Trans Trade RK SA v State Food and Grain Corporation of Ukraine

Under section 49(2) of the Sale of Goods Act 1979, a price is payable “irrespective of delivery” only where the seller’s delivery obligation is not a condition precedent or concurrent condition of the buyer’s obligation to pay. An f.o.b. contract requiring cash against shipping documents, where the seller retains the right of disposal, does not satisfy that requirement. A fixed payment date may satisfy the separate “day certain” requirement, but it cannot remove the conditional nature of payment against documents. A seller whose claim under section 49 fails may in principle claim damages, but cannot introduce that different claim on a section 69 appeal where it was not made in the arbitration.

The claimant brought three appeals under section 69 of the Arbitration Act 1996 against GAFTA Appeal Awards upholding the defendant seller’s claims for the unpaid price of Ukrainian feed corn.

The contracts were f.o.b. contracts requiring payment by a specified date against scanned shipping documents. Title remained with the seller until payment. The buyer argued that the seller could not sue for the price under section 49(2) of the Sale of Goods Act 1979, because payment remained conditional upon delivery. The seller relied on a fixed payment date and recent authorities adopting a different approach. The central issues were the meaning of “day certain” and “irrespective of delivery”, and whether an alternative damages claim could be advanced on appeal.

1. Appeals allowed. The relevant parts of each GAFTA Award were set aside and replaced by dismissal of the seller’s price claim. No remission was ordered.
2. The Awards contained sufficient reasons and the appeals were neither premature nor procedurally flawed. The seller’s proposed alternative argument under section 69(7) was admissible procedurally, because CPR PD62 para 12.6 did not apply to a respondent that had not opposed the application for leave. However, the argument was substantively inadmissible because it sought to introduce a different damages claim requiring factual findings not sought in the arbitration.
3. The fixed date in the amended payment clause was a “day certain” within section 49(2), even if the correctness of Shell-Mex remained in issue. The “before breaking bulk” wording did not create relevant uncertainty. Making time of payment of the essence affected breach consequences, not whether the payment obligation was for a day certain.
4. For an f.o.b. contract requiring cash against shipping documents, the documents represented completion of the seller’s delivery obligation. Payment and delivery were concurrent conditions. The price was therefore not payable “irrespective of delivery”, although the goods had been shipped and title had not passed.
5. The court followed Stein Forbes and Muller Maclean, and held that Readie Construction was wrongly decided and should not be followed. CE Energy did not decide the meaning of “irrespective of delivery”. Caterpillar remained binding: a price claim under a sale of goods contract had to fall within section 49.
6. The seller’s only possible remedy under the Act was, in principle, damages. No such claim had been advanced in the arbitrations, so it could not be introduced on the appeals.

The appeals were brought under section 69 of the Arbitration Act 1996 against three GAFTA Appeal Awards. Henshaw J granted leave to appeal on 11 February 2025. The High Court allowed each appeal and dismissed the seller’s relevant price claim.