Compromise and Coercion: The Cenk Kaptanoglu
The Commercial Court’s recent decision in Progress Bulk Carriers Ltd v Tube City IMS LLC (The Cenk Kaptanoglu) is an interesting example of economic duress founded (in part) on a lawful threat. The claimants in this case were the disponent owners of the vessel Cenk Kaptanoglu. On 2 April 2009, they chartered the vessel to the respondent-charterers for the carriage of shredded scrap but delivered the vessel to a third party shortly thereafter. This constituted a repudiatory breach of the charterparty, which was not accepted by the charterers even though there was then no realistic chance of the Cenk Kaptanoglu’s fulfilling the charter. Conceding their error, the owners promised to provide an alternative vessel and compensate the charterers for their loss. A substitute vessel (the Agia) was subsequently identified, but by that time it was clear that a delay in shipment could not be avoided. The charterers then sought, unsuccessfully, to negotiate a discount on the freight as a condition for accepting the Agia and the late shipment. On 28 April 2009, the owners made a “take it or leave it” offer, requiring the charterers to accept the Agia at a $2 per metric ton discount and waive all claims connected to the owners’ repudiatory breach. The charterers eventually agreed under protest.
Lloyd's Maritime and Commercial Law Quarterly
LEE, Pey Woan.
Compromise and Coercion: The Cenk Kaptanoglu. (2012). Lloyd's Maritime and Commercial Law Quarterly. 2012, (4), 478-481. Research Collection School Of Law.
Available at: http://ink.library.smu.edu.sg/sol_research/1154