Teekay Tankers Ltd v STX Offshore & Shipbuilding Co. Ltd

Teekay Tankers Ltd v STX Offshore & Shipbuilding Co. Ltd

The option agreement was void for uncertainty because delivery dates for the optional vessels were left to future mutual agreement without objective criteria or enforceable machinery for determination. Neither of Teekay's proposed implied terms (STX offer date or reasonable date) could be implied as a matter of law or commercial necessity. Accordingly, Teekay's claim failed. If the agreement had been valid, STX's conduct would have amounted to renunciation, entitling Teekay to terminate and claim damages. Teekay's estoppel/abuse of process assertions failed as it was not a privy of the arbitration claimants. STX's counterclaim for breach of confidentiality failed as Teekay's disclosures...

Parties
Claimant: Teekay Tankers Ltd; Defendant: STX Offshore & Shipbuilding Co. Ltd
Jurisdiction
England and Wales
Judgment Date
15 February 2017
Procedural Posture
Commercial Contract Dispute / Final Judgment After Full Trial
Outcome
Claim dismissed; counterclaim dismissed
Legal Topics
Agreements to Agree, Uncertainty in Contracts, Repudiation and Renunciation, Damages for Loss of Bargain, Issue Estoppel, Abuse of Process, Confidentiality in Arbitration
Contract Law Commercial Law International Trade Agreements to Agree Uncertainty in Contracts Repudiation and Renunciation Damages for Loss of Bargain Issue Estoppel +2 more

Case Brief

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Parties

Teekay Tankers Ltd

Claimant

STX Offshore & Shipbuilding Co. Ltd

Defendant

Procedural Posture

Commercial Contract Dispute / Final Judgment After Full Trial

Legal Issues

  1. 1 Whether the option agreement was void for uncertainty
  2. 2 Whether STX repudiated or renounced the option agreement
  3. 3 Whether Teekay was entitled to terminate the option agreement and claim damages

Ratio Decidendi

The option agreement was void for uncertainty because delivery dates for the optional vessels were left to future mutual agreement without objective criteria or enforceable machinery for determination. Neither of Teekay's proposed implied terms (STX offer date or reasonable date) could be implied as a matter of law or commercial necessity. Accordingly, Teekay's claim failed. If the agreement had been valid, STX's conduct would have amounted to renunciation, entitling Teekay to terminate and claim damages. Teekay's estoppel/abuse of process assertions failed as it was not a privy of the arbitration claimants. STX's counterclaim for breach of confidentiality failed as Teekay's disclosures...

Court Disposition

Claim dismissed; counterclaim dismissed

Orders

  • Teekay's claim is dismissed as the option agreement is void for uncertainty.
  • STX's counterclaim for breach of confidentiality is dismissed.