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Justin Santiago, BAppSc (Hons), MBA, LLB (Hons) comes from a journalism, market research, intellectual property and strategic communications consulting background. Now based in Melbourne he spends his time advising businesses on how to communicate to their customers as well as writing on various subjects of interest in this blog.

Friday, February 13, 2009

Remoteness

Why did Viscount Simmonds say that the test of remoteness should be foresight and not directness? Are his reasons justified? - Justin Santiago

The judgement in the Privy Council case Overseas Tankship v Morts Dock & Engineering Co Ltd (The Wagon Mound) added some certainty in the law on remoteness in negligence case. The previous law on remoteness in Re Polemis allowed for recovery of all the damage as a result of the direct consequences of the negligence even though they could not reasonably have been anticipated. Directness was difficult to define especially when it involved multiple incidents. Suppose a car hits a lamp post which subsequently falls to the ground, shards of glass then fly in all directions landing into someone's sandwich causing a stomach upset. Under Re Polemis the damage caused would have been classified as a direct consequence.

In The Wagon Mound it was decided that to recover damages in respect of injury caused by another’s negligence it must be of the type which was a reasonably foreseeable consequence of that negligence. It was not enough that some damage was foreseeable, it must be established that damage of the type that actually occurred was foreseeable. Therefore the actual loss (fire damage to the wharf) was of a different type from that which was foreseeable (damage by air fouling). The justification for this decision is that the defendant is not penalised excessively and that the rule in Re Polemis might give rise to palpable injustice.

While his reasons may be justified, The Wagon Mound has showed up some limitations.

There can even be ambiguity with regard to the definition of the type of harm caused. The courts have adopted a variety of different approached from the narrow and restrictive : Tremain v Pike to the generous and expansive : Page v Smith - no justification for regarding physical and psychiatric injury as different kinds of damage.

In a line of cases Jolley v Sutton London Borough Council, Hughes v Lord Advocate, Doughty v Turner Manufacturing it was held that not only must the loss be of a reasonably foreseeable kind, the accident must also be a reasonably foreseeable consequence of the negligence which further restricted The Wagon Mound. In Doughty v Turner Manufacturing Co Ltd injury was by (unforeseeable) explosion rather than by (foreseeable) splashing.

Addtitionally the egg-shell skull rule has survived the introduction of the new rule for remoteness and plaintiffs can recover in respect of both foreseeable and unforeseeable consequences of the negligence - the tortfeasor takes his victim as he finds him : Smith v Leech Brain & Co. Ltd.

Ultimately as Lord Denning said in Lamb v Camden LBC (1981) QB 625, Denning said: "The truth is that all these three – duty, remoteness and causation – are all devices by which the courts limit the range of liability for negligence . . . All these devices are useful in their way. But ultimately it is a question of policy for the judges to decide." In other words, the court's main task is to do justice as between these parties in their present situation.This is the justification for the narrow interpretation for remoteness.

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