Contract Natural Gas Ltd (in liquidation) v Zog Energy Ltd (in liquidation)

Contract Natural Gas Ltd (in liquidation) v Zog Energy Ltd (in liquidation)

Clause 13.3 of the MSA imposes a global £250,000 cap on liability for all claims, not per transaction, and ZOG's claim does not fall within the payment exception. Clause 13.5 applies bilaterally to both parties, barring claims not brought within twelve months, but does not extinguish liability. Time does not stop running in administration, but does stop in liquidation. Acknowledgment in a statement of affairs does not restart the contractual time bar.

Parties
Applicant/respondent: Contract Natural Gas Limited (in liquidation); Respondent/applicant: Zog Energy Limited (in liquidation)
Jurisdiction
England and Wales
Judgment Date
18 July 2025
Procedural Posture
Insolvency Application / Judgment on Preliminary Issues
Outcome
Preliminary issues determined in favour of CNG on clause 13.3 and partially in favour of CNG on clause 13.5; ZOG's proof limited to £250,000; CNG's proof for debts not time-barred at liquidation may be admitted, subject to further submissions.
Legal Topics
Limitation of Liability, Contractual Time Bar, Proof of Debt, Interpretation of Contracts
Insolvency Contract Limitation of Liability Contractual Time Bar Proof of Debt Interpretation of Contracts

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Parties

Contract Natural Gas Limited (in liquidation)

Applicant/respondent

Zog Energy Limited (in liquidation)

Respondent/applicant

Procedural Posture

Insolvency Application / Judgment on Preliminary Issues

Legal Issues

  1. 1 Whether clause 13.3 of the Master Sales Agreement imposes a global or per-transaction £250,000 liability cap
  2. 2 Whether clause 13.5 of the Master Sales Agreement bars CNG's claims after twelve months and whether time stops running in administration or liquidation
  3. 3 Whether ZOG's statement of affairs constituted an acknowledgment restarting the limitation period

Ratio Decidendi

Clause 13.3 of the MSA imposes a global £250,000 cap on liability for all claims, not per transaction, and ZOG's claim does not fall within the payment exception. Clause 13.5 applies bilaterally to both parties, barring claims not brought within twelve months, but does not extinguish liability. Time does not stop running in administration, but does stop in liquidation. Acknowledgment in a statement of affairs does not restart the contractual time bar.

Court Disposition

Preliminary issues determined in favour of CNG on clause 13.3 and partially in favour of CNG on clause 13.5; ZOG's proof limited to £250,000; CNG's proof for debts not time-barred at liquidation may be admitted, subject to further submissions.

Orders

  • ZOG's liquidators' rejection of CNG's proof above £250,000 upheld.
  • CNG not precluded from claiming debts where twelve-month period had not expired at liquidation.