The cargo, soya beans, was insured against heating, sweating and spontaneous combustion risks. It arrived in a heated and deteriorated condition. The insurers denied liability saying that the proximate cause of the damage was inherent vice or nature of the subject matter insured, for which they were not liable under section 55(2)(c); and that the cover only extended to heating, sweating or spontaneous combustion brought about by some external cause.
Held: As a matter of construction the policy did ‘otherwise provide’ within the meaning of the opening words of section 55(2)(c) so that the perils of heating, sweating and spontaneous combustion arising from inherent vice or nature of the subject matter insured were covered.
Lord Diplock suggested a definition of ‘inherent vice’ in an insurance policy: ‘The facts as I have summarized them for the purpose of determining the question of construction of the HSSC policy in the instant case, assume that the loss resulting from the deterioration of the soya beans during the voyage was proximately caused by the ‘inherent vice or nature of the subject-matter insured’. This phrase (generally shortened to ‘inherent vice’) where it is used in section 55(2)(c) refers to a peril by which a loss is proximately caused; it is not descriptive of the loss itself. It means the risk of deterioration of the goods shipped as a result of their natural behaviour in the ordinary course of the contemplated voyage without the intervention of any fortuitous external accident or casualty.’ Inability to withstand the ordinary incidents of the voyage is an appropriate test of inherent vice.
Judges:
Lord Diplock
Citations:
[1983] 1 Lloyd’s Rep 122
Statutes:
Marine Insurance Act 1906 55(2)(c)
Jurisdiction:
England and Wales
Citing:
Appeal from – Soya GmbH Mainz Kommanditgesellschaft v White CA 1982
Where insured goods deteriorated during a passage, not because they had been subjected to some external fortuitous accident or casualty, but because of their natural behaviour in the ordinary course of the voyage, then such deterioration amounted to . .
Cited by:
Cited – Mayban General Assurance Bhd, AMI Insurans Bhd, Malaysian International Insurance Bhd, Syarikat Takaful Malaysia Bhd v Alstom Power Plants Ltd, Alstom T and D Ltd QBD 11-May-2004
An electrical transformer was shipped from Ellesmere Port to Rotterdam and there transferred to a container vessel for carriage to Lumut. Severe weather was encountered, but not such as a commercial person would regard as falling outside the range . .
Cited – Global Process Systems Inc and Another v Berhad CA 17-Dec-2009
An oil rig suffered major damage in transit in rough seas. The insurers repudiated liability saying that the damages was the result of a natural vice rather than perils at sea.
Held: The fact that the sea conditions were within the range of . .
Cited – Global Process Systems Inc and Another v Berhad SC 1-Feb-2011
An oil rig (The Cendor MOPU) was being transported from Texas to Malaysia. During the voyage, three of the four legs suffered damage. The insurers refused liability saying that the damage was the result of inherent weaknesses in the rig.
Held: . .
Lists of cited by and citing cases may be incomplete.
Insurance, Transport
Updated: 02 May 2022; Ref: scu.384351