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Kuwait Airways Corp v Iraqi Airways Co & Anor [2002] UKHL 19 (16 May 2002)

Kuwait Airways Corp v Iraqi Airways Co & Anor [2002] UKHL 19 (16 May 2002)


Citation:Kuwait Airways Corp v Iraqi Airways Co & Anor [2002] UKHL 19 (16 May 2002)

Link to case on WorldLII.

Rule of thumb:What is the ‘but for’ test? In life there are always many contributing factors that lead to an event happening. The starting point of the ‘but for’ test is that every single contributing factor to an event creates joint & several liability for it. However, if it can be shown that the contribution to the event happening was minimal, then legally this is not included as a contributing factor with joint & several liability not applying to it.

Background facts:

The basic facts of this case were that Iraq invaded Kuwait. The Iraqi army went into Kuwait airport and took 10 aeroplanes which belonged to Kuwait Airways Ltd. The Iraqi Airways Company, based in Iran, were given this fleet of aeroplanes on the orders of the Iraqi Government. Kuwait were part of the UN and a coalition of forces helped them to reclaim their land from Iraq. 4 of the aeroplanes were destroyed in bombings. The Iraqi Airways Company then demanded $20 million as payment for storage of the aeroplanes.

Judgment:

The Court affirmed that joint & several liability did not apply to Iraqi Airways for what was done by the Iraqi army and the orders of the Iraq National Government. Any arguments that Iraqi Airways had contributed in any way to the aeroplanes being taken were spurious and these were deemed ‘de minimis’ contributions at best where liability did not arise. The Court affirmed that Kuwait Airways had to pay the $20 million as payment for the storage of the items, minus any amount if the Iraq Airways company did not maintain them properly. It was also affirmed that the Iraqi Government could not be sued in the UK Courts due to international immunity.

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Ratio-decidendi:

‘This threshold "but for" test is based on the presence or absence of one particular type of causal connection: whether the wrongful conduct was a necessary condition of the occurrence of the harm or loss…. In very many cases this test operates satisfactorily, but it is not always a reliable guide. Academic writers have drawn attention to its limitations: see, for example, the late Professor Fleming's The Law of Torts, 9th ed (1998) , pp 222-230 , and Markesinis & Deacon, Tort Law, 4th ed (1999) , pp 178-191 . Torts cover a wide field and may be committed in an infinite variety of situations. Even the sophisticated variants of the "but for" test cannot be expected to set out a formula whose mechanical application will provide infallible threshold guidance on causal connection for every tort in every circumstance. In particular, the "but for" test can be over-exclusionary. This may occur where more than one wrongdoer is involved. The classic example is where two persons independently search for the source of a gas leak with the aid of lighted candles. According to the simple "but for" test, neither would be liable for damage caused by the resultant explosion. In this type of case, involving multiple wrongdoers, the court may treat wrongful conduct as having sufficient causal connection with the loss for the purpose of attracting responsibility even though the simple "but for" test is not satisfied. In so deciding the court is primarily making a value judgment on responsibility. In making this judgment the court will have regard to the purpose sought to be achieved by the relevant tort, as applied to the particular circumstances’, (Lord Nicholls at 73-74)

‘The removal of the Iran Six to Iran and the payment of the $20 million. 203. The removal of these six aircraft to Iran was, as Lord Nicholls has observed, done on the orders of the Iraq Government. It was not, on the facts, something for which IAC were responsible. Nor, in my opinion, was their removal to Iran a likely or foreseeable result of the incorporation of the aircraft into the IAC fleet. A fortiori, their continued detention in Iran after hostilities had ceased and Iran's extraction of $20 million as the price of their release cannot, in my opinion, be described as consequences flowing naturally or directly from IAC's incorporation of the aircraft into its fleet. 204. These conclusions do not, I think, depend upon any controversial opinion as to the rule of remoteness of damage in conversion cases. They depend upon the limited nature of the conversion/usurpation for which IAC can be held responsible and the absence of any sufficient causal connection between that usurpation and the end result for which damages are sought. Conclusion on damages. 205. If, therefore, contrary to any opinion, KAC has a cause of action for conversion, I would, in relation to the Iran six, confine KAC's claim to the deterioration suffered by the aircraft while they were being retained by IAC as part of its fleet. I would allow IAC's appeal and dismiss KAC's cross appeal accordingly’.

Warning: This is not professional legal advice. This is not professional legal education advice. Please obtain professional guidance before embarking on any legal course of action. This is just an interpretation of a Judgment by persons of legal insight & varying levels of legal specialism, experience & expertise. Please read the Judgment yourself and form your own interpretation of it with professional assistance.