Economic Loss: Anns, Junior Books and Bills of Lading
| Author | Richard Kidner |
| Date | 01 May 1985 |
| DOI | http://doi.org/10.1111/j.1468-2230.1985.tb00845.x |
| Published date | 01 May 1985 |
352
THE
MODERN
LAW
REVIEW
[Vol.
48
may be doubted.
No
figures were produced in court as to the
number of petitions to the Home Secretary from persons aggrieved
by decisions
of
prison governors. One can only assume he is not
overwhelmed thereby. Whether the courts would be
so
overbur-
dened if the filter of petition prior to judicial review
was
held to be
unnecessary can only be a matter of speculation.
SANDY GHANDHI*
ECONOMIC
LOSS:
ANNS, JUNIOR BOOKS
AND
BILLS
OF
LADING
Leigh and Sillivan
v.
Aliakmon Shipping
Co.
(The Aliakmon)'
is
an intriguing and important case because it presents both wide and
narrow issues of great importance. The wide issues concern not
only the recovery of economic loss in negligence, but also the
effect of the
Anns
principle and the relationship between contract
and tort as affected by
Junior
Books.
The narrow issue relates to
the inability
of
the Bills
of
Lading Act
1855
and the privity
doctrine to meet the needs of the commercial community.
The plaintiffs were buyers of steel coil from Japanese sellers
under a
c.
and
f.
contract. The steel was shipped from Korea
aboard the
Aliakmon,
owned by the defendants, but it suffered
damage due to bad stowage and ventilation. In normal circumstances
both ownership
of
the steel and the right to sue on the contract
between the consignors and the shipowner, would have passed to
the buyers when the bill of lading was endorsed to them in return
for a bill of exchange. Unfortunately the buyers were unable to
provide a bill
of
exchange and subsequent negotiations resulted in
what the Court of Appeal held to be a reservation of the right of
disposal by the sellers under the Sale of Goods Act
1979, s.19.
Accordingly the Bills
of
Lading Act
1855
did not operate2 and title
to sue on the contract did not pass to the buyers, by virtue
of
the
bill of lading. Hence this was one
of
those not uncommon cases3
where ownership remained in the sellers while risk passed to the
buyers,
or
more strictly, as the court pointed out, where the buyers
had agreed to pay full price whatever the state of the goods on
receipt. In the event the Court of Appeal held that the buyers
could not sue the shipowners for the damage to the steel, either
in
contract or tort, but the three members of the court gave separate
and irreconcilable reasons for doing
so.
Lecturer in Law, University of Reading.
[1985]
2
W.L.R. 289. Leave
to
appeal to the House
of
Lords has been granted.
I
am
most grateful
to
Miss
D.
Sabalot, Law Librarian
of
Holman, Fenwick
&
Willan for
providing a transcript
of
the judgments at an early stage.
*
Because by the Sale of
Goods
Act 1979, s.19(3) property does not pass on the
reservation of a right
of
disposal, and title
to
sue on the contract between consignor and
shipowner will only pass under the Bills of Lading Act 1855, s.1 if the property passes on
endorsement of the bill. are The Wear Breeze 119671
2
Lloyd's Rep. 315; The
Elu
The Irene's
Success
I19811
2
Lloyd's Rep. 635; The Neu Ty
if
i
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