Sub 20 Ltd v Royalton Investment Limited & Ors
[2024] EWHC 907 (Comm)
Sucden Financial Limited v TMT Metals AG & Ors
18 April 2024
[2024] EWHC 1051 (Comm)
High Court
A trading company (Sucden) sued another (TMT) for unpaid money. TMT tried to argue Sucden was unfair, but the judge disagreed, saying Sucden acted within the rules and TMT already admitted owing the money. The judge ruled in favor of Sucden.
Key Facts
- •Sucden Financial Limited (Sucden) claimed US$6,637,746.65 plus interest and costs from TMT Metals AG (TMT) for unpaid margin calls under a trading facility letter.
- •TMT had a substantial net short position in nickel, and losses incurred due to market volatility and the LME nickel market suspension.
- •TMT made partial payments and offered security for the debt.
- •Sucden's application was for summary judgment, and TMT sought leave to amend its defence.
- •The contract incorporated Sucden's terms of business, which included clauses on margin calls, default, and rights and remedies.
- •TMT's defence included arguments of wrongful pressure, arbitrariness, waiver, estoppel, and an inconsistency in the debt calculation.
Legal Principles
Summary judgment should only be granted if the defendant has no real prospect of success.
Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch); Okpabi v Royal Dutch Shell Plc [2021] UKSC 3; Korea National Insurance Corp v Allianz Global Corporate & Speciality AG [2007] 2 CLC 748
The court should consider the possibility of amendment on a summary judgment application.
Unspecified, but referenced throughout sections discussing the amendment application.
Implied terms should be considered when assessing contractual obligations.
Lewison - Interpretation of Contracts (2024 edition) at paragraph 6.128; North Midland Building Limited v Cyden Homes Limited [2018] EWCA Civ 1744
A contractual discretion must be exercised honestly, in good faith, and not arbitrarily, capriciously, or unreasonably.
Abu Dhabi National Tanker Company v Product Star Shipping Limited [1993] WL 965611
An express reference to reasonableness doesn't necessarily oust an implied obligation not to act arbitrarily or capriciously.
Hays v Willoughby [2013] UKSC 17
A failure to exercise a right or delay in exercising it does not automatically constitute waiver.
Clause 15.11 of the contract
Outcomes
Summary judgment granted to Sucden for the principal amount claimed.
TMT's defences lacked a real prospect of success. The alleged wrongful pressure, arbitrariness, waiver, and estoppel arguments were deemed weak and unsubstantiated. The alleged inconsistency in the debt calculation was explained and deemed inconsequential. TMT's actions, including partial payments and offers of security, implicitly acknowledged the debt.
Leave to amend the defence refused.
The proposed amendments were considered futile as they had no real prospect of success.