Azimut-Benetti Spa (Benetti Division) v Healey [2010] EWHC 2234 (Comm) (03 September 2010)

Azimut-Benetti Spa (Benetti Division) v Healey [2010] EWHC 2234 (Comm) (03 September 2010)

Clause 16.3 is not even arguably a penalty; it is commercially justifiable, balances the parties' interests, and is enforceable. The guarantee does not extend to obligations void as penalties. The claimant is entitled to summary judgment for €7.1 million under the liquidated damages clause.

Citation
[2010] EWHC 2234 (Comm)
Parties
Claimant: Azimut-Benetti SpA (Benetti Division); Defendant: Darrell Marcus Healey
Jurisdiction
England and Wales
Judgment Date
03 September 2010
Procedural Posture
Commercial Summary Judgment Application Under a Guarantee / High Court, Summary Judgment
Outcome
Summary judgment granted for the claimant
Legal Topics
Penalty Clauses, Liquidated Damages, Guarantee Liability, Summary Judgment, Shipbuilding Contracts
Contract Law Commercial Law Penalty Clauses Liquidated Damages Guarantee Liability Summary Judgment Shipbuilding Contracts

Case Brief

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Parties

Azimut-Benetti SpA (Benetti Division)

Claimant

Darrell Marcus Healey

Defendant

Procedural Posture

Commercial Summary Judgment Application Under a Guarantee / High Court, Summary Judgment

Legal Issues

  1. 1 Whether clause 16.3 of the Yacht Construction Contract is an unenforceable penalty clause or a valid liquidated damages provision
  2. 2 Whether the defendant guarantor is liable under the guarantee if the underlying obligation is unenforceable as a penalty
  3. 3 Whether the claimant is entitled to summary judgment for the liquidated damages or, alternatively, for the first instalment of the contract price

Ratio Decidendi

Clause 16.3 is not even arguably a penalty; it is commercially justifiable, balances the parties' interests, and is enforceable. The guarantee does not extend to obligations void as penalties. The claimant is entitled to summary judgment for €7.1 million under the liquidated damages clause.

Court Disposition

Summary judgment granted for the claimant

Orders

  • Defendant to pay €7.1 million to the claimant under the guarantee, being 20% of the contract price less deposit
  • Interest and any other outstanding matters to be resolved separately