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Insurance Provisions To Cargo Interests' Liability

Insurance Provisions To Cargo Interests' Liability

 

Insurance Provisions To Cargo Interests' Liability


Insurance Provisions To Cargo Interests' Liability
relevance of insurance provision to Cargo interest liability to contribute in general average Hercules Maritime limited versus gun for international BV on Friday 4 December 2020 sir Nigel tier handed down judgment in herculito Maritime limited versus gun for international BV as a 69 appeal from an arbitration Award of Timothy young QC Dominic Kendrick cusey and Simon gold guy Blackwood QC of quadrant Chambers appeared on behalf of Hercules the successful appealing instructed by Richard nalen and Jenny Selman at hfw the case concerned two novels point of law whether a water is close or equivalent in a charter party was incorporated into a bill of lading by General word of incorporation whether provision concerning responsibility for the payment of insurance premium in a charity party could affect the obligation of a bill of lading holder to contribute to General average the dispute arose out of the hijacking of the MV polar the vessel in the Gulf of Aden by Somali pirate in October 2010 Wilson was performing a voyage from Petersburg to Singapore pursuant to a voyage Charter between her kilito and Clear Lake shipping LTD gun for was the lawful holder of six pills of leading issued in respect of the Cargill carried on Fourth the bills provided that Freight was payable as per the charter party the bills also contain General word of incorporation which purported to incorporate term and condition libraries and exemption of the charter party the charter party had the following relevant Clauses a close which permitted herculito not to continue the foliage or to deviate a close which applied Clear Lake to Bear the expenses caused by the exercise of the Liberties in above by her kilito Clauses which require Clear Lake to pay for additional worries and kidnap and Ransom K and our insurance to Transit the group of Aden The Vessel was released in August 2011 following the payment of a ransom of 7 million US Dollar by herculito General average was declared and in the usual way cargo Underwriters provide a general average guarantee and gun for a general average bomb an adjustment was issued pursuant to which 4 million US dollar was held to be the amount of Converse contribution to General average under the term of the charter party referred to above Hercules had procured War Reese and knr cover which identified them for the entirety of the ransom pay their claim was met with the defense that the Georgia party provision which required Clear Lake to pay the insurance premium for the world race and knr cover this entitled Hercules from claiming a contribution to General Bridge from cargo interest under the charter party because the insurance Provisions were in effect a complete code an agreement that herculito would only look to the underwriters and not Clear Lake for any losses falling within the scope of the cover which had been paid for by clearly it was further argued that those Provisions were incorporated into the bills of leading such as that a claim could not be broke against gun for under the bills either the award the tribunal helped that to enforce defense succeeded it held that the charter party did set out a code for the losses resulting from the operation of unfoyage Prior Series in the Gulf of Aden area namely the Clear Lake agreed to pay the premium for the relevant insurance policies and Hercules agreed not to emphen's claim against clearly in respect of losses which fell within those insurance policies the tribunal further helped out the obligation to pay extra insurance premium was incorporated into the bill of lading contract and therefore the same code applied as between herculito and gun for however the tribunal also held that even if the obligation to pay the extra insurance premium was an incorporated into the bill of lading contract that didn't matter since within all the matters is that the charter code involved an agreement by the owners not to see contribution for policy losses it is not a case of incorporating a positive obligation on cargo but of an agreement by the owners excusing cargo from liability the Judgment of the commercial Court sir Nigel tier identified three principal issues which failed to be determined whether the charter party provision concerning the payment of insurance premium incorporated into the bills of lading was the effect of the insurance provision in the charter party such as to prevent a claim being made by herculedo again clearly under the charter party what's the effect of the insurance provision in the charter party such as the prevalent Acclaim being made by herculed again for under the bills of lading issue one incorporation sir Nigel tier set out at paragraph 34 the well-established principle of incorporation of Charter term into a bill of leading contracts implemented at paragraph 35 with some additional observation found in the authorities in applying those principles he held the world of incorporation in the bills of leading were wide enough to incorporate the relevant Clauses from the charter party the obligation to pay for additional War risks and knr cover to Transit the Gulf of Aiden was directly German to the carriage and delivery of the cargo under the bills of leading in the appeal of leading holders would expect the vessel to proceed on its foliage fire the Gulf of Adam and would have understood that herculito might have to take out such Insurance the key question on incorporation was whether it was appropriate to substitute the word holder of the bill of lading for charterers so as to make the bill of lading holders liable under the bill of lading contract to pay the insurance premium he held that it was not appropriate to do so for two reasons firstly the price to be paid by the bill of leading holder for the carriage of his cargo to Singapore was afraid as per the charger party as such the job held the clear Ward will be required to impose a liability not only to pay Freight but also to pay the additional insurance premium as the price for the carriage of his cargo and there were no such clear words secondly the appeals of lady give no indication as to what each bill of lading holder was to pay given that the additional premium was for the entire foliage and not on a per bill of lading basis given the like of any wording in the bills addressing the prettiest liability of each of the holders or how the premium were to be apportioned that was a further indication that the parties didn't intend the charterer should be substitute by bill of lading holder

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