• In the case of British crane hire corporation ltd v Ipswich plant hire Ltd 1975 QB 303 it was found that certain customary trade practices can be deemed to be incorporated into contracts without express provision.

Facts of the Case

  • A plant hire company (D), engaged in drainage and other engineering works on marsh land. They had arranged by telephone to hire a dragline crane from C.
  • The crane was delivered, and C subsequently sent a printed form setting out the conditions that D should be responsible for the recovery of the crane from soft ground and that D should be responsible for, and indemnify C against, all expenses arising out of the crane use.
  • D neither signed nor returned the form to C.
  • D gave C’s driver directions as to the route by which he should drive the crane over the marsh to the site but warned him of the need to use “naivmats”.
  • The driver did not wait for D to supply the “navimats” and drove the crane onto the marsh and subsequently sank into the marsh.
  • D managed to ger the crane out.
  • On the following day, the crane sunk again into the marsh although on that second occasion, the driver was using “navimats” and had followed the instructions of D’s site agent.
  • C relied upon their conditions of hire and claimed the costs of the recovery of the crane on the second occasion and the D counterclaimed for the cost of recovery of the crane on the first occasion.
  • The judge at first instance held that the printed conditions were not incorporated into the oral contract but held that D was liable for the recovery of the crane on the second occasion on the ground inter alia, that there was an implied term into the contract that D would return the crane at the end of the hiring.
  • He allowed D’s counterclaim for the recovery of the crane on the first occasion on the ground that C’s driver had been negligent.

Issues in British crane hire corporation ltd v Ipswich plant hire Ltd 1975 QB 303

In bullet points

  • The issues in this case relate to whether trade customs and practices can be incorporated into a contract where both parties are of equal bargaining power and experience in the trade.
  • Who could recover for the negligent acts of the driver.
  • Who could recover for the recovery of the crane on the second occasion.

Held by Court of Appeal

  • On D’s appeal and C’s cross appeal: both appeals dismissed

Lord Denning

Elaborate on the judgment

  • Appeal dismissed as where the parties to a contract of hire were both in the trade and of equal bargaining power, the conditions habitually imposed in such contracts would be incorporated into the contract based on the common understanding of the parties that the usual conditions would apply.
  • The cross-appeal was also dismissed as the conditions were not wide enough to exempt C from responsibility for the negligence of their driver on the first occasion and in the absence of clear words exempting them form responsibility for their negligence, they were liable for the recovery of the crane on that occasion.
  • “From that evidence it is clear that both parties knew quite well that conditions were habitually imposed by the supplier of these machines: and both parties knew the substance of those conditions. In particular that if the crane sank in soft ground it was the hirer’s job to recover it: and that there was an indemnity clause. In these circumstances, I think the conditions on the form should be regarded as incorporated into the con- tract. I would not put it so much on the course of dealing, but rather on the common understanding which is to be derived from the conduct of the parties, namely, that the hiring was to be on the terms of the plaintiffs’ usual conditions” p311 B