Scruttons Ltd v Midland Silicones Ltd  concerned a contract for the carriage of goods and the limitation clause included in the contract.
The case summary contains 255 words.
Contract Law – Shipping – Contract – Limitation clause – Damage – Negligence – House of Lords
In Scruttons Ltd v Midland Silicones Ltd , the shippers and the carriers of the chemicals formed a contract for the carriage of goods by sea. According to the limitation clause included in the contract, the carriers’ liability was limited to USD 500 in case of damage. The stevedores (not part of the contract) damaged the goods by their negligence. As a result, the shippers sued to recover damages. The stevedores relied on the limitation clause in the contract.
Whether the stevedores were entitled to rely on the limitation clause even though they were not part of the contract.
The House of Lords found that the stevedores were not carriers of goods, nor were they parties to the contract. Also, there was no other implied contract involving the stevedores. So, the House of Lords decided the matter in favour of the shippers and held that as the stranger parties to that contract the stevedores could not rely upon the limitation clause.
Distinguished and criticised: Paterson Zochonis & Co Ltd v Elder Dempster & Co Ltd  A.C. 522,  3 WLUK 68; Mersey Shipping & Transport Co Ltd v Rea Ltd (1925) 21 Ll. L. Rep. 375,  4 WLUK 2; White v John Warwick & Co Ltd  1 W.L.R. 1285,  5 WLUK 117.
References:  A.C. 446;  2 W.L.R. 18;  1 All E.R. 1;  2 Lloyd’s Rep. 365;  12 WLUK 26; (1962) 106 S.J. 34;  C.L.Y. 2842.