Trafigura Beheer Ltd v Renbrandt Ltd

On 1 December the Commercial Court gave a judgment for the Claimant seller in this matter, which arose out of the sale of a cargo of gas oil in 2008.

The facts

The cargo was to be loaded by STS transfer from a mother vessel.

The Quality clause in the sale contract provided that the sulphur content should not exceed 3%; and that “The Seller gives no guarantees, conditions, warranties or representations, express or implied… in relation to the quality… of the product … which extend beyond the description of the product and any specifications contained in this contract.

The Determination of [Quantity and] Quality clause provided that “Quality shall be as already determined at the time of loading of the mother vessel.” This was to be by a certificate of quality which was final and binding on the parties for all purposes save for fraud or manifest error, in the usual way. There was a further requirement that any claim regarding quality had to be submitted in writing, with various documents attached, within 5 days of the bill of lading date.

There was a confused jurisdiction clause in the contract providing for English law and High Court jurisdiction but reference to commencement of arbitration within five days of the bill of lading date if disputes arose and were not settled (with a carve out for particular types of claim).

Delivery took place in October 2008 but no claim about the quality was made by the Buyer until the following year, when it first commenced proceedings in Nigeria. These were withdrawn but further proceedings were commenced, again in Nigeria, in 2016.

The Claimant Seller sought a declaration of non-liability from the English court and summary judgment in respect of that claim.

The decision

The Court made short work of finding that the Claimant was entitled to summary judgment.

  1. In relation to whether the claim form was validly served in Nigeria, the Defendant’s evidence was found to be of no evidential value and the CPR’s aim of protecting the position of a defendant who wishes to dispute jurisdiction from being required to engage in the merits of the claim pending such application does not apply where the time limit for filing an acknowledgement of service has passed and no jurisdictional challenge has been raised.
  2. The arbitration provisions in the jurisdiction clause related to quantity / quality disputes, not a claim for a declaration of non-liability.
  3. There was found to be no undue delay by the Claimant in bringing its claim, in circumstances where it was claiming in the contractually agreed forum that the Defendant’s claims were time barred, the latter having been brought out of time in a non-contractual jurisdiction.
  4. It confirmed that the purpose of a conclusive evidence clause is to avoid disputes as to quality and to achieve finality. Quality here was to be determined at the time of loading of the mother vessel.
  5. The Court’s declaration would serve a useful purpose insofar as it would assist the Nigerian courts, in circumstances where the contract was governed by English law, to have a ruling of the English court on the issue.

Significance

The decision confirms the role of conclusive evidence clauses and that a claim for a non-declaration of liablity in respect of a quality / quantity claim is not impacted by any restrictive time bars relating to the underlying claim. It also provides a useful insight for practitioners on the role of summary judgment, as opposed to default judgment, proceedings.