Maritime Insurance Law Part 8
Pursuant to the earlier topic of Introduction to Maritime Law in Malaysia, published on 22 February 2021, in the coming series the basis and elements of Marine Insurance claims will be explored.
Change Of Voyage, Deviation And Delay
Attachment Of Risk, Change Of Voyage And Deviation
Section 45 MIA provides as follows:-
- Where, after the commencement of the risk, the destination of the ship is voluntarily changed from the destination contemplated by the policy, there is said to be a change of voyage.
- Unless the policy otherwise provides, where there is a change of voyage, the insurer is discharged from liability as from the time of change, that is to say, as from the time when the determination to change it is manifested; and it is immaterial that the ship may not in fact have left the course of voyage contemplated by the policy when the loss occurs.
Section 46 MIA provides as follows:-
- Where a ship, without lawful excuse, deviates from the voyage contemplated by the policy, the insurer is discharged from liability as from the time of deviation, and it is immaterial that the ship may have regained her route before any loss occurs.
- There is a deviation from the voyage contemplated by the policy—
- Where the course of the voyage is specifically designated by the policy, and that course is departed from; or
- Where the course of the voyage is not specifically designated by the policy, but the usual and customary course is departed from.
- The intention to deviate is immaterial; there must be a deviation in fact to discharge the insurer from his liability under the contract.
Where change of voyage is concerned, the application of section 44 MIA is very important. Section 44 states that no risk attaches when vessel sails to another destination than that defined within the insurance policy.
Distinction Between Change Of Voyage And Deviation
The difference is that deviation is not a give up or loss of sight of the original destination of the voyage meanwhile that is a change in voyage (New York Firemen Ins co v Lawrence).
Change of Voyage
This was first seen in Simon Israel v Sedgewick. It is only identified through the construction of the policy.
Deviation happens when the course of journey in the policy is not followed. It is not necessary to prove that the deviation has caused the risk to grow as the insurer is immediately discharged from the risk when there is deviation.
Deviation, however, is allowed when usage is raised to prove as a reason for such a deviation (Cormack v Gladstone and Frenkel v Macandrews).
Additionally Section 47 MIA is used to regulate the order of ports which is contained within the policy.
Section 47 MIA provides as follows:-
- Where several ports of discharge are specified by the policy, the ship may proceed to all or any of them, but, in the absence of any usage or sufficient cause to the contrary, she must proceed to them, or such of them as she goes to, in the order designated by the policy. If she does not there is a deviation.
- Where the policy is to “ports of discharge,” within a given area, which are not named, the ship must, in the absence of any usage or sufficient cause to the contrary, proceed to them, or such of them as she goes to, in their geographical order. If she does not there is a deviation.
Where the ship is insured at and from one named port of departure and other port or ports of departure to a fixed terminus, it is not prima facie a deviation for the ship to depart from the direct course between the first named port of departure and the terminus ad quem for a purpose connected with the main object of the voyage insured (Bragg v Anderson and Ashley v Pratt).
The policies may also carry licence clauses to enable the vessel “to call” or “to touch” or “to touch and stay” or “to touch, stay and trade”. In these instances or similar instances, there will not be a deviation
The licence clauses must not fall outside the main object of the policy.
The liberty in the policy must always be in line with the main object of the policy.
Section 42 MIA deals with delays in commencement of voyage.
Section 42MIA provides as follows:-
- Where the subject-matter is insured by a voyage policy “at and from” or “from” a particular place, it is not necessary that the ship should be at that place when the contract is concluded, but there is an implied condition that the adventure shall be commenced within a reasonable time, and that if the adventure be not so commenced the insurer may avoid the contract.
- The implied condition may be negatived by showing that the delay was caused by circumstances known to the insurer before the contract was concluded, or by showing that he waived the condition.
Delay in prosecuting the voyage is dealt with Section 48 MIA, which provides as follows:-
In the case of a voyage policy, the adventure insured must be prosecuted throughout its course with reasonable dispatch, and, if without lawful excuse it is not so prosecuted, the insurer is discharged from liability as from the time when the delay became unreasonable.
Necessary delay for the purpose of voyage is justifiable. There must be a clear imputation of waste of time (Grant v King). The delay necessary to accomplish the voyage is not a delay which allows for the insurer to discharge risk (Phillips v Irving)
Section 49 MIA provides as follows for the justifiable deviation or delay:-
- Deviation or delay in prosecuting the voyage contemplated by the policy is excused—
- Where authorised by any special term in the policy; or
- Where caused by circumstances beyond the control of the master and his employer; or
- Where reasonably necessary in order to comply with an express or implied warranty; or
- Where reasonably necessary for the safety of the ship or subject-matter insured; or
- For the purpose of saving human life, or aiding a ship in distress where human life may be in danger; or
- Where reasonably necessary for the purpose of obtaining medical or surgical aid for any person on board the ship; or
- Where caused by the barratrous conduct of the master or crew, if barratry be one of the perils insured against.
- When the cause excusing the deviation or delay ceases to operate, the ship must resume her course, and prosecute her voyage, with reasonable dispatch.
Held Covered clauses are used in circumstances where the strict application of the law would deprive the assured of cover but insurers are prepared to maintain cover usually on terms as to notice and additional premium. These clauses are used when there is, inter alia, change of voyage, delay, deviation, breach of warranty and misdescription of cargo.
If you have any questions or require any additional information, please contact our lawyer that you usually deal with.
This article is written by our Principal Associate, Chakaravarthi
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