H Parsons (Livestock) Ltd v Uttley Ingham & Co Ltd [1978] QB 791

Facts: The defendant (D) was contracted by the plaintiff (P), owners of a pig farm, to supply and install a bulk feed hopper to store pig feed. It was a term of the contract that the hopper be reasonably fit for purpose. The hopper was not properly ventilated, and the pig food became mouldy. Pigs got e.coli and died. P claimed damages for the 254 dead pigs, expenses incurred in dealing with the outbreak, and the lost sales.

Held: D was liable for damages. The Court held that for the first limb of Hadley v Baxendale, there is no requirement to have knowledge of the specific type or extent of damage caused by a possible contractual breach, only to have broad knowledge of the type of damage. It was sufficient that D has broad knowledge that if the feed hopper was unsuitable, the pigs may become ill. Contemplation of the degree of illness (including death) was not material.

Questions:

1. Was the death of the pigs too remote for damages?

Scarman LJ applied Lord Reid’s test in Koufos v Czarnikow. It was found that it was not too remote because it is not unlikely to occur (even though it wasn’t contemplated by either parties). Poor storage of food leading to illness and death of pigs were reasonably foreseeable.

2. In general, for the first limb, does the extent of the damage need to be seriously contemplated, or is it sufficient for the type of damage to be seriously contemplated?

No, the specific or extent of damage does not need to be seriously contemplated, just the type of damage.