Profindo Pte Ltd v Abani Trading Pte Ltd: Demurrage Calculation in CFR Contract Dispute
In Profindo Pte Ltd v Abani Trading Pte Ltd, the Singapore High Court heard an appeal regarding the calculation of demurrage in a cost and freight (CFR) contract. Profindo, the seller, sued Abani, the buyer, for demurrage, loss of earnings, and port disbursement charges. Abani counterclaimed for cement quality issues and a shortfall in delivery. The High Court allowed Profindo's appeal regarding the demurrage and shortfall claims, finding Abani liable for demurrage despite an interruption in berthing and reversing the District Judge's decision on the cement shortfall. The court dismissed Profindo's claim for loss of earnings.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal allowed in part.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court case concerning demurrage calculation in a CFR contract. The court held the buyer liable for demurrage despite vessel's berthing interruption.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Abani Trading Pte Ltd | Respondent | Corporation | Counterclaim dismissed | Dismissed | |
| Profindo Pte Ltd | Appellant | Corporation | Appeal allowed in part | Partial |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Judith Prakash | Judge | Yes |
4. Counsels
4. Facts
- Profindo agreed to sell 2,750 metric tons of cement to Abani Trading under a CFR contract.
- The contract specified a discharge rate of 1,000 metric tons per day and demurrage at US$5,500 per day.
- The vessel arrived at the discharge port on 28 June 2009 and berthed on 29 June 2009.
- On 1 July 2009, port authorities required the vessel to leave the berth, interrupting discharge.
- Discharge was completed on 3 July 2009.
- The shipowners imposed demurrage on Profindo, who sought reimbursement from Abani.
- Abani refused to pay demurrage, claiming laytime was suspended when the vessel left the berth.
5. Formal Citations
- Profindo Pte Ltd v Abani Trading Pte Ltd, District Court Appeal No 5 of 2012, [2013] SGHC 10
- Profindo Pte Ltd v Abani Trading Pte Ltd, , [2012] SGDC 176
6. Timeline
| Date | Event |
|---|---|
| Profindo agreed to sell cement to Abani Trading. | |
| MV Athens arrived at Diego Suarez, Madagascar. | |
| Vessel berthed at 0700 hours; discharge commenced at 0805 hours. | |
| Discharge continued. | |
| Vessel required to leave berth. | |
| Mr. Wong informed Mr. Damodar about vessel's anchorage. | |
| Vessel returned to berth; discharge completed. | |
| District Court Appeal No 5 of 2012 | |
| Judgment reserved. |
7. Legal Issues
- Demurrage Calculation
- Outcome: The court held that laytime continued to run despite the vessel leaving the berth, making the respondent liable for demurrage.
- Category: Substantive
- Shortfall in Cement Delivery
- Outcome: The court held that the appellant fulfilled its delivery obligation by loading the agreed amount of cement onto the vessel, reversing the District Judge's decision.
- Category: Substantive
- Remoteness of Damages
- Outcome: The court agreed with the DJ that the appellant failed to satisfy the legal requirements of remoteness and mitigation in relation to this alleged loss
- Category: Substantive
8. Remedies Sought
- Demurrage
- Loss of Earnings
- Reimbursement of Port Disbursement Charges
- Damages for Shortfall in Delivery
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Shipping Disputes
11. Industries
- Trading
- Shipping
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Profindo Pte Ltd v Abani Trading Pte Ltd | District Court | Yes | [2012] SGDC 176 | Singapore | The decision of the district judge that was being appealed against. |
| Triton Navigation Limited v Vitol SA | English Court of Appeal | Yes | [2003] EWCA Civ 1715 | England and Wales | Cited in relation to contracts of carriage between charterers and shipowners. |
| Etablissements Soules et Cie v Intertradex SA | English Court of Appeal | Yes | [1991] 1 Lloyd’s Rep 379 | England and Wales | Cited regarding when laytime commences in a CIF contract. |
| The Asia Star | N/A | Yes | [2010] 2 SLR 1154 | Singapore | Cited for the principle that a claimant cannot recover damages for reasonably avoidable loss. |
| Hadley v Baxendale | N/A | Yes | (1854) 9 Exch 341 | N/A | Cited for the principle of remoteness of damages in contract law. |
| Fal Oil Co Ltd & Anor v Petronas Trading Corp Sdn Bhd | English Court of Appeal | Yes | [2004] EWCA Civ 822 | England and Wales | Cited regarding the demurrage clause in the CFR sale contract between the parties was a free-standing provision of an independent contract unconnected with the contractual arrangements between the appellant and the shipowners |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| No applicable statutes | |
15. Key Terms and Keywords
15.1 Key Terms
- Cost and Freight (CFR)
- Demurrage
- Laytime
- Port Disbursement Charges
- Bill of Lading
- Short Delivery
15.2 Keywords
- demurrage
- CFR contract
- laytime
- shipping
- cement
- Singapore High Court
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Demurrage | 90 |
| Contract Law | 85 |
| CFR Contracts | 80 |
| Laytime | 75 |
| Shipping Law | 70 |
| Commercial Law | 65 |
16. Subjects
- Contract Law
- Shipping
- International Trade