Begum v Maran (UK) Ltd

A negligence claim based on knowingly sending a vessel for demolition in notoriously unsafe conditions may arguably engage the creation-of-danger exception to the general rule against liability for harm caused by third parties. Whether that duty exists should ordinarily be determined on established facts where the claim involves developing law and has a realistic prospect of success. Article 7 of the Rome II Regulation does not apply to workplace injury without a causative connection to environmental damage. A foreign limitation period is not contrary to public policy merely because it is shorter than the English period. Disapplication under Article 26 requires manifest incompatibility with public policy, although a specific contention of undue hardship may require factual determination.

The claimant was the widow of a worker who died after falling from an oil tanker being demolished at the Zuma Enterprise Yard in Chattogram, Bangladesh. The defendant was an English company which provided agency and shipbroking services within the vessel owner’s shipping group. It negotiated the vessel’s sale to Hsejar Maritime Inc, an intermediate demolition buyer, which delivered the vessel to Bangladesh.

For the interim applications, the defendant was assumed to have complete autonomy over the sale. It was also assumed to know that the vessel would be demolished in Bangladesh under notoriously unsafe working conditions. The claimant alleged that the defendant owed her husband a duty of care arising from its control of the sale and its creation of the danger to shipbreaking workers.

Jay J refused the defendant’s applications for summary judgment and striking out in [2020] EWHC 1846 (QB). He found that Bangladeshi law imposed an expired, non-extendable one-year limitation period, but left arguments under Articles 7 and 26 of the Rome II Regulation for further determination. The defendant appealed on the arguability of the duty and those two potential exceptions to the time bar.

1. The appeal was allowed in part. The duty-of-care claim survived summary judgment and striking out. Article 7 and the general public-policy objection to the Bangladeshi limitation period failed. A confined question of undue hardship under Article 26 was remitted for trial as a preliminary issue.

2. Where striking out was sought because the pleading disclosed no reasonable grounds, the applicable assessment corresponded to whether the claimant had a realistic prospect of success. The court should accept factual assertions unless demonstrably unsupportable, avoid a mini-trial and allow for further evidence. Short questions of construction could be decided summarily. Novel negligence questions in developing law should ordinarily be determined on facts established at trial, consistently with Barrett v Enfield DC and Vedanta Resources PLC & Another v Lungowe & Others.

3. Foreseeability alone could not establish a duty of care. The conventional neighbour-principle claim faced substantial difficulties concerning proximity and the shipbreaker’s intervention, but was not fanciful. The alternative claim arguably engaged the recognised creation-of-danger exception to the general rule against liability for third-party harm. On the assumed facts, knowingly directing the vessel to an unsafe destination could constitute an active creation of danger and establish sufficient proximity to exposed workers. The court determined arguability, leaving the existence and breach of any duty for trial.

4. By the majority reasoning of Coulson and Bean LJJ, Article 7 of the Rome II Regulation required the non-contractual obligation to arise out of environmental damage. The alleged obligation concerned workplace safety, and the fatal fall resulted from the absence of safe working practices and a safety harness. Even assuming that beaching caused environmental damage, that damage had no causative connection with the death. Males LJ agreed on that narrower ground, while reserving the precise strength of the required causative link and the autonomous meaning of the event giving rise to the damage.

5. Article 26 permitted refusal of foreign law only where its application was manifestly incompatible with public policy. General public policy required exceptional circumstances involving a fundamental principle of justice. A shorter foreign limitation period did not meet that standard merely because English law was more generous. The defendant’s supposed motives for relying on the foreign period were irrelevant to that general inquiry.

6. Undue hardship required excessive hardship attributable to applying the foreign limitation period, beyond its inevitable consequences. The detailed pre-action letter showed that the claimant had obtained the material needed to bring proceedings before expiry. New evidence nevertheless raised a confined issue about information available to her solicitors concerning the correct accident date between the letter of claim and expiry. That issue could exceptionally be reopened and was remitted to the Queen’s Bench Division for preliminary determination. Subject to establishing undue hardship, the claim was statute-barred.

• Court of Appeal (Civil Division): In [2021] EWCA Civ 326 , upheld the refusal to dispose summarily of the duty-of-care claim, rejected reliance on Article 7 and general public policy under Article 26, and remitted the confined undue-hardship issue to the Queen’s Bench Division.
• Court of Appeal permission stage: Permission to challenge the application of Bangladeshi law and its non-extendable one-year limitation period was refused by Carr LJ on 17 November 2020. Permission was granted to the defendant on the Article 7 and Article 26 issues.
• High Court, Queen’s Bench Division: Jay J, in [2020] EWHC 1846 (QB) , refused summary judgment and striking out on the negligence claim. He found that Bangladeshi law otherwise time-barred the claim, but left potential exceptions under Articles 7 and 26 unresolved. He granted permission to appeal on the duty-of-care issue.