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Overseas Tankship (UK) Ltd. v The Miller Steamship Co. (The Wagon Mound, No. 2)

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Overseas Tankship (UK) Ltd. v The Miller Steamship Co. (The Wagon Mound, No. 2)
Nsw

Citation

Overseas Tankship (UK) Ltd. v The Miller Steamship Co. (The Wagon Mound, No. 2), [1967] 1 AC 617

Appellant

Overseas Tankship (U.K.) Limited

Respondent

The Miller Steamship Co. Pty. Limited and another

Year

1967

Court

Judicial Committee of the Privy Council

Judges

Lords Reid, Morris of Borth-Y-Gest, Pearce, Wilberforce, and Pearson

Country

Australia

State

New South Wales

Area of law

Foreseeability, Standard of care

Issue

Should the defendant be liable for damages which were not foreseeable?

FactsEdit

Miller owned a freighter ship named the Wagon Mound which was moored at a dock. Overseas Tankship owned two ships that were moored nearby. At some point during this period the Wagon Mound leaked furnace oil into the harbour while some welders were working on a ship. The sparks from the welders caused the leaked oil to ignite destroying all three ships. Overseas sued seeking damages.

IssueEdit

  1. Should the defendant be liable for damages which were not foreseeable?

DecisionEdit

Appeal dismissed.

ReasonsEdit

Lord Reid, in discussing the concept of negligence, says that there are two kinds of negligence cases:

  1. those where the risk of the result should not be regarded because it was thought to be impossible or too far-fetched to reasonably pay attention to; and
  2. those where there was a real and substantial risk.

He states that the occurrence in Bolton v Stone does not fall under the first classification, as it was foreseeable. He says that a reasonable man would only neglect such a risk if he had a valid reason for doing so – the costs, for example. He says that the Bolton decision found that it is justifiable not to take steps to eliminate a real risk if the risk of it is so very small that a reasonable person would think it right to neglect it.

RatioEdit

There are two kinds of negligence cases:

  1. those where the risk was thought to be so remote as not to pay attention to; and
  2. those where the risk was real and substantial.

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