Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd

The Hong Kong Fir
Court	Court of Appeal
Full case name	Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd
Citations	[1961] EWCA Civ 7, [1962] 2 QB 26, [1962] 1 All ER 474
Transcript	Full text of judgment

Hong Kong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26 [1961] EWCA Civ 7 is a landmark English contract law case. It introduced the concept of innominate terms, a category between "warranties" and "conditions".

Under the English sale of goods principles, a condition is a term whose breach entitles the injured party to repudiate the contract,^[1] but a breach of warranty shall give rise only to damages.^[2] In this case, Diplock LJ proposed that some terms could lead either to the right to terminate a contract as a remedy, or to the mere entitlement to damages (without a right to terminate). What mattered was not whether a particular contract term was called a "warranty" or a "condition", but how serious was the breach of the term.

In short, the test for whether or not one may repudiate has now become, "does the breach deny the claimant the main benefit of the contract?" However, modern commercial custom has since established that some breaches, such as failure to meet a "notice of readiness to load" a sea cargo, will always be repudiatory.^[3]