VITOL SA V BETA RENOWABLE GROUP SA

[2017] EWHC 1734 (Comm), Queen's Bench Division, Commercial Court, The Honourable Mrs Justice Carr DBE, 7 July 2017

Contracts - Sale of goods - Repudiation - Renunciatory breach - Failure to nominate vessel - Vessel nomination as condition precedent to seller's obligation to deliver - Calculation of loss - Actual loss suffered through hedging instruments used - Market value - Sale of Goods Act 1979, section 51

This dispute arose from a contract whereby Vitol agreed to buy and Beta agreed to sell and deliver 4,500 mt of a biofuel product. Vitol sought damages, claiming that in breach of contract Beta indicated in early to mid-June 2016 that it would be unable to provide the biofuel in accordance with its obligations. As a result, Vitol accepted such repudiatory and/or renunciatory breach by failing to nominate a vessel by 27 June and sent a notice of contractual termination by email on 7 July. Beta accepted that it had acted in renunciatory breach of contract as alleged but denied that by failing to nominate a vessel, Vitol had accepted that breach. Instead, it argued, the failure was a mere oversight and in any event did not amount to clear and unequivocal conduct conveying to Beta that Vitol was treating the contracts as at an end. On Beta's case, Vitol's failure to nominate relieved Beta of its obligation to deliver. Vitol should have terminated contractual relations in good time by accepting Beta's renunciation, which it did not do. Vitol contended that it had been ready and willing to nominate and that Beta had indicated that it could not deliver within the contract period, and that it was entitled to damages.