Saipol S.A. v Inerco Trade S.A.

Saipol S.A. v Inerco Trade S.A.

The tribunal erred in law by limiting recoverable damages to section 53(3) and section 54 of the Sale of Goods Act 1979, failing to consider Saipol’s claim for consequential losses under section 53(2), which expresses the first limb of Hadley v. Baxendale. The Board also failed to properly address the issue of joint contribution to the contamination and gave no adequate reasons for rejecting liability for the whole cargo.

Parties
Claimant/respondent: Saipol S.A.; Defendant/appellant: Inerco Trade S.A.
Jurisdiction
England and Wales
Judgment Date
20 June 2014
Procedural Posture
Appeal Under Arbitration Act Section 69 / Judgment on Appeal
Outcome
Appeal allowed
Legal Topics
Damages, Breach of Warranty, Consequential Loss, Contractual Liability, Commingling of Goods
Commercial Law Arbitration Sale of Goods Damages Breach of Warranty Consequential Loss Contractual Liability Commingling of Goods

Case Brief

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Parties

Saipol S.A.

Claimant/respondent

Inerco Trade S.A.

Defendant/appellant

Procedural Posture

Appeal Under Arbitration Act Section 69 / Judgment on Appeal

Legal Issues

  1. 1 Whether Sale of Goods Act 1979 limits recoverable damages to difference in value between sound and defective goods
  2. 2 Whether comingling of respondent’s 3,000 MT with other sellers’ parcels affects liability for third party liabilities or expenses

Ratio Decidendi

The tribunal erred in law by limiting recoverable damages to section 53(3) and section 54 of the Sale of Goods Act 1979, failing to consider Saipol’s claim for consequential losses under section 53(2), which expresses the first limb of Hadley v. Baxendale. The Board also failed to properly address the issue of joint contribution to the contamination and gave no adequate reasons for rejecting liability for the whole cargo.

Court Disposition

Appeal allowed

Orders

  • Remission to the tribunal to reconsider damages applying section 53(2) of the Sale of Goods Act 1979 and proper legal principles
  • No special direction on costs; costs to be at tribunal’s discretion