NOVASEN SA V ALIMENTA SA

[2013] EWHC 345 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Popplewell, 27 February 2013

Sale of goods - Prohibition of export of groundnut oil from Senegal - Contract termination upon prohibition of export - Subsequent change in circumstances - Whether loss suffered by the buyers - Assessment of damages - Application of The Golden Victory - FOSFA Prohibition and Default Clause

The parties had entered into a contract for the sale of groundnut oil exported from Senegal. The contract remained open when on 2 April 2008 sellers notified buyers of an export ban and extended the shipment period by 30 days pursuant to the prohibition clause. On the same day sellers also communicated a termination amounting to an anticipatory repudiation which was accepted by the defendant buyers. The export ban continued in force until after the expiry of the 30-day extension. The FOSFA appeals board rejected sellers' argument that no loss had been suffered because the contract would in any event have come to an end. Sellers obtained permission to appeal on the following question of law: "Should the Tribunal have taken account of matters occurring after 2 April 2008 (in particular those relating to the ongoing export prohibition and the operation of clause 22 which would have resulted in the termination of the Contract on 2 May 2008 without any liability on the part of the Sellers) when assessing whether or not the Buyers suffered a loss, and hence whether or not the Buyers were entitled to substantial damages?"