Golden Strait Corp. v. Nippon Yusen Kubishka Kaisha, (2007) 368 N.R. 324 (HL)

• Case Date: March 28, 2007
• Jurisdiction: Canada (Federal)
• Citations: (2007), 368 N.R. 324 (HL)

Golden Strait Corp. v. Nippon (2007), 368 N.R. 324 (HL)

MLB headnote and full text

Temp. Cite: [2007] N.R. TBEd. OC.014

Golden Strait Corporation (appellants) v. Nippon Yusen Kubishka Kaisha (respondents)

([2007] UKHL 12)

Indexed As: Golden Strait Corp. v. Nippon Yusen Kubishka Kaisha

House of Lords

London, England

Lord Bingham of Cornhill, Lord Scott of Foscote, Lord Walker of Gestingthorpe, Lord Carswell and Lord Brown of Eaton-under-Heywood

March 28, 2007.

Summary:

Golden Straight Corp. chartered a ship to Nippon Yusen Kubishka Kaisha by a period time charterparty dated 10 July 1998, under which the earliest contractual termination date was December 6, 2005. Nippon repudiated the charter by redelivering the vessel to Golden on December 14, 2001. Golden accepted the repudiation on December 17, 2001. An arbitration was held to determine damages. By that time, the second Gulf War had broken out, which pursuant to a war clause in the charterparty, entitled the charterers (Nippon) to cancel the charter, if it had still been current. Nippon claimed that it would have exercised its right to cancel under the war clause. The arbitrator accepted that argument. An issue then arose as to whether the damages sustained by Golden should be measured by reference to the full term of the charter (i.e., until the earliest contractual date of termination on December 6, 2005), or whether damages should run only from December 17, 2001, the date when the repudiation was accepted, until the outbreak of the war in March 2003, when Nippon would have cancelled the charter. The arbitrator held that Nippon was correct and that the outbreak of war in March 2003 placed a temporal limit on the damages, none being recoverable for the period from March 20, 2003 onwards. Golden appealed.

The High Court, per Langley, J. dismissed the appeal. Golden appealed.

The Court of Appeal dismissed the appeal. Golden appealed again.

The House of Lords, Lord Bingham of Cornhill and Lord Walker of Gestingthorpe, dissenting, dismissed the appeal.

Shipping and Navigation - Topic 864

Charter of ships - The charterparty - Damages - Repudiation - Golden Straight Corp. (owners) chartered a ship to Nippon Yusen Kubishka Kaisha (charterer) under a charterparty dated 10 July 1998 - The earliest contractual termination date was December 6, 2005 - The charterer repudiated the charter by redelivering the vessel to the owners on December 14, 2001 - The owners accepted the repudiation on December 17, 2001 - An arbitration was held to determine damages - By that time, the second Gulf War had broken out which according to a war clause in the charterparty entitled the charterer to cancel the charterparty, if it had still been current - The charterer claimed that it would have exercised its rights to cancel under the war clause - The arbitrator accepted that argument - An issue arose as to whether the damages sustained by the owners should be measured by reference to the full term of the charter (i.e., until the earliest contractual date of termination on December 6, 2005), or whether damages should run only from December 17, 2001, the date when the repudiation was accepted, until the outbreak of the war in March 2003, when the charterer would have cancelled the charterparty - The arbitrator held that the charterer was correct and that the outbreak of war in March 2003 placed a temporal limit on the damages, none being recoverable for the period thereafter - Golden appealed - The House of Lords dismissed the appeal.

Shipping and Navigation - Topic 947

Charter of ships - The charterparty - Time charter - Redelivery - Repudiation by redelivery - Damages - [See Shipping and Navigation - Topic 864 ].

Cases Noticed:

BS & N Ltd. (BVI) v. Micado Shipping Ltd. (Malta); Ship Seaflower, Re, [2000] 2 Lloyd's Rep. 37, refd to. [paras. 7, 40, 54, 73].

Koch Marine Inc. v. D'Amica Societa di Navigazione ARL; Ship Elena D'Amico, Re, [1980] 1 Lloyd's Rep. 75, refd to. [paras. 10, 57, 80].

Jamal v. Moolla Dawood Sons & Co., [1916] A.C. 175, refd to. [para. 11].

Miliangos v. Frank (Textiles) Ltd., [1976] A.C. 443, refd to. [paras. 11, 32].

Johnson v. Agnew, [1980] 1 A.C. 367, refd to. [paras. 11, 57].

Dodd Properties (Kent) Ltd. v. Canterbury City Council, [1980] 1 W.L.R. 433, refd to. [paras. 11, 33, 80].

County Personnel (Employment Agency) Ltd. v. Pulver (Alan R.) & Co., [1987] 1 W.L.R. 916 (C.A.), refd to. [paras. 11, 33].

Bwllfa and Merthyr Dare Steam Collieries (1891) Ltd. v. Pontypridd Waterworks Co., [1903] A.C. 426, refd to. [paras. 12, 36, 65, 78].

Bradberry, In re, [1943] Ch. 35, refd to. [para. 12].

Carslogie Steamship Co. v. Royal Norwegian Government, [1952] A.C. 292, refd to. [para. 12].

Thoars, In re, [2002] EWHC 2416 (Ch.), refd to. [para. 12].

McKinnon v. E Survey Ltd., [2003] EWHC 475 (Ch.), refd to. [para. 12].

Curwen v. James, [1963] 1 W.L.R. 748, refd to. [para. 13].

Murphy v. Stone-Wallwork (Charlton) Ltd., [1969] 1 W.L.R. 1023, refd to. [para. 13].

Dudarec v. Andrews, [2006] EWCA Civ. 256; [2006] 1 W.L.R. 3002, refd to. [para. 13].

Baker v. Willoughby, [1970] A.C. 467, refd to. [para. 13].

Jobling v. Associated Dairies Ltd., [1982] A.C. 794, refd to. [para. 13].

Radford v. De Froberville, [1977] 1 W.L.R. 1262, refd to. [paras. 13, 80].

Re-Source America International Ltd. v. Platt Site Services Ltd., [2005] EWCA Civ. 97; [2005] 2 Lloyd's Rep. 50, refd to. [para. 13].

Wertheim v. Chicoutimi Pulp Co., [1911] A.C. 301, refd to. [paras. 13, 30, 57].

Maredelanto Compania Naviera SA v. BergbauHandel GmbH; Ship Mihalis Angelos, Re, [1971] 1 Q.B. 164 (C.A.), refd to. [paras. 14, 30, 40, 55, 71].

Woodstock Shipping Co. v. Kyma Compania Naviera SA; Ship Wave, Re, [1981] 1 Lloyd's Rep. 521, refd to. [paras. 15, 39].

SIB International SRL v. Metallgesellschaft Corp.; Ship Noel Bay, Re, [1989] 1 Lloyd's Rep. 361, refd to. [paras. 16, 80].

Kaines (UK) Ltd. v. Osterreichische Warrenhandelsgesellschaft Austrowaren Gesellschaft m.b.H., [1993] 2 Lloyd's Rep. 1, refd to. [paras. 17, 34, 79].

North Sea Energy Holdings NV v. Petroleum Authority of Thailand, [1999] 1 Lloyd's Rep. 483, refd to. [paras. 18, 33].

Dampskibsselskabet Norden A/S v. Andre & Cie SA, [2003] EWHC 84 (Comm. Ct.), refd to. [para. 20].

Dampskibsselskabet Norden A/S v. Andre & Cie S.A., [2003] 1 Lloyd's Rep. 287 (C.A.), refd to. [para. 20].

Vallejo v. Wheeler (1774), 1 Cowp. 143, refd to. [paras. 23, 58].

Scandinavian Trading Tanker Co. AB v. Flota Petrolera Ecuatoriana; Ship Scaptrade, Re, [1983] Q.B. 529; [1983] 2 A.C. 694, refd to. [para. 23].

Ship Starsin, Re, [2004] 1 A.C. 715; 307 N.R. 100; [2003] UKHL 12, refd to. [para. 23].

Homburg Houtimport BV v. Agrosin Private Ltd. - see Ship Starsin, Re.

Jindal Iron and Steel Co. et al. v. Islamic Solidarity Shipping Co. Jordan Inc., [2005] 1 W.L.R. 1363; 332 N.R. 323; [2004] UKHL 49, refd to. [para. 23].

Ship Jordan II, Re - see Jindal Iron and Steel Co. et al. v. Islamic Solidarity Shipping Co. Jordan Inc.

Robinson v. Harman (1848), 1 Exch. 850, refd to. [para. 29].

Lavarack v. Woods of Colchester Ltd., [1967] 1 Q.B. 278 (C.A.), refd to. [para. 33].

Kitchen v. Royal Air Force Association, [1958] 1 W.L.R. 563, refd to. [para. 64].

Livingston v. Rawyards Coal Co. (1880), 5 App. Cas. 25, refd to. [para. 80].

Authors and Works Noticed:

Chitty on Contracts (29th Ed. 2004), vol. 1, para. 26-057 [paras. 11, 57].

McGregor, Harvey, Damages (17th Ed. 2003), paras. 2-002 [para. 57]; 8-024 ff. [para. 64].

Treitel, Guenter, H., Assessment of Damages for Wrongful Repudiation (2007), 123 L.Q.R. 9, generally [para. 23].

Treitel, Guenter H., The Law of Contract (7th Ed. 1987), p. 742 [para. 17].

Treitel, Guenter H., The Law of Contract (11th Ed. 2003), pp. 955 to 957 [para. 21].

Waddams, Stephen M., The Date for the Assessment of Damages (1981), 97 L.Q.R. 445, p. 446 [para. 11].

Counsel:

Nicholas Hamblen, Q.C., and David Allen (instructed by Reed Smith Richards Butler LLP), for the appellants;

Timothy Young, Q.C., and Henry Byam-Cook (instructed by More Fisher Brown), for the respondents.

Agents:

[None disclosed.]

This appeal was heard by Lord Bingham of Cornhill, Lord Scott of Foscote, Lord Walker of Gestingthorpe, Lord Carswell and Lord Brown of Eaton-under-Heywood, of the House of Lords. The decision of the House was delivered on March 28, 2007, when the following opinions were filed:

Lord Bingham of Cornhill, dissenting - see paragraphs 1 to 25;

Lord Scott of Foscote - see paragraphs 26 to 38;

Lord Walker of Gestingthorpe, dissenting - see paragraphs 39 to 47;

Lord Carswell - see paragraphs 48 to 68;

Lord Brown of Eaton-under-Heywood - see paragraphs 69 to 85.