Transport legal update: Griffon Shipping LLC v Firodi Shipping Ltd (The Griffon)  EWHC 593 (Comm)
In Griffon Shipping LLC v Firodi Shipping Ltd (The Griffon), Teare J considered, in the context of clause 13 of the standard form Norwegian Sale Form (NSF) 1993, where a buyer fails to pay the deposit under a memorandum of agreement (MoA), whether the seller’s claim is limited to compensation for its actual losses or whether the seller is entitled to the deposit amount.
On 28 April 2010, Griffon Shipping (the seller) agreed to sell the M/V Griffon to Firodi Shipping (the buyer) at a price of $22m (£13m). On 1 May 2010, an MoA on NSF 1993 was signed. Clause 2 of the MoA provided that the buyer was obliged to pay a deposit of 10 per cent ($2.156m) within three banking days of signature (i.e. by 5 May 2010).
The deposit was not paid within three banking days and on 6 May 2010 the seller accepted the buyer’s conduct as a repudiation of the MoA and/or cancelled the MoA pursuant to an express contractual right to do so. The buyer accepted that its failure to pay the deposit was a repudiatory breach…
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