The vessel had been chartered on an amended New York Produce Exchange Form. As the contractually agreed charter period was nearing an end, the charterer gave notice to the owners of the approximate redelivery date. It then became clear that the vessel’s performance was such that an extra voyage could be squeezed in before the contractual redelivery date, so the charterer sent a further notice to the owners purporting to amend the redelivery date. The owners did not accept that the charterers were entitled to change the redelivery date in this way, having already fixed the vessel for her next employment. The owners withdrew the vessel from the chartered service prior to the last date for redelivery, which the charterers contended was a wrongful withdrawal and claimed damages for repudiation.
At arbitration, the owners claimed that the notice of approximate redelivery gave rise to one or other of three types of estoppel – waiver by election, promissory estoppel or estoppel by convention. The charterers contended that the notice was “approximate” and reservations were introduced by certain acronyms, including “wp” and “wog”, which the arbitrators held to mean “without prejudice” and “without guarantee”. The arbitrators concluded that the charterer’s notice of approximate redelivery gave rise to a promissory estoppel, so that when the notice of approximate redelivery date was given there was an implied term that the charterer would not do anything deliberately to prevent the redelivery date being met. On this basis, the arbitrators found in favour of the owners.
On appeal, the court held that a promissory estoppel is tantamount to a contractual variation or waiver and cannot be based upon a statement made “without prejudice”, on which basis the notice of approximate redelivery date was given. The arbitrators also did not address the question of whether without the term implied by the promissory estoppel, that the charterer would not do anything deliberately to prevent the redelivery date being met, the contract would not work. The court held that the contract would work without such a term, and further that it was difficult to believe that the parties would have intended such an implied term to form part of the contract. The arbitrators’ award was set aside and an award in favour of the charterer substituted.