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All Cases
Tort
Privy Council
1961

Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co (The Wagon Mound No 1)

[1961] AC 388

Ratio Decidendi

The test for remoteness of damage in negligence is reasonable foreseeability, not directness. The defendant is only liable for damage of a kind that was reasonably foreseeable as a consequence of the negligent act.

Facts

Oil was carelessly spilled from a ship in Sydney Harbour. The oil spread to the claimant's wharf where welding was being carried out. The oil ignited and caused extensive fire damage.

Judgment Summary

The Privy Council held the defendants were not liable. Fire damage from the oil spillage was not reasonably foreseeable because furnace oil on water was not known to be easily ignitable. This overruled the directness test in Re Polemis.

Key Quotes

"It is the foresight of the reasonable man which alone can determine responsibility."

Viscount Simonds

Subsequent Treatment

Foundational

Replaced the direct consequence test from Re Polemis with the foreseeability test for remoteness in negligence.