The areas of work in which we have particular expertise, experience and excellence.
Articles | Tue 28th Jul, 2020
The recent decision of Jay J in Begum v Maran  EWHC 1846 (QB) provides guidance in respect of the scope of a ship owner’s duty of care in selling a vessel for dismantling, issues of applicable law; and an intriguing aside relating to local standards.
The Claimant, a Bangladeshi national, was the widow of a Bangladeshi shipbreaker working in a yard in Chittagong, in Bangladesh. On 30th March 2018 her husband had fallen to his death whilst working to dismantle an oil tanker. Evidence called on her behalf indicated that working conditions at Chittagong shipyards were notoriously extremely hazardous, with little or no personal protective equipment and no regard for safe working practices.
Presumably for practical reasons, Mrs Begum did not sue the most obvious tortfeasors, her husband’s employers or the yard owners, but instead issued proceedings against the former managers of the vessel, an English company. This enabled her to bring proceedings in the courts of England and Wales in negligence and unjust enrichment seeking damages under the Fatal Accident Act 1976, or, in the alternative, under the relevant provisions of Bangladeshi law.
Via an independent contractor the Defendant had arranged for the sale of the vessel for demolition to a third party domiciled in Nevis, which had sold it on to the shipyard. It was then beached at the shipyard for demolition. It was common ground that the Defendant had had no involvement with the vessel after sale, and that it had no control over or interest in the shipyard; but also that for present purposes it could be assumed that the Defendant was aware that the demolition would take place in Bangladesh rather than in one of the more reputable yards in China or in Turkey.
The Defendant applied for the claim to be struck out, or for summary judgment to be entered against the Claimant. At the hearing of the application Jay J considered whether the claim had a real prospect of success, based on the agreed assumption that English law applied.
The Application for Summary Judgment
The Defendant applied for summary judgment on the basis that nothing it did or failed to do caused the accident; that it had no control over the shipyard or its workers; and that it had not assumed any responsibility for them.
It was contended on behalf of the Claimant that the Defendant was fully aware when it arranged for the sale that the vessel was overwhelmingly likely to be broken up at a Bangladeshi shipyard, given the price agreed (which would have been much lower had a reputable shipyard been involved in the demolition), and the location of transfer (being Singapore, within reach only of disreputable shipyards, and of Chinese shipyards, which would have charged much more for demolition). Furthermore, so the Claimant averred, it was well known that Bangladeshi shipyards have scant regard for the safety of their workers, and, as a result, an unenviable track record of injuries and deaths. The net result of this, so it was said, was that the Defendant owed a duty of care to the workers in the shipyards at which its vessels would be dismantled.
The judge found, for the purposes of the application for summary judgment, that the Defendant’s sale of the vessel to a buyer who was sure to convey it to the dangerous Bangladeshi shipyards constituted an act rather than an omission. Having accepted that, it was inevitable that the workers at the shipyard would be exposed to risk of injury, and foreseeable that that risk would eventuate.
The immediate and proximate cause of the death of Mrs Begum’s husband was the active involvement of a third party, namely the shipyard; but it was arguable that the Defendant was responsible for that situation arising, in allowing the vessel to be sold to a buyer who would have it broken up at the shipyard.
Jay J concluded that the claim in negligence could proceed to trial:
“…My overall conclusion is that it is artificial and overly restrictive to say that the danger was created solely by the acts and omissions of the yard/employer in Bangladesh, particularly when these third parties were not acting deliberately in the sense of intending to injure the deceased. It was a danger which inhered in this end-of-life vessel once it was broken up, unless appropriate safety measures were taken…”
He did, however, strike out that part of the claim relating to unjust enrichment, finding it ‘not remotely arguable’ that the Defendant had been enriched at the expense of the Claimant.
The primary claim proceeded on the basis that English law applied pursuant to Article 4(3) of Regulation (EU) No.864/2007 (‘Rome II’) on the basis that there was a manifestly closer connection to England than to Bangladesh. The judge had no difficulty in rejecting his ambitious argument.
The Claimant’s secondary argument, that the accident was ‘environmental damage’ within the meaning of Article 7 of Rome II, and thus arguably governed by English law, found greater favour, perhaps surprisingly. In the view of the authors this seems to stretch the natural meaning of the wording of Article 7 and of the words ‘environmental damage’ to, and beyond, breaking point.
The Claimant’s tertiary argument, that the Bangladeshi one year non-extendable limitation period should be disapplied pursuant to Article 26 for reasons of public policy, was not determined. This too seems to be a surprising result; one year limitation periods are far from unusual, indeed some countries have six month limitation periods, and in English law some employment claims are time-barred after three or six months. If the English courts were to disapply foreign limitation periods of one year for public policy reasons, would they also have to disapply our own domestic limitation periods for similar reasons? It appears to the authors that as a matter of logic, they would; but the constitutional consequences of their doing so would be seismic.
The Reference to Local Standards
An interesting side-point in the claim was the judge’s treatment of what was, in effect, a classic ‘local standards’ argument.
The evidence before the Court was that over the previous ten years more than 70% of the approximately 800 vessels that reach the end of their operating lives were broken up using the dangerous “beaching” method deployed in the Chittagong shipyard.
The Defendant argued given that since nearly all vessels ended up in South Asia, it could not be said that it was deviating from standard practice. It did not use the term ‘local standards’ but the essence of the argument was the same, namely that even if the local practice fell far below the standards followed in other areas of the world, compliance with a locally recognised and followed approach was sufficient to discharge the duty to exercise ‘reasonable’ skill and care.
The judge gave the argument very short shrift:
“…I reject that submission on the straightforward basis that if standard practice was inherently dangerous, it cannot be condoned as sound and rational even though almost everybody does the same…”
This is the second example, in recent months of the Court departing from the standard or custom which is followed on a local level. In Palaiokrassaas & Tsakou v Black & Green Trading (2020) 4 WLUK 476 Master Thornett held, in the context of a claim arising out of an aircraft crash in Ethiopia, that it would be unnecessary for the Court to receive expert on the customary standard of pilots practising in Ethiopia:
“…I entirely accept the Claimant’s submissions that it surely cannot be defence having any realistic prospect of success to argue that there might be a different local standard in Ethiopia how to fly and land an aircraft; as distinct from, say, standards of maintenance or cleansing. The Defendant fails to satisfy me that anything could be argued to the effect that the manner in which an aircraft is operated can vary from locale to locale: with or without the assistance of expert evidence in this regard.
The Claimant makes a valid and dispositive point that aviation safety is governed by a set of international rules and, as pleaded in the Particulars of Claim, Ethiopia is a signatory to those rules. A consumer can reasonably expect conformity with the rules. If this were an accident involving a car, one would not expect the defendant to argue that a report as to how cars are to be operated in Ethiopia to be necessary. An aircraft flown and landed safely ought not involve running off the runway and hitting a tree. The Defendant fails to persuade me that any aspect of local rules, standards or practice might suggest otherwise…”
Does this mark some kind of shift in the judicial attitude on this issue? It is respectfully suggested that it does not, for two reasons.
The first is that there will be cases where the applicable standard derives from international norms of behaviour or conduct which practically override any local application. The example of car driving, provided by Master Thornett, is a case in point. It is the reason why the Court of Appeal in Wreford-Smith v Airtours (2004) EWCA Civ 453 concluded that a coach driver in Turkey had not been responsible for a road traffic accident without there being any evidence at all of local safety standards.
The second point is that the classic statement of local standards, derived from Wilson v Best Travel (1993) 1 All ER 353 always carried an escape clause, namely that compliance with local customs, regulations or practice was sufficient except where “the absence of some safety feature might lead a reasonable holidaymaker to decline to take a holiday at the hotel in question”
Whilst this ‘second limb’ of the local standards test has received little attention in the case law, it is, it is suggested, comparable to the ‘Bolitho’ approach in clinical negligence claims, namely that even if a clinical practice is supported by a reasonable body of professional opinion (thereby satisfying the ‘Bolam’ test), it will be held to be unreasonable if it does not withstand objective logical scrutiny.
Outside the context of personal injury claims, the clearest exposition of this approach is the Privy Council decision in Edward Wong Finance v Johnson Stokes (1984) AC 296, a solicitors’ negligence claim arising out of conveyancing practice in Hong Kong. The evidence before the Court was that it was widespread accepted practice in Hong Kong, in completing a contract for the sale of land was for the purchaser’s solicitor to forward the purchase price to the vendor’s solicitor on an undertaking by the vendor’s solicitor to forward to the purchaser’s solicitor within a specified period the documents of title duly executed. The Court held that since this practice gave rise to a foreseeable risk of injury, there was a breach of duty:
“…As already indicated, the prevalence of the Hong Kong style of completion is established beyond a peradventure. It is peculiarly well adapted to the conditions in Hong Kong. It has obvious advantages to both solicitors and their clients. Their Lordships intend to say nothing to discourage its continuance. However, in assessing whether the respondents fell short of the standard of care which they owed towards the appellants, three questions must be considered; first, does the practice, as operated by the respondents in the instant case, involve a foreseeable risk? If so, could that risk have been avoided? If so, were the respondents negligent in failing to take avoiding action?…
The risk inherent in the Hong Kong style of completion as operated in the instant case being foreseeable, and readily avoidable, there can be only an affirmative answer to the third question, whether the respondents were negligent in not foreseeing and avoiding that risk…”
It is submitted that Jay J’s approach in the present case reflects the same line of thinking: that it is not possible to shelter behind a local practice if, viewed objectively, it prevents both obvious and reasonably avoidable risks.
Only time will tell whether this approach gains traction, particularly in the even more consumer-friendly environment of the new Package Travel and Linked Travel Arrangements Regulations 2018.
About the Authors
Called to the Bar in 1997 and 2004 respectively, Sarah Prager and Jack Harding have been listed in the legal directories as recommended practitioners in travel and consumer law for many years. Together with their colleague at 1 Chancery Lane, Matthew Chapman QC, they co-write the leading legal textbook in the area, and have been involved in many of the leading cases in the field in the last decade.