Novasen SA v Alimenta SA [2013] EWHC 345 (Comm) (27 February 2013)

Novasen SA v Alimenta SA [2013] EWHC 345 (Comm) (27 February 2013)

The FOSFA Default Clause does not confer a right to damages where no loss has been suffered; it limits damages but does not override the compensatory principle. If the buyer does not buy against the default, damages are assessed according to common law, taking into account subsequent events. The appeal succeeds as the Board erred in law by not considering subsequent events in assessing damages.

Citation
[2013] EWHC 345 (Comm)
Parties
Claimant: Novasen S.A.; Defendant: Alimenta S.A.
Jurisdiction
England and Wales
Judgment Date
27 February 2013
Procedural Posture
Arbitration Appeal / Judgment on Appeal Under Section 69 of Arbitration Act 1996
Outcome
Appeal allowed
Legal Topics
Assessment of Damages, Default Clauses, Prohibition Clauses, Compensatory Principle, Contract Termination, Sale of Goods
Commercial Law Arbitration Contract Law Assessment of Damages Default Clauses Prohibition Clauses Compensatory Principle Contract Termination +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 4
Sign in to unlock

Parties

Novasen S.A.

Claimant

Alimenta S.A.

Defendant

Procedural Posture

Arbitration Appeal / Judgment on Appeal Under Section 69 of Arbitration Act 1996

Legal Issues

  1. 1 Does the FOSFA Default Clause exclude the application of common law principles for the assessment of damages?
  2. 2 Was the Prohibition Clause applicable?
  3. 3 Would the operation of the Prohibition Clause have resulted in automatic termination without further notice?

Ratio Decidendi

The FOSFA Default Clause does not confer a right to damages where no loss has been suffered; it limits damages but does not override the compensatory principle. If the buyer does not buy against the default, damages are assessed according to common law, taking into account subsequent events. The appeal succeeds as the Board erred in law by not considering subsequent events in assessing damages.

Court Disposition

Appeal allowed

Orders

  • Award remitted to the Board of Appeal for further consideration in light of this judgment