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Why In Re Polemis and Furness, Withy and Co Ltd is important

In Re Polemis and Furness, Withy and Co Ltd is an early case in which the Court of Appeal held that a defendant is liable for all losses which are a direct consequence of their negligence.

Facts

The defendant charterers were using a ship to transport cargo, which included petrol. Whilst unloading the cargo at the port, the workers dropped a heavy plank into the hold, which caused an explosion. The resulting fire destroyed the ship.

Claim

The owners of the vessel brought a claim in the tort of negligence for the loss of their vessel against the charterers. Inter alia, the charterers argued they were not liable because the damage was too remote.

Held

The defendant’s appeal was rejected by the Court of Appeal. They held that the defendant was liable for the claimant’s loss, irrespective whether the damage caused was not of a kind reasonably expected.

Reasoning

The Court considered two possible interpretations of the ‘remoteness’ rule. On the first interpretation, the reasonableness of any consequences of negligence are only material for the purpose of deciding if an act is or is not negligent. On the second interpretation, the consequences of negligence are also relevant when deciding whether the defendant is liable for the claimant’s loss.

The Court of Appeal adopted the former interpretation. They concluded that whether the consequences of a negligent act are reasonably expected is immaterial to the defendant’s liability. The only relevant consideration is whether the loss was a direct cause of the defendant’s negligence.

Bankes LJ said:

The fire appears to me to have been directly caused by the falling of the plank. Under these circumstances I consider that it is immaterial that the causing of the spark by the falling of the plank could not have been reasonably anticipated.

Similarly, Warrington LJ concluded that:

The presence or absence of reasonable anticipation of damage determines the legal quality of the act as negligent or innocent. If it be thus determined to be negligent, then the question whether particular damages are recoverable depends only on the answer to the question whether they are the direct consequence of the act.

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