Lloyd's Maritime and Commercial Law Quarterly
English Sale of Goods Law
Sanam Saidova *
CASES
182. Addax Energy SA v Petro Trade Inc 1
Sale of petroleum products—DAP—terms of contract—incorporation by course of
dealing—passing of risk and property—jurisdiction—hearing where one party is unrepresented—Sale of Goods Act 1979, s.7—whether an agreement was void for uncertainty
This case concerned a dispute between the claimant (seller) Addax Energy SA (“Addax”) and the defendant (buyer) Petro Trade Inc (“PT”) in respect of US$2,761,408.78 and contractual interest for four unpaid invoices for petroleum products (motor gasoline
and gasoil) delivered to PT under a spot gasoil contract and a term agreement DAP Monrovia, Liberia.
On 14 January 2022, Cockerill J heard PT’s application challenging an English jurisdiction clause in relation to the claims arising under the term agreement.2 PT alleged that the term agreement had not been concluded and therefore that the English jurisdiction clause was not incorporated. Cockerill J dismissed the application and held that looking at all the facts against the relevant background, there was a previous course of dealing between the parties constituting a plausible evidential basis both for the conclusion
of a term agreement and for the inclusion in that agreement of a jurisdiction clause. Following this decision, PT ceased to participate in the proceedings. However, the court and the counsel for Addax were able to draw on PT’s defence, two witness statements
and skeleton argument available from the previous hearing to proceed with the matters arising in PT’s absence.3
In the course of five to seven years, Addax and PT traded in a manner common in the petroleum industry: an agreement for the sale and purchase of petroleum products would be reached orally, recapped in an email and a written contract containing all the terms already agreed by the parties would be emailed by the seller to the buyer, often followed by the latter’s approval. In addition to the spot contracts and the term agreement, the parties entered into a tripartite storage and release contract titled Secured Distribution Agreement (“SDA”). The parties to this agreement were Addax as the supplier, PT as the buyer and ACE Global Depository DMCC (“ACE”) as an independent contracting party responsible for storage, monitoring and release of the goods. Under the SDA: Addax delivered petroleum products into storage tanks managed by ACE and PT accessed the
* Assistant Professor, University of Nottingham.
1. [2023] EWHC 1609 (Comm); [2023] 7 WLUK 120 (KB, Comm Ct: David Elvin KC, sitting as a Deputy High Court Judge).
2. Addax Energy SA v Petro Trade Inc [2022] EWHC 237 (Comm) (KB, Comm Ct: Cockerill J).
3. Hirbodan Management Co v Cummins Power Generation Ltd [2021] EWHC 3315 (Comm) applied.
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