Buchanan was a 3:2 decision, with the minority stating that excise duty was not recoverable. Buchanan was criticised from the outset by academic commentators, has not been followed in many jurisdictions (such as Germany and the Netherlands) and was criticised by the English Court of Appeal in Sandeman Coprimar SA v Transitos y Transportes Integrales SL [2003] EWCA Civ 113.
In JTI, the Supreme Court acknowledged that there were "powerful arguments" and "considerable force” in favour of the interpretation adopted by the minority in Buchanan. However, regrettably, the Supreme Court said that the majority view in Buchanan was "not untenable", and respect for the English common law doctrine of precedent therefore meant that they would not overturn the Buchanan case.
After almost 50 years of debate, the issue of the recoverability of excise duty is now settled. However, it is possible that there may now be disputes about what other charges that arise in connection with a carriage following a loss in transit are now recoverable, and whether they are recoverable without limit (in addition to the value of the cargo lost). Carriers could find themselves in a tricky situation trying to navigate arguments around the foreseeability of such charges. The Supreme Court does not think that these issues are likely to arise as they are a theoretical rather than real-world problem. Time will tell.
DWF's team comprised Darren Kenny, Ben Griffin and Stephanie Sandford-Smith, as well as John Kimbell KC and Maya Chilaeva of Quadrant Chambers.
