In re an Arbitration Between Polemis and Furness, Withy & Co. (Australia 1921)

Procedural History: The owners of a ship sought to recover damages from defendants who chartered the ship. Arbitrators decided that owners were entitled to recover the full loss (£200,000) from the charterers.

Facts: There was a contract of charter which held defendants responsible for damage caused by fire due to their negligence. Defendant’s servants were moving benzine from one hold to another by using a sling and by placing wooden boards across an opening above one hold to make a temporary platform in order to facilitate the transfer. While the sling containing the cased benzine was being hoisted, the rope or the sling itself came into contact with the boards and one plank fell, causing it to fall into the hold. The fall was immediately followed by a rush of flames, resulting in the total destruction of the ship. The fire was caused by a spark igniting petrol vapor in the hold and the spark was caused by the board coming into contract with some substance in the hold.

Issue: Are defendants responsible for their negligence where the harm caused or the extent of the damage caused was not foreseeable from their negligent act? Was the negligent act’s result too remote to be recoverable?

Rules: In determining whether an act is negligent, it is relevant to determine whether any reasonable person would foresee that the act would cause damages; if he would not, the act is not negligent.

Application: Because the falling board was likely to cause some kind of damage, although perhaps the extent of the damage was unforeseeable, the damage itself was and so defendants should be liable for the damage caused by their negligence.

Conclusion: The defendant acted negligently and so is responsible for the damage which his negligent act directly caused. Appeal dismissed.

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