Freight Management Ltd v Caribbean Cement Company Ltd
| Jurisdiction | Jamaica |
| Judge | Sinclair-Haynes J |
| Judgment Date | 24 January 2013 |
| Court | Supreme Court (Jamaica) |
| Docket Number | CLAIM NO. 2012 CD 00043 |
| Date | 24 January 2013 |
[2013] JMCC Comm. 2
IN THE SUPREME COURT OF JUDICATURE OF JAMAICA
CLAIM NO. 2012 CD 00043
Mrs. Trudy Ann Dixon Frith and Mrs. Kimberley Mc Dowell instructed by Messrs. Grant, Stewart, Phillips and Company for the claimant.
Mr. Emile Leiba and Miss Gillian Pottinger instructed by Messrs. Dunn Cox for the defendant.
WHETHER TENDER WAS ACCEPTED-WHETHER THERE IS A CONCLUDED CONTRACT — WHETHER DEFENDANT IS ESTOPPED BY ITS CONDUCT FROM RELYING ON CERTAIN CLAUSES — WHETHER CLAIMANT ENTITLED TO DAMAGES — WHETHER THE FACT THAT VESSEL IS NOT OWNED BY CLAIMANT PRECLUDES A CLAIM FOR DAMAGES — WHETHER CLAIM FOR INTEREST PURSUANT TO THE LAW REFORM (MISCELLANEOUS PROVISIONS) ACT MUST BE PLEADED — WHETHER COURT HAS JURISDICTION TO ENTERTAIN CLAIM FOR INTEREST AFTER JUDGMENT DELIVERED
In or about August 2002, the Caribbean Cement Company Limited (CCCL) (defendant) issued an invitation for tenders which were to be submitted for the transportation of cement by way of sea from its Rockfort plant in Kingston to its Montego Bay depot. Tenders were submitted by Freight Management Limited (FML) (claimant) and five other companies. The claimant's tender was accepted and so it was verbally advised. A contract document was attached to the Tender Document which was signed by the claimant's representative but not by the defendant.
On the 3 October 2003, however, the defendant informed the claimant that it no longer intended to pursue haulage by sea as haulage by road was more feasible because of the devaluation of the Jamaican dollar. Consequently, the claimant has instituted these proceeding against the defendant for breach of contract and/ or promissory estoppel. It claims the following:
-
(1) US $330,000.00 as mobilization costs of vessel under the contract sixty (60) days at US $5,500 per day. (This claim was amende d at the trial to US$396,000.00 for loss of use for 72 days);
-
(2) General Damages for loss of contract; and
-
(3) $25,000.00 as Attorney's Costs.
It is the claimant's claim that it was verbally advised by the defendant that its tender was successful. It was asked by the defendant to adjust its tender price per metric ton. The claimant, by way of letter dated 17 January 2003, adjusted its price. The parties conducted themselves on the understanding that there was a binding contract in force. They engaged in discussions pertaining to the logistics and details for performance of the contract.
It was agreed that the claimant would commence the transportation of the cement on the 7 July 2003. On 17 February 2003, the claimant notified the defendant that in order to make its vessel, the ‘Island Trader,’ available to the defendant by the 7 July 2003, it would reduce or curtail its charter contract. With the knowledge of the defendant, it incurred expenses in its preparation to transport the cement. On the 7 July 2003, the vessel, pursuant to the agreement between the parties, was moored at the defendant's pier facility at Rockfort.
The defendant advised the claimant that as a result of difficulties it had experienced, it was unable to commence on the agreed date. On 3 October 2003, it was informed by the defendant that it was no longer interested in pursuing haulage by sea.
The defendant stridently resists the claim that there was a concluded contract. It insists that its Board of Directors approved the claimant merely as the ‘preferred supplier’ of the haulage services which would have been required, on the 22 November 2003. Mr. Lake, the claimant's managing director, was verbally informed although its practice was to advise the bidder in writing that its bid was preferred and that it would be contacted to enter a formal written contract. The claimant was not so advised because the defendant was concerned about the claimant's pricing, which was tied to the United States' exchange rate.
It is the defendant's case that subsequent to notifying the claimant that its bid was accepted, Mr. Richard Lake, the claimant's managing director, Mr. Derrick Isaacs, the defendant's materials manager and Adrian Spencer (CCCL's material manager and then marketing manager) met. Mr. Lake was questioned as to the impact the movement of the exchange rate would have on his proposal. He (Mr. Lake) voluntarily adjusted the price which had been submitted. No request was made by the defendant. The revised figures required the approval of the Board of Directors. The said prices were never approved by the Board of Directors.
The defendant contends that the verbal notification did not constitute a contract as it was subject to the execution of a formal contract. According to the defendant, it had no experience in haulage of that nature hence the discussions with the claimant regarding logistics and methodology. It indicated to the claimant its desire for a trial shipment, however, it lacked sufficient quantities of cement and pallets for such a shipment. It denies instructing the claimant to mobilize its vessel and equipment and is adamant that there was no agreement between the parties for the commencement of the contract.
The defendant also contends that the claimant's vessel was not in a condition to commence the haulage of the cement because it lacked the required trucks and was in need of repairs. The claimant sought its permission and was allowed to moor at its pier for the purpose of carrying out repairs. It is also the defendant's case that it regularly provides the owners of vessels with permission to moor at its pier to effect repairs to their vessels.
Mr. Richard Lake's evidence is that the claimant was awarded the tender. He was then advised that the purpose of the tender was to provide an alternative mode of transporting the defendant's cement to its warehouse in Montego Bay. Discussions ensued between the defendant's representatives and him. There were several discussions about the logistics for the execution and performance of the contract, particularly the transportation details as to cost build up; foreign exchange content and the commencement date for the haulage service.
It is his evidence that he was asked, during the course of the discussions, if a test run with the vessel could be arranged. He explained to the defendant's representatives that the vessel could not be made available for one day as it was not the same as renting a car and returning it the following day. They were advised that the vessel was under charter and would not be available until June or July 2003 to commence the service. He further informed them that, in the circumstances, he would not renew that charter in order to make the vessel available to them by the first week of May 2003. Mr. Derrick Isaacs, the defendant's then materials manager, agreed to that arrangement and requested that the vessel be brought to Jamaica. The said vessel was operating at a market rate of US$5, 500.00 per day.
Mr. Isaacs told him that the defendant wished to limit the effects of the fluctuations in the US dollar on the price quoted. The matter was discussed on the premise of an awarded contract with an awarded price that was tied to the exchange rate and oil prices. Consequently, on the 17 January, 2003, by way of letter, the claimant adjusted its price as requested.
On the 17 February 2003, the claimant wrote to the defendant for Mr. Isaac's attention regarding developments in the services it was to provide. In that letter, the claimant also responded to Mr. Isaac's query about the possibility of obtaining a substitute vessel in order to commence its services earlier. He (Mr. Lake) informed him (Mr. Isaac) that it would be impossible. He however advised him that the claimant would not renew the contract with its charterers so as to make the vessel available to the defendant by the 10 May 2003.
In response to the letter, Mr. Isaacs informed him that the defendant was not in a state of readiness and requested that they delay the arrival of the vessel. Consequently the claimant took a short-term charter. On the 27 June 2003, the claimant wrote to the defendant and advised that the vessel would arrive in Kingston on the 29 June 2003 to begin its service with the defendant in or about July 2003. The defendant was informed that in order to prepare for service, maintenance would be carried out on the vessel during that period. The letter reminded the defendant of the agreement that the vessel would berth at the wharf without charge.
The vessel arrived at the defendant's wharf on the 7 July 2003 ready to embark on the contract. The claimant was however informed by Mr. Isaacs that there was further delay on its part for the following reasons: lack of warehouse space as a result of the filling of export quotas, insufficient pallets and cement, and the opening of a depot in Spanish Town. During the period, the claimant awaited the defendant's readiness, with the consent of the defendant, it embarked on two charter voyages to the Dominican Republic and to Honduras. Each trip lasted eight (8) days.
On the 3 October 2003, Mr. Anthony Haynes, the defendant's then general manager advised him that the defendant no longer intended to transport its cement by sea. Mr. Isaac further informed him that the reason for the termination of the contract was that, upon the arrival of the vessel at the defendant's berth, the haulage contractors had reduced their claims for an increase. CCCL therefore did not anticipate any further problems with the road contractors.
The evidence of Ms. Yanique Forbes, (a former employee of the claimant) is that after the tender was submitted, they were invited to a meeting at which it was discussed...
To continue reading
Request your trial
-
Theophilus Tyrell v Sunset Beach Resort & Spa Hotel Ltd
... ... Ltd. (Surrey Paving). The company permitted him to contract in his own behalf for jobs not ... grounded her submissions in the authority of Freight Management Limited v Caribbean Cement Company Limited ... ...