GLOBALIA BUSINESS TRAVEL SAU (FORMERLY TRAVELPLAN SAU) OF SPAIN V FULTON SHPPING INC OF PANAMA (THE "NEW FLAMENCO")

[2017] UKSC 43, Supreme Court, Lord Neuberger, president, Lord Mance, Lord Clarke, Lord Sumption, Lord Hodge, 28 June 2017

Contracts - Breach - Repudiation of charterparty - Damages - Mitigation - Shipowners selling vessel upon repudiation of charterparty by charterers - Vessel subsequently losing market value - Whether owners obliged to account for benefit of early sale in calculation of damages

A time charterparty on the NYPE 93 form for the cruise ship New Flamenco had been extended by agreement until November 2009. The charterers repudiated the charterparty in October 2007. Owners immediately proceeded to sell the vessel. The sale was followed by a precipitous fall in the market for such ships so that it was calculated that the owners were US$17 million better off by selling the vessel in 2007 than they would have been, selling her upon the agreed redelivery date in November 2009. The charterers argued, and the arbitrator and Court of Appeal agreed, that the owner must give credit for this benefit in calculating the damages owed by the charterers for their breach.