Albright & Wilson UK Ltd v Biachem Ltd
| Jurisdiction | England & Wales |
| Judge | Henry,Buxton L JJ,Sir Swinton Thomas |
| Judgment Date | 28 February 2001 |
| Court | Court of Appeal (Civil Division) |
| Date | 28 February 2001 |
Court of Appeal (Civil Division).
Henry and Buxton L JJ and Sir Swinton Thomas.
W Norris QC and A Phillips (instructed by Vizards Staples & Bannisters) for the first defendant.
Roger ter Haar QC and A Guggenheim (instructed by Beachcroft Wansbroughs) for the second, third and fourth defendants.
A Bartlett QC and J Field (instructed by Davies Arnold Cooper) for the claimant.
The following cases were referred to in the judgment of Buxton LJ:
Barclays Bank plc v Fairclough Building LtdELR [1995] 1 QB 214.
Feuer Leather Corp v Frank Johnston and Sons Ltd [1981] Com LR 251.
Henderson v Merrett Syndicates Ltd [1994] CLC 918; [1995] 2 AC 145.
Hollier v Rambler Motors (AMC) LtdELR [1972] 2 QB 71.
McCutcheon v David MacBrayne LtdWLR [1964] 1 WLR 125.
Wilson v Rickett Cockerell & Co LtdELR [1954] 1 QB 598.
Carriage of goods — Contract — Agency — Misdelivery — Claimant ordered different chemicals from two different suppliers — Suppliers used same agent to make deliveries — Agent delivered one chemical with delivery note relating to other — Whether misdelivery was in performance or purported performance of either contract or both.
This was an appeal from a judgment of Eady J, on 12 April 2000, on various preliminary points ordered to be decided in a case between Albright & Wilson UK Ltd (“Albright”), the claimant, the first defendant, Biachem Ltd (“Biachem”), and the second, third and fourth defendants, collectively “Berk”.
Albright placed an order with Berk for a delivery of sodium chlorite to the fluid plant at Albright's chemical works. Albright also placed an order with Biachem for epichlorohydrin (“EPI”) to be delivered to the phosphates plant at the works. The suppliers of the chemicals instructed the same company, “Huktra”, to make the deliveries. Through a mistake made at Huktra, the driver of the tanker containing Berk's sodium chlorite on delivery presented Biachem's delivery note relating to the EPI delivery. In consequence the sodium chlorite was discharged into Albright's existing stocks of EPI causing an explosion. Albright took proceedings and preliminary issues were ordered to be tried to determine whether the delivery was in performance of the Berk or Biachem contract or both or neither, and whether Berk or Biachem was in breach, and whether the Biachem contract was on Albright's or Biachem's standard terms. The judge held that the delivery constituted performance or purported performance of both Berk's and Biachem's contracts with Albright through the common agency of Huktra; that Biachem was in breach of contract because it delivered sodium chlorite when it should have delivered EPI; that Berk was in breach of an express term of the contract to deliver to the fluids plant, not the phosphates plant, and in breach of an implied term that delivery should be accompanied by documents correctly identifying the substance being delivered (there also being a common usage in the chemical trade to the same effect), and in breach of a statutory implied term as to quality and fitness; and that the contract with Biachem was on Albright's standard terms. Biachem and Berk appealed.
Held, dismissing the appeals:
1. As the judge held, the delivery constituted performance or purported performance of both Berk's and Biachem's contracts with Albright, acting through the common agency of Huktra. Presentation of the delivery note, representing that the goods were EPI, was purported performance of the Biachem contract. Huktra and the contracted driver acting for Berk were also purporting to deliver Berk's sodium chlorite. In both those transactions Huktra was acting both for Biachem and Berk. This was a case where there was objectively an attempt to perform, but that attempt had gone wrong. ( Wilson v Rickett Cockerell & Co LtdELR [1954] 1 QB 598 applied.)
2. It followed Biachem was in breach of implied terms as to description and as to quality and fitness by delivering sodium chlorite when it should have delivered EPI. Tender of the delivery note was the offer of performance on behalf of Biachem and a representation by Biachem that the goods in the tanker were EPI.
3. Berk was in breach of an implied term that correct documentation would accompany the goods, and the statutory implied term as to quality and fitness by reason of the fact that the sodium chlorite was accompanied by documentation inaccurately describing it as EPI. Berk was in breach in delivering to the phosphates plant.
4. The judge was right to find that Albright's terms and conditions applied to the Biachem contract.
Henry LJ:
1. I will ask Buxton LJ to give the first judgment.
Buxton LJ:
2. This is an appeal from a judgment of Eady J, delivered on 12 April 2000, on various preliminary points ordered to be decided in a case between Albright & Wilson UK Ltd, the claimant, and the first defendant, Biachem Ltd. The second, third and fourth defendants are various emanations of Berk Chemicals Ltd (to whom I will refer generally as “Berk”). The fifth defendant, which is not concerned as a party to this appeal but which plays a large part in it, is a company incorporated in Belgium called Huktra. The sixth defendant was apparently deleted. The seventh defendant is a company or partnership called A T Stevens Transport, which again plays some role in the background facts.
3. The dispute with which we are concerned is between Albright & Wilson and, on the one part, Biachem and, on the other part, Berk. I cannot express the background facts better than they were stated by the judge in para. 1-4 of his judgment, a statement that rightly attracted no criticism before us:
“1. The claimants (“A & W” [Albright & Wilson]) operate a chemical works at Avonmouth where an explosion occurred on 3 October 1996. This led to extensive damage to property and some personal injuries. The circumstances of the explosion and its immediate cause are reasonably clear. There are, however, a number of issues as to liability arising between the parties to these proceedings.
2. On 16 September 1996 A & W placed an order (Reference No. 404569) with one or more of the second to fourth defendants (“Berk”) for 23 metric tonnes of sodium chlorite for delivery at the fluids plant at Avonmouth. It was ultimately agreed that delivery was to take place on 3 October. On 20 September A & W placed an order (Reference No. 404588) with the first defendants (“Biachem”) for 23 metric tonnes of epichlorohydrin (“EPI”) to be delivered to their phosphates plant on 3 October. They also ordered a further 23 metric tonnes to be delivered on 4 October (with a further 46 tonnes to be delivered at a later date).
3. All three consignments were to be delivered, as it happened, by the fifth defendants (“Huktra”). The sodium chlorite was ordered from Caffaro in Italy, and it was they who gave instructions for it to be delivered by Huktra to Avonmouth. Huktra assigned tank number HUKU 302012-8. In respect of the two consignments of EPI, it was Biachem who instructed Huktra. The tank numbers assigned were HUKU 302014-9 and HUKU 30041-0 respectively. Huktra subcontracted to the seventh defendants (“Stevens”).
4. Through a mistake made at Huktra, the tanker driver of tank HUKU 302012-8 (containing the sodium chlorite) upon delivery presented Biachem's delivery note 8190. Unfortunately, this related to the EPI intended for the phosphates plant (although it is true that the tanker number written on that delivery note did in fact correspond to the tanker he was driving). In consequence, the contents were discharged into existing stocks of EPI. The sodium chlorite reacted with them causing the explosion. Hence these proceedings (begun by writ in October 1997).”
4. In order to illuminate the argument that follows, it is necessary to say something more about what the judge described in para. 4 of his judgment as “a mistake made at Huktra”. That mistake was twofold. The gentleman who was dealing with the matter at Huktra appears to have thought (though, as Biachem strongly urged to us, to have thought incorrectly) that Biachem did not wish the source of the goods that it was providing to Albright & Wilson to be apparent on the face of the documentation. As a result of that belief, Huktra instructed the driver, who was provided by Stevens, to tender on delivery only the Biachem delivery note. That instruction is clear from various documents before us. Secondly, over and above that, in relation to the particular consignment which was the cause of the explosion on 3 October, that instruction to the carrier was reinforced by a fax sent by Huktra which said, in part:
“Delivery to Avonmouth 3rd October. Please remove all documents and use this delivery note only.”
5. The delivery note which was referred to and which was attached to that fax was the Biachem delivery note for EPI; but, by mistake, there had been endorsed on it by Huktra the tanker number relevant to the delivery on behalf of Berk of sodium chlorite: that is to say, HUKU 302012-8. That is clear from the copy of the delivery note that we have in the bundle. That is how it came to pass that, when that driver was carrying out Huktra's instructions, he was driving a tanker full of sodium chlorite, but it had associated with it Biachem's delivery note — the only document that he was under instructions to tender — saying that the load was EPI.
6. Against those background facts there might, at first sight, seem to be a simple approach to this problem. The question would first arise as to whether the delivery company made a misrepresentation to Albright & Wilson about the nature of the contents of the tanker. If the facts were analysed in that way, the question would then follow as to whether that misrepresentation was made on behalf of Biachem or of Berk or of either of them; and, if it was, whether it was negligent and actionable, because those specialist chemical companies...
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