It is probably a fair statement to say that subrogation involves the cargo market more actively than other branches of marine insurance, and there is accordingly a need for the claims practitioner engaged in that field to understand the relationship between the bailee, the assured and his Underwriters. In collision cases, of course, the matter of pressing the claim against another vessel, which may be wholly or partly to blame, will usually be well regulated by the solicitors initially employed to protect the interests of all concerned. In general average too, there is no particular difficulty in obtaining the credit balance due, since Underwriters have merely to ensure that the Average Adjusters concerned are aware of any settlement they have made for sacrifice or deposit, and they can remain secure in the knowledge that the cash position will be ultimately resolved. Many claims on cargo policies are the result of including the so-called “extraneous” risks, such as pilferage or negligent handling, but at one time the exceptions clauses in the carriers’ contracts of carriage were so comprehensive that it was considered virtually impossible to hold them responsible. The position when the contract of affreightment is evidenced by a Bill of Lading is now controlled by the incorporation of the Hague or Hague-Visby Rules which have been adopted by most countries, but prior to that the piece of verse which follows probably gave a good reflection of the attitude of carriers.
SO TRY YOUR UNDERWRITER
- It is much to be regretted
- That your goods are slightly wetted.
- But our lack of liability is plain,
- So Which is proof against evading,
- Bears exceptions for sea-water, rust and rain;
- Also wheat contamination.
- Fire and all depreciation
- That we’ve ever seen or heard of on a ship;
- And our due examination.
- Which we made at destination,
- Shows your cargo much improved by the trip.
- Furthermore the protest shows
- That the Master blew his nose,
- And the hatches were demolished by the gale.
- Oh, we’ll all stick together
- To prove it’s heavy weather,
- For we’ve got the cargo owner by the tail;
- So, reserving all defenses,
- Alibis and false pretences,
- We suggest that your underwriter man
- Is the guy that’s out of luck?
- We can always pass the buck;
- Yes—we always duck the issues if we can.
- ‘This a cause of grief sincere,
- And we almost weep to hear
- You are claiming for your cargo wet by rain.
- It really is a crime
- That you’re wasting all your time
- For our bill of lading clauses make it plain
- That from ullage, rust or seepage,
- Water, sweat, or just plain leakage,
- Act of God, restraint of princes, theft or war,
- Loss, damage or detention,
- Lock out, strike or circumvention,
- Blockade, interdict, or loss ‘twixt ship and shore,
- Quarantine or heavy weather,
- Fog and rain, or both together,
- We’re protected from all these and many more;
- And it’s very plain to see
- That our liability
- As regards your claim is absolutely nil;
- So try your underwriter,
- He’s a friendly sort of blighter,
- And is pretty sure to grin and foot the bill.
Even today, however, a degree of skill is often required before liability is admitted by the carrier or other bailee, and it would be rare indeed for the consignee to obtain such an admission as soon as he lodges a claim. Provided a claim has been introduced to the carrier by the consignee in the first instance, therefore, Underwriters will usually be quite willing to settle the claim, unless non-delivery of a complete package is concerned, when it is prudent to await the result of a search at the port of destination and other ports of call.
Since carriers can usually find apparently legitimate reasons to excuse themselves, protracted correspondence will often be required before opposing views are accepted, and for this reason, either the services of Lloyd’s Recoveries Department will be utilized, or insurers will pass the documents to recognized recovery agents specializing in this type of work. Nevertheless, it is useful to know which cases need further consideration and the problems which can arise; accordingly, in this and the following chapter a study of the transport conditions most widely in use in the United Kingdom has been undertaken.
Consignees could quite easily prejudice the rights of Underwriters to effect a recovery by failing to lodge a claim against the responsible party in the specified time limits, hence the need for the Duty of Assured Clause in standard cargo clauses. Insurers’ claims departments should therefore have an awareness of the time limits in general operation so as to bring any faults to the attention of the consignees, as well as to avoid failure on their own part to forward the documents to the party concerned in due time.
Takis Kalogerakos
Marine Underwriter
