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$1 Million Contract Dispute Hangs on One Signature

Following extensive litigation, with more than $1 million at stake, the High Court has found that an apparently complex dispute relating to an abortive oil trading contract is in the end likely to come down to a single missing signature.

Two Swiss companies had entered into a contract for the annual supply of up to 400,000 metric tons of various forms of oil product. The contract, which contained an exclusive English jurisdiction clause, was never performed and the buyer launched proceedings claiming $1,078,547 from the seller.

The buyer obtained a default judgment for that sum after the seller failed to file its defence within the time limit laid down the Civil Procedure Rules. In seeking to have that judgment set aside, the seller argued without success that the particulars of claim had themselves not been properly served.

However, in cutting to the heart of the matter, the Court noted that the contract bore only one of the two authorised signatures which were required to make it valid as a matter of Swiss law. On that basis the Court observed that, on the current state of the evidence, the seller’s defence appeared to be ‘not merely arguable’ but ‘bound to succeed’. The default judgment was set aside, enabling the case to proceed to trial.