Members may not have noticed a shipping case in today's BAILII, correctly decided but containing some worryingly subversive reasoning.

In MSC Mediterranean Shipping Co S.A. v Cottonex Anstalt [2015] EWHC 283 (Comm) shippers shipped containerised cotton from the Middle East to Bangladeshi buyers. The cotton market collapsed and the buyers never collected the goods: for the last 3+ years the containers have been sitting, still stuffed, in some noisome yard in Chittagong Port. Under a term in the carriage contract, which on a proper interpretation was held applicable here, the shippers agreed to pay 'container demurrage' for unreturned containers at a given rate per day. Quite rightly, in an overall excellent decision, the shippers were held liable for 3-odd years' demurrage on the containers, and counting. The contract meant what it said.

One or two disquiets. At [97] we see good faith raising its ugly head again, courtesy of the SCC in Bhasin v Hrynew, 2014 SCC 71, and trying as ever to commingle focused argument with vacuous verbiage. The shipper had pleaded the usual last refuge of the desperate, 'legitimate interest' under White & Carter. Rightly saying there was legitimate interest, Leggatt J went on to resurrect the concept by saying that the victim's right (under the law) to refuse to accept a repudiation was on a par with any other contractual discretion (under an express term) that presumptively could not be exercised arbitrarily, capriciously or irrationally. This seems a doubtful parallel to me. There was also a novel suggestion ([116]) that demurrage terms could be penal unless there was a duty to mitigate by taking steps to put an end to the situation creating the demurrage concerned. A worrying step for those who believe in freedom of contract in international trade.

Andrew