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Catex Oil Case Study

2016 Words9 Pages

Caltex Oil (Australia) Pty Ltd v The Dredge Willemstad (1976) 11 ALR 227 Chapter 4 Relevant facts Caltex oil (Australia) Pty Ltd (Caltex) and Australian Oil Refining Pty Ltd (AOR) both parties were having an agreement according to which AOR used to refine the oil that was delivered to its refinery on the southern shore of Botany Bay by Caltex and then the refined product is delivered back to Caltex’s oil terminal on the northern shore of Botany Bay through a pipeline which was running under bay. The pipeline was basically owned by AOR. According to the terms of the agreement Caltex was having ownership of the oil in its differents forms, and as per the agreement AOR was responsible for the risk of damage or any type of loss to the oil because it was running through its pipeline. Between 25th and 26th of October 1971 at night the pipeline was accidently got damaged. On that night the dredge was being used to dredge a deep water channel in the bed of the bay. The western boundary of the area which was to be dredged at that time (area A) was about 100 feet to the east of the pipeline, part of which lay within another area (area D) which adjoined area A to the west. It was intended that after the dredging of area A had been completed the pipeline would be removed and replaced elsewhere and that the dredging of area D would commence thereafter. On the night in question the dredge repeatedly passed over the pipeline and its suction pipes caused damage extending over about

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