Alcoa Minerals of Jamaica Inc. v Herbert Broderick

JurisdictionUK Non-devolved
JudgeLord Slynn of Hadley
Judgment Date22 March 2000
Judgment citation (vLex)[2000] UKPC J0320-1
CourtPrivy Council
Docket NumberAppeal No. 68 of 1998
Date22 March 2000
Alcoa Minerals of Jamaica Inc.
Herbert Broderick

[2000] UKPC J0320-1

Present at the hearing:-

Lord Slynn of Hadley

Lord Mackay of Clashfern

Lord Jauncey of Tullichettle

Lord Hope of Craighead

Lord Clyde

Appeal No. 68 of 1998

Privy Council


[Delivered by Lord Slynn of Hadley]


From 1973 Mr. Broderick has owned, and from 1975 has lived in, a house in Clarendon, Jamaica. The appellant ("Alcoa") is an American company which at all material times held mining leases permitting it to mine and win alumina from bauxite deposits in Clarendon. Clarendon Alumina Production Limited ("Clarendon"), a Jamaican company, is a subsidiary of Alcoa.


By a writ and statement of claim dated 9th April 1990, the latter as amended on 26th July 1993, Mr. Broderick claimed that in and from 1972 Alcoa and Clarendon erected and operated a smelting plant in Clarendon. They applied to the alumina a process ("the Bayer process") which generated and dispersed into the atmosphere pollutants, noxious gases and corrosive dust. These caused corrosion to the galvanised zinc panels of the roof of his house and other injury to his property and to his health. When the damage first occurred he repaired it but by 1989 the damage had occurred again and he was not able to pay for the necessary repairs. In 1990 in his statement of claim he put his special damage at $211,140 being $135 for each of 1564 square feet of the building. But on 25th March 1994 he was allowed to amend this figure to $938,400 being $600 per square foot of the same area. This increase from $135 to $600 represented the increase in the cost of doing the repair between the two dates.


Mr. Broderick alleges that in 1987 on various dates representatives of Alcoa and Clarendon admitted that the two companies were responsible for the damage to the roof and building not only of Mr. Broderick but also of other residents in the area: they also agreed that the defendants would repair the same at their expense. Mr. Broderick alleged that a representative of the two companies again admitted in May 1988 that they would repair all the damaged houses. These allegations were denied by both defendants.


After a trial lasting 17 days between 7th October 1991 and 19th December 1994 Theobalds J. on 15th February 1995 gave a judgment for Mr. Broderick for $938,400 special damages and $30,000 general damages. He also granted an injunction restraining the companies from maintaining "the nuisance" from 30th June 1995. The judge accepted that the companies had caused the damage – "on an overwhelming preponderance of evidence the plaintiff has discharged the burden of proof". But he did not give detailed findings of fact nor did he give his assessment of the evidence which had been given.


The Court of Appeal on 11th November 1996 affirmed the order as to damages but set aside the order for an injunction. Because the judge had not made sufficient findings of fact, the judges of appeal found it necessary to analyse in detail the record of the evidence. Having done so they concluded that Mr. Broderick had proved his claim in nuisance. Alcoa had caused the damage and, however much it had sought to remedy the position, the nuisance continued.


There is no issue as to liability before their Lordships. The issue is as to the quantification of the damages. The latter is important to Mr. Broderick, a carpenter and Pastor of his church, because of the high cost involved; it is important to Alcoa partly for the same reason but principally because some 60 other claims have been made by other residents which may turn on the results of this appeal.


Alcoa contends that the original figure was right. It was the cost of repair at March 1990 by which time the physical damage had occurred. The general rule in tort is that damages should be assessed at the date of breach ( Miliangos v. George Frank (Textiles) Ltd. [1976] A.C. 443, 468D per Lord Wilberforce). That rule applies here. The increase in cost was due to Mr. Broderick's failure to do the repair at or soon after the date of breach. Alcoa was not liable for that increase in costs which was essentially due to inflation and to the fact, as Downer J.A. in the Court of Appeal put it, that "because of the dramatic fall in value of the Jamaican dollar building prices and labour costs have soared" (page 57 transcript). The cost of repairs should be taken at the time when reasonably he could be expected to have done the repairs and insofar as the delay in repairing was due to his lack of funds, as two members of the Court of Appeal held, his impecuniosity should be ignored when considering the date when damages ought to be assessed ( Leisbosch Dredger v. Edison [1933] A.C. 449).


Alcoa contends further that the two judges of appeal who accepted that it was prudent for Mr. Broderick to delay the repairs in view of the promises made on behalf of Alcoa to do the repairs and pay for them did so without sufficient evidence to support such a finding. Moreover there was nothing to show that Mr. Broderick had delayed repairs because of any such promise.


There are thus really two separate but related questions: (a) is the plaintiff entitled to have damages assessed at a date other than the date by which the physical damage was complete; and (b) does the fact that he could not afford to pay for repairs until he had obtained judgment have to be ignored when fixing the date by which damages must be assessed.


As to the first question Alcoa is entitled to say that the starting point for assessing damages is the so-called "breach date" rule. But Lord Wilberforce in his speech in Miliangos made it clear that the rule is subject to exceptions. In that case it was held that damages in sterling were not an adequate remedy so that an order for the delivery of a foreign currency in specie might be made. It would have been unjust to award damages in sterling at the breach date. It is a very different case from the present, but it seems to their Lordships that in a case where damages are the appropriate remedy, if adoption of the breach date rule in assessing them produces injustice the court has a discretion to take some other date. Even in contract of sale cases where the assessment of damages is normally taken as at the date of breach, Lord Wilberforce in Johnson v. Agnew [1980] A.C. 367 citing Ogle v. Vane (1867) L.R. 2 Q.B. 275, (1868) 3 Q.B. 272 considered that "this is not an absolute rule: if to follow it would give rise to injustice, the court has power to fix such other date as may be appropriate in the circumstances". See also Oliver J. in Radford v. De Froberville [1977] 1 W.L.R. 1262.


In a case where repairs have to be done at what is a heavy cost in relation to the plaintiff's financial position there may be stronger grounds for delaying the date of assessment than in a case where the plaintiff has undertaken a contractual obligation to buy and pay for goods where he could go out into the market and buy the goods at or near the same price. There is in their Lordships' view force in the statement of I.N. Duncan Wallace in (1980) 96 L.Q.R. Costs of Repairs: Date for Assessment at page 342 that "… failure by a wrongdoer to accept liability will in many cases be a crucial factor in justifying a plaintiff in postponing work of repair until final judgment".


The breach date rule is therefore not a conclusive answer to the plaintiff's claim.


The second question turns on a consideration of the decision in The Liesbosch, which in Alcoa's contention precludes the plaintiff from claiming the cost of repair at the date of judgment since the delay was due to his impecuniosity and not to the defendant's breach of duty. In view of the importance attached to what is said in The Liesbosch by Sir Sydney Kentridge Q.C. for Alcoa and to the criticism of it made by Mr. Cherryman Q.C. for Mr. Broderick it is important to consider what it in fact says and what developments have taken place since.


In The Liesbosch the dredger's moorings were fouled by the Edison and consequently the dredger sank. It was doing construction work under a contract with heavy penalties for delay. The dredger's owners could not, because of want of funds, purchase another dredger and so they hired a dredger. They were awarded as damages the market price of a comparable dredger on the day the Liesbosch sank together with the cost of adapting it and transporting it to the site. Lord Wright, with whom other members of the House agreed, said at page 459 that the owners of The Liesbosch "… should recover such sum as will replace them, so far as can be done by compensation in money, in the same position as if the loss had not been inflicted on them, subject to the rules of law as to remoteness of damage". The Admiralty Registrar and the judge had also held that the owners were entitled to recover their actual loss taking into account their want of means, so long as they acted reasonably, "even though but for their financial embarrassment they could have replaced The Liesbosch at a moderate price and with comparatively short delay". Lord Wright rejected this approach:-

"The respondents' tortious act involved the physical loss of the dredger; … But the appellants' actual loss in so far as it was due to their impecuniosity arose from that impecuniosity as a separate and concurrent cause, extraneous to and distinct in character from the tort; the impecuniosity was not traceable to the respondents' acts, and in my opinion was outside the legal purview of the consequences of these acts … In the varied web of affairs, the law must abstract some consequences as relevant, not perhaps on grounds of pure logic but simply for practical reasons. In the present case if the appellants' financial embarrassment is to be regarded as a consequence of the respondents' tort, I think it is too...

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