CL-2021-000341 - [2025] EWHC 1684 (Comm)

SUMMARY JUDGMENT

Under CPR 24.3, the court may give summary judgment “against a claimant or defendant on the whole of the claim or on an issue if — (a) it considers that the party has no real prospect of succeeding on the claim, defence or issue; and (b) there is no other compelling reason why the case or issue should be disposed of at a trial”.

In The LCD Appeals (Iiyama (UK) Ltd and others v Samsung Electronics Co Ltd and others) [2018] EWCA Civ 220, the Court of Appeal approved the following considerations applicable to summary judgment applications, taken from passages in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) and Swain v Hillman [2001] 1 All ER 91 at 94:

If an applicant for summary judgment adduces credible evidence in support of the application, the respondent then comes under an evidential burden to prove some real prospect of success or other reason for having a trial: Sainsbury’s v Condek [2014] EWHC 2016 (TCC) § 13.

In the present case, the Defendant has no real prospect of successfully defending the Claimant’s claims. The Claimant’s claims are for damages for breach of contract and for demurrage liabilities under the terms of the contract.

First, the written contract’s authenticity and validity are undisputable, and have not been challenged by the Defendant. Secondly, the Defendant failed to pay the full advance payment required under clause 9 and, with the exception of a few payments which the Claimant gives credit for, the Defendant has otherwise failed to fulfil its obligations under the Contract. Further or alternatively, the Defendant's actions properly understood constituted an “Event of Default” within the meaning of clause 30(A) of the Contract.

The Defendant’s breach led the Claimant to enter into swap arrangements with an alternative buyer and ultimately resell the product at a loss.

The prima facie measure of loss under section 50(3) of the Sale of Goods Act 1979 is the market measure. However, that measure applies only where there is an available market. Benjamin’s Sale of Goods (12th ed.) states that “[t]he availability of buyers and sellers, and their ready capacity to supply or to absorb the relevant goods is the basic concept of an ‘available market’” (§ 16-068). In the present case, the evidence quoted above of Mr Alaskari indicates that the Claimant was not faced with “available buyers” but rather, effectively, a local monopoly in the form of SPC. The Claimant considered whether the Product could be sold to other potential customers in Sudan or the wider region. Having made enquiries, it concluded that there was no alternative local buyer other than SPC because the sale of gasoline was heavily restricted by the Sudanese government. Further the Claimant concluded that it would be very difficult to find a buyer outside of Sudan as the grade of the Product was very specific to the Sudanese gasoline market; and any sale outside of Sudan would have required the Claimant to incur the cost of chartering a vessel and re-loading the Product for transport to any new buyer; and, in any event, SPC had threatened to expropriate the Product.

Benjamin goes on to explain that:

“If s.50(3) does not apply, because there is no available market, the court is thrown back on the general principle enunciated in s.50(2): “… the estimated loss directly and naturally resulting, in the ordinary course of events, from the buyer’s breach of contract”... If, despite the absence of an available market, the seller has in fact been able eventually to find a substitute buyer, the resale price may be evidence to fix the seller’s loss, if the terms of the resale are substantially similar to those in the original sale.” (§ 16-079)

The Claimant’s sale of the gasoline to SPC, via and on the terms of the swap agreements, was the best and probably only realistic course open to the Claimant, and was a reasonable step to take in mitigation. The prices thereby achieved were the best reasonably available to the Claimant. Accordingly, the difference set out above between the contract price and the prices achieved under the swap agreements represents the “estimated loss directly and naturally resulting, in the ordinary course of events” from the Defendant’s breach of contract for the purposes of section 50(2) of the Sale of Goods Act, and provides the appropriate measure of damages.

Additionally, the Defendant is clearly liable for demurrage under clause 13 of the Contract and has not paid the outstanding amounts to date.

Thus, the sums claimed, including contractual interest as claimed, are undoubtedly due. The Defendant has never put forward any defence or any basis on which the Claimant’s claims might be challenged.

I am satisfied that the Claimant’s counsel has considered whether any other possible defences might be available to the claims and drawn them to my attention. In this regard, counsel for the Claimant noted that the Defendant might have contested quantum if it had participated in the proceedings but suggested that their defence would not have a real prospect of succeeding for two reasons, and I concur with these reasons.

First, as regards the loss on the resale of the Product, the Claimant gave the Defendant ample opportunity to fulfil its obligations and to take delivery of the Product. When it became clear that this would not be possible, the Claimant took steps to resell the Product in order to mitigate its losses. Given that the cargo had already been discharged into tank at Port Sudan in the hope that the Defendant would perform its obligations, it made commercial sense to sell the product in Sudan. For the reasons I have already given, it is difficult to criticise the Claimant’s decision to sell the Product to SPC, as it was the best option available to the Claimant due to the lack of alternative local buyers other than SPC in Sudan, the logistical issues associated with pursuing a sale to buyers outside Sudan, and the threats of expropriation of the Product by SPC during the relevant time.

Secondly, the Claimant’s demurrage claim was calculated in accordance with clauses 12 and 13 of the Contract, which set out a procedure for the running of laytime and the calculation of demurrage. The Defendant has no basis to, and indeed does not, contest the Claimant’s calculations.

There is no compelling reason for the claim to be determined at trial. There are no disputed facts nor any reason to believe that further investigation into the underlying facts would reveal any material matters. There is no other reason why a trial would be appropriate. On the contrary, it would waste court time and legal costs. In such circumstances, summary determination is clearly appropriate (Sagicor Bank Jamaica Ltd v Taylor-Wright [2018] UKPC 12 § 16 per Lord Briggs).

The Claimant’s application for summary judgment therefore succeeds.