Uzinterimpex JSC v Standard Bank Plc
| Jurisdiction | England & Wales |
| Judge | Sir Anthony Clarke MR,Laws,Moore-Bick L JJ. |
| Judgment Date | 15 July 2008 |
| Neutral Citation | [2008] EWCA Civ 819 |
| Court | Court of Appeal (Civil Division) |
| Date | 15 July 2008 |
Court of Appeal
Before Sir Anthony Clarke, Master of the Rolls, Lord Justice Laws and and Lord Justice Moore-Bick
In a claim in conversion for wrongful interference with goods, the claimant's failure to mitigate the loss was a new intervening cause, breaking the link between the original wrongdoing and and the continuing loss, which released the wrongdoer from liability for subsequent loss after that failure.
The Court of Appeal so held, dismissing the appeal of the claimant seller, Uzinterimpex JSC, against Mr Justice David SteelUNK ((2007) 2 Lloyd's Rep 187) who gave judgment for Uzinterimpex against the defendant, Standard Bank plc, and awarded damages of US$916,267.36 for conversion only up to the date when the seller failed to mitigate its loss.
Mr Jeffrey Gruder, QC and Ms Philippa Hopkins for Uzinterimpex; Mr Stephen Phillips, QC and Mr Michael Lazarus for the bank.
LORD JUSTICE MOORE -BICK said that the claim arose out of a contract for the sale of cotton by Uzinterimpex, an Uzbek state company, to an English cotton trader, A. Meredith Jones and Co Ltd, of 50,000 metric tonnes of cotton and the arrangements made with the bank to obtain the finance needed to pay for the goods.
From the outset both sides experienced difficulties in performing the contract. Meredith Jones took steps to obtain goods without waiting to receive the documents from Uzinterimpex. The bank was willing to assist Meredith Jones and on some transactions the bank received the value of the goods twice.
Uzinterimpex obtained two arbitrations awards against Meredith Jones in 2000 entitling it to over US$8 million, but Meredith Jones went into insolvent liquidation in February 2001. There was no prospect of significant recovery for Uzinterimpex.
In 2004, Uzinterimpex brought proceedings against the bank seeking to recover the amount it had received under the guarantee in excess of what was properly due and damages for conversion of the cotton covered by documents the bank had failed to release.
The judge held that the bank had converted the goods in question and was liable in damages, but did not accept that Uzinterimpex was entitled to recover the full amount of its claim. Its refusal to agree to the bank's suggestion of August 9, 2000, that the goods be sold and the proceeds held in a blocked account to await the outcome of the dispute, was unreasonable. He held that it had failed...
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