Dr.

RAM MANOHAR LOHIYA NATIONAL LAW

UNIVERSITY, LUCKNOW
ACADEMIC SESSION
2016-2017

LAW OF TORTS
FINAL PROJECT
ON
REMOTENESS OF DAMAGE
IN CONTEXT TO
WAGON MOUND CASE

SUBMITTED TO: SUBMITTED BY:

Mr. Abdullah Nasir MOHD ABUSHAD

ASSISTANT PROFESSOR ROLL NO: 02

LAW 2ND SEMESTER

B.A. LL.B (Hons) SEC: B

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 TABLES OF CONTENT

 List of Cases…………………………………………………………………………….03

 Introduction……………………………………………………………………………..04

 Historical Approach on Remoteness of Damage………………………………………..05

 Analysis on Remote and Proximate Damage……………………………………………07

 Tests for determination of Remoteness of Damages…………………………………….08

 The test of reasonable foresight……………….....................08

 The test of Directeness…………………………...................08

 The Wagon Mound Case………………………………………………………………...10

 Facts…………………………………………………………10

 Decision……………………………………………………..10

 Significance………………………………………………….11

 Application…………………………………………………..12

 Principles in considering Remoteness of damage………………………………………...14

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 LIST OF CASES REFERRED

 Righy v. Hewitt, (1850) 5 Ex 240.

 Greenland v. Chaplin, (1850) 5 Ex 243.

 Re Polemis v.Furness Withy & Co. Ltd (1921) 3 KB 560.

 Overseas Tankship (U.K.)Ltd. V. Mort’s Dock Engg, (1961) 1 All ER 404 : 1961 AC

338.

 Scott v. Shepherd, 17 W.B1. 892.

 Hayens v. Harwood (1935) 1 KB 146.

 Donoghue v Stevenson (1932) A.C. 562, 579.

 London and South Western Railway Co (1870) L.R. 6 C.P. 14.

 Page v. Smith,(1995) 2 All ER 736.

 Hughes v. Lord Advocate (1963) AC 837: (1963) 1 All ER 705.

 Doughty v. Turner Manufacturing Co. Ltd. (1964) 1 QB 518.

 Simmons v. British Steel Plc. (2004) UKHL 20.

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 INTRODUCTION

The rule of remoteness of damage runs through the whole realm of compensation. A plaintiff

is not be entitled to get damage sustained by him is too remote a consequence of the

defendant’s conduct. The chain of causation between the defendant’s act and the plaintiff’s

injury must not be too indirect for no man is liable in law ad infinitum for the consequences

of his acts.

The reason for the rule is that law cannot take account of everything that follows a wrongful

act; it regards some subsequent matters as outside the scope of its selection because “it were

infinite to trace the causes of causes or the consequences of consequences”. On practical

grounds the line must be drawn somewhere and certain kinds or types of losses, though a

direct result of defendants conduct may remain uncompensated. As Lord Wright has said:

“The law cannot take account of everything that follows a wrongful act; it

regards some subsequent matters as outside the scope of its selection, because

it were infinite for the law to judge the causes of causes or the consequences of

consequences. In the varied web of affairs, the law must abstract some

consequences as relevant, not perhaps on ground of pure logic but simply for

practical reasons.”

Therefore it would be manifest injustice if a person were held responsible for all

consequences of his act which in theory may be endless. A person is therefore held

responsible in law only for consequences which are not remote. A damage or injury may

though caused by a tortious act of defendant will not qualify for award of damage if it is too

remote.

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 HISTORICAL APPROACH ON REMOTENESS OF DAMAGE

There is a well known Latin maxim, “in jure non remota causa sed proxima spectator”,

which means that in law the immediate and not the remote cause of any event is regarded.

Lord Bacon paraphrased it thus in 1630:

“it were infinite for the law to consider the cause of causes and their impulsions one

of another; therefore it contenteth itself with the immediate cause judgeth

of acts by that, without looking to any further degree”

In early case, English judges were seen to have used various terms like ‘effective’, ‘direct’,

‘natural’, ‘probable’, etc., when speaking of causes that led to an accident. With regard to the

test of remoteness, originally the view prevailed that consequences were too remote if a

reasonable man would not have foreseen them. In 1850, Pollock, C.B. in two cases, Righy v.

Hewitt 1 and Greenland v. Chaplin2 , expressed a strong doubt whether the man is responsible

for all the consequences that may under any circumstances arise in respect of mischief which

by no possibility could have been foreseen and which no reasonable person could be called

on to anticipate. He intimated that the rule was that the man is expected to guard against all

reasonable consequences of his act. This rule is the test of reasonable foresight. According to

this rule, a wrongdoer was only responsible for damage which was intended by him, or which

though not intended was the natural and probable consequences of his act. A consequence for

this purpose will be considered natural and probable when it is so likely to result from his act

that a reasonable man in the circumstances of the wrongdoer would have foreseen it and

abstained from the act accordingly.

This view was rejected in the case of Polemis v.Furness Withy & Co. Ltd3 and another rule

was laid down. It was that if a reasonable man would have foreseen any damage likely to

1
(1850) 5 Ex 240.
2
(1850) 5 Ex 243.
3
(1921) 3 KB 560.

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result from his act, then he is liable for all the direct consequences of it whether a reasonable

man would have foreseen them or not. This may be called as test of direct cause. But again

the test of reasonable foresight or foreseeability test has been adopted by the Privy Council in

its decision in Overseas Tankship (U.K.)Ltd. V. Mort’s Dock Engg. Co.(Wagon Mound

No.1)4 .

4
(1961) 1 All ER 404 : 1961 AC 338.

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 ANALYSIS ON REMOTE AND PROXIMATE DAMAGE

If the damage is too remote a consequences of the wrongful act the defendant is not liable and

on the other hand if the act and the consequences are so connected that they are not too

remote but are proximate, the defendant will be liable for the consequences. It is not

necessary that the event which is immediately connected with the consequences is proximate

and that further from it is too remote.

In Scott v. Shepherd5 , A threw a lighted squib into a crowd, it fell upon X. X, in order to

prevent injury to himself threw it further, it fell upon Y and Y in turn did the same thing and

it then feell on B, as a result of which B lost one of his eyes. A was held liable to B. His act

was proximate cause of the damage even though his act was farthest from the damage in so

far as the acts of X and Y had intervened in between.

In Hayens v. Harwood6 the defendant’s servant negligently left a horse van unattended in

crowded street. The throwing of stones at horse by a child, made them bolt and a policeman

was injured in an attempt to stop them bolt and a policeman was injured in an attempt to stop

them bolt and a policeman was injured in an attempt to stop them with a view to rescuing the

woman and children on the road. One of the defenses pleaded by the defendant was novus

actus interveniens, or remoteness of consequences, i.e., the mischief of the child was the

proximate cause and the negligence of the defendant’s servants was the remote cause. It was

held that the defendant was liable even though the horse had bolted when a child threw stones

on them, because such a mischief on the part of the children was anticipated.

‘It is occasioned by a combination of wrongful act of defendant and some further conscious

act by an intervening person, that of itself prevents the court from coming to a conclusion in

the plaintiff’s favour if the accident was the natural and probable consequences of the

wrongful act’.

5
17 W.B1. 892.
6
(1935) 1 KB 146.

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TESTS FOR DETERMINATION OF REMOTENESS OF DAMAGES

There are two main tests to determine whether the damage is remote or not:

 The test of Reasonable Foresight

 The test of Directness

 The test of Reasonable foresight:-

The test of Reasonable foresight says that “If the consequences of

a wrongful act could have been foreseen by a reasonable man, they are not too remote

and on the other hand if these consequences are not foreseen by a reasonable man than

they are too remote”.

Pollock, C.B. expressed a strong doubt whether the man is responsible for all the

consequences that may under any circumstances arise in respect of mischief which by no

possibility could have been foreseen and which no reasonable person could be called on

to anticipate. He intimated that the rule was that the man is expected to guard against all

reasonable consequences of his act. He also said that the liability of person is only for

those consequences which could have been foreseen by a reasonable man placed in the

circumstances of the wrongdoer.

As per this test, if I commit a wrong, I will be liable only for those consequences which I

could foresee, for whatever could not have been foreseen is too remote a consequence of

my wrongful act.

 The test of Directness:

The test of reasonable foresight was rejected and the test of

directness was considered to be more appropriate by the court of Appeal in Re

Polemis and Furness, Withy & Co. Ltd.7 According to the test of directness, a person

is liable for all the direct consequences of his wrongful act, whether he could have

7
(1921) 3 KB 560.

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 foreseen them or not, i.e., could he foresee some damage? If the answer to this

question is in the affirmative, i.e., if he could foresee any damage to the plaintiff, then

he is liable not merely for those consequences which he could have foreseen but for

all the direct consequences of his wrongful act.

The first authority for the view advocating the directness test is the case of Smith v.

London and South Western Railway Co.8 where Channel B. said: “where there is no

direct evidence of negligence, the question what a reasonable man might foresee is of

importance in considering the question whether there is evidence for the jury of

negligence or not but when it has been once determined that there is evidence of

negligence, whether he could have foreseen them or not. What the defendant might

reasonably anticipate is only material with reference to the question, whether the

defendants were negligent or not, and cannot alter their liability if they guilty of

negligence.”

The test of directness has been considered to be incorrect and was rejected by the

Judicial Committee of the Privy Council in Overseas Tankship (U.K.) Ltd. V. Morts

Dock and Engg. Co. Ltd.9 (Wagon Mound Case), an appeal from the New South

Wales and it was held that the test of reasonable foresight is the better test.

8
(1870) L.R. 6 C.P. 14.
9
(1961) A.C. 388: (1961) 1 All E.R. 404 (P.C.)

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 THE TEST OF REASONABLE FORESIGHT:

THE WAGON MOUND CASE

GENERAL ANALYSIS ON THE CASE:

The Wagon Mound no 1 [1961] AC 388: House of Lords

Facts:

The defendant's vessel, The Wagon Mound, leaked furnace oil at a Wharf in Sydney Harbour.

Some cotton debris became embroiled in the oil and sparks from some welding works ignited

the oil. The fire spread rapidly causing destruction of some boats and the wharf.

Held:

Re Polemis should no longer be regarded as good law. A test of remoteness of damage was

substituted for the direct consequence test. The test is whether the damage is of a kind that

was foreseeable. If a foreseeable type of damage is present, the defendant is liable for the full

extent of the damage, no matter whether the extent of damage was foreseeable.

The Wagon Mound No.2 [1967] 1 AC 617: Privy Council

Facts:

The defendant's vessel, The Wagon Mound, leaked furnace oil at a Wharf in Sydney Harbour

due to the failure to close a valve. Some cotton debris became embroiled in the oil and sparks

from some welding works ignited the oil. The fire spread rapidly causing destruction of some

boats and the wharfs.

Held:

The defendants were in breach of duty. Although the likelihood of harm was low, the

seriousness of harm was high and it would have cost nothing to prevent it.

Lord Reid:

In the present case the evidence shows that the discharge of so much oil on to the water must

have taken a considerable time, and a vigilant ship's engineer would have noticed the

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discharge at an early stage. The findings show that he ought to have known that it is possible

to ignite this kind of oil on water. and that the ship's engineer probably ought to have known

that this had in fact happened before. The most that can be said to justify inaction is that he

would have known that this could only happen in very exceptional circumstances. But that

does not mean that a reasonable man would dismiss such a risk from his mind and do nothing

when it was so easy to prevent it. If it is clear that the reasonable man would have realised or

foreseen and prevented the risk then it must follow that the appellants are liable in damages.

The learned Judge found this a difficult case: he says that this matter is "one upon which

different minds would come to different conclusions". Taking a rather different view of the

law from that of the learned Judge, their Lordships must hold that the respondents are entitled

to succeed on this issue.

BROADER ANALYSIS ON THE CASE:

 Facts of the Case:

Overseas Tankship had a ship, the Wagon Mound, docked in Sydney

Harbour in October 1951. At a distance of about 600 feet, the respondents, Morts Dock

Company, owned a Wharf, where the repairs of a ship including some welding operation

were going on. The crew had carelessly allowed furnace oil (also referred to as Bunker oil) to

leak from their ship. The oil drifted under a wharf thickly coating the water and the shore

where other ships were being repaired. Hot metal produced by welders

using oxyacetylene torches on the respondent's timber wharf (Mort's Dock) at Sheerlegs

Wharf fell on floating cotton waste which ignited the oil on the water. The wharf and ships

moored there sustained substantial fire damage. In an action by Mort's Dock for damages for

negligence it was found as a fact that the defendants did not know and could not reasonably

have been expected to know that the oil was capable of being set alight when spread on

water. The dock owners knew the oil was there, and continued to use welders.

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 Decision:

The trial court applied the rule of directness and held the O.T. Ltd liable.

The Supreme Court of the New South Wales also followed the Polemis rule and mentioning

the unforeseeability of damage by fire was no defence, held the O.T. Ltd liable, Manning, J,

said: “Notwithstanding that, if regard is to be had separately to each individual, occurrence

in the chain of events that led to this fire, each occurrence was improbable, and, in one

sense, improbability was heaped upon improbability. I cannot escape from the conclusion

that if the ordinary man in the street had been asked, as a matter of common sense, without

any detailed analysis of the circumstances, to state the cause of the fire at Morts’ Dock, he

would unhesitatingly have assigned such cause to the spillage of oil by the appellants,

employees”

On appeal, the Privy Council held that Re Polemis was no more good law and reversed the

decision of the Supreme Court. Since a reasonable man could not foresee such injury, the

appellants were held not liable in negligence even though their servant negligence was the

direct cause of the damage. Referring to the above stated judgment of the Supreme Court and

the application of the Polemis rule there, the Privy Council said : “but it is not the hindsight

of a fool; it is the foresight of the reasonable man which alone can determine responsibility.

The Polemis rule by substituting “direct” to “reasonably foreseeable” consequences leads to a

conclusion equally illogical and unjust.

 Significance:

Up till this time the leading case had been Re Polemis, where the central

question was that of the directness of the chain of events between the triggering act being

examined for negligence and the result. The Council decided that rather than go with

precedent (authority) they would determine a principle from a range of cases, in a similar way

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as Lord Atkin did in Donoghue v Stevenson10, and their principle was primarily a single test

for foreseeability which they argued was a logical link between the damage and the liability

(culpability). Stated differently, foreseeability was the logical link between, and the test for,

breach of the duty of care and the damages. This is the supreme test, and may be rephrased as

"the liability of a consequence ... was natural or necessary or probable." The Lords made

reference to hindsight, indicating it is nothing like foresight and should play no role in

assessing negligence. There is authority to challenge this view of hindsight; in Page v.

Smith11, Lord Lloyd stated: "In the case of secondary victims, i.e. persons who were not

participants in an accident, the defendant will not be liable unless psychiatric injury is

foreseeable in a person of normal fortitude and it may be legitimate to use hindsight in order

to be able to apply the test of reasonable foreseeability."

The Lords gave Morts the opportunity to sue in nuisance but there is no record of them

testing this action in that tort. The common law rules of causation have had their importance

lessened by the promulgation of statute law in Australia. Contributory negligence is now

essential for many determinations and is covered by statutes such as the Civil Liability Act

(1936) South Australia which has more recent counterparts in a number of jurisdictions

including New South Wales.

Application in Other Cases:

In Hughes v. Lord Advocate12 the post office employees opened a manhole

for the purpose of maintaining underground telephone equipment. The manhole was covered

with a tent. One evening, it was left surrounded by paraffin lamps but otherwise unguarded.

A child of eight years entered the tent and started playing with one of the lamps. The lamp

fell into the manhole and caused a violent explosion resulting in the fall of the boy also in the

10
(1932) A.C. 562, 579.
11
(1995) 2 All ER 736.
12
(1963) AC 837: (1963) 1 All ER 705.

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hole and severe injures to him from burns. It was foreseeable that a child could get burnt by

tampering with the lamp, but the explosion could not be foreseen. The House of Lords held

that since the kind of Damage was foreseeable although the extent was not, the defendants

were liable, Lord Reld said: ‘the appellant’s injuries were mainly cause by burns and it

cannot be said that injuries from burns was unforeseeable. As a warning to traffic, the

workmen had set the lighted red lamps round the tent which covered the manhole, and if boys

did enter the dark tent, it was very likely that they would take one of these lamp with them. If

the lamp fell and broke, it was not at all unlikely that thee boy would be burnt and the burns

might well be serious. No doubt, it was not to be expected that the injuries would be as

serious as these which the appellant in the fact sustained. But the defendant is liable, although

the damage may be a good deal grater in extent than was foreseeable’.

The test of reasonable foresight as stated in Wagon Mound case was also applied in the case

of Doughty v. Turner Manufacturing Co. Ltd.13 The plaintiff was employed by the

defendants. Some other workmen of defendant let an asbestos cement cover slip into a

cauldron of hot molten liquid. It resulted in an explosion and the liquid thereby erupted,

causing injuries to the plaintiff, who was standing nearby. The cover had been purchased

from erupted, causing injuries to the plaintiff, who was standing nearby. The cover have been

purchased from reputed manufacturers and nobody could foresee that any serious

consequences could follow by the falling of the cover into the cauldron.

Held that the damage resulting from the explosion was not of the kind as could

reasonably have been foreseen, and, therefore, the defendant was not liable.

13
(1964) 1 QB 518.

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 PRINCIPLES IN CONSIDERING REMOTENESS

In Simmons v. British Steel Plc.14 Lord Rodger summarized the principles involved in

considering the question of remoteness of damage. The summary reads:

These authorities suggest that, once liability is established, any question of

remoteness of damage is to be approached along the following lines which may, of

course, be open to refinement and development.

1. The starting point is that a defender is not liable for a consequence of a

kind which is not reasonably foreseeable.

2. While a defender is not liable for damage that was not reasonably

foresseable, it does not follow that he is liable for all damage that was

reasonably foreseeable: depending on the circumstances, the defender may

not be liable for damage caused by a novus actus interveniens or

unreasonable conduct on the part of pursuer, even if it was reasonably

foreseeable.

3. Subject to the qualification in (2), if the pursuer’s injury is of a kind that

was foreseeable, the defender is liable, even if the damage is greater in

extent than was foreseeable or it was caused in way that could not have

been foreseen.

4. The defender must take his victim as he finds him.

5. Subject again to the qualification in (2), where personal injury to the

pursuer was reasonably foreseeable, the defender is liable for any personal

injury, whether physical or psychiatric, which the pursuer as a result of his

wrongdoing.

14
(2004) UKHL 20.

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 CONCLUSION

The conclusion that have been reached after the research on the project is that remoteness

exists as a separate and distinct inquiry, and it seems clear that the test for remoteness

remains that of reasonable foreseeability of damage of a particular kind. There is undoubtly

an overlap between the question of whether the scope of the duty of care encompasses

damage of that particular kind, and the question of whether that kind of loss is too remote. In

many cases, the overlap between these two inquiries would be complete. However, the

separate inquiry into remoteness does allow the court to make a more focused and particular

examination of actual loss suffered by the plaintiff. Just because the court has found that in

general terms at least, a duty of care was owed to prevent a particular kind of loss, it does not

necessarily follow that the actual loss suffered by the plaintiff is one which was itself

reasonably foreseeable.

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 BIBLIOGRAPHY
 BOOKS:
 Law of Torts, including Motor Vehicles Act and Consumer Protection Act, R.K.

Bangia, revised by Dr. Narendra Kumar, 23 edition, 2013.

 Winfield and Jolowicz on Tort, WVH Rogers, 18th edition, 2010.

 Ratanlal and Dhirajlal, The Law of Torts, 26th edition, 2010.

 WEBSITES:

 http://www.shortlandchambers.co.nz/pub/users/andrewbaker/files/Remoteness_of_Dam

ages.pdf

 http://e-lawresources.co.uk/Tort-law.php

 http://en.wikipedia.org/wiki/Remoteness_in_English_law#Directness

 http://en.wikipedia.org/wiki/Overseas_Tankship_(UK)_Ltd_v_Morts_Dock_and_Engin

eering_Co_Ltd

 http://www.e-lawresources.co.uk/The-Wagon-Mound-no-1.php

 http://www.e-lawresources.co.uk/The-Wagon-Mound-No-2.php.

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