APEX ENERGY INTERNATIONAL PTE LTD V WANXIANG RESOURCES (SINGAPORE) PTE LTD

[2020] SGHC 138, High Court of Singapore, Hoo Sheau Peng J, 6 July 2020

Contract – Formation – Offer and acceptance – Breach – Duty of reasonable mitigation – Quantum – Effect of hedging arrangement

Apex contended and Wanxiang denied that the parties had entered into a contract for the sale of a cargo of light cycle oil. There had been a deal recap on 23 November 2017 and further communications thereafter. Once the transaction had fallen through, Apex had sold the cargo to another buyer. The question arose whether, if there was a contract and a breach, this was a reasonable mitigation. Wanxiang argued that Apex had not proven that the sale was made on an available market price. Apex argued that there was no available market because of price uncertainty at the time and difficulties in selling the cargo so that section 50(3) of the Sale of Goods Act (Cap 393, 1999 Rev Ed) did not apply. Wanxiang also contended that a hedging arrangement entered into by Apex was unreasonable.