occasion abused his authority and committed the first defendant to liabilities which had not previously been discussed, this was not the case in relation to the guarantee.