Transition Feeds LLP v Itochu Europe Plc

Transition Feeds LLP v Itochu Europe Plc

The Board failed to deal with two distinct issues: (1) the Buyers’ entitlement to a price allowance under clause 2 of FOSFA 80 if the goods would not have been GMQ on arrival at Liverpool, and (2) the inapplicability of Rotterdam resale prices in measuring Sellers’ damages. These failures constituted serious irregularities under s.68(2)(d) causing substantial injustice. Additionally, the Board’s application of the 'costs follow the event' rule was obviously wrong as it ignored the existence of cross-appeals; costs should have been apportioned accordingly.

Parties
Claimant/buyers: Transition Feeds LLP (formerly known as Advanced Liquid Feeds LLP); Defendant/sellers: Itochu Europe plc
Jurisdiction
England and Wales
Judgment Date
15 November 2013
Procedural Posture
Arbitration Claim (commercial Court, Queen's Bench Division, England) / Judgment on Applications Under Sections 68(2)(d) and 69 of the Arbitration Act 1996
Outcome
Buyers’ applications under s.68(2)(d) and s.69 succeed; arbitral awards set aside in part and remitted to the Board for reconsideration of specified issues.
Legal Topics
Serious Irregularity in Arbitration, Remission of Arbitral Award, Interpretation of CIF Contracts, Damages for Breach of Contract, Costs in Arbitration, Application of FOSFA Contract Terms
Arbitration Commercial Law Sale of Goods Serious Irregularity in Arbitration Remission of Arbitral Award Interpretation of CIF Contracts Damages for Breach of Contract Costs in Arbitration +1 more

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Parties

Transition Feeds LLP (formerly known as Advanced Liquid Feeds LLP)

Claimant/buyers

Itochu Europe plc

Defendant/sellers

Procedural Posture

Arbitration Claim (commercial Court, Queen's Bench Division, England) / Judgment on Applications Under Sections 68(2)(d) and 69 of the Arbitration Act 1996

Legal Issues

  1. 1 Whether the arbitral tribunal failed to deal with the Buyers’ claim for a price allowance under clause 2 of FOSFA 80 if goods would not have been GMQ on arrival at Liverpool
  2. 2 Whether the tribunal failed to address the Buyers’ contention that Rotterdam resale prices were inapplicable in measuring Sellers’ damages
  3. 3 Whether the Board’s application of the 'costs follow the event' rule was correct in the context of cross-appeals

Ratio Decidendi

The Board failed to deal with two distinct issues: (1) the Buyers’ entitlement to a price allowance under clause 2 of FOSFA 80 if the goods would not have been GMQ on arrival at Liverpool, and (2) the inapplicability of Rotterdam resale prices in measuring Sellers’ damages. These failures constituted serious irregularities under s.68(2)(d) causing substantial injustice. Additionally, the Board’s application of the 'costs follow the event' rule was obviously wrong as it ignored the existence of cross-appeals; costs should have been apportioned accordingly.

Court Disposition

Buyers’ applications under s.68(2)(d) and s.69 succeed; arbitral awards set aside in part and remitted to the Board for reconsideration of specified issues.

Orders

  • The Board’s Award dated 12 January 2012 is set aside insofar as it determined damages payable by Buyers to Sellers, including costs orders.
  • The Award is remitted to the Board for consideration of (i) the Buyers’ entitlement to a price allowance under clause 2 of FOSFA 80, and (ii) the applicability of Rotterdam resale prices in measuring damages.