Market-Rate Damages for Late Redelivery Despite Forward Sale:
Res Inter Alios Acta in Time Charter Overruns

Skyros Maritime Corporation & Anor v Hapag-Lloyd AG (Re “SKYROS” & “AGIOS MINAS”)
[2025] EWCA Civ 1529, Court of Appeal (Civil Division), 28 November 2025

1. Introduction

This judgment of the Court of Appeal (Males, Andrews and Coulson LJJ) addresses a significant and genuinely novel question in time charter law and the wider law of contract damages:

Can a shipowner recover substantial market-rate damages for late redelivery of a time-chartered vessel even where, on the facts, the owner was committed to sell the vessel and would not (and could not) have re-chartered it after redelivery?

The arbitrators, applying long-standing maritime authority, awarded substantial damages. The Commercial Court (Bright J), on appeal under s.69 Arbitration Act 1996, confined the owners to nominal damages on the basis that they had suffered no actual financial loss given their pre-existing sale commitments. The Court of Appeal has now reversed that decision and restored the arbitrators’ award.

In doing so, the Court:

Reaffirms the orthodox “normal measure” of damages for late redelivery under a time charter: the difference between the charterparty rate and the prevailing market rate of hire for the period of the overrun.
Holds that the owner’s actual plans or commitments for the vessel’s post-redelivery use (including a forward sale and a promise not to re-charter) are res inter alios acta — collateral matters to be disregarded when assessing damages.
Rejects the invitation to re-characterise such damages as “user damages” or to limit recovery to cases where an owner in fact loses a specific rechartering opportunity.
Clarifies the conceptual distinction between remoteness and the res inter alios acta principle within the broader Robinson v Harman compensatory framework.

The case is significant not only in maritime law but also for the general law of contractual damages, providing clear guidance on the treatment of a claimant’s collateral arrangements (including sales and sub-contracts) when quantifying loss.

2. Background to the Dispute

2.1 The parties and charterparties

The dispute concerned two container vessels, the SKYROS and the AGIOS MINAS, owned by the claimant owners (Skyros Maritime Corporation and another) and time-chartered to Hapag-Lloyd AG, a major German container line, under New York Produce Exchange (NYPE) form charterparties on materially identical terms (paras 3–9).

SKYROS charter: Initial 11–13 month period from April 2017 at US$14,750/day, with optional extension at US$30,000/day. An addendum (12 March 2019) extended the charter to minimum 1 March 2021 / maximum 30 May 2021 (in charterer’s option); latest permitted redelivery: 24:00 on 30 May 2021.
AGIOS MINAS charter: Charter from 23 March 2020 at US$22,000/day until minimum 15 March 2021 / maximum 31 May 2021 (charterer’s option); latest permitted redelivery: 24:00 on 31 May 2021.
Both charters were subject to English law and LMAA arbitration (para 9).

2.2 The sale of the vessels and late redelivery

Before the contractual latest redelivery dates, the owners entered into Memoranda of Agreement (MOAs) to sell the vessels — one to MSC, one to Maersk — and under those MOAs they agreed not to enter further charter fixtures before delivery to the buyers (paras 10–11).

In breach of the charterparties, Hapag-Lloyd:

redelivered SKYROS about two days late, and
redelivered AGIOS MINAS about seven days late,

although hire at the charter rates was paid for those overrun days (para 10). At that time, following the remarkable spike in container shipping rates during 2021, the spot and period market rates far exceeded the charter rates:

SKYROS: approx. US$190,000/day (short term 30–60 days); approx. US$57,500/day (24–26 month period).
AGIOS MINAS: approx. US$150,000/day (short term); approx. US$45,000/day (24–26 month period).

It was common ground that:

The vessels could not in practice have been fixed out in the market just for the few days of overrun (para 15).
Even if redelivered on time, the owners would not and, because of the MOAs, could not have re-chartered the vessels; they would have been delivered straight to the buyers (para 10–11).

2.3 The preliminary issue

On assumed facts, the parties asked the arbitrators to decide a preliminary issue (para 12): were the owners entitled to:

Substantial damages (measured by reference to the higher market rate for the period of overrun), or
Only nominal damages because they suffered no real loss — having in any event sold the vessels and relinquished any right to re-charter them?

The financial stakes were high because the difference between market and charter rates during the overrun was very large.

3. From Arbitration to the Court of Appeal

3.1 The arbitrators’ award

The arbitral tribunal (Sir Bernard Eder, David Steward, Peter Jago) recognised that the preliminary issue raised a “novel point” (para 18): can substantial damages for late redelivery be recovered where, on the evidence, the owner could not or would not have re-chartered the vessel after timely redelivery?

They held that the owners were entitled to substantial compensation, on three alternative bases (paras 20–22):

Quantum meruit (primary basis):
There was an implied request by the charterer for services outside the contractual scope (use of the vessel beyond the final redelivery date), with an implied agreement to pay at the market rate. This was said to be consistent with the compensatory principle because the owners supplied services beyond what they had contracted to supply.
User damages (alternative):
The owners had lost the valuable right to use the vessels during the overrun (even though they would not in fact have used them); user damages assessed as the difference between market and charter rate would compensate for the charterer’s wrongful use. The MOAs were to be disregarded as too remote or as res inter alios acta.
Negotiating damages (further alternative):
If neither of the above applied, the owners were entitled to “negotiating damages” — a sum representing what the parties would hypothetically have agreed for an extension of the charters over the overrun period, not necessarily equal to the prevailing market rate.

3.2 The Commercial Court: Bright J’s decision

On appeal under s.69 Arbitration Act 1996, Bright J rejected all three bases and held that the owners were confined to nominal damages (paras 23–28).

Quantum meruit: Could not apply because the services were rendered under, and within the scope of, the charterparties; hire was paid at the charter rate for the whole overrun, so there was no non-contractual request or enrichment outside the charter (para 24, relying on The Paragon).
User damages: The owners never lost possession of their vessels; hire was earned at the contract rate throughout; the charterers’ use of the ships was not a wrongful invasion of proprietary rights but authorised by the charters. Late redelivery did not constitute a proprietary or possessory invasion of the type that attracts user damages (para 25).
Negotiating damages: Following One Step (Support) Ltd v Morris-Garner, such damages are not a freestanding head of non-compensatory relief. In any event, timely redelivery had no economic value to these owners given their commitment to sell without re-chartering, so there was nothing of economic value to be the subject of a hypothetical bargain (para 26).

Bright J then turned to compensatory damages in the orthodox sense (para 27). He accepted that the normal measure of damages for late redelivery, where the market exceeds the charter rate, is the difference between market and charter rates over the overrun. But he held that this normal measure is justified because the owner loses the opportunity to fix the vessel in the market for that period. Since these owners were already contractually precluded, by the MOAs, from making any further fixture, they had not lost such an opportunity. On standard Robinson v Harman principles, they had suffered no recoverable loss and so were entitled to nominal damages only.

Nevertheless, he granted permission to appeal on two questions only (para 28):

Whether the owners were in principle entitled to user damages for late redelivery; and
Whether the owners’ sale contracts (MOAs) must be disregarded when assessing damages.

Quantum meruit and negotiating damages therefore fell away on appeal.

3.3 Submissions in the Court of Appeal

For the owners (Mr Julian Kenny KC and Mr Adam Board) (paras 29, 31):

The long-established “normal measure” — difference between market and charter rate over the overrun — applies regardless of whether the owners would or could in fact re-charter the vessel.
The true rationale of that measure is to compensate for the value of the vessel’s services during the overrun period of which the owners were wrongfully deprived, not for a proven lost re-fixing opportunity.
Alternatively, any consideration of the MOAs is too remote or should be disregarded as res inter alios acta; the charterer is simply not concerned with the owners’ collateral arrangements.
On the user damages ground of appeal (if needed), late redelivery does amount to wrongful use of the vessel; the right to control that use is a valuable proprietary-type interest; user damages are therefore conceptually available notwithstanding absence of conventional financial loss.

For the charterer (Mr Steven Berry KC and Mr Board for the user damages point) (paras 30–31):

Damages for late redelivery are, and should be, compensation for loss of the opportunity to employ the vessel in the market; they are not a penalty or automatic surcharge.
Given the MOAs, the owners had no such market opportunity; no opportunity lost means no substantial loss and therefore only nominal damages on Robinson v Harman principles.
User damages are exceptional. They arise for wrongful invasion of proprietary or possessory rights where control over an asset is abstractly valuable even if unused. Here, late redelivery did not involve wrongful use in that sense; the charterers’ use was contractually authorised and hire was fully paid.

4. Summary of the Court of Appeal’s Decision

Males LJ (with whom Andrews and Coulson LJJ agreed) allowed the appeal and restored the arbitrators’ order (paras 2, 59–60). The key holdings can be summarised as follows:

The “normal measure” of damages for late redelivery remains firmly established: where the market rate exceeds the charter rate, the owner is prima facie entitled to the difference between those rates over the period of the overrun (paras 32–36).
The owner’s actual arrangements for post-redelivery use — including sale of the vessel and promises not to re-charter — are collateral and must be disregarded (res inter alios acta):
- Those arrangements arise “independently of the circumstances giving rise to the breach” and are ignored in quantifying the owner’s loss (paras 47–49).
- The charterer is “simply not concerned with such matters” (para 49).
The owners are therefore entitled, as compensatory damages, to be paid the difference between market and charter rates for the overrun period, notwithstanding that they would not and could not in fact have re-chartered the vessels (paras 39, 49–50).
User damages are not needed and not appropriate here:
- If the orthodox compensatory measure correctly yields substantial damages (which it does), user damages do not arise (para 51).
- Even if there were no conventional loss, the Court would not extend the user damages jurisprudence to this kind of contractual breach; late redelivery is not a true invasion of property rights of the sort envisaged in One Step and earlier authorities (paras 52–57).
Practical effect: the matter is remitted to the arbitrators only for the quantum assessment — i.e. to determine the relevant market rate(s) during the overrun period and apply the normal measure (paras 2, 60).

The decision thus restores doctrinal orthodoxy in a way that both maintains commercial certainty and clarifies the role of res inter alios acta within the compensatory damages framework.

5. Analysis of the Legal Reasoning

5.1 The “normal measure” of damages for late redelivery

The Court of Appeal anchored its reasoning in a century of authority affirming that the owner’s prima facie measure of damages for late redelivery, where the market is higher than the charter rate, is the difference between those rates over the period of overrun (paras 32–36). Authorities cited include:

Watson Steamship Co v Merryweather & Co (1913) 18 Com Cas 294
Meyer v R.F. Sanderson & Co (1916) 32 TLR 428
The Dione [1975] 1 Lloyd’s Rep 115
The Johnny [1977] 2 Lloyd’s Rep 1
The Black Falcon [1991] 1 Lloyd’s Rep 77
The Peonia [1991] 1 Lloyd’s Rep 100
The Gregos [1995] 1 Lloyd’s Rep 1
The Paragon [2009] 2 Lloyd’s Rep 688

This line of authority was described by Males LJ as “formidable” and “uniform” (paras 32–33). It is reflected in the leading textbooks:

Scrutton on Charterparties (25th ed, 2024) paras 17-003, 17-004 — stating that, whether the last voyage is legitimate or illegitimate, the owner recovers hire at the charter rate up to the end of the tolerance period and damages by reference to market rate for the excess (para 34).
Time Charters (7th ed, 2014) paras 4.52–4.53 — the owners are “entitled to damages compensating them for the loss of the opportunity to take advantage of the market rate during the period of the overrun”; the normal measure is the difference between what they earned in hire and what the market would have paid for that period (para 35).
Carver on Charterparties (3rd ed, 2024) paras 12-285–12-286 — again endorsing the same measure, whether the last voyage is legitimate or illegitimate (para 36).

Critically, Males LJ notes that:

None of the authorities or textbooks suggests that the owner’s right to that measure depends on proof that the owner would in fact have entered into a new fixture on the contractual final redelivery date (para 37).
In practice, owners often conclude a new fixture before redelivery, often on the strength of redelivery notices, or may have plans unrelated to immediate re-chartering (repairs, positioning, or sale). The measure has not historically been adjusted to reflect such variations (paras 37–38).

The Court therefore reaffirms that the “normal measure” is conceptually abstract and does not track an owner’s actual post-redelivery plans or precise timing of market entry.

5.2 Res inter alios acta vs remoteness: conceptual clarification

The core innovation in Males LJ’s reasoning is the explicit and careful separation between:

Remoteness of damage — whether a particular type of loss is within the scope of the defendant’s responsibility (Hadley v Baxendale); and
Res inter alios acta — the rule that some aspects of the claimant’s actual financial position, though real, are to be ignored when assessing the loss for which the defendant must pay (paras 46–47).

Drawing on Professor Treitel (quoted at para 46), the Court emphasises:

The first question is: what has the claimant lost? (comparison between the claimant’s position with and without the breach).
The second question is: for how much of that loss is the defendant legally responsible? (remoteness / scope of responsibility).

The res inter alios acta principle operates at the first stage (para 47): when we ask what the claimant has lost, certain collateral gains or collateral constraints are treated as irrelevant to that comparison, because they arise independently of the breach.

A key example is The Doric Valour [2024] EWCA Civ 1312, [2025] 1 Lloyd’s Rep 401 (para 48):

A bill of lading holder suffered no actual economic loss because it had already been paid in full by its buyer.
Nevertheless, it recovered damages measured by the diminution in value of the damaged cargo.
The seller’s arrangement with the buyer was treated as a collateral matter (res inter alios acta), irrelevant to the quantum of damages recoverable from the carrier.

Males LJ applies the same logic here (para 49):

The owners’ commitments under the MOAs — including that they would not re-charter the vessels — arose independently of the breach (late redelivery).
They are therefore to be ignored in the Robinson v Harman comparison of the owners’ position with and without the breach.
Properly analysed, the owners have lost the opportunity to deploy their vessels as they wished at the contractual redelivery time; the value of that lost opportunity is measured by reference to the market rate, not by investigating what they happened in fact to intend or to have arranged.

Importantly, Males LJ notes (para 45) that just as the owners here cannot recover damages for loss of the sale contracts (if late redelivery had enabled cancellation), so too the charterer cannot invoke those same sale contracts to reduce the owners’ ordinary damages. In both directions, the MOAs are collateral.

5.3 The role of Achilleas

The decision interacts with (and implicitly limits) the controversial reasoning in The Achilleas [2008] UKHL 48, [2009] 1 AC 61. In Achilleas, late redelivery caused the owner to lose a highly lucrative follow-on charter that had been fixed in advance at a peak rate shortly before a market collapse. The House of Lords held:

Damages for the entire loss on the follow-on charter were too remote — the charterer had not assumed responsibility for such a loss; but
The owner could recover the normal measure of damages, i.e. the difference between market and charter rate for the overrun period itself (para 40).

Males LJ highlights two passages (paras 41–43):

Lord Hoffmann (para 23 of Achilleas): He treats the owner’s specific arrangements for a follow-on charter as res inter alios acta: the purpose of the timely redelivery clause is to enable the vessel to be at the owner’s “full disposal” from the redelivery date; if the last voyage overruns, the owner is entitled to be paid at market rate for the overrun, irrespective of the specifics of the following fixture.
Lord Rodger (para 54 of Achilleas): He states that parties contemplate that if a follow-on fixture is lost, the owner will resort to the market; the availability of that market, and the standard market-rate measure, is what the authorities have treated as the normal measure of loss.

Males LJ distils two important points:

Even when the owner has in fact concluded a follow-on fixture in advance (as is common), the measure of damages for the overrun does not adjust to the details of that specific fixture (para 42).
The normal measure may in some cases over- or under-compensate the owner (para 44). That is acceptable as a matter of principle: the law favours an abstract, predictable measure over litigating every factual nuance of the owner’s business strategy.

In this case, the Court of Appeal essentially says: if the charterer cannot use the existence of a forward lucrative fixture (as in Achilleas) to increase its liability beyond the normal measure, it equally cannot use the existence of a forward sale (here) to reduce liability below the normal measure. Both types of collateral arrangement are res inter alios acta.

5.4 Certainty and commercial policy

Males LJ underscores the policy benefits of this approach (para 50):

It promotes certainty in commercial dealings.
It allows parties to close their accounts and settle disputes with minimal factual investigation into the owner’s internal business arrangements.
If the law required examination of the owner’s actual plans for the vessel, charterers would face uncertainty and disputes would become more complex, intrusive and costly, encouraging fishing expeditions in disclosure “in the hope that something would turn up”.

He acknowledges the argument that in this specific case the result confers a “windfall” on the owners, given that they would not have used the overrun period to earn market-rate hire. But he responds, citing classic authorities:

Scrutton LJ in Slater v Hoyle & Smith Ltd [1920] 2 KB 11, 25: “the rules of English law do not always give exact indemnity”.
Greer LJ in The London Corporation [1935] P 70, 78: it is “desirable that there should be a measure of damage which can be easily and definitely found”.

Coulson LJ’s short concurring judgment (para 62) draws an explicit analogy with cases where damaged assets are nonetheless not repaired or are destined for scrap:

The London Corporation [1935] P 70: A vessel was damaged but had already been sold for scrap; argument that no repair would ever be carried out was rejected; the sale arrangements were treated as an “accidental circumstance” irrelevant to damages.
Manchikalapati v Zurich Insurance plc [2019] EWCA Civ 2163: Homeowners could recover the cost of repair even though they had not done (and possibly would never do) the repairs themselves.

Coulson LJ applies the same reasoning: the fact that the vessels here had been sold, and so could not have been re-chartered during the overrun, was an “accidental circumstance” irrelevant to the assessment of damages.

5.5 User damages: why the Court declined to extend the doctrine

Although Males LJ’s primary reasoning makes it unnecessary to engage with user damages, he does so “briefly” because the point was argued (para 51).

He starts with One Step (Support) Ltd v Morris-Garner [2018] UKSC 20, [2019] AC 649, where Lord Reed analysed user damages (also called “Wrotham Park damages”) as:

Generally awarded where there has been an invasion of property rights (including intangible property), but no pecuniary loss or physical damage to the property.
A means of compensating for the loss of the ability to control and monetise use of the property — in effect, the wrongdoer must pay a reasonable price or hire for the wrongful use (paras 52–54 of this judgment).

Classic illustrations, discussed by Males LJ, include:

The liveryman’s horse: if a third party rides another’s horse without permission, it is no answer to say the horse is none the worse and the owner would not have hired it out (Watson, Laidlaw & Co v Pott, Cassels & Williamson (1914) SC (HL) 18).
Lord Halsbury’s chair: a wrongdoer cannot reduce damages by showing that the owner did not use the chair or had others available (The Mediana [1900] AC 113; explained in Stoke-on-Trent CC v W & J Wass Ltd [1988] 1 WLR 1406) (paras 52–53).

Males LJ accepts that much of this reasoning is analytically attractive when applied to late redelivery (para 55):

By keeping the vessel beyond the contractual redelivery date, the charterer is in one sense making unauthorised use of the owner’s property.
The right to control and monetise the vessel’s use is a valuable asset, demonstrated by the market rate.
The charterer’s keeping the vessel beyond time prevents the owner from exercising its right to exploit that economic value, regardless of whether it actually would have done so.

However, he rejects the extension of user damages to this situation for two main reasons (paras 56–57):

If the compensatory principle, properly applied (with res inter alios acta), yields substantial damages, then user damages are unnecessary and would risk duplicating or unsettling the orthodox scheme.
This is not truly comparable to classic user-damage scenarios:
- The charterer’s use of the vessel is, up to the redelivery date (and arguably throughout the last voyage), contractually authorised; even if the last voyage is illegitimate, the owner has chosen to comply and has received hire at the charter rate.
- There is no straightforward, discrete invasion of a proprietary or possessory right in the sense used in the horse/ chair cases; it is rather a breach of a contractual timing obligation in a complex continuing relationship.

Accordingly, Males LJ sees “no justification for introducing into the law of damages in contract a novel basis of recovery, outflanking the basic compensatory principle and awarding user damages where in fact no loss has been suffered” (para 57).

This is an important signal: user damages remain exceptional, largely confined to property rights and certain exceptional contractual contexts, and should not be used as a broad escape route where a court concludes there is no conventional loss.

5.6 Quantum meruit and negotiating damages

Although not live issues on appeal (permission having been refused), the judgment implicitly supports the Commercial Court’s rejection of these alternative bases:

Quantum meruit: The services rendered during the overrun were rendered under the charterparties and fully paid for at the charter rate; there was no separate implied request or benefit outside the contract justifying a restitutionary award (para 24).
Negotiating damages: After One Step, such awards are not a separate, non-compensatory category but a way of assessing loss in very particular situations (e.g. breach of restrictive covenant in a sale of business). They do not apply where the underlying right has no demonstrable economic value or where orthodox compensatory analysis suffices (para 26).

In effect, the Court of Appeal centres the analysis firmly on expectation damages and the res inter alios acta principle, rejecting restitutionary or quasi-restitutionary alternatives as inapt in this doctrinal setting.

6. Complex Concepts Explained

6.1 Time charters, redelivery, and last voyages

Time charter: A contract under which a shipowner agrees to provide a vessel, crew and services for a specified period; the charterer directs how and where the vessel trades (within agreed limits) and pays a daily hire rate.
Redelivery: The point at which the charterer hands the ship back to the owner at the end of the charter period, in a contractually specified range of ports, and usually by a stated “final redelivery date” (sometimes subject to margin/tolerance).
Legitimate vs illegitimate last voyage (The Peonia):
- Legitimate last voyage: A final voyage order that, when given, can reasonably be expected to finish within the charter period (or tolerance). If it overruns despite diligence and no fault, the charterer must still pay damages for the period beyond the redelivery date if the market is higher.
- Illegitimate last voyage: A last voyage that cannot reasonably be expected to complete in time. The charterer is not entitled to order it; giving such an order is itself a breach. The owner may refuse to undertake it, or may choose to perform it; if performed, the owner can claim damages (difference between market and charter rate) for the late redelivery period, in addition to hire at the charter rate.
Males LJ notes that in either case the charterer has an obligation to redeliver by the final date; the legitimate/illegitimate distinction does not affect the damages issue in this appeal (paras 16–17).

6.2 The compensatory principle (Robinson v Harman)

The fundamental rule, from Robinson v Harman (1848) 1 Exch 850, is that:

“The party who has suffered loss by a breach of contract is to be placed, so far as money can do it, in the same situation, with respect to damages, as if the contract had been performed.”

In practice this means:

Comparing the financial position the claimant would have been in had the contract been performed with the position it is in as a result of the breach.
Applying rules of remoteness and causation to decide for how much of that loss the defendant is legally responsible.

The present judgment clarifies that the res inter alios acta principle is part of stage (1): some aspects of the claimant’s actual financial position (e.g. collateral contracts, insurance, resale arrangements) are ignored for purposes of that comparison.

6.3 Remoteness vs res inter alios acta

Remoteness: Concerns whether a type of loss is too remote to be recoverable — usually decided under the Hadley v Baxendale “reasonable contemplation” test. For example, is loss of a very unusual downstream contract too remote?
Res inter alios acta: Concerns what factors we take into account when measuring the claimant’s loss. Certain collateral benefits or constraints — such as insurance proceeds, resale contracts, or forward sale agreements — are treated as “someone else’s business” and ignored, even though they are factually connected.

In this case:

Remoteness would govern whether owners could recover damages for, say, loss of their sale contracts if late redelivery allowed buyers to cancel. Males LJ says they could not: that would be too remote (para 45).
Res inter alios acta explains why the owners’ existing MOAs cannot be used by the charterer to argue that the owners have suffered no loss; those MOAs are ignored when quantifying the owners’ loss of the vessel’s use (paras 47–49).

6.4 User damages

“User damages” (sometimes “Wrotham Park damages”) are an award that requires a wrongdoer to pay a reasonable sum for having made unauthorised use of another’s property or rights, even when:

The property has not suffered physical damage; and
The owner cannot prove they would have commercially exploited that use in any particular way.

They are best understood as a way of valuing loss when what has been lost is the ability to control and monetise a right to use. Typical contexts:

Trespass to land or use of another’s chattel (the horse/ chair examples).
Sometimes, breach of restrictive covenants or misuse of intellectual property, where the core loss is being deprived of control over how the right is exploited.

The Court of Appeal in this case declines to treat late redelivery as a user damages scenario for the reasons explained above (paras 55–57).

6.5 Quantum meruit and negotiating damages

Quantum meruit: Literally “as much as he has earned”; a restitutionary remedy where someone is paid a reasonable price for services or benefits supplied outside a contract, or where a contract has been discharged. Here, because the services were provided under an existing charter and fully remunerated at the charter rate, there was no room for a quantum meruit claim (para 24).
Negotiating damages: Damages assessed by reference to what a hypothetical reasonable bargain would have produced, typically used where the defendant has wrongfully used property or rights over which the claimant has control. After One Step, such damages are not a separate category of non-compensatory relief; they are another way of valuing the claimant’s loss where appropriate. The Court agreed with Bright J that they had no role to play here (para 26).

7. Impact and Significance

7.1 For shipping and time charter practice

The judgment has immediate and practical consequences for maritime practitioners:

Confirms and stabilises the “normal measure” for late redelivery:
Owners can confidently claim the difference between market and charter rates for the overrun period without needing to prove:
- that they would have re-chartered the vessel, or
- that they lacked conflicting commitments (such as MOAs, drydocking, or lay-up plans).
Charterers cannot reduce liability by probing owners’ post-redelivery plans:
Attempts to argue “you would not have chartered the vessel anyway” are now firmly excluded. This greatly simplifies litigation and arbitration about short overruns in volatile markets.
No need to classify the last voyage for this purpose:
Though legitimate/illegitimate last voyage issues may matter for other reasons (e.g. whether owner had to obey the order), they do not affect the measure of damages for the overrun: the same market-minus-charter measure applies (paras 16–17, 34, 36).
Textbook alignment:
The Court gently corrects the suggestion in Time Charters 8th ed (2025) that the normal measure for late redelivery is best understood as “user damages” (paras 35, Note 1). It reasserts that the measure is an orthodox expectation measure, informed by res inter alios acta, not a species of user damages.

7.2 For the wider law of contract damages

Beyond shipping, the case is a significant data point in the modern development of contractual damages:

Affirms the limited role of user damages after One Step:
The Court resists the temptation to deploy user damages as a catch-all when no conventional loss is apparent. It confirms that such awards are exceptional and mainly appropriate where there is a discrete invasion of property rights.
Clarifies the function of res inter alios acta in contract:
Together with The Doric Valour, this case strengthens the principle that certain collateral contracts (sales, sub-sales, or insurance) are disregarded in assessing damages — a point that can apply in:
- Sale of goods (resales, sub-sales)
- Carriage of goods (CIF/FOB structures)
- Construction and insurance claims (as highlighted by Coulson LJ)
Rebalances Achilleas:
While Achilleas sparked debates about “assumption of responsibility” and the scope of remoteness, this decision shows that:
- The “normal measure” for late redelivery remains robust and abstract.
- Owners’ actual follow-on arrangements (whether charters or sales) should generally not distort that measure.
The case therefore helps to confine Achilleas to its specific facts and prevents its reasoning from undermining stable, market-based measures of loss.

7.3 Practical drafting and risk allocation

Contract drafters may draw several lessons:

Charterparties: If parties wish to alter the normal measure of damages for late redelivery (e.g. cap liability or tie it to actual loss), they must do so expressly. The Court emphasises that, absent such drafting, the market-minus-charter measure will apply irrespective of collateral arrangements.
Sale contracts (MOAs): Owners who agree, in MOAs, not to re-charter before delivery can do so without fearing that this will strip them of damages rights against time charterers for late redelivery; those MOA promises are collateral as between owner and charterer.
Insurance and sub-contracts: The logic of disregarding collateral contracts when quantifying loss may influence how parties structure their risk allocation (e.g. ensuring that insurance recoveries or sub-contract structures do not inadvertently reduce their recoverable damages against primary contracting parties).

8. Conclusion

The Court of Appeal in Skyros Maritime Corporation & Anor v Hapag-Lloyd AG has delivered a carefully reasoned and doctrinally significant judgment which:

Reaffirms the normal measure of damages for late redelivery under time charters: the difference between market and charter rates during the overrun period.
Decisively holds that the owner’s actual arrangements for the vessel’s post-redelivery use — including binding sale contracts and promises not to re-charter — are res inter alios acta and irrelevant to quantification.
Clarifies the relationship between remoteness, res inter alios acta and the compensatory principle in Robinson v Harman.
Resists an unwarranted expansion of user damages and recentre damages assessment on orthodox expectation principles.
Promotes commercial certainty by discouraging invasive, fact-intensive inquiries into an owner’s business plans and by giving a stable, market-based rule that parties can contract against.

Going forward, shipowners can confidently rely on the established market-based measure of damages for late redelivery, while charterers are on clear notice that collateral sales or other owner-side arrangements will not provide an escape from substantial liability where they redeliver late in a rising market.

In a broader sense, the judgment is a strong statement that English law of contract damages remains committed to principled, commercially straightforward rules, even at the cost of occasional “non-exact indemnity”, and that it will treat collateral contracts as precisely that — collateral — when calibrating the consequences of breach.

Market-Rate Damages for Late Redelivery Despite Forward Sale: Res Inter Alios Acta in Time Charter Overruns