The master of a ship had not been to sea for twenty-two years, being employed on shore as a stevedore, and on the last occasion when he was at sea his ship had been lost and his certificate suspended for six months. The vessel, whose market value was about pounds 9000, and whose freight, one-half of which had been paid before sailing, was pounds 4790, was insured on behalf of the owners, on hull, valued at pounds 18,500, pounds 19,000, on freight, valued at pounds 5500, pounds 5500, on disbursements, P. P. I. policy, pounds 4600, on policies effected by the manager of the ship, who took out also P. P. I. policies for pounds 6500 on his own behalf.
The underwriters of the hull were not informed of the master’s record, nor of the freight and disbursements policies or the policies on behalf of the manager.
The vessel having become a total loss, and the owners suing under the policies on the hull, held, affirming judgment of the First Division, (1) that as the master’s competency was covered by the warranty of seaworthiness there was no duty on the owners to disclose to the underwriters his record, and (2) that in the circumstances the master was not proved to have been incompetent so as to put the owners in breach of the warrant of seaworthiness; but, reversing judgment of the First Division, (3) that there was a duty on them to disclose the other policies of insurance, these being material circumstances which would influence the mind of a prudent insurer in fixing the premium and determining whether he would take the risk, and that the policies were therefore voidable and the underwriters not liable.
Judges:
Lord Chancellor (Loreburn), Lord Alverstone, Lord Shaw, and Lord Robson
Citations:
[1911] UKHL 796, 48 SLR 796
Links:
Jurisdiction:
Scotland
Transport
Updated: 09 June 2022; Ref: scu.619200