Re The Aliakmon [1986] AC 785 (HL)

Facts

  • A cargo of steel coils carried on the vessel The Aliakmon was damaged during sea transit.
  • The sale contract in question contained a retention-of-title clause: ownership remained with the seller until the buyer paid the price in full.
  • At the time the coils were damaged, the buyer had not paid and therefore held no legal or equitable title to the goods.
  • Relying on contractual rights under the bill of lading and the sale agreement, the buyer sought damages for the physical loss.
  • The dispute reached the House of Lords, which examined whether the buyer’s lack of proprietary or possessory interest barred the claim.

Issues

  1. Could a person who neither owned nor possessed the goods at the moment of damage sue for their physical loss?
  2. Do contractual rights under a bill of lading or sale contract amount to a proprietary or possessory interest sufficient to support such a claim?

Decision

  • The House of Lords dismissed the buyer’s action.
  • It held that a claimant must have a proprietary or possessory interest in the damaged property when the loss occurs; without that interest, no cause of action arises.
  • Contractual rights, even those evidenced by a bill of lading, do not by themselves confer the necessary proprietary status.
  • Because the retention-of-title clause prevented ownership passing before payment, the buyer lacked standing to recover damages for the coils.

Legal Principles

  • A valid claim for physical damage to property requires the claimant to hold a proprietary or possessory interest at the time of the loss.
  • Contractual or expectant interests—however extensive—do not satisfy this requirement unless coupled with ownership or possession.
  • The critical moment for establishing standing is the occurrence of the damage, not the commencement of proceedings.
  • Limiting recovery to those with a direct property interest avoids overlapping or speculative claims and preserves the coherence of tortious liability.

Conclusion

The House of Lords affirmed that only parties with a proprietary or possessory stake in goods at the instant they are harmed may sue for their damage. Because title to the steel coils had not passed when they were damaged, the buyer’s contractual rights alone could not support an action. Re The Aliakmon remains a leading authority on the nexus between property rights and tortious recovery in maritime commerce.

The answers, solutions, explanations, and written content provided on this page represent PastPaperHero's interpretation of academic material and potential responses to given questions. These are not guaranteed to be the only correct or definitive answers or explanations. Alternative valid responses, interpretations, or approaches may exist. If you believe any content is incorrect, outdated, or could be improved, please get in touch with us and we will review and make necessary amendments if we deem it appropriate. As per our terms and conditions, PastPaperHero shall not be held liable or responsible for any consequences arising. This includes, but is not limited to, incorrect answers in assignments, exams, or any form of testing administered by educational institutions or examination boards, as well as any misunderstandings or misapplications of concepts explained in our written content. Users are responsible for verifying that the methods, procedures, and explanations presented align with those taught in their respective educational settings and with current academic standards. While we strive to provide high-quality, accurate, and up-to-date content, PastPaperHero does not guarantee the completeness or accuracy of our written explanations, nor any specific outcomes in academic understanding or testing, whether formal or informal.
No resources available.

Job & Test Prep on a Budget

Compare PastPaperHero's subscription offering to the wider market

PastPaperHero
Monthly Plan
$10
Assessment Day
One-time Fee
$20-39
Job Test Prep
One-time Fee
$90-350

Note the above prices are approximate and based on prices listed on the respective websites as of May 2025. Prices may vary based on location, currency exchange rates, and other factors.

Get unlimited access to thousands of practice questions, flashcards, and detailed explanations. Save over 90% compared to one-time courses while maintaining the flexibility to learn at your own pace.

All-in-one Learning Platform

Everything you need to master your assessments and job tests in one place

  • Comprehensive Content

    Access thousands of fully explained questions and cases across multiple subjects

  • Visual Learning

    Understand complex concepts with intuitive diagrams and flowcharts

  • Focused Practice

    Prepare for assessments with targeted practice materials and expert guidance

  • Personalized Learning

    Track your progress and focus on areas where you need improvement

  • Affordable Access

    Get quality educational resources at a fraction of traditional costs

Tell Us What You Think

Help us improve our resources by sharing your experience

Pleased to share that I have successfully passed the SQE1 exam on 1st attempt. With SQE2 exempted, I’m now one step closer to getting enrolled as a Solicitor of England and Wales! Would like to thank my seniors, colleagues, mentors and friends for all the support during this grueling journey. This is one of the most difficult bar exams in the world to undertake, especially alongside a full time job! So happy to help out any aspirant who may be reading this message! I had prepared from the University of Law SQE Manuals and the AI powered MCQ bank from PastPaperHero.

Saptarshi Chatterjee

Saptarshi Chatterjee

Senior Associate at Trilegal