The Griffon: the deposit or compensation?
The recent decision of Mr Justice Teare in Griffon Shipping LLC v Firodi Shipping Ltd (the Griffon)  EWHC 593 (Comm) heralds a departure from the previously held view that under clause 13 of the standard form Norwegian Sale Form 1993, where a buyer fails to pay the deposit under a memorandum of agreement, an innocent seller’s claim is limited to compensation for its losses. In this case, the court concluded that a seller is in fact entitled to claim the deposit in such circumstances.
Griffon Shipping LLC, as Sellers, entered into a memorandum of agreement (MOA) with Firodi Shipping Ltd, as Buyers, for the purchase of the MV Griffon. The MOA was on a standard Norwegian Sale Form 1993 (NSF 93). Pursuant to clause 2 of the MOA, a deposit of 10%, (US$2,156,000) was due to be paid within three banking days of signature of the MOA. The MOA was signed but the deposit was not paid within the three banking days. On the following day, the Sellers accepted the Buyers’ conduct as a repudiation of the MOA and/or cancelled the MOA…
If you are registered and logged in to the site, click on the link below to read the rest of the Ince & Co briefing. If not, please register or sign in with your details below.
Sign in or Register to continue reading this article
It's quick, easy and free!
Why register to The Lawyer
More relevant to you
News from Ince & Co
News from The Lawyer
Briefings from Ince & Co
The Supreme Court has recently ruled that the buyers under a sale contract on GAFTA 49 terms could only recover nominal damages for the sellers’ wrongful cancellation of the contract.
Claimants with contractual claims against a Korean ship operator can go through London courts.