“This insurance is subject to English law and practice …………. 4. CLASSIFICATION 4.1 It is the duty of the Assured, Owners and managers at the inception of and throughout the period of this insurance to ensure that 4.1.1 the Vessel is classed with a Classification Society agreed by the Underwriters and that her class within that Society is maintained. 4.1.2 any recommendations requirements or restriction imposed by the Vessel’s Classification Society which relate to the Vessel’s seaworthiness or to her maintenance in a seaworthy condition are complied with by the dates required by that Society. …………………………. 4.4 Should the Underwriters wish to approach the Classification Society directly for information and/or documents, the Assured will provide the necessary documentation. …………………………. 6. PERILS 6.1 This insurance covers loss of or damage to the subject-matter insured caused by …………………. 6.1.2 fire, explosion ……………………. 11. DUTY OF ASSURED (SUE AND LABOUR) 11.1 In case of any loss or misfortune it is the duty of the Assured and their servants and agents to take such measures as may be reasonable for the purpose of averting or minimising a loss which would be recoverable under this insurance. 11.2 Subject to the provisions below and to Clause 12 the Underwriters will contribute to charges properly and reasonably incurred by the Assured their servants or agents for such measures……. 11.6 The sum recoverable under this Clause 11 shall be in addition to the loss otherwise recoverable under this insurance but shall in no circumstances exceed the amount insured under this insurance in respect of the Vessel. ……………………….. 12. DEDUCTIBLE 12.1 ………..This Clause 12.1 shall not apply to a claim for total or constructive loss of the Vessel or, in the event of such claim, to any associated claim under Clause 11 arising from the same accident or occurrence.”
"18. — Disclosure by assured (1) Subject to the provisions of this section, the assured must disclose to the insurer, before the contract is concluded, every material circumstance which is known to the assured, and the assured is deemed to know every circumstance which, in the ordinary course of business, ought to be known by him. If the assured fails to make such disclosure, the insurer may avoid the contract. (2) Every circumstance is material which would influence the judgment of a prudent insurer in fixing the premium, or determining whether he will take the risk. (3) In the absence of inquiry the following circumstances need not be disclosed, namely:— (a) Any circumstance which diminishes the risk; (b) Any circumstance which is known or presumed to be known to the insurer. The insurer is presumed to know matters of common notoriety or knowledge, and matters which an insurer in the ordinary course of his business, as such, ought to know; (c) Any circumstance as to which information is waived by the insurer; (d) Any circumstance which it is superfluous to disclose by reason of any express or implied warranty. (4) Whether any particular circumstance, which is not disclosed, be material or not is, in each case, a question of fact. (5) The term "circumstance" includes any communication made to, or information received by, the assured."
“(1) Every material representation made by the assured or his agent to the insurer during the negotiations for the contract, and before the contract is concluded, must be true. If it be untrue the insurer may avoid the contract. (2) A representation is material which would influence the judgment of a prudent insurer in fixing the premium, or determining whether he will take the risk. ………………. (4) A representation as to a matter of fact is true, if it be substantially correct, that is to say, if the difference between what is represented and what is actually correct would not be considered material by a prudent insurer. ……………….. (7) Whether a particular representation be material or not is, in each case, a question of fact.”
“... The Managers shall have authority to take such actions as they may from time to time in their absolute discretion consider to be necessary to enable them to perform this Agreement in accordance with sound ship management practice”
“Caution is needed against attempting literally to fit the Blue Fleet/C2 relationship into the Shipman form as this is not necessary for the defence on this point to succeed and is not what D is suggesting”
“With all respect, sir. I started this company in 1991, and until now never happen that I give any of my vessels to any company to manage, as we are a professional manager and professional owner.”
“… doing this job since 32 years and I don’t need [a manager]. Sorry for that. Why should I let them manage one ship out of 67 vessels which I did in my life?”
“I already had a bad experience with Blue Fleet, where he manages the vessel in a very poor condition…I would rather think thousand times to accept a risk where I hear the name Blue Fleet”
“Q…In your witness statement, you refer only to the firefighting deficiencies? A. Yes, sir. Q. So the other deficiencies weren’t relevant to your underwriting the risk? It was just the firefighting deficiencies which were relevant? A. In this case, of course, all deficiencies are relevant. And with fire being a major peril, we would definitely be seriously concerned. Q. But in this case, just the firefighting ones were ones which you regard as material? A. Which is very important, so I regarded it as material, yes. Q. Yes, I see, but they are the only ones that you regarded as material? A. They’re the only ones in this case.”
“The proposer is only obliged to disclose material circumstances known to him (or of which he has imputed knowledge). If he has every intention and expectation that the vessel will be properly maintained, he cannot, it seems to me, be under an obligation to disclose a circumstance which might raise a question mark in the mind of an underwriter but which the proposer knows to be of no relevance to the vessel’s continuing maintenance”
“The experience of an active underwriter over the time since port state controls become more prevalent in the mid 90s, was to understand more of the reasons that brought about the type of lists that we are seeing here, because at face value from the underwriter’s perspective they look quite horrendous.”
“Considering this question from the point of view of London Market customs and practice, it would be usual for a prudent marine underwriter to be aware of the market information that was available on line, particularly subscription based services. What is in the public knowledge arena is usually taken as being known to the prudent underwriter. The insured need not mention what the underwriter ought to know or what he takes upon himself the knowledge of. Whilst it is not obligatory for an underwriter to check for such available information from this restricted public domain, it would be none the less desirable. Whether an underwriter is deemed to have consulted a particular source is a factual matter for the attention of the Court.”
“I can see considerable force in Mr. Kendrick's argument on the construction of the unamended clause 18 of the Vitol terms. If the judge were right, an owner would find himself in breach of the clause, if any fact existed which would cause the approval letters to be amended or withdrawn whether or not he knew of that fact and whether or not he had had any opportunity to put right the defect which would have caused the letters to be amended or withdrawn. That is a very far reaching warranty which would indeed cut across the warranty of seaworthiness in the Asbatankvoy form. The only way to avoid that conclusion would be to treat clause 18 as a warranty in relation to documentation not a warranty as to the underlying condition of the vessel.”
“A ship can comply with the ISM Code even if one or more non-conformities exist. A ship does not comply with the ISM Code if there is an outstanding major non-conformity. That is, a major non-conformity that has not been down-graded. Failure of the SMS to address a section of the Code (e.g. section 3.2) constitutes a major non-conformity at the document review stage of an audit or at any audit if not previously identified and corrected. A section of the Code addressed in the SMS but which has not been implemented such that it poses a serious threat to the safety of personnel or the ship or a serious risk to the environment constitutes a major non-conformity.”
“Moreover, the warranty contained in s. 41, if it applied to foreign law would be extremely wide. Suppose that, unknown to an assured, some ingredient in a cargo which he was exporting to a foreign country could not by reason of a law of that country of which he was also unaware lawfully be present in that cargo. The adventure would be unlawful. Suppose that, in ignorance of some foreign law, an assured directs that a vessel does something which turns out to be illegal. He would be in breach of warranty and lose from that moment the protection of his policy. In the latter case no principle of common law would, I think, render a claim unenforceable, unless it be the Beresford principle: but that would require the commission of a crime (and thus in most, albeit not all, cases the existence of mens rea) and a (direct) causative connection between crime and claim under the policy. In such a case, however, there would be no need of a warranty. The point of a warranty is that it reflects the definition of the risk undertaken by the insurer, so that there need be no causative link between breach and loss. The statutory warranty is nevertheless implied by law. It seems to me to be odd to imply by way a term with the strength of a warranty to a situation not reflected in cases before the Act or even to the common law relating to foreign illegality as it has now developed. In sum, I think that Mr. Justice Staughton’s considerable doubt [in Euro-Diam Ltd v Bathurst[1990] 1 QB 1 , 13-14] was well founded and hold that “lawful” in s. 41 (and thus in s. 3(1) as well) is a reference to lawfulness under English law. The consequences for a policy of marine insurance of unlawfulness under foreign law are therefore a matter for the common law.”