Controlling contractual discretion

Research output: Contribution to journalArticlepeer-review


In 1993 Leggatt L.J. said in Abu Dhabi National Tanker Co. v. Product Star Shipping Ltd. (The Product Star) [1993] 1 Lloyds Rep. 397, 404: Where A and B contract with each other to confer a discretion on A, that does not render B subject to A’s uninhibited whim. In my judgment, the authorities show that not only must the discretion be exercised honestly and in good faith, but, having regard to the provisions of the contract by which it is conferred, it must not be exercised arbitrarily, capriciously or unreasonably.
Original languageEnglish
Pages (from-to)239-294
Number of pages56
JournalCambridge Law Journal
Publication statusPublished - 2002


  • discretion
  • exercised honestly
  • good faith
  • provisions
  • contract


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