Atlasnavios - Navegacao, LDA v Navigators Insurance Company Ltd & Ors

Atlasnavios - Navegacao, LDA v Navigators Insurance Company Ltd & Ors

The exclusion in clause 4.1.5 of the Institute War and Strikes Clauses applies to exclude cover for a constructive total loss where the loss is caused both by a malicious act (concealment of drugs by third parties) and by detainment for infringement of customs regulations, as both are proximate causes. There is no warrant for implying a limitation to the exclusion so as to allow cover where the infringement is itself the manifestation of a malicious act. The policy must be construed as a whole, and the exclusion applies even if the infringement arises from a malicious act by third parties.

Parties
Claimant/respondent/cross Appellant (owners): Atlasnavios - Navegação, LDA (formerly BNavios - Navegação, LDA); Defendants/appellants/cross Respondents (insurers): Navigators Insurance Company Limited and others (see list)
Jurisdiction
England and Wales
Judgment Date
01 August 2016
Procedural Posture
Civil Appeal (insurance Contract Dispute) / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal allowed; cross-appeal dismissed.
Legal Topics
War Risks Insurance, Policy Exclusions, Proximate Cause, Malicious Acts, Customs Regulations, Constructive Total Loss
Insurance Law Maritime Law Contract Law War Risks Insurance Policy Exclusions Proximate Cause Malicious Acts Customs Regulations +1 more

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Parties

Atlasnavios - Navegação, LDA (formerly BNavios - Navegação, LDA)

Claimant/respondent/cross Appellant (owners)

Navigators Insurance Company Limited and others (see list)

Defendants/appellants/cross Respondents (insurers)

Procedural Posture

Civil Appeal (insurance Contract Dispute) / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Whether the exclusion in clause 4.1.5 of the Institute War and Strikes Clauses applies to exclude cover for a constructive total loss caused by malicious acts of third parties (drug smugglers) leading to infringement of customs regulations and subsequent detainment/confiscation of the vessel.

Ratio Decidendi

The exclusion in clause 4.1.5 of the Institute War and Strikes Clauses applies to exclude cover for a constructive total loss where the loss is caused both by a malicious act (concealment of drugs by third parties) and by detainment for infringement of customs regulations, as both are proximate causes. There is no warrant for implying a limitation to the exclusion so as to allow cover where the infringement is itself the manifestation of a malicious act. The policy must be construed as a whole, and the exclusion applies even if the infringement arises from a malicious act by third parties.

Court Disposition

Appeal allowed; cross-appeal dismissed.

Orders

  • Insurers' appeal allowed; owners' claim for indemnity under the policy is excluded by clause 4.1.5.
  • Cross-appeal by owners dismissed.