Navig8 Inc v South Vigour Shipping Inc & Ors

Identification of the parties to a written contract is an objective question of fact. The description of a signatory’s capacity forms part of the factual evidence, and other admissible evidence may assist. Subjective intentions matter only so far as communicated.

The expression “disponent owner” usually refers to a charterer of the vessel, but may, in an unusual context, describe a manager acting for the registered owner. Authority to contract on another’s behalf must be proved on the balance of probabilities. Inferences from silence or conduct must amount to unequivocal acceptance. An agent without authority is liable for breach of the implied warranty of authority.

Navig8 chartered four Aframax vessels from SMMC, which described itself as “disponent owners” in the fixture documents. Navig8 contended that SMMC acted for the registered owners, the first to fourth defendants, under an agreement reached in September 2011, by subsequent conduct, or under express authority given in April 2012.

The registered owners denied being parties to the charters and denied giving SMMC authority. The issues were the identity of the contracting owners, whether SMMC had authority, the alternative restitution claim, and SMMC’s liability.

1. Contracting party. Identification of the parties was an objective question of fact. The wording used in the charterparties was factual evidence of the signatory’s identity and capacity, but other evidence could be considered. Subjective intention was relevant only where communicated: [2004] 1 AC 715 (paras 91–94).
2. Meaning of “disponent owner”. The expression normally denotes a person who has chartered the vessel from the registered owner. However, it had also been used to describe a manager with wide powers: [1985] 2 Lloyd’s Rep. 109; (1949) 82 Lloyd’s List Rep. 936. In this case the parties intended SMMC to sign as manager for the registered owners, and did not intend SMMC to incur personal liability. That conclusion did not establish that the registered owners were bound, since authority remained necessary.
3. Authority. Navig8 failed to prove authority on the balance of probabilities. The contemporaneous note recording a conclusion from the registered owners after the September 2011 meeting, the absence of written confirmation, the later meeting documents, and the subsequent conduct all supported the conclusion that no agreement had been reached. The alleged agreement by conduct was not unequivocally established. Nor was express authority given by telephone on 13 April 2012. The claims against the registered owners were therefore dismissed.
4. Alternative claims. The restitution claim against the registered owner of Caspian Galaxy failed. Even assuming a three-party unjust enrichment claim could arise, the registered owner had changed position, or had otherwise received the money in discharge of an existing debt, so the enrichment was not unjust. SMMC was liable for breach of its implied warranty of authority. The damages were the sum that would otherwise have been recoverable from the registered owners, together with the balance of account.