The Commercial Court (Cooke J) handed down a multi-million USD judgment in a long-running dispute arising out of a contract to transfer exchange-traded freight derivative positions worth hundreds of millions of USD.
The case had already resulted in a number of significant decisions on the ambit of the standard Commercial Court freezing in junction and relief from sanctions (see e.g.  1 WLR 291;  EWHC 1814 (Comm);  3 Costs L.R 532;  EWCA Civ 1195).
The case arose from an oral agreement reached between major players in the tanker market, Mr Polys Haji-Ioannou (heir, together with Stelios Haji-Ioannou to the Troodos shipping group) and Mr Nobu Su of TMT. Having effectively transferred certain positions, TMT did not buy them back and Mr Haji-Ioannou's company, Lakatamia, was left holding the position through the 2008 collapse of the global freight market and the global financial crisis.
Cooke J's judgment contains unusual findings on personal liability of ultimate beneficial owners and directors in relation to their companies' commercial dealings. He concluded that Mr Su, despite being accustomed to doing business through corporate vehicles as is common in the shipping market, had entered into an overarching personal agreement with Mr Haji-Ioannou that “the deal be done” between there companies and had therefore assumed personal liability for breach of contract. This finding was made despite the conclusion that both men had anticipated that the buy-back would (and could only) be conducted by a corporate entity.
In the context of damages, Cooke J declined to apply the market measure of damages (see s.50(3) of the Sale of Goods Act 1979) holding that the prima facie measure had been displaced by the defendants’ conduct in promising, post-breach, to buy-back the position.
In allowing recover of actual loss by the Claimant, Cooke J concluded that Lakatamia's novation of 80% of its position to sister companies was not fatal to recovery and found that the novation agreements were accompanied by implied contracts of indemnity between Lakatamia and the other defendants.
In March 2015 the Court of Appeal (Longmore and Jackson LJJs) granted conditional permission to appeal all aspects of the judgment.