Overseas Tankship (UK) Ltd v Miller Steamship Co Pty Ltd (The Wagon Mound (No 2)) [1967] 1 AC 617
Tort; Negligence; causation of harm; the harm foreseeable as a consequence of the breach.
Facts: This case arose from the same incident that gave rise to The Wagon Mound (No 1). While refueling a ship, employees of the Overseas Tankship Co negligently spilt fuel oil into Sydney Harbour. The oil spread, some of it to the wharf where the plaintiff company was refitting a ship. However, as it was believed by all concerned that fuel oil lying on water could not ignite, the plaintiff continued the refitting work on the ship, including welding work. An unusual series of events then occurred: a piece of molten metal fell onto a piece of floating cotton waste, which caught fire and ignited the oil around the ship and dock.
Issue: In The Wagon Mound (No 2) the plaintiffs were the owners of two ships damaged after the oil spilt by the defendant into Sydney Harbour caught fire. They argued that, on new facts proved, the harm was reasonably foreseeable.
Decision: Harm is reasonably foreseeable if there is a real and substantial risk that something like the event which happens might occur.
Reason: Lord Reid said (at 718 - 9):
"...in their 'Lordships' view the only question is whether a reasonable man having the knowledge and experience to be expected of the chief engineer of The Wagon Mound would have known that there was a real risk of the oil on the water catching fire in some way... In their Lordships' view a properly qualified and alert chief engineer would have realised there was a real risk here...."