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Allied Marine Transport Ltd v Vale do Rio Doce Navegacao SA: The Leonidas D (1985) CA
In April 1975, the plaintiff owners granted the defendant charterers a charter on The Leonidas D. Disagreements between December 1975 and March 1976 resulted in the charterers suing the owners for almost $110,000. Arbitrators would resolve the disagreement in accordance with the parties' contract, the time charter. In April 1976, the parties each selected an arbitrator; however, the arbitrators were unable to select a third arbitrator. The time charter was extended and used until May 1977 without any more charterers' concerns or mention of the first disagreement. In fact, the charterers didn't take any further action to further their claim until August 1981, when they announced their plan to move forward with the arbitration. Due to the prolonged delay, the owners now requested an injunction to stop the charterers from continuing with the arbitration.
ruled that the charterers were entitled to pursue their claim. (I) In the event that no offer and acceptance were received, there was no agreement to end the arbitration. According to Robert Goff LJ, who delivered the court's decision: "We have all been raised to believe that it is axiomatic that acceptance of an offer cannot be inferred from silence, unless there are very specific circumstances."
In the absence of such circumstances, the court could not have concluded—by applying an objective standard to their conduct—that either party had offered or accepted the arbitration's termination. There were just too many plausible explanations for both parties' silence. (II) (3.7.2) In a similar vein, the owners were unable to use promissory estoppel.
It is well settled that that principle requires that one party should have made an unequivocal representation that he does not intend to enforce his strict legal rights against another; yet it is difficult to imagine how silence and inaction can be anything but equivocal.
In April 1975, the plaintiff owners granted the defendant charterers a charter on The Leonidas D. Disagreements between December 1975 and March 1976 resulted in the charterers suing the owners for almost $110,000. Arbitrators would resolve the disagreement in accordance with the parties' contract, the time charter. In April 1976, the parties each selected an arbitrator; however, the arbitrators were unable to select a third arbitrator. The time charter was extended and used until May 1977 without any more charterers' concerns or mention of the first disagreement. In fact, the charterers didn't take any further action to further their claim until August 1981, when they announced their plan to move forward with the arbitration. Due to the prolonged delay, the owners now requested an injunction to stop the charterers from continuing with the arbitration.
ruled that the charterers were entitled to pursue their claim. (I) In the event that no offer and acceptance were received, there was no agreement to end the arbitration. According to Robert Goff LJ, who delivered the court's decision: "We have all been raised to believe that it is axiomatic that acceptance of an offer cannot be inferred from silence, unless there are very specific circumstances."
In the absence of such circumstances, the court could not have concluded—by applying an objective standard to their conduct—that either party had offered or accepted the arbitration's termination. There were just too many plausible explanations for both parties' silence. (II) (3.7.2) In a similar vein, the owners were unable to use promissory estoppel.
It is well settled that that principle requires that one party should have made an unequivocal representation that he does not intend to enforce his strict legal rights against another; yet it is difficult to imagine how silence and inaction can be anything but equivocal.
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