Replacement

They were obliged at great expense to hire a replacement. In their claim for damages for the loss of their dredger they included the costs of hiring in addition. It was held that although the damages in respect of the replacement were not recoverable under the measure of damages rule in Re Polemis (1921), since that was the direct result of the claimant’s financial instability and not the defendant shipowner’s negligence, nevertheless the claimant was entitled to the value of Liesbosch as a going concern and not merely her value as a somewhat old dredger. It should be remembered from the discussion on damages in tort, that the test for remoteness and the measure of damages was formerly as laid down in Re Polemis (1921). This test was that the plaintiff could recover all direct loss i.e. all that loss which was a direct consequence of the defendant’s negligence. It is, of course, arguable that the cost of hiring a replacement vessel was indeed in this case a direct consequence of the damage caused, the ‘eggshell skull’ doctrine could also be argued here, i.e. that the defendant should ‘take his victim as he finds him’. In reality it is, however, difficult to persuade the court to apply this doctrine where the plaintiff’s loss is financial. Consider the difficulties surrounding the issue of ‘pure economic loss’. It is possible that in such a case as the Liesbosch, the court would find that the cost in respect of hiring a replacement vessel was purely economic, and not dependent upon the injury caused to the damaged vessel. It is difficult to say with any certainty how the courts would treat any one given case; the issue of pure economic loss is surrounded by complex judicial authority.