Commercial Disputes Weekly – Issue 22917 December 2024

Maritime – Limitation
Following a fire on board a ship which sank with the loss of all her cargo, the shipowners set up a limitation fund against which claims arising from the casualty would be made. Three parties (Maersk, MSC and Bengal Tiger Line) had contractual arrangements for the carriage of cargo on board the ship and claimed that they were also entitled to limit their liability for any claims made against them. The contracts were a connecting carrier agreement, fixed slots contract and an agreement for transport services. Following the principle laid down in The MSC Napoli in relation to slot charterers, the court concluded that each of these arrangements meant that the parties were “charterers” as appeared within the definition of a shipowner for the purposes of limitation of liability. The limitation fund was also deemed constituted on behalf of these parties.
Sea Consortium PTE Ltd and other v Bengal Tiger Line PTE Ltd and others [2024] EWHC 3174 (Admtly), 12 December 2024

Trusts – Formalities
Where two parties already owned the legal title in one share each in a joint venture company, together with 49% of the beneficial interest in the share, an oral agreement to transfer the remaining 51% of the beneficial interest did not require any further formalities to be effective. The Supreme Court held that the requirements of writing in section 53(1)(c) Law of Property Act 1925 were displaced when a constructive trust was momentarily created (and section 53(2) applied). With the full beneficial interest being held by the legal owners, the legal and equitable interests merged.
LA Micro Group Inc v LA Micro Group (UK) Ltd [2024] UKSC 42, 11 December 2024

Maritime – Enforcement
In the ongoing litigation relating to the sinking of the M/T Prestige and resulting pollution of the French and Spanish coastlines, the English Court of Appeal has dealt with various appeals relating to foreign judgments. The judge had been right to refuse to register a Spanish judgment against the defendant P&I club on the basis that the matter had already been dealt with by an English court (thereby creating an issue estoppel). The judge had, however, been wrong to uphold an award of equitable compensation to the club for breach of the obligation to arbitrate their disputes, rather than pursue them in the courts. It was correct that an injunction restraining enforcement of the Spanish judgment could not be granted against Spain or France for reasons of sovereign immunity, nor could equitable damages be granted in lieu of an injunction. Where neither an injunction nor damages could be awarded, equitable compensation was also precluded.
The Kingdom of Spain v The London Steam-Ship Owners’ Mutual Insurance Association Ltd and other cases [2024] EWCA Civ 1536, 12 December 2024

Construction
Where the parties had entered into a framework agreement for construction works in relation to telecommunications, an email sent by the employer notifying that certain work would not be commenced for some weeks was a variation not a cancellation of the work contained in the Work Order. The court also held that there was no implied term that the employer would not postpone the start of works and so the employer was not liable for the defendant’s alleged costs and loss of profit.
Grain Communications Ltd v Shepherd Groundworks Ltd [2024] EWHC 3067 (TCC), 29 November 2024

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