The process of building a vessel or a floating object involves a
series of risks. Both the entity who orders the construction and
the shipyard are exposed to considerable losses if a casualty takes
place. Accidents can occur at any of the construction phases
involving people and property and also affecting the environment.
These events can happen during construction, at the moment the
vessel is launched and while sea trials are executed and even just
before delivery to the buyer.
Under English law the process of building a ship under the
shipbuilding contract is at the end considered a contract for the
sale of goods . Lord Diplock stated"...it seems well settled
by authority that, although a shipbuilding contract is , in form, a
contract for the construction of the vessel, it is in law a
contract for the sale of goods..." (Mc. Dougal v Aeromarine of
Emsworth Ltd , 1958) Therefore its provisions depend on the Sale of
Goods Act 1979.
