Commercial Disputes Weekly – Issue 24710 June 2025

ARBITRATION
The claimant buyer of a cargo of wheat has successfully challenged a decision of the GAFTA Board of Appeal under sections 67, 68 and 69 of the Arbitration Act 1996. The dispute arose out of a contract for the sale of 28,000mt of Russian milling wheat. The buyer had issues paying for the cargo due to US sanctions against Russia and the result was a second contract being concluded pursuant to which payment was made and the cargo delivered. The seller brought an arbitration claim for damages for repudiatory breach of the first contract. One of the issues in the arbitration was whether the tribunal could consider the interpretation of the termination clause in the second contract, when the tribunal had been constituted under the arbitration clause in the first contract. The tribunal considered that it did not have jurisdiction. The court held that the dispute could fall within both arbitration clauses and the claimant could choose which to invoke. The question of interpretation of the termination clause in the second contract impacted rights and liabilities under the first contract, so the tribunal did have jurisdiction to consider the question (although that question could also have been considered in an arbitration pursuant to the second contract arbitration agreement). The appeal award that made an unconditional award of damages in favour of the seller was to be set aside or varied.
CAFI – Commodity & Freight Integrators DMCC v GTCS Trading DMCC [2025] EWHC 1350 (Comm), 3 June 2025

MARITIME
The Commercial Court has considered whether the parties entered into a contract of affreightment (“COA”) for the transportation of cargoes of oil over a 15-year period. Palmali claimed damages from Litasco for an alleged failure to provide cargoes for shipment. The court held that the COA was void under Swiss law (Litasco is a Swiss company) because the signatory for Litasco had a conflict of interest at the time of signing and the deal was not in Litasco’s best interests. The signatory for Palmali knew this at the time he signed the COA. It was therefore inferred that neither party intended it to have legal effect. Litasco successfully counterclaimed for sums owing from unpaid debts and unjust enrichment from advance payments, against which was set off an additional claim from Palmali for sums owing under various charterparties and bills of lading.
Palmali Shipping SA v Litasco SA [2025] EWHC 1149 (Comm), 23 May 2025

CONSTRUCTION
The Technology and Construction Court has provided guidance on the recoverable damages from the developer and others for breach of lease and under section 1 of the Defective Premises Act 1972 in relation to fire safety and other defects in the flats. The claimants were past or present leaseholders of the flats. The court held that certain claims were in principle recoverable as a matter of law, including diminution in value and loss of rental income, but that the claimants needed to particularise their losses and seek permission to amend their pleadings. However, some heads of claim were not recoverable, including capital losses, investment losses, secured borrowing loss, indemnity for claims from sub-tenants and taxation losses.
Wilson and others v HB (SWA) Ltd and others [2025] EWHC 1315 (TCC), 30 May 2025

BUILDING SAFETY ACT
The freeholder of a building has successfully appealed against a remediation order made by the First-Tier Tribunal (“FTT”) under the Building Safety Act 2022. It argued that the order was too wide and included various defects that were not properly before the FTT on the evidence. The Upper Tribunal held that the FTT’s decision was procedurally irregular and unfair. The FTT had included various additional items in the order such as balconies, bin stores, courtyard walkways and floor area and roof terrace. Only the courtyard cladding and combustible insulation should have been included in the remediation order. The order was set aside. The Upper Tribunal has also provided guidance on the extent to which the FTT can raise points which are not part of either party’s case, and how it should proceed if it chooses to do so. This was the first time the issue arose in the context of the Building Safety Act 2022.
Monier Road Limited v Blomfield and other leaseholders [2025] UKUT 157 (LC), 4 June 2025