Sea Harvest Corporation (Pty) Ltd and Another v Duncan Dock Cold Storage (Pty) Ltd and Another

• Jurisdiction: South Africa
• Judge: Smalberger JA, Howie JA, Marais JA, Scott JA, Streicher JA
• Judgment Date: 26 November 1999
• Citation: 2000 (1) SA 827 (SCA)
• Docket Number: 12/97
• Counsel: RS Van Riet (with him IJ Muller) for the appellants GR De M Hofmeyr (with him MJ Fitzgerald) for the respondents
• Court: Supreme Court of Appeal

Scott JA:

[1] Shortly after midnight on 1 January 1993 the first G respondent's cold store at K berth, Duncan Dock, Table Bay Harbour, was set alight by a distress flare fired by an unknown reveller in celebration of the New Year. The city fire brigade was summoned but by the time the fire was eventually extinguished the cold store and its contents had been largely destroyed. The cold store was recently built H and had been in operation for no more than a few months. It was the product of a joint venture between the second respondent (Portnet) and a company, Afco Holdings Ltd, the latter having a shareholding of 70% and the former a shareholding of 30% in the first respondent, which was established to operate the cold store. The building was I erected on land belonging to Portnet and let to the first respondent. The facilities provided included those suitable for the storage of tuna fish at extremely low temperatures, ie in the region of -60° C, and intended for export. According to the port engineer, Portnet's participation in the venture was mainly to ensure that the facilities provided by the cold store were made available to all. J

Scott JA

[2] Prior to the fire, the first respondent entered into oral A agreements of deposit with both the first and second appellants in terms of which it undertook for reward, in the case of the first appellant, to freeze and store certain fish and fish products and, in the case of the second appellant, to store pre-frozen raw and cooked lobster tails. The property of both appellants was destroyed in the B fire and each, as plaintiff, instituted a separate but similar action for damages against the respondents in the Cape Provincial Division. The actions were consolidated and in due course the trial proceeded before King J who was asked to decide only the issue of liability and to permit the question of quantum of damages to stand over. The learned Judge found in favour of the respondents C on the issue of liability, hence the present appeal.

[3] The appellants' claims were founded in the first instance on oral contracts of deposit and were directed at the first respondent alone. In the alternative they sued in delict, alleging that the destruction of their respective property in the fire was occasioned by D the negligence of the first respondent or, alternatively, the negligence of Portnet or, in the further alternative, the negligence of both the first respondent and Portnet. I shall set out the grounds of negligence relied upon later in this judgment. The first respondent admitted the contracts of deposit but alleged that each E was subject to one or other implied or tacit term or trade usage to the effect, stated broadly, that it would be liable only in the event of wilful misconduct on its part and not for negligence. In their respective replications the appellants denied the existence of such additional terms or trade usage and alleged that, in any event, any exemption or limitation applied only to acts or omissions committed subsequent to the conclusion of the contracts of deposit and not to F those committed prior to the conclusion of the contracts and upon which they relied to found their claims in delict. The appellants contended further that the first respondent was precluded from relying on the alleged terms by reason of a non-disclosure on its part of various facts relating to the construction of the cold store, which facts form G the basis of the claim in delict and to which I shall refer in more detail later.

[4] It was common cause that in the event of it being held that the contracts of storage were not subject to one or other of the additional terms or the trade usage alleged by the first respondent it would be obliged, in order to escape liability, to establish on a balance of H probabilities that the loss suffered by the appellants was not caused by dolus or culpa on its part. (Stocks & Stocks (Pty) Ltd v T J Daly & Sons (Pty) Ltd 1979 (3) SA 754 (A) at 761H - 762C.) As far as the claim against Portnet was concerned, the onus, of course, remained on the appellants. The Court I a quo did not deal with the appellants' claim in contract against the first respondent. It considered only the question of negligence and concluded that neither the first respondent nor Portnet had been negligent. In other words, even assuming that the first respondent bore the onus of proving it was not negligent, it was held to have discharged that onus. Before considering the grounds upon which the appellants contend that the respondents were negligent and in order J

Scott JA

better to understand them A it is necessary first to set out certain facts and circumstances which are largely common cause.

[5] A firm of consulting engineers specialising in industrial refrigeration, Worthington-Smith and Brouwer, was engaged by the first respondent to design the cold store in question. Mr B Worthington-Smith, or more accurately his firm, was also appointed as project-leader to co-ordinate the work to be performed by the various professional firms engaged to assist in the project, including structural engineers, mechanical engineers, electrical engineers and architects. Work began in about the last quarter of 1991. By the end of June 1992 it was all but completed. C

[6] The main section of the building, and the section which contained the refrigeration chambers, was steel-framed with a roof of fibre cement sheeting made up of two pitches separated by a 70 m-long valley gutter. The gutter was a custom-built box gutter and made of fibreglass as specified by the structural engineers, Kantey and Templer. Although D difficult to ignite, fibreglass is combustible and burns quickly with a high heat output. Its obvious advantage is that it is non-corrosive. The roof sheeting was non-combustible. It was insulated, however, by panels of insulation material fitted above the roof purlins. These panels were referred to in evidence by their trade name 'Kulite' and I shall do the same. They consisted of a core of expanded polystyrene E 25 mm thick enclosed in a sheath of aluminium foil. Kulite, as in the case of the fibreglass gutter, was specified by Kantey and Templer. Although the sheath provided some protection, the polystyrene core was combustible and would burn once the panel delaminated or the joining strips failed, allowing the polystyrene to flow from the panel when it melted. Kulite was widely used as a roof insulation. It was the subject F of a report dated January 1986 by the National Building Institute of the CSIR in which it was stated that Kulite panels 'will not add to the growth and spread of fire when used as lay-in ceilings or as over-purlin roof insulation'. The reason, shortly stated, was said to G be that the polystyrene core would melt before it ignited so that the panels would 'drop out of the hot zone of a fire long before the ignition temperature of polystyrene . . . [was] reached'. It was common cause that in the present case the Kulite panels had not been capped and had been allowed to protrude from under the roof sheeting into the valley gutter. H

[7] There were five refrigeration chambers; three operated at -30° C and two at -60° C. A 'T'-shaped passage provided access to all five. The height of each was 10 m. The total floor area was in the region of 5 000 square metres. They were constructed of insulation material I similar to Kulite save that both the core of polystyrene and the metal sheet-covering were thicker. Panels of this nature are used almost exclusively in cold stores. They were referred to in evidence by their trade name 'Chromodeck' and I shall do the same. In the case of the chambers operating at -30° C, the thickness of the polystyrene cores in the panels of both the walls and ceilings was 200 mm. In the case of the chambers J

Scott JA

operating at -60°C, it was 300 mm. The total quantity of A polystyrene in the Kulite roof panels was of the order of 3% of the total quantity in the Chromodeck panels.

[8] The products stored in the refrigeration chambers were generally set on wooden pallets piled in stacks some 9 m high. Corridors were B maintained between the stacks to permit access by forklift loaders. Whether the products were contained in cardboard cartons or not depended on what they were. Frozen tuna was not; most other products were. On the night of the fire the store was approximately 88% full. The products stored comprised fish (including lobster), chicken and vegetables with a total weight of 8 000 tons. The quantity of wood and C cardboard in the store amounted to approximately 430 and 80 tons respectively, ie in the region of 6,5% of the total of the frozen products.

[9] The area above the refrigeration chambers, ie between the Chromodeck roof of the refrigeration chambers and the roof of the D building, was referred to as the roof void or service area. It housed amongst other things various service pipes and items of equipment relating to the freezing process. Access was gained to it by means of a catwalk. Finally, and to complete the picture, it is necessary to mention that adjoining what I have called the main section of the building were an office block and other structures containing a E workshop, plant and the like. These, however, were sealed off from the main section. The building was relatively isolated in the sense that there were no other buildings nearby from which a fire could spread to the cold store.

[10] The port area did not fall within the jurisdiction of the Cape Town municipality. Accordingly, the erection of any building in the F area did not require the approval of the City Council but the approval of the port engineer. The latter would cause the plans to be circulated amongst the various departments of Portnet which would scrutinise them to see that they...