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You are here: BAILII >> Databases >> England and Wales High Court (Commercial Court) Decisions >> Fortune Hong Kong Trading Ltd. v Cosco-Feoso (Singapore) Pte Ltd. “Freja Scandic” [2002] EWHC 79 (Commercial) (6th February, 2002) URL: https://www.bailii.org/ew/cases/EWHC/Comm/2002/79.html Cite as: [2002] EWHC 79 (Commercial) |
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QUEENS BENCH DIVISIONCOMMERCIAL
COURT
Strand, London, WC2A 2LL | ||
B e f o r e :
____________________
FORTUNE HONG KONG TRADING LIMITED | Claimant | |
- and - | ||
COSCO-FEOSO (SINGAPORE) PTE LIMITED “FREJA SCANDIC” | Defendant |
____________________
Mr J. Russell QC and Mr P. Ferrer (instructed by Clyde & Co for the Defendant)
Hearing Dates: 22 January to 29 January 2002
____________________
THE HON. MR JUSTICE LANGLEY
Crown Copyright ©
Mr Justice Langley:
“since Mr Yu was my good friend, I wanted to help him solve his problem. Furthermore, I considered that helping Mr Yu could be a good opportunity for Fortune to enter into the oil trading business”
a) To pay 20% of the value of the Letter of Credit in advance as a deposit before the Letter of Credit was opened.
b) To remit the balance of the amount of the Letter of Credit two days before the Letter of Credit was paid and in default Fortune was "entitled to forfeit the deposit and the cargo under the said Letter of Credit as well as claim damages from" Cosco-Feoso.
c) To pay 2½% of the value of the Letter of Credit as "agent fee".
“We refer to a cargo of 5,000.000 mt of gasoil sold by us to you pursuant to contract No. CF/PI 053/97 dated 01 August 1997 and shipped aboard the vessel MY Freja Scandic at the port of Pasir Gudang, Malaysia pursuant to B/L dated 03 August 1997.
Although we have sold the cargo to you, we have been unable to provide you with the original Bills of Lading and the shipping documents covering the said sale.
In consideration of your paying to us the full purchase price of US$ 915,000.00, we hereby warrant that we have title free and clear of any lien or encumbrance to such material and having the full right and authority, we herewith transfer such title and to effect delivery of same to you.
We further agree to make all reasonable effort to obtain and surrender to you as soon as possible the original Bills of Lading and other shipping documents and to indemnity, protect, and hold you harmless from any all cost ... claims, losses, damages, demands and any consequences or expense which you may suffer, incur or put to as a [re]sult of not having received such document or breach of the warranties given above, including but not limited to any claims and demands which may be made by a holder or transferee of the original Bills of lading or by any other third party claiming an interest in or lien on the cargo or proceeds hereof.
This Indemnity shall be governed and construed in accordance with the laws of England and to the exclusive jurisdiction of the English High Courts.
This Letter of Indemnity shall expire automatically and simultaneously with your receiving the original Bills of Lading and other shipping documents in full conformity with the Letter of Credit ....”
“As soon as all original Bills of Lading for the above goods shall have arrived and/or come into our possession to produce and deliver the same to you whereupon our liability hereunder shall cease.”
“person whose business (whether or not he carries on any other business) is that of making loans....”
“No moneylender shall be entitled to recover in any court any money lent by him ... or to enforce any agreement made or security taken in respect of any loan made by him unless ... at the date of the loan ... he was licensed.
Provided that if the court is satisfied that in all the circumstances it would be inequitable if a moneylender who did not satisfy it that he was licensed at the relevant time was thereby not entitled to so recover such money ... the court may order that the moneylender is entitled to recover such money ... to such an extent and subject to such modifications or exceptions as the court considers equitable.”
“It is not enough to show that a person has on several occasions lent money at remunerative rates of interest; there must be a certain degree of system and continuity about the transactions”
a) The amount paid under the letter of credit and so debited to Fortune by the Bank was US$ 915,000. That occurred on 19 September 1997. It was on that date also that Cosco-Feoso's obligations under The LOI arose.
b) The amount due from Pacific Fond under The Financing Agreement was US$ 937,875 made up of $915,000 and the handling fee of 2½%. Strictly those sums should also have been paid in full on or before 19 September. In the event only $ 117,000 (paragraph 26) was paid against this amount.
c) The state-established wholesale price for gasoil of the relevant quality at Sanya, Hainan in August/September 1997 was RMB 2,974 pmt (US$ 358.75). That price applied only after the gasoil had been imported into mainland China. In order to import it, import duty, consumer tax and VAT would be payable as well as agents' fees of 1% for "importing formalities". After payment of those obligations the net wholesale value of the cargo in US$ would be 1,481,450.90. This is the sum which is the basis of Fortune's primary claim under The LOI.
d) The evidence of what may be called "the international price" of gasoil CIF Singapore or Malaysia is the agreed price of the cargo itself and the evidence of Cosco-Feoso's expert, Dr McDonald. Both support a price of $183 pmt. It is an obvious but nonetheless significant comment
that this price demonstrates that the state-controlled wholesale price in China was very substantially in excess of and almost double international prices.
e) Miss Wang's evidence was not very easy to follow. That was partly because of difficulties of interpretation and partly because, as she readily and properly made clear, she could not speak from her own experience on matters involving import licences and how an importer or cargo owner without a licence could go about obtaining and disposing of a cargo in China. She was reliant on what others had told her for such answers as she gave on those matters. What was clear, however, is that no one could import gasoil into China without a licence to do so (which Fortune did not have) and that the internal market was closely controlled by the State both by way of quotas and prices.
a) The measure of damages is such sum as will put Fortune in the position it would have been had the cargo of gasoil been delivered to it.
b) Fortune is therefore entitled to the value of the cargo at the time when and the place where (Sanya) it should have been delivered to it.
c) If there was then an "available market" for the cargo at Sanya that is the value to be taken. If there was no available market then the court must do the best it can to put a figure on the value on such evidence as is available to it.
d) The value at the port of discharge is to be reduced by any sums the claimant would have to pay in order to get the cargo so as to be able to realise its value.
e) The market value (where there is one) is to be taken independently of "circumstances peculiar to the claimant" and so, for example, independently of any contract he may have made to sell the cargo whether that be at a price greater or less than the market value.