“19. It is against this background that the decision of the House of Lords in the Scaptrade must be seen. The House of Lords was concerned with the question of giving relief from forfeiture in circumstances where an owner had justifiably withdrawn his vessel in accordance with the terms of the charter. Lord Diplock held that the remedy of relief from forfeiture was unavailable, in part because a Court of Equity would not grant specific performance in respect of it. In this context he equated an injunction restraining the ship owner from exercising his right of withdrawal of the vessel (a contractual right given to him under the charter) with an order for specific performance. 20. An order restraining a party from exercising a contractual right, whether justifiably or not, is, both in form and substance, different from an order which restrains an owner from employing the vessel outside the charter. As the earlier authorities, to which I have referred, make plain, an injunction which restrains the defendant from employing the vessel outside the time charter does not in itself compel performance of the charter even though in practice, if the defendant is restrained from other gainful employment for the vessel, it is likely that performance under the charter will continue. 21. Thus it may be that in accordance with the dictum of Lord Diplock, an injunction in the form set out in paragraph 12(a) might be impermissible but that in paragraph 12(c) would be in accordance with the authorities as, in my judgment, would be an injunction in the form set out in paragraph 12(b). If the formula utilised in the Strathcona, the Georgios C and the Oakworth decisions is followed, there can be no objection in principle to the granting of an injunction.”
“Permission is sought on the limited and sole basis that The Scaptrade decided that an injunction of the kind granted by Cooke J cannot (or ought not) to be granted. So it is accepted that otherwise the balance of convenience favours grant of an injunction”
“The orders made would be negative in form and negative in substance and there would be no compulsion …. to perform the charters – only a financial incentive to do so in the absence of any other legitimate available employment.”
“26. The evidence is that the Vessels continue to trade and to operate normally in the pool despite the financial disputes between the parties and the allegations of anti-competitiveness. Although the parties, in the course of their dispute have been abusive about one another, there is nothing in the material before me upon which I could conclude that the continuation of the current arrangements is unworkable, even if it that was relevant in the context of any possible injunction to be granted. If an injunction was to be granted until the determination of the current disputes between the parties, that would not present any insuperable problems in the interim period. Lauritzen and the Owners have shown themselves capable of cooperating with each other and working together on a day-to-day basis, despite their differences and such matters as dry-docking have been arranged without apparent difficulty.”
“Has the High Court any jurisdiction to grant relief against the exercise by a shipowner of his contractual right, under the withdrawal clause in a time charter, to withdraw the vessel from the service of the charterer upon the latter’s failure to make due payment as provided by the withdrawal clause?”
“A time charter, unless it is a charter by demise, with which your Lordships are not here concerned, transfers to the charterer no interest in or right to possession of the vessel; it is a contract for services to be rendered to the charterer by the shipowner through the use of the vessel by the shipowner’s own servants, the master and the crew, acting in accordance with such directions as to the cargoes to be loaded and the voyages to be undertaken as by the terms of the charterparty the charterer is entitled to give to them. Being a contract for services it is thus the very prototype of a contract of which before the fusion of law and equity a court would never grant specific performance: Clarke v Price (1819) 2 Wils. 157; Lumley v Wagner (1852) 1 De G.M & G. 604. In the event of failure to render the promised services, the party to whom they were to be rendered would be left to pursue such remedies in damages for breach of contract as he might have at law. But as an unbroken line of uniform authority in this House, from Tankexpress [1949] A.C. 76 to A/S Awilco of Oslo v Fulvia S.p.A. di Navigazione of Cagliari (The Chikuma) [1981] 1 W.L.R. 314, has held, if the withdrawal clause so provides, the shipowner is entitled to withdraw the services of the vessel from the charterer if the latter fails to pay an instalment of hire in precise compliance with the provisions of the charter. So the shipowner commits no breach of contract if he does so; and the charterer has no remedy in damages against him. To grant an injunction restraining the shipowner from exercising his right of withdrawal of the vessel from the service of the charterer, though negative in form, is pregnant with an affirmative order to the shipowner to perform the contract; juristically it is indistinguishable from a decree for specific performance of a contract to render services; and in respect of that category of contracts, even in the event of breach, this is a remedy that English courts have always disclaimed any jurisdiction to grant. This is, in my view, sufficient reason in itself to compel rejection of the suggestion that the equitable principle of relief from forfeiture is juristically capable of extension so as to grant to the court a discretion to prevent a shipowner from exercising his strict contractual rights under a withdrawal clause in a time charter which is not a charter by demise.”
“Wherever this Court has not proper jurisdiction to enforce specific performance, it operates to bind men’s consciences, as far as they can be bound, to a true and literal performance of their agreements; and it will not suffer them to depart from their contracts at their pleasure, leaving the party with whom they have contracted to the mere chance of any damages which a jury may give. The exercise of this jurisdiction has, I believe, had a wholesome tendency towards the maintenance of that good faith which exists in this country to a much greater degree perhaps that in any other; and although the jurisdiction is not to be extended, yet a Judge would desert his duty who did not act up to what his predecessors have handed down as the rule for his guidance in the administration of such an equity. It was objected that the operation of the injunction in the present case was mischievous, excluding the Defendant J. Wagner from performing at any other theatre while this Court had no power to compel her to perform at Her Majesty’s Theatre. It is true that I have not the means of compelling her to sing, but she has no cause of complaint if I compel her to abstain from the commission of an act which she has bound herself not to do, and thus possibly cause her to fulfil her engagement. The jurisdiction which I now exercise is wholly within the power of the Court, and being of opinion that it is a proper case for interfering, I shall leave nothing unsatisfied by the judgment I pronounce. The effect, too, of the injunction in restraining J. Wagner from singing elsewhere may, in the event of an action being brought against her by the Plaintiff, prevent any such amount of vindictive damages being given against her as a jury might probably be inclined to give if she had carried her talents and exercised them at the rival theatre: the injunction may also, as I have said, tend to the fulfilment of her engagement; though, in continuing the injunction, I disclaim doing indirectly what I cannot do directly.”
“I think that a vessel engaged under a charter-party ought to be regarded as a chattel of a peculiar value to the charterer, and that although a Court of Equity cannot compel a specific performance of the contract which it contains, yet that it will restrain the employment of the vessel in a different manner, whether such employment is expressly or impliedly forbidden, according to the principle so fully expressed in the case of Lumley v Wagner. In such cases the Court repudiates the idea of indirectly compelling performance where it could not directly decree it. It gives all the relief in its power, without looking to the effect which may be ultimately produced by the restraint which it places on the party who is disposed to break his contract.”
“It does not matter that this Court cannot enforce specific performance. It can proceed if there is expressed or clearly implied a negative stipulation.”
“The consequences of this decision, both as to the future use of the vessel and as to damages, will be applied in the Court below. It is incredible that the owners will lay up the vessel rather than permit its use under the contract, of which they were notified, and the provisions of which it is now determined that they ought to respect. The resumption of use under the charterparty will thus simplify the ascertainment of damages.”
“This consideration of the authorities has led us to believe that the following general principles are applicable to the grant or refusal of an injunction to enforce performance of the servant's negative obligations in a contract for personal services inseparable from the exercise of some special skill or talent. (We use the expressions "master" and "servant" for ease of reference and not out of any regard for the reality of the relationship in many of these cases.) In such a case the court ought not to enforce the performance of the negative obligations if their enforcement will effectively compel the servant to perform his positive obligations under the contract. Compulsion is a question to be decided on the facts of each case, with a realistic regard for the probable reaction of an injunction on the psychological and material, and sometimes the physical, need of the servant to maintain the skill or talent. The longer the term, for which an injunction is sought, the more readily will compulsion be inferred. Compulsion may be inferred where the injunction is sought not against the servant but against a third party if either the third party is the only other available master or if it is likely that the master will seek relief against anyone who attempts to replace him. An injunction will less readily be granted where there are obligations of mutual trust and confidence, more especially where the servant's trust in the master may have been betrayed or his confidence in him has genuinely gone.”
“Any consideration of the authorities must be made with two general thoughts in mind. First, in this as much as in any other area of the law an injunction is a discretionary remedy, whose grant or refusal, especially at an interlocutory stage, depends on the infinitely variable facts of the individual case. Although statements of the principles on which the discretion ought to be exercised in some particular area are often authoritative, they are principles of practice rather than of law, whose application may be rendered inappropriate by the finest of factual variations between one case and another. Secondly, the discretion belongs, as always, to the judge of first instance. His decision can only be interfered with by an appellate court if he has erred in principle, if he has not exercised his discretion at all or if he has exercised it in a manner which is plainly wrong.”
“25. Despite these passages in the award and the Owners' arguments as to the special nature of the relationship between the Owners and Lauritzen, I am unable to equate arrangements of this kind with those in Warren v Mendy. There is no real doubt in my mind that the ship managers can continue to manage the vessels and give appropriate orders to the officers and crew of the vessels and that the services rendered by Lauritzen are not so "personal" nor involve such a degree of skill and talent in the context of man management as to make a negative injunction unavailable, whether as a matter of principle or of discretion. There is no psychological or physical element of the kind which surfaces in cases which involve the world of entertainment or sport. The position here is much closer to that of the Pageguide case and, in reality, little different from any of the charter-party cases where injunctions have previously been granted. The fiduciary element where trust and loyalty are involved, centres upon the discretionary decision making of Lauritzen in the employment of the vessel but above all in relation to the accounting for the pool as a whole. That is where issues have arisen between the parties which led to the Duties Arbitration and continuing disputes as to the reward to be paid under the pooling arrangements to the owners. Those matters do not touch upon the workability of the future arrangements in the event of an injunction being granted, even if the Owners decide to continue under the charter-party in circumstances where the injunction does not compel them to do so but merely prevents them from employing the Vessel for other purposes. 26. The evidence is that the Vessels continue to trade and to operate normally in the pool despite the financial disputes between the parties and the allegations of anti-competitiveness. Although the parties, in the course of their dispute have been abusive about one another, there is nothing in the material before me upon which I could conclude that the continuation of the current arrangements is unworkable, even if it that was relevant in the context of any possible injunction to be granted. If an injunction was to be granted until the determination of the current disputes between the parties, that would not present any insuperable problems in the interim period. Lauritzen and the Owners have shown themselves capable of cooperating with each other and working together on a day-to-day basis, despite their differences and such matters as dry-docking have been arranged without apparent difficulty. 27. In short, despite the nature of the pool and its management, and the existence of fiduciary duties found by Lord Millett, I do not find that the relationship between the parties is anything like those which exist in the entertainment or sporting worlds where "the services are so linked to some special skill or talent whose continued display is essential to the psychological, material or physical well-being of the 'servant'". Here there are commercial arrangements made between independent companies involving the employment of no named individuals, where the services are not "personal" in nature, notwithstanding the fiduciary obligations owed by one commercial entity to another.”
“Leaving aside the factual issue as to whether Pageguide would be able to establish that they have lost confidence in the Regent companies, in regard to which there is, in my judgment, a serious question to be tried, this action raises the further serious question, as yet unresolved by English authority, as to the extent to which a commercial arrangement of this kind between two independent companies, which does not provide for the employment of any named individuals and is part of a larger package including the sale of the hotel itself, can be properly treated as analogous to a contract of personal service. There are, however, two commonwealth decisions, one from Canada and one from Singapore, both of which were concerned with attempts by hotel owners to terminate long-term management contracts and in both cases the courts granted interlocutory relief. The Canadian case went to the Court of Appeal of Montreal which affirmed the decision: Loewess Hotel Montreal v Concordia City Properties [1979]. In the Singapore case, Holiday Inns v Holiday Enterprises [1975] the court expressly contemplated that specific performance was available.”
“In the Page One Records’ case contract was to manage four young men and was concerned with every aspect of the pop stars’ life. The judge considered that if a negative injunction had been granted, then the pop stars would have been obliged to be managed by the plaintiffs or to be idle. All this is far removed from managing a hotel.”