CARGO INSURANCE GFML 3043

GROUP 20 (CHANGE OF VOYAGE)PREPARED FOR:

DR. SALWANI ARBAKPREPARED BY:

MOHD ZIA-UDDIN NASIR 229176DEVAGGI ARUMUGAM 221182

FAIZ BIN MARJAN 221124

CHANGE OF VOYAGE

What is actually change of voyage?

• Change of destination• The ship must in Seaworthiness• Just like deviation (under clause 9 & 8.3)• It could be liable or not liable• The duty of assured • Under clause 10

Rickards v Forestal Land,

Timber and Railways Co Ltd [1942] A.C. 50

The Facts

By Lloyd's policies of insurance against marine and war risks, cargoes belonging to the assured, who were British subjects, and shipped in three German vessels, the Minden,, the Wangoni., and the Halle,., for various destinations in August, 1939, were insured by underwriters against

"enemies .... surprisals, takings at sea, arrests, restraints and detainments of all kings, princes and people," and, by incorporation of the Institute War Clauses, against the risks, excluded from the standard form of English marine policy by an f.c. and s. clause, and "the consequences of hostilities or warlike operations. ..."

Each policy provided:

"Warranted free of any claim based upon loss of, or frustration of, the insured voyage or adventure caused by arrests restraints or detainments of kings princes peoples. ..."

The voyages were begun before the outbreak of war between Great Britain and France and Germany on September 3, 1939.

But on August 24, the Minden, on September 1, the Wangoni, and on September 6, the and Halle, put in at neutral ports in obedience to orders by the German government that the masters should so take refuge and, if possible, return to Germany with their cargoes, or, as a last resort, scuttle their vessels.

The M. and the H. left their ports of refuge some weeks after the outbreak of war in an attempt to reach Germany, but were eventually scuttled in the presence of Allied warships. The W. succeeded in reaching Germany in March, 1940.

Per Lord Porter. Underwriters do not succeed in proving a loss within the exception in the frustration clause merely by showing that the adventure has been lost.

A total loss of goods must always have that result.

In the present case it is true that the adventure was put an end to by the loss of the goods, but the goods were not lost by reason of the loss of the adventure.

VS

(MARCH 21, 2006)CASE II: M/V Hyundai

Fortune

Britannia Steamship Insurance Association Ltd

Hyundai Merchant Marine Co., Ltd. v Nippon Yusen Kaisha 

(NYK Group)

O On March 21, 2006, M/V Hyundai Fortune was en route from ports in China and Singapore through the Gulf of Aden about 60 miles (97 km) south of the coast of Yemen. She was sailing west towards the Suez Canal on the way to ports in Europe.

O Panama flag container M/V Hyundai Fortune (built 1996) has suffered major explosion & massive fire in aft on-deck container stacks.

O Entire after end of ship completely involved in fire. Crew has abandoned ship, picked up by Dutch Navy frigate HNLMS De Zeven Provincien.

O  M/V Hyundai Fortune in position 12-39N 047-22E (Gulf of Aden). Numerous (60 to 90) containers blown over the side, forming a debris field about 5 miles long -- many of which are drifting around the vessel. 

O After the explosion, fire raged in the ship for days and the stricken vessel had to be towed to safety at Salalah, Oman.

Hyundai Fortune fire expected to be biggest cargo insurance claim

O The 21 March 2006, the HYUNDAI FORTUNE suffered an explosion on board near the coasts of Yemen. The cause of the explosion could be fireworks. The vessel was towed to the nearest port of refuge, Oman.

O 5,000 containers caught fire (5,500 TEU)O Lloyd’s underwriters anticipate claims to be

around $100 million and claims for the replacement of the vessel to be close to $80 million

O American Maritime Lawyers Know M/V Hyundai Fortune From Her Prominence in U.S. Commerce.

O Vessel was Korea for Rotterdam. She is insured by Britannia Steamship.

Result: Hyundai Merchant Marine Co., Ltd.

O Generally speaking, marine cargo insurance provides flexible coverage for policy holders. According to the "Change of Voyage Clause", once the policyholder is informed about the change, he must provide written notice to the insurance company promptly. If there are changes in the voyage, the insurance company may need to re-assess the risk and the conditions and, as a result, an additional premium may be required for the continuance of cover.

O After the vessel was towed to the nearest port of refuge, Oman, the sound containers were offloaded for transportation to other ships to Europe. In this case, as the vessel and the route changed from those stated at the start of the voyage, in order to enjoy marine cargo insurance coverage, cargo owners need to inform the insurance company about the changes as soon as they know about them by written notice so as to obtain the consent of the insurance company.

O If the cargo owners do not inform the insurance company once they are advised of any changes, they may not enjoy insurance cover as they have breached the contract mutually agreed by the cargo owners and the insurance company. Therefore, it is important to remind your customers to inform us in writing promptly if there are any changes in the voyage.

Principle

Marine Insurance Act 1906 - The underwriter is discharged from liability if there has been a change in the voyage (voluntarily)

Institute Cargo Clause 1963 - A change of voyage would not be fatal to the assured as he could held covered by an additional payment of premium

Clause 10 of the 1982 Institute Cargo Clause 1963 – The requirement is strict

Implied Warranty – Legality of Voyage (incorporated under Marine Law)

THANK YOU!TERIMA KASIH!

XIEXIE!NAMASTE!