The Moorcock

"The Moorcock", 14 P.D. 64 (1889), is a leading English case in contract law where the concept of implied terms was first introduced.

Background

The owners of the ship "Moorcock" contracted for space at a wharf owner's jetty in order to unload the Moorcock's cargo. While docked the tide went down to a point where the hull of the ship hit a ridge causing damage to the ship.

The plaintiff argued that the wharfingers were responsible to ensure that his vessel would remain safe while docked. The wharf owners, in their defence, claimed that there were no provisions in the contract to ensure the vessel's safety nor could they have foreseen the damage caused to the vessel.

The issue before the Court was whether there can be any implied warranty in the circumstances.

The trial court found that there was an implied warranty.

Ruling

The Court held for the ship owner, ruling that the wharfingers were responsible for the safety of the ship while docked.

Bowen LJ stated that any implied warranties must be based on the presumed intentions of the parties. An implied warranty may be read into a contract for reasons of "business efficacy" and in order to maintain the presumed intention of the parties:

In business transactions such as this, what the law desires to effect by the implication is to give such business efficacy to the transaction as must have been intended at all events by both parties who are business men; not to impose on one side all perils of the transaction, or to emancipate one side from all the chances of failure, but to make each party promise in law as much, at all events as it must have been in the contemplation of both parties that he should be responsible for in respect to those perils or chances.
Bowen looked at the presumed risks of the agreement and who was expected to bear them. The wharfingers were in such a position that they must have known that there was a risk of damage to the ship and would be in the best position to judge the safety of the vessel. Thus the wharf owners were under an obligation to ensure the ship was safe to complete the transaction.

Analysis

This case was regarded with cynicism and was highly controversial at the time as it contradicted the common belief that all terms in a contract had to be explicit.


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