Clea Shipping Corp v Bulk Oil International, The Alaskan Trader (No 2): 1984

The 24 month charterparty vessel suffered a major engine breakdown after nearly a year. The repairs would take several months. The charterers said they had no further use for the vessel but the owner did the repairs and sought to hold the charterers liable for hire for the rest of the period of the charterparty, once the repairs had been completed – some seven months. On an arbitration, the award was that the owners had no legitimate interest in pursuing their claim for hire rather than asserting a claim for damages. The owners appealed.
Held: The appeal was dismissed. Given the defendants’ conduct when called on to honour their clear obligations and because of their policy of non-cooperation during the proceedings, including admitting liability only at the last moment, it would not be equitable to deny the claimants their statutory rights.
Lloyd J reviewed the case law and said: ‘this court is bound to hold that there is some fetter [on the innocent party’s right to elect to disregard the repudiation], if only in extreme cases; and for want of a better way of describing that fetter it is safest for this court to use the language of Lord Reid, which, as I have already said, was adopted by a majority of the Court of Appeal in The Puerto Buitrago.’ The correct analysis was that, the court, on equitable grounds, refused to allow the innocent party to enforce his full contractual rights.

Lloyd J
[1984] 1 All ER 129, [1983] 2 Lloyds Rep 645
England and Wales
Citing:
CitedAttica Sea Carriers Corporation v Ferrostaal Poseidon Bulk Reederei GmbH, The Puerto Buitrago CA 1976
The parties entered into a charterparty by demise of a bulk carrier. It was in a state of disrepair. The owners required the charterers to repair it before redelivery, and claimed hire losses until it was returned repaired. The extensive repairs . .

Cited by:
CitedReichman and Another v Beveridge CA 13-Dec-2006
The defendants were tenants of the claimant. They vacated the premises and stopped paying the rent. The claimant sought payment of the arrears of rent. The defendants said that the claimants should have taken steps to reduce their damages by seeking . .

Lists of cited by and citing cases may be incomplete.

Contract, Transport

Leading Case

Updated: 01 November 2021; Ref: scu.396614