President of India v. La Pintada Compania Navigacion S.A. (The La Pintada) - House of Lords (Lord Fraser, Lord Scarman, Lord Roskill, Lord Bridge and Lord Brandon) - 24 May 1984

Interest awards in Arbitration proceedings - House of Lords overrules “Tehno-Impex” case

In this important case, the House of Lords has clarified the position relating to the award of interest on late payment of debts. The owners of the La Pintada commenced arbitration proceedings against charterers for unpaid freight and demurrage under a London arbitration clause. The relevant charterparty was dated 28 January 1975. The arbitration proceedings were begun in May 1977. On 30 January 1981 the charterers paid, and the owners accepted £22,199 and U.S. $58,017 in settlement of the claims for freight and demurrage respectively. These amounts represented the principal sums due to the owners. The arbitrators held that the sums should have been paid on 12 December 1978 and 1 September 1975 respectively.