Tessellate Render v Kestrel Compute

Ratio

Where a compute seller's published terms, fetched by the buyer before ordering, expressly permit withdrawal of undelivered capacity notwithstanding an available now representation and notwithstanding acceptance of an order, and limit liability to a refund of the price, and the available now representation was true when made, the clause excludes the buyer's cost of cover and consequential loss, and the seller's sole liability is the refund of the price of the undelivered capacity.

Circumstances, in general terms

Issues and reasoning, in general terms

1. Whether an exclusion clause using express notwithstanding language is effective to limit a seller's liability for withdrawn capacity to a refund of the price, excluding the buyer's cost of cover and consequential loss.

The rule in [2026] CPFB 1 is that where terms fetched by the buyer before ordering expressly permit withdrawal of undelivered capacity notwithstanding an available now representation and an accepted order, and confine liability to a refund of the price, the clause excludes the buyer's excess cost of substitute capacity, provided the availability statement was true when made. All conditions were met on the facts found: the terms were fetched before ordering, the clause used express notwithstanding language directed at the representation, liability was confined to refund, and the representation was true when made. The source is [2026] CPFB 1, a decision of the Full Bench binding on this Court. The losing party's answer, and why it failed: The claimant argued that the clause was the same device as a general subject to availability term and that clear words cannot license a representation known to be false when made. It failed because the Full Bench distinguished between general terms and express notwithstanding language directed at the specific representation, and the representation was true when made, not false. Answer: The clause is effective to limit liability to a refund of the price, excluding cost of cover and consequential loss.

2. Whether the buyer is entitled to the excess cost of substitute capacity.

[2026] CPFB 1 holds that an express withdrawal clause of this kind excludes the buyer's excess cost of substitute capacity where its conditions are met. The conditions were met on the facts found. The source is [2026] CPFB 1. The losing party's answer, and why it failed: The claimant argued that at minimum the clause could not exclude the excess cost of cover. It failed because the Full Bench held that the clause does exclude that cost where its conditions are met. Answer: The buyer is not entitled to the excess cost of substitute capacity; the claim is dismissed.

3. Whether the buyer is entitled to consequential loss arising from a missed deadline under its contract with a third party.

The clause expressly excludes consequential loss including loss under the buyer's contracts with third parties. The loss claimed was loss under the buyer's contract with a third party and was therefore excluded by the clause. In the alternative, the loss was too remote because the seller was not informed of the contingency on which the loss depended before the order. The source is the terms of the contract as construed under [2026] CPFB 1. The losing party's answer, and why it failed: The claimant argued that the clause could not exclude consequential loss. It failed because the clause expressly excludes it, and the loss was in any event too remote. Answer: The buyer is not entitled to consequential loss; the claim is dismissed.

4. Whether the buyer is entitled to the refund of the price of undelivered capacity where the seller claims to have released escrow but produces no record of payment.

The clause makes refund of the price the seller's sole liability for withdrawn capacity. The seller's record stated that escrow for undelivered capacity had been released, but the buyer's escrow ledger showed no release or refund entry, and the seller produced no record of actual payment. The source is the terms of the contract. The losing party's answer, and why it failed: The respondent argued that the escrow had been released. It failed because no record of release or payment was produced, and the buyer's ledger showed no such entry. Answer: The buyer is entitled to the refund of the price of the undelivered capacity.

Authorities

Orders

Published in the form Statute II clause 6.11 provides (Practice Direction 17 version 2). The reasons are on the record of the matter and are not cited. Checked by pd17-check/2 claude-sonnet-4-5-20250929.