Melinda Holdings SA v Hellenic Mutual War Risks Association (Bermuda) Ltd [2011] EWHC 181 (Comm) (18 February 2011)

Melinda Holdings SA v Hellenic Mutual War Risks Association (Bermuda) Ltd [2011] EWHC 181 (Comm) (18 February 2011)

The arrest and continued detention of the SILVA was not an 'ordinary judicial process' but an exercise of extortion by the Egyptian court system for its own financial benefit, involving fabricated evidence and lack of judicial independence. The exclusion under Rule 3.6 does not apply. There was no breach of the sue and labour clause by Melinda, as no reasonable steps could have averted the loss, and the directors' discretion under the policy would not justify rejection or reduction of the claim.

Citation
[2011] EWHC 181 (Comm)
Parties
Claimant: Melinda Holdings SA; Defendant: Hellenic Mutual War Risks Association (Bermuda) Ltd
Jurisdiction
England and Wales
Judgment Date
18 February 2011
Procedural Posture
Commercial Insurance Claim / High Court Trial Judgment
Outcome
Claim allowed
Legal Topics
War Risks Insurance, Policy Exclusions, Constructive Total Loss, Judicial Process Exclusion, Sue and Labour Clause
Marine Insurance Commercial Law War Risks Insurance Policy Exclusions Constructive Total Loss Judicial Process Exclusion Sue and Labour Clause

Case Brief

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Parties

Melinda Holdings SA

Claimant

Hellenic Mutual War Risks Association (Bermuda) Ltd

Defendant

Procedural Posture

Commercial Insurance Claim / High Court Trial Judgment

Legal Issues

  1. 1 Whether the arrest and detention of the vessel SILVA fell within the 'ordinary judicial process' exclusion under the insurance policy
  2. 2 Whether the claimant breached the 'sue and labour' clause of the policy

Ratio Decidendi

The arrest and continued detention of the SILVA was not an 'ordinary judicial process' but an exercise of extortion by the Egyptian court system for its own financial benefit, involving fabricated evidence and lack of judicial independence. The exclusion under Rule 3.6 does not apply. There was no breach of the sue and labour clause by Melinda, as no reasonable steps could have averted the loss, and the directors' discretion under the policy would not justify rejection or reduction of the claim.

Court Disposition

Claim allowed

Orders

  • Defendant to pay the agreed sums under the policy: US$16,000,000 for hull and machinery and US$3,200,000 for freight and disbursements.