Port of Tilbury (London) Ltd v Stora Enso Transport & Distribution Ltd & Anor

Port of Tilbury (London) Ltd v Stora Enso Transport & Distribution Ltd & Anor

The contract contained a clear no set-off provision in clause 15, subject only to express exceptions. Clause 8.11 did not expressly permit set-off of a cross-claim, but was confined to disputes as to quantum of sums invoiced. The implied term contended for by Stora was neither reasonable, necessary, nor obvious, and was inconsistent with the express terms of the contract. Therefore, Stora was obliged to pay the minimum tonnage payment without set-off, but could pursue its cross-claim separately.

Parties
Appellant/claimant: Port of Tilbury (London) Ltd; Respondent/defendant: Stora Enso Transport & Distribution Ltd; Respondent/defendant: Stora Enso Transport Distribution AB (now renamed Stora Enso Logistics AB)
Jurisdiction
England and Wales
Judgment Date
23 January 2009
Procedural Posture
Civil Appeal / Appeal From Summary Judgment in Technology & Construction Court
Outcome
Appeal allowed; summary judgment granted for the Port of Tilbury (London) Ltd.
Legal Topics
No Set Off Clauses, Implied Terms, Summary Judgment, Set Off and Counterclaim, Take or Pay Contracts
Contract Law Commercial Law No Set Off Clauses Implied Terms Summary Judgment Set Off and Counterclaim Take or Pay Contracts

Case Brief

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Parties

Port of Tilbury (London) Ltd

Appellant/claimant

Stora Enso Transport & Distribution Ltd

Respondent/defendant

Stora Enso Transport Distribution AB (now renamed Stora Enso Logistics AB)

Respondent/defendant

Procedural Posture

Civil Appeal / Appeal From Summary Judgment in Technology & Construction Court

Legal Issues

  1. 1 Whether the contract permitted set-off of a cross-claim against the minimum tonnage payment
  2. 2 Whether an implied term should be read into the contract to prevent the Port from claiming the minimum tonnage payment when unable or unwilling to perform its services

Ratio Decidendi

The contract contained a clear no set-off provision in clause 15, subject only to express exceptions. Clause 8.11 did not expressly permit set-off of a cross-claim, but was confined to disputes as to quantum of sums invoiced. The implied term contended for by Stora was neither reasonable, necessary, nor obvious, and was inconsistent with the express terms of the contract. Therefore, Stora was obliged to pay the minimum tonnage payment without set-off, but could pursue its cross-claim separately.

Court Disposition

Appeal allowed; summary judgment granted for the Port of Tilbury (London) Ltd.

Orders

  • Stora Enso Transport & Distribution Ltd and Stora Enso Logistics AB to pay the minimum tonnage payment of £1,829,574.60 to the Port of Tilbury (London) Ltd.
  • Stora may pursue its cross-claim for damages, including the minimum tonnage payment, in subsequent proceedings.