Torts - Cases, Principles, and Institutions Fifth Edition, 2016a

Witt & Tani, TCPI 7. Proximate Cause
The Wagon Mound Cases
The Polemis rule soon ran aground off the coast of Australia in the Wagon Mound Cases.
These were two independent lawsuits arising out of the same incident in a port near Sydney,
Australia. The incident began when a ship, the Wagon Mound, took on furnace oil as cargo in
Mort Bay. One of the hatches to the Wagon Mound’s tank was left open as the tank was filling
with furnace oil, causing oil to spill out of the ship and float on the surface of Mort Bay. After
taking on the furnace oil, the Wagon Mound left the bay. At the same time in another part of the
bay, two other ships, the Corrimal and the Audrey D., were being refitted by Mort’s Dock and
Engineering Company. The refitting involved significant welding by the Mort’s Dock engineers.
Upon seeing the spill, the works manager of Mort’s Dock, Mr. Parkin, telephoned an agent of the
Wagon Mound, Mr. Durack. Mr. Durack assured Mr. Parkin that normal work could safely
continue. Two and a half days later, the welding work ignited the oil, causing a large fire. The
fire damaged the Mort Dock and both ships being refitted. In Wagon Mound (No. 1), Mort’s
Dock sued the Wagon Mound for damage to the dock. In Wagon Mound (No. 2), the owners of
the Corrimal and the Audrey D. sued the Wagon Mound for damage to their ships.
Wagon Mound (No. 1)
Overseas Tankship (U.K.) Ltd. v. Morts Dock & Eng. Co., [1961] A.C. 454
[Plaintiff brings suit for damage to the dock caused by a fire from the ignition of oil
negligently discharged by Defendant’s ship, the Wagon Mound. Plaintiff prevailed at trial, and
Defendants appealed.]
[The lower court judge] made the all important finding, which must be set out in his own
words. “The raison d’être of furnace oil is, of course, that it shall burn, but I find the defendant
did not know and could not reasonably be expected to have known that it was capable of being set
afire when spread on water.” . . .
The learned Judge held that apart from damage by fire the respondents had suffered some
damage from the spillage of oil in that it had got upon their slipways and congealed upon them
and interfered with their use of the slips. He said “The evidence of this damage is slight and no
claim for compensation is made in respect of it. Nevertheless it does establish some damage
which may be insignificant in comparison with the magnitude of the damage by fire, but which
nevertheless is damage which beyond question was a direct result of the escape of the oil.” It is
upon this footing that their Lordships will consider the question whether the appellants are liable
for the fire damage.
. . . It is inevitable that first consideration should be given to the case of In re Polemis . . .
. For it was avowedly in deference to that decision and to decisions of the Court of Appeal that
followed it that [lower court] was constrained to decide the present case in favour of the
respondents. . . .
There can be no doubt that the decision of the Court of Appeal in Polemis plainly asserts
that, if the defendant is guilty of negligence, he is responsible for all the consequences whether
reasonably foreseeable or not. The generality of the proposition is perhaps qualified by the fact
that each of the Lords Justices refers to the outbreak of fire as the direct result of the negligent act.
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