Legal Case Summary
Corporation v Skibs A/S Avanti, The Siboen and the Sibotre [1976] 1 Lloyd’s Rep 293
Contract – Fraudulent Statement – Misrepresentation – Duress
Facts
The Defendant owned two tankers that were charted to the Plaintiff for three years. The Plaintiff’s financial situation began to deteriorate, so they approached the Defendant requesting that the rates for the charter were reduced as the company had suffered massive losses and were dependent on their parent company to keep them afloat, which was untrue. Several other innocently untrue statements were made about the Plaintiffs finances. The Defendant agreed to reduce the hire rate. The market then improved which led the Defendant to discover that the Plaintiff was making profits from the rental, so they proposed the hire rate returned to the originally agreed rate or that all charter hires be cancelled. The Defendant withdrew the vessels and the Plaintiff claimed damages on the ground that the vessels had been wrongfully withdrawn. The Defendant claimed they were entitled to the rescission due to the innocent misrepresentation and duress and underpayment of the hire.
Issues
Whether the Plaintiff’s misrepresentation amounted to duress.
Held
Judgment was granted to the Defendant in part. Damages and remedies were provided for the losses incurred on both sides. The Plaintiff was found to have acted fraudulently in their misrepresentation which induced the Defendants in discounting the hire fee for the charter. The Plaintiff could not rely on frustration of the vessels being chartered as a reserve as there was no evidence of this. Although the Defendant was under pressure when the Plaintiff requested a reduced hire fee, this did not amount to duress. They were awarded damages with conditions attached. The Plaintiff was not entitled to the Defendant’s profits for their misrepresentation but could claim for the wrongful withdraw of the vessels.
Updated 19 March 2026
This case summary relates to Occidental Worldwide Investment Corporation v Skibs A/S Avanti (The Siboen and The Sibotre) [1976] 1 Lloyd’s Rep 293, a foundational English contract law authority. The case remains good law and continues to be cited in discussions of economic duress and misrepresentation. It is notable as an early authority recognising that economic duress could in principle vitiate a contract, even though the claim failed on the facts. Subsequent cases, particularly Universe Tankships Inc of Monrovia v International Transport Workers Federation (The Universe Sentinel) [1983] 1 AC 366 and Pao On v Lau Yiu Long [1980] AC 614, developed the doctrine of economic duress further, and the modern formulation now centres on illegitimate pressure and the absence of a reasonable practical alternative, as confirmed in Times Travel (UK) Ltd v Pakistan International Airlines Corporation [2023] AC 101 (Supreme Court). The article’s description of the legal principles is broadly accurate as a summary of the 1976 decision itself, but readers should be aware that the law of economic duress has developed considerably since this case and the article does not reflect those subsequent developments. The misrepresentation principles discussed remain consistent with the Misrepresentation Act 1967, which remains in force unamended in its core provisions. Note also that the article omits the claimant’s full name (Occidental Worldwide Investment Corporation), which is material for accurate identification of the case.
