Hongkong Fir Shipping Co. Ltd. v. Kawasaki Kisen Kaisha Ltd., the Hongkong Fir (1961)

Abstract

This chapter discusses the decision of the Court of Appeal in The Hongkong Fir, one of the most important English contract cases of the 20th century. In this analysis of the Hongkong Fir case I argue that close consideration of the case law, coupled with an appreciation of the historical background, reveals certain flaws in the current general understanding of the decision. In particular I argue, first, that the reasoning in the case was not as novel as has sometimes been suggested; secondly, that the most novel aspect of that reasoning (the suggestion that there was a third category of terms—later christened ‘innominate’ or ‘intermediate’ terms—alongside conditions and warranties) was not as central to the analysis as it is generally assumed to have been; and, thirdly, that another, very important, aspect of the reasoning in the case (the very strong connection between the rules governing discharge by frustration and discharge for breach) tends now to be overlooked.

Keywords: contract law, breach of contract, discharge, intermediate term, frustration