Transocean Drilling UK Ltd v Providence Resources Plc

Transocean Drilling UK Ltd v Providence Resources Plc

Clause 20 of the contract, properly construed, excludes liability for wasted spread costs as they fall within the definition of consequential loss, and the clear language of the clause must be given effect. The right to set-off under clause 13.6 is procedural and does not override the substantive exclusion of liability for consequential loss under clause 20.

Parties
Appellant: Transocean Drilling U.K. Ltd; Respondent: Providence Resources Plc
Jurisdiction
England and Wales
Judgment Date
13 April 2016
Procedural Posture
Civil Appeal / Appeal From High Court Judgment
Outcome
appeal allowed
Legal Topics
Exclusion Clauses, Interpretation of Contracts, Allocation of Risk, Consequential Loss, Set Off
Contract Law Commercial Law Exclusion Clauses Interpretation of Contracts Allocation of Risk Consequential Loss Set Off

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 4 Authorities cited 15 Party arguments 2
Sign in to unlock

Parties

Transocean Drilling U.K. Ltd

Appellant

Providence Resources Plc

Respondent

Procedural Posture

Civil Appeal / Appeal From High Court Judgment

Legal Issues

  1. 1 Whether 'spread costs' incurred by Providence as a result of Transocean’s breaches are 'consequential losses' excluded by clause 20 of the contract
  2. 2 Whether Providence could recover spread costs by way of set-off under clause 13.6

Ratio Decidendi

Clause 20 of the contract, properly construed, excludes liability for wasted spread costs as they fall within the definition of consequential loss, and the clear language of the clause must be given effect. The right to set-off under clause 13.6 is procedural and does not override the substantive exclusion of liability for consequential loss under clause 20.

Court Disposition

appeal allowed

Orders

  • Appeal allowed; judgment below set aside to the extent appealed; Providence not entitled to recover spread costs from Transocean.