In re Polemis

The owners of the ship Thrasyvoulos sought to recover damages from the defendants who chartered the ship. The contract of charter was read to hold the defendant charterers responsible for damage caused by fire due to their negligence. Stevedores, for whose conduct the defendants were responsible, were moving benzine from one hold to another by means of a sling. The stevedores had placed wooden boards across an opening above one hold to make a temporary platform to facilitate the transfer. "When the sling containing the cases of benzine was being hoisted up, owing to the negligence of the stevedores the rope by which the sling was hoisted or the sling itself came in contact with the boards, causing one of the boards to fall into the hold, and the fall was immediately followed by a rush of flames, the result being the total destruction of the ship."

The case was heard by arbitrators who found "that the fire arose from a spark igniting petrol vapour in the hold; that the spark was caused by the falling board coming into contact with some substance in the hold; . . . [and] that the causing of the spark could not reasonably have been anticipated from the falling of the board though some damage to the ship might reasonably have been anticipated." Damages were set at almost £200,000.

Subject to the court's opinion on the law, the arbitrators decided that the owners were entitled to recover the full loss from the charterers. The court was required to accept the arbitrator's findings. Although the case arose in the contract context, none of the three opinions mentions this point, and all rely on tort cases in their analyses.