Calmer waters

In Fulton Shipping Inc of Panama v Globalia Business Travel SAU [2014] EWHC 1547 (Comm), [2014] All ER (D) 184 (May) the claimant, Fulton Shipping (the owner) managed a small cruise ship called the “New Flamenco”. It had chartered it to the defendant, Globalia Business (the charterer). In August 2005, the parties agreed to extend the charter to 28 October 2007 with an option for a third year. On 8 June 2007, it agreed to extend the charter to 2 November 2009. In fact, in the run up to August 2007 the charterer, wrongly, disputed that it had reached any such agreement in June that year. On 17 August 2007, the owner treated the charterer’s position as an anticipatory breach and accepted the breach as terminating the contract. The charterer handed the vessel back on 28 October 2007. The owner sold it immediately for USD$23,765,000. The financial crisis caused the ship’s value to plummet to just US$7,000,000