Read the full judgment text of CACV 000162/1987 on BabelCite. This Court of Appeal judgment was delivered on 2 November 1988 before Cons, V.-P., Kempster, J.A., Clough, J.A..
Negligence – duty of care – proximity – novel situation – dead ship moored to typhoon buoy – repair yard's responsibility for third-party damage – A 'dead ship' of almost 10,000 gross tons, the M.V. Hua Lien, which had suffered severe bottom damage by stranding off Taiwan, was brought to Hong Kong in May 1983 and accepted into the custody of Hong Kong United Dockyards Limited (HUD) for repair. A Dead Ship Permit was issued by the Director of Marine and a buoy shackle was attached to the port anchor cable, with a simulated drop of the starboard anchor. On 16 June 1983 the master accepted custody on behalf of the owners, who had also appointed a local superintendent. No further repairs were effected. When Typhoon Ellen approached in September 1983, the Hua Lien was moved to typhoon buoy A42. At the height of the storm, the port mooring cable snapped – the cause being excessive cable length released through a faulty guillotine stopper missing its securing pin – and the starboard anchor was found jammed. The vessel drifted, grounded on Tsing Yi Island and caused substantial damage to the shore-based installations of the Plaintiffs. The Court below (Macdougall J.) found HUD guilty of negligence. Held, reversing the court below, that the circumstances did not disclose a degree of proximity between HUD and the Plaintiffs sufficient to fix HUD with a duty of care. The applicable test for a duty of care in a novel situation, following Anns v Merton as refined in Peabody, Curran and Yuen Kun Yeu, is whether, on all the circumstances, close and direct relations exist between the parties, foreseeability being a necessary but not sufficient ingredient. Although HUD had expertise, equipment, an internal policy of moving vessels to typhoon buoys, and a contractual right to charge the owners for typhoon precautions, the master and crew, agents and superintendent exercised exclusive control of the vessel on behalf of the owners from 16 June 1983. Clause 19 of HUD's Standard Conditions of Contract placed responsibility for the vessel's safety on the customer, and the Marine Department, owners and superintendent all looked to the owners' representatives for safety of the ship. There is no general duty to prevent third parties from causing damage, and assumption of responsibility principles did not apply absent reliance. A bystander with a loudhailer on a cliff would still have to shout, but foreseeability of harm and ability to act do not of themselves give rise to a duty. Distinguishing misfeasance from non-feasance, and giving weight to the changed approach of superior courts (particularly the dissent of Lord Brandon in Leigh & Sillavan adopted in D & F Estates), the Court of Appeal entered judgment for HUD, with assessment of damages reserved.
Legal issues: Whether HUD owed a duty of care to the shore-based Plaintiffs arising from negligent preparation of a dead ship for typhoon mooring · Whether HUD exercised sufficient control over the Hua Lien to ground a duty of care
Outcome: Appeal allowed; judgment entered for the Defendant/Appellant, reversing the decision of Macdougall J. who had found HUD guilty of negligence.