(The ‘Kleovoulos of Rhodes’) A large quantity of cocaine was discovered by divers behind a grille in a sea chest at the vessel’s discharge port, Aliveri – having been placed there by unknown third persons at the load port in Colombia, South America. The crew were ultimately acquitted of any involvement, but the vessel’s detainment lasted so long that she could be and was declared a constructive total loss under clause 3. The insurance policy incorporated standard provisions which excluded cover for ‘loss damage arising from detainment by reason of infringement of any customs or trading regulations.’ The ship was detained and the insurers refused payment.
Held: The term ‘customs regulations’, in a marine insurance law, had to be construed widely enough to include rules allowing the detention of a ship for contravention of controlled drugs and other prohibited goods laws.
Clarke LJ described the Hooley Hill Rubber principle as: ‘essentially a principle of construction. Thus the court is trying to ascertain the intention of the parties in using the expression deployed in the contract. Where a contract has been professionally drawn, as in the case of the Institute Clauses, the draftsman is certain to have in mind decisions of the courts on earlier editions of the clause. Such decisions are part of the context or background circumstances against which the particular contract falls to be construed. If the draftsman chooses to adopt the same words as previously construed by the courts, it seems to me to be likely that, other things being equal, he intends that the words should continue to have the same meaning.’
Mr Justice Scott Baker, Lord Justice Clarke, Lord Justice Peter Gibson
Times 03-Feb-2003, [2003] EWCA Civ 12, Gazette 20-Mar-2003, [2003] 1 All ER (Comm) 586, [2003] 1 LLR 138, [2003] Lloyds Rep IR 349
Bailii
England and Wales
Citing:
Appeal from – Sunport Shipping Limited, Prometheus Maritime Corporation, Celestial Maritime Corporation, Surzur Overseas Limited v Tryg-Baltica International (UK) Limited, C N R Atkin ComC 27-Feb-2002
A claim was made under a marine insurance policy. The policy incorporated the Institute War and Strikes Clauses, Hulls-Time of 1/10/83, and included a clause ‘loss damage . . arising from . . Detainment . . by reason of infringement of any customs . .
Cited – Panamanian Oriental Steamship Corporation v Wright (The Anita) CA 1971
The burden is on Underwriters to bring themselves within an exclusion clause they seek to rely on.
Lord Denning distinguished between what might be described as justified or ‘connected’ political interference on the one hand and unjustified or . .
Cited – Re Hooley Hill Rubber and Royal Insurance Co CA 1920
When interprting a contract, it is assumed that the draftsman works with a view to certainty of sense and standardisation of terms. Bankes LJ said: ‘Courts should be chary in interfering with the interpretation given to a well-known document and . .
Cited by:
Cited – Bedfordshire Police Authority v Constable and others ComC 20-Jun-2008
The authority insured its primary liability for compensation under the 1886 Act through the claimants and the excess of liability through re-insurers. The parties sought clarification from the court of the respective liabilities of the insurance . .
Cited – Bedfordshire Police Authority v Constable CA 12-Feb-2009
The police had responded to a riot at Yarlswood detention centre. They had insurance to cover their liability under the 1886 Act, but the re-insurers said that the insurance did not cover the event, saying that the liability was for statutory . .
Cited – Navigators Insurance Company Ltd and Others v Atlasnavios-Navegacao Lda SC 22-May-2018
The vessel had been taken by the authorities in Venezuela after drugs were found to have been attached to its hull by third parties. Six months later it was declared a constructive total loss. The ship owners now sought recovery of its value from . .
Lists of cited by and citing cases may be incomplete.
Updated: 25 July 2021; Ref: scu.178796
