Sanhe Hope Full Grain Oil Foods Production Co Ltd v Toepfer International Asia Pte Ltd

Sanhe Hope Full Grain Oil Foods Production Co Ltd v Toepfer International Asia Pte Ltd

The Appeal Tribunal wrongly treated clause 27 as a liquidated damages clause rather than a limitation on damages to actual loss suffered, subject to a cap. The matter is remitted to the Tribunal to determine whether the Seller would have earned the profit from the Henan contract but for the Buyer's breach.

Parties
Claimant Buyer (respondent/defendant in the Arbitration): Sanhe Hope Full Grain Oil Foods Production Co Ltd; Defendant Seller (claimant/appellant in the Arbitration): Toepfer International Asia Pte Ltd
Jurisdiction
England and Wales
Judgment Date
28 November 2007
Procedural Posture
Commercial Arbitration Appeal / Appeal Under Section 69(1) of the Arbitration Act 1996 From FOSFA Appeal Arbitration Award
Outcome
Award remitted to the Tribunal for reconsideration in light of the judgment.
Legal Topics
Interpretation of Contract Clauses, Damages for Breach of Contract, Liquidated Damages Vs. Assessment of Loss
Commercial Law Arbitration Interpretation of Contract Clauses Damages for Breach of Contract Liquidated Damages Vs. Assessment of Loss

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Parties

Sanhe Hope Full Grain Oil Foods Production Co Ltd

Claimant Buyer (respondent/defendant in the Arbitration)

Toepfer International Asia Pte Ltd

Defendant Seller (claimant/appellant in the Arbitration)

Procedural Posture

Commercial Arbitration Appeal / Appeal Under Section 69(1) of the Arbitration Act 1996 From FOSFA Appeal Arbitration Award

Legal Issues

  1. 1 Proper construction of clause 27 of FOSFA Form 22
  2. 2 Whether damages are to be assessed as liquidated damages or as actual loss subject to a cap
  3. 3 Whether the Seller suffered any loss as a result of the Buyer's breach

Ratio Decidendi

The Appeal Tribunal wrongly treated clause 27 as a liquidated damages clause rather than a limitation on damages to actual loss suffered, subject to a cap. The matter is remitted to the Tribunal to determine whether the Seller would have earned the profit from the Henan contract but for the Buyer's breach.

Court Disposition

Award remitted to the Tribunal for reconsideration in light of the judgment.

Orders

  • The award is remitted to the Tribunal for reconsideration.