(The Trident Beauty) Charter hire, payable by the charterers 15 days in advance, had been assigned to a third party. The appeal related to hire duly paid in advance for a 15 day period, throughout the whole of which the vessel proved in fact to be off hire, and after the end of which she continued off hire until the charter was justifiably terminated by the charterers on account of the owners’ repudiation. The owners were in these circumstances under an express obligation (and, even in the absence of an express obligation would have been under an implied obligation) to repay the charter hire overpaid, but were not worth powder and shot. The charterers claimed, unsuccessfully, to recover the overpaid hire from the third party assignee to whom it had been paid.
Held: An assignee of hire contract need not repay advance repayments
Lord Goff of Chieveley stated as a general rule that the existence of a contractual regime for the recovery of overpayments made the imposition by law of a remedy for total failure of consideration ‘both unnecessary and inappropriate’. ‘I am of course well aware that writers on the law of restitution have been exploring the possibility that, in exceptional circumstances, a plaintiff may have a claim in restitution when he has conferred a benefit on the defendant in the course of performing an obligation to a third party (see, eg, Goff and Jones on the Law of Restitution, 4th ed (1993), pp 55 et seq, and (for a particular example) Burrows on the Law of Restitution, (1993) pp 271-272). But, quite apart from the fact that the existence of a remedy in restitution in such circumstances must still be regarded as a matter of debate, it is always recognised that serious difficulties arise if the law seeks to expand the law of restitution to redistribute risks for which provision has been made under an applicable contract.’
Lord Woolf said: ‘There is no justification for subjecting an assignee, because he has received a payment in advance, to an obligation to make a repayment because of the non-performance of an event for which he has no responsibility.’
Judges:
Lord Goff of Chieveley, Lord Woolf
Citations:
Independent 01-Feb-1994, [1994] 1 Lloyds Rep 365, [1994] 1 WLR 161, [1994] 1 All ER 470
Jurisdiction:
England and Wales
Citing:
See Also – Pan Ocean Shipping Co Ltd v Creditcorp Ltd CA 24-Mar-1993
(The Trident Beauty) Advance payments made under a charterparty contract were not recoverable the assignees when the charter became ineffective. Such contracts were provisional as between the original parties, but did not retain that characteristic . .
Appeal from – Pan Ocean Shipping Co Ltd v Creditcorp Ltd CA 1-Feb-1994
(The Trident Beauty) Assignee not obliged to repay advance payment for non-performance. . .
Lists of cited by and citing cases may be incomplete.
Contract, Transport
Updated: 11 July 2022; Ref: scu.84552
