Ailsa Craig Fishing Co. Ltd. v. Malvern Fishing Co. Ltd. and ors. (The Strathallan) - House of Lords (Lords Wilberforce, Elwyn-Jones, Salmon, Fraser of Tullybelton and Lowry) - 26 November 1981

Breach of contract - Whether limitation of liability clause effective

The issue before the House was whether the respondents (“Securicor”) had succeeded in limiting their liability under a contract between themselves and the Aberdeen Fishing Vessel Owners’ Association Ltd. who had acted on behalf of the appellants. Securicor had agreed to provide security cover for fishing vessels in Aberdeen harbour. On 31 December 1971 the appellants’ vessel Strathallan sank in the harbour as a result of sliding under the deck of an open structure quay so that she became caught (or “snubbed”) by the bow on the rising tide. At first instance, the Lord Ordinary held that the loss of the vessel had been caused by breach of contract and negligence on the part of Securicor. Damages were assessed at around £55,000. The Court of Session held that liability had been limited in accordance with the contract and the appellants now appealed against that decision.