Standard Chartered Bank v Pakistan National Shipping Corporation & Ors [2001] EWCA Civ 55 (26 January 2001)

Standard Chartered Bank v Pakistan National Shipping Corporation & Ors [2001] EWCA Civ 55 (26 January 2001)

The loss suffered by SCB was directly caused by PNSC's fraud, as SCB was induced to pay for goods it would not otherwise have acquired, and the subsequent inability to recover the full value on resale was a direct consequence of the fraud. The burden was on PNSC to prove that SCB failed to mitigate its loss and that such failure caused additional loss, which PNSC failed to do. The trial judge's assessment of damages based on the actual resale price and reasonable consequential expenses was upheld, except for the recovery of a proportion of Mr Griffiths' salary, which was disallowed as not constituting recoverable consequential loss in the circumstances.

Citation
[2001] EWCA Civ 55
Parties
Claimant: Standard Chartered Bank; First Defendant: Pakistan National Shipping Corporation; Second Defendant: Seaways Maritime Limited; Fourth Defendant: Oakprime International Limited; Fifth Defendant: Arvind Mehra; Third Defendant (part 20 Defendant): SGS United Kingdom Limited
Jurisdiction
England and Wales
Judgment Date
26 January 2001
Procedural Posture
Appeal (civil) / Court of Appeal Judgment on Quantum of Damages
Outcome
Appeal dismissed in part, allowed in part
Legal Topics
Damages Assessment, Fraudulent Misrepresentation, Mitigation of Loss, Causation, Letters of Credit, Consequential Loss
Commercial Law Tort Law Banking Law Damages Assessment Fraudulent Misrepresentation Mitigation of Loss Causation Letters of Credit +1 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 10 Party arguments 2 Amounts and remedies 3
Sign in to unlock

Parties

Standard Chartered Bank

Claimant

Pakistan National Shipping Corporation

First Defendant

Seaways Maritime Limited

Second Defendant

Oakprime International Limited

Fourth Defendant

Arvind Mehra

Fifth Defendant

SGS United Kingdom Limited

Third Defendant (part 20 Defendant)

Procedural Posture

Appeal (civil) / Court of Appeal Judgment on Quantum of Damages

Legal Issues

  1. 1 Whether the claimant's loss was directly caused by the defendant's fraud or by its own conduct
  2. 2 Whether the claimant failed to mitigate its loss by not seeking alternative buyers outside Vietnam
  3. 3 Whether consequential losses, including employee salary, are recoverable

Ratio Decidendi

The loss suffered by SCB was directly caused by PNSC's fraud, as SCB was induced to pay for goods it would not otherwise have acquired, and the subsequent inability to recover the full value on resale was a direct consequence of the fraud. The burden was on PNSC to prove that SCB failed to mitigate its loss and that such failure caused additional loss, which PNSC failed to do. The trial judge's assessment of damages based on the actual resale price and reasonable consequential expenses was upheld, except for the recovery of a proportion of Mr Griffiths' salary, which was disallowed as not constituting recoverable consequential loss in the circumstances.

Court Disposition

Appeal dismissed in part, allowed in part

Orders

  • Damages award to SCB affirmed except for the sum relating to Mr Griffiths' salary, which is disallowed.