Tang Chong Jun Featured in ALB’s Friday Debrief on The Lila Lisbon and Loss-of-Bargain Damages Under the Norwegian Saleform
Our Executive Director, Tang Chong Jun, has been featured in Asian Legal Business’s (ALB) Friday Debrief, sharing his views on the implications of the Court of Appeal’s decision in The Lila Lisbon for sellers, buyers and financiers in ship sale and purchase transactions. Chong Jun acted for the buyers in the underlying LMAA arbitration, giving him a first-hand vantage point on a dispute that is now headed to the UK Supreme Court.
In the interview, Chong Jun explains that the decision confirms rather than changes the industry accepted norm. He further explains that there are limits to the recoverability of loss-of-bargain damages by buyers: loss-of-bargain damages under the Norwegian Saleform 2012 are available to buyers, not merely because the sellers miss the agreed cancelling date - buyers must additionally prove that sellers were negligent in their failure to deliver. He sets out what this means in practice. Buyers should gather contemporaneous evidence of a seller’s conduct before exercising their right to cancel, since proving negligence after the fact can be an uphill task. Sellers who leave delivery to the eleventh hour take on real risks, as a missed cancelling date can be characterised as a negligent failure to be ready for delivery. Financiers on both sides, while typically removed from delivery risks, are not insulated from the fallout of a failed delivery.
With sellers having appealed to the UK Supreme Court, Chong Jun expects parties to continue with negotiations on risk allocation and cancellation terms under the widely used Norwegian Saleform, pending a definitive word from the apex court. His broader lesson for Asia’s maritime sector: industry standard forms are no substitute for proper risk assessment at the contract stage, and engaging professional advisors early - before a dispute fully develops - can make all the difference to how it is ultimately resolved.
Read Chong Jun’s full interview on ALB’s Friday Debrief: https://www.legalbusinessonline.com/other-news/friday-debrief-negligence-and-bargain
For further enquiries, please contact:
Tang Chong Jun at tang.chongjun@helmsmanlaw.com
For media enquiries, please contact:
Marisa Tse at marisa.tse@helmsmanlaw.com
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