New Judgment: Farstad Supply A/S v Enviroco Ltd  UKSC 16
06 Wednesday Apr 2011
On appeal from:  EWCA Civ 1399
Farstad, the owner of the vessel Far Service, brought a claim against Enviroco for losses it suffered as a consequence of a fire. Whilst Enviroco were hired to clean oil tanks on Far Service, a fire killed one of its employees and caused substantial damage. Enviroco sought to rely on the indeminty clauses in the 1994 contract on the basis that it was an “Affiliate” of ASCO UK Ltd, because each of them was a subsidiary of ASCO plc.
The Supreme Court unanimously dismissed Enviroco’s appeal and held that Enviroco was not a subsidiary in accordance with the Companies Act 1985, s 736 because ASCO plc was not “a member” of Enviroco. To find in Enviroco’s favour would have required the court to engage in an impermissible form of judicial legislation.