Free resources to assist you with your legal studies! Conditions, Warranties and Innominate Terms. But where they go only to a part, where a breach may be paid for in damages, there the defendant has a remedy on his covenant and shall not plead it as a condition precedent". The Court created a third class of contractual term outside of warranties and conditions In McFadden v Blue Star Lines [1905] 1 KB 607 it was stated that, to be seaworthy, a vessel must have the degree of fitness that an ordinarily careful and prudent shipowner would require his vessel to have at the commencement of a voyage, having regard to all possible circumstances. The Court of Appeal held that the "seaworthiness" term was not breached in a sufficiently serious way to entitle the charterer to terminate. In some classes of contracts such as sale of goods, marine insurance, contracts of affreightment evidenced by bills of lading and those between parties to tills of exchange, Parliament has defined by statute some of the events not provided for expressly in individual contracts of that class; but where an event occurs the occurrence of which neither the parties nor Parliament have expressly stated will discharge one of the parties from further performance of his undertakings it is for the court to determine whether the event has this effect or not. It was early recognised that contractual undertakings were of two different kinds; those collateral to the main purpose of the parties as expressed in the contract and those that were mutually dependent so that the non-performance of an undertaking of this class was an event that excused the other party from the performance of his corresponding undertakings. Firstly, the Court held that in order to construe whether a contractual clause constitutes a condition precedent, the breach of which permits repudiation, or an innominate term, the breach of which permits damages, depends on a holistic assessment of the contract’s surrounding circumstances in determining the intention of the parties in their treatment of the clause. White and Carter (Councils) Ltd v McGregor, "a 25-year-old vessel called the "Antrim", which they renamed the "Hong Kong Fir", of some 5395 tons gross and 3145 tons net register", Law Reform (Frustrated Contracts) Act 1943, Universal Cargo Carriers Corporation v Citati, Maredelanto Compania Naviera SA v Bergbau-Handel GmbH, L Schuler AG v Wickman Machine Tool Sales Ltd, Golden Strait Corporation v Nippon Yusen Kubishka Kaisha, https://en.wikipedia.org/w/index.php?title=Hong_Kong_Fir_Shipping_Co_Ltd_v_Kawasaki_Kisen_Kaisha_Ltd&oldid=983505504, Court of Appeal (England and Wales) cases, Creative Commons Attribution-ShareAlike License, [1962] 2 QB 26, [1961] EWCA Civ 7, [1962] 1 All ER 474, This page was last edited on 14 October 2020, at 16:34. Plaintiff [Hongkong] owned a ship and chartered it to the Defendant [Kawasaki] A clause in the agreement guaranteed that the ship would be in good condition etc. Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd (1962) Kawasaki chartered the Hong Kong Fir from Hong Kong Fir Shipping Co for 24 months. Construction of contractual terms as ‘conditions’ and repudiatory breach of contract. Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1961] EWCA Civ 7 is a landmark English contract law case. At first instance, it was held that although the ship was a seaworthy vessel on delivery in Liverpool, Hong Kong Fir had not exercised due diligence to maintain the vessel in an efficient and seaworthy state. [14] (2) The question whether an event which is the result of the other party's breach of contract has this consequence cannot be answered by treating all contractual undertakings as falling into one of two separate categories: "conditions" the breach of which gives rise to an event which relieves the party not in default of further performance of his obligations, and "warranties" the breach of which does not give rise to such an event. has exercised the English Courts for centuries, probably ever since assumpsit emerged as a form of action distinct from covenant and debt and long before even the earliest cases which we have been invited to examine; but until the rigour of the rule in Paradine v Jane[5] was mitigated in the middle of the last century by the classic judgments of Mr Justice Blackburn in Taylor v Caldwell [6] and Baron Bramwell in Jackson v Union Marine Insurance [7] it was, in general, only events resulting from one party's failure to perform his contractual obligations that were regarded as capable of relieving the other party from continuing to perform what he had undertaken. Common Law Procedure Act 1852. The enormous costs involved in chartering mean that parties cannot afford to leisurely loiter, whilst pondering the consequences of the breach. Upon initial delivery, the vessel’s machinery was described to be in ‘reasonably good condition,’ yet required constant maintenance due to its age. The Hong Kong Fir confirmed that the term "seaworthiness" has a very broad meaning ranging from trivial defects like a missing life preserver or a major flaw that would sink the ship. "Seaworthiness" is defined both by common law and by statute. Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd which was held in 1961 is a landmark case in English contract law area. This chapter discusses the decision of the Court of Appeal in Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd, The Hong Kong Fir [1962] 2 QB 26, one of the most important English contract cases of the 20th century. The ship in fact was not in good condition, and its repairs caused a lot of delays for the Defendant. This case document summarizes the facts and decision in Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26, Court of Appeal. No doubt there are many simple contractual undertakings, sometimes express but more often because of their very simplicity ("It goes without saying") to be implied, of which it can be predicated that every breach of such an undertaking must give rise to an event which will deprive the party not in default of substantially the whole benefit which it was intended that he should obtain from the contract. We also have a number of sample law papers, each written to a specific grade, to illustrate the work delivered by our academic services. Construction of contractual terms as ‘conditions’ and repudiatory breach of contract. The common law evolves not merely by breeding new principles but also, when they are fully grown, by burying their ancestors. However, modern commercial custom has since established that some breaches, such as failure to meet a "notice of readiness to load" a sea cargo, will always be repudiatory.[3]. VAT Registration No: 842417633. Hong Kong Fir Shipping Co v Kawasaki Kisen Kaisha , [1962] 2 QB 26, 1 All ER 474, known as the Hong Kong Fir case, is a leading English case on contract law. Hongkong Fir Shipping Company Ltd v Kawasaki Kisen Kaisha Ltd “the Hong Kong Fir” [1961] 1 Lloyd’s Rep 159; [1961] 2 Lloyd’s Rep 478 By michael Posted on August 3, 2011 Maritime Baltime charterparty – vessel unseaworthy – charterers not entitled to cancel This chapter discusses the decision of the Court of Appeal in The Hongkong Fir, one of the most important English contract cases of the 20th century. But it is by no means true of contractual undertakings in general at common law. Kawasaki appealed. The key issue is turn upon whether MicroHard Company Pte Ltd has breached any term in the Software Support Services Agreement it had signed with Ravi (the Customer). Registered Data Controller No: Z1821391. An intermediate term is a term of a contract that may give rise to a right of termination for breach depending on how serious the consequences are. Hong Kong Fir was successful at trial and Kawasaki appealed. If it is not a condition precedent, what matters it whether it is unperformed with or without excuse? Nolan, Donal, Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd, the Hongkong Fir (May 30, 2008). There was a charter-party between the plaintiff who was the owner of the vessel called Hongkong Fir and the defendant who was the charterer. case of Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd. By this time, barely seventeen months of the two-year time-charter remained. City University of Hong Kong Disclaimer: This work was produced by one of our expert legal writers, as a learning aid to help law students with their studies. In this analysis of the In the earlier cases before the Common Law Procedure Act 1852, the problem tends to be obscured to modern readers by the rules of pleading peculiar to the relevant forms of action-covenant, debt and assumpsit, and the nomenclature adopted in the judgments, which were mainly on demurrer, reflects this. There are, however, many contractual undertakings of a. more complex character which cannot be categorised as being "conditions" or "warranties" if the late nineteenth century meaning adopted in the Sale of Goods Act, 1893, and used by Lord Justice Bowen in Bensen v Taylor Sons & Co[15] be given to those terms. Essential Cases: Contract Law provides a bridge between course textbooks and key case judgments. This is only a specific application of the fundamental legal and moral rule that a man should not be allowed to take advantage of his own wrong. In short, the test for whether or not one may repudiate has now become, "does the breach deny the claimant the main benefit of the contract?" To export a reference to this article please select a referencing stye below: Our academic writing and marking services can help you! Cases - Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd Record details Name Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd Date [1962] Citation 2 QB 26 CA Legislation. Company Registration No: 4964706. Hong Kong Fir Shipping Co v Kawasaki Kisen Kaisha Ltd: CA 20 Dec 1961 The plaintiffs had recently acquired the ship the ‘Hong Kong Fir’ and contracted to charter it to the defendants, but being late in delivering it, the defendants cancelled the charterparty contract. Are mutual conditions, the one precedent to the contract citing hong Kong Fir Co. 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