Charman v W.O.C. Offshore B.v (Volvox Hollandia)
| Jurisdiction | England & Wales |
| Judgment Date | 29 July 1993 |
| Judgment citation (vLex) | [1993] EWCA Civ J0729-9 |
| Court | Court of Appeal (Civil Division) |
| Date | 29 July 1993 |
[1993] EWCA Civ J0729-9
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE QUEEN'S BENCH DIVISION
Before: Lord Justice Staughton Lord Justice Mann
MR R JACOBS (instructed by Clyde & CO, London EC3M IJP) appeared for the Plaintiffs
MR M SWAINSTON (instructed by Richards Butler, London EC3A 7EE) appeared for the Defendants
Thursday, 29th July 1993
Charman
v.
WOC Offshore BV
Staughton LJ
In May and June 1990 a contract of insurance was concluded between a Dutch company called WOC Offshore BV and the members of three syndicates at Lloyd's. The Dutch company, whom I shall call the Owners, had let some of their property on hire to a Yugoslav company for purposes connected with the construction of a breakwater in Algeria. They are referred to as the Charterers. The Owners were the insured under the contract of insurance, and are the defendants in this action. The Plaintiffs, Mr Charman and Mr Brockbank, sue on their own behalf and for the other members of their syndicates.
The slip by which the contract was concluded contained the words
FORM Mar./SG.
That, it seems, was a reference to two different printed forms of contract used in the insurance market. One is the familiar SG form used in the marine market. That contains no term as to who shall have jurisdiction to decide disputes. The other form, Mar.(which stands for Marine), provides
This insurance is subject to English jurisdiction.
That was the slip. Much later, a policy was issued, on the SG form. For the present, it is immaterial that the SG form was used in compiling the policy; but that may become significant at a later stage.
The insurance was against the risk that, at the end of the construction of the breakwater, the Charterers would not be able to repatriate the property which they had hired and return it to the Owners. Against the heading VESSELS/OBJECTS AND SUMS INSURED in the policy there is the following list of that property:
A. Stone Placing Equipment:
A1. Loaders Cat. 988 B 5 units in all
B. Concrete Block Placing Equipment:
B1. Cranebarge "MB 101"
B2. 1 flat top barge 60 x 20 mtr
B3. Tugboat "HOLLAND"
B4. Landbased Manitowoc
C. Equipment for dredging and excavation:
C1. Floating crane "MB 106"
D. Matrass Placing Equipment:
D1. Total equipment including following
Tug "GEODKOOP 14"
D2. Motorboat "KEMPHAAN"
Positioning equipment "FLAKKEE" and "STREKKER" including end beams P & H crane in all
E. Other equipment:
E1. Divers/salvage equipment in all
E2. Rescueboat
F. Hire equipment:
F1. Eerland ponton
The terms of the insurance, so far as relevant, are as follows:
AND WHEREAS the Assured wish to insure their loss of earnings and/or hire and/or additional expenses which they incur by reason of the Vessel not sailing from Algeria at expiry of the contract in respect of sub A, B, E and F in December 1990 and in respect of sub C1 and D in August 1990.
NOW THEREFOR if in consequence of the Charterers or their Agents failing for any reason whatsoever to obtain an Export Licence from the appropriate Authority in Algeria for the Assured the vessel is unable to sail from Algeria or its territorial waters at the end of the above referred to contract periods, THIS INSURANCE is to pay up to the Sums Insured as above to contract periods as follows:
A1. US$ 25,000
B1. US$ 35,500
B2. US$ 4,300
B3. US$ 9,500
B4. US$ 12,500
C1. US$ 26,750
D1. US$ 9,500
D2. US$ 22,770
E1. US$ 9,500
E2. US$ 1,750
F1. US$ 4,375
per week and pro rata, fixed and agreed amounts until the Vessels sail from Algeria and its territorial waters.
The judge thought it manifest that the words
the vessel is unable to sail from Algeria
must have some wider meaning, so as to encompass the removal from Algeria of each of the listed items of property; and other similar departures from the literal wording must have been intended. The contrary has not been argued in this court.
There is a further description of the property in an affidavit of the Owners' solicitor:
Items A are land vehicles;
Items B1, B2, C1 and D2 (apart from the Kemphaan), F1 and Addendum 1 are dumb barges;
Items D1, D2 (Kemphaan) are small harbour work boats;
Items B4 and D2 (P & H crane) are land cranes;
Item B3 is a tug boat.
Yet further description is available if required. For the present it is enough to say that some items were plainly land based, and that some were sea-going vessels.
The Owners say that a loss occurred under the policy, and that they ought to be paid. The Insurers maintain that they are entitled to avoid the policy, or alternatively that they are under no liability in accordance with its terms.
At first the Owners commenced summary proceedings in the District Court of Haarlem. But the Dutch court ruled that, on the footing that the Mar. form was part of the contract, the Dutch courts had no jurisdiction. The Insurers then commenced the present action as Plaintiffs, seeking a declaration that they were entitled to avoid and have avoided the contract for material non-disclosure. Alternatively they seek what has been called a negative declaration, that they are not liable to the Owners under the contract. Shortly after the writ was issued, the Owners started fresh proceedings of a non-summary character in the Dutch courts. Meanwhile the Owners have applied to set aside the English proceedings under O. 12 r.8, on the ground that only the Dutch courts have jurisdiction.
That application raised two issues. First, does the contract of insurance incorporate the MAR form or the SG form? Secondly, are the Insurers entitled to rely on the jurisdiction clause in the MAR form, despite the terms of the European convention scheduled to the Civil Jurisdiction and Judgments Act 1982? If the Owners succeed on either issue, these proceedings are not within the jurisdiction of the English Courts and must be set aside. But it is said, and Hirst J. apparently accepted, that expert evidence will be relevant to the determination of the first issue. So he ordered that the second issue should be decided first. In the event he decided it in favour of the Owners; and if that decision stands there will be no need to decide the first issue. But the Insurers appeal.
There was another point raised before Hirst J. and decided by him, which also features in this appeal. The Owners argued that an action for negative declarations (as both the declarations claimed by the Insurers effectively are) was improper, and that the English proceedings should be set aside on that ground also. The judge would not have been minded to accept that argument.
So I turn to the Brussels convention, as amended, which has the force of law in the United Kingdom by virtue of section 2(1) of the 1982 Act. Article 2 provides the basic rule of jurisdiction, that (subject to other provisions of the convention) persons domiciled in a contracting state shall be sued in the courts of that state.
Articles 7 to 12A in section 3 deal with jurisdiction in matters relating to insurance. For present purposes the first relevant provision is Article 11, which provides that
an insurer may bring proceedings only in the courts of the Contracting State in which the defendant is domiciled, irrespective of whether he is the policy holder, the insured or a beneficiary.
But there is an exception provided in Articles 12 and 12A, which I must quote in full:
Article 12
The provisions of this Section may be departed from only by an agreement on jurisdiction:
(1) which is entered into after the dispute has arisen, or
(2) which allows the policy holder, the insured or a beneficiary to bring proceedings in courts other than those indicated in this Section, or
(3) which is concluded between a policy holder and an insurer, both of whom are at the time of conclusion of the contract domiciled or habitually resident in the same Contracting State, and which has the effect of conferring jurisdiction on the courts of that State even if the harmful event were to occur abroad, provided that such an agreement is not contrary to the law of that State, or
(4) which is concluded with a policy holder who is not domiciled in a Contracting State, except in so far as the insurance is compulsory or relates to immovable property in a Contracting State, or
(5) which relates to a contract of insurance in so far as it covers one or more of the risks set out in Article 12A.
Article 12A
The following are the risks referred to in point (5) of Article 12:
(1) Any loss of or damage to
(a) sea going ships, installations situated offshore or on the high seas, or aircraft, arising from perils which relate to their use for commercial purposes,
(b) goods in transit other than passengers' baggage where the transit consists of or includes carriage by such ships or aircraft;
(2) Any liability, other than for bodily injury to passengers or loss of or damage to their baggage,
(a) arising out of the use or operation of ships, installations or aircraft as referred to in point (1)(a) above in so far as the law of the Contracting State in which such aircraft are registered does not prohibit agreements on jurisdiction regarding insurance of such risks,
(b) for loss or damage caused by goods in transit as described in point (1)(b) above;
(3) Any financial loss connected with the use or operation of ships, installations or...
To continue reading
Request your trial
-
Standard Steamship Owners' Protection and Indemnity Association (Bermuda) Ltd v GIE Vision Bail [QBD (Comm)]
...insurance in respect of a multiplicity of risks, the vast majority of which fell within Article 14. Where, as in Charman v WOC [1993] 2 Lloyd's Rep. 551, the insured is someone of sufficient economic power to be in the class of people who obtain cover which falls within Article 14, it does......
-
Ian Nwabueze v University of Law Ltd and Others
...was placed in written submissions on an insurance case, Charman v WOC Offshore DV [1993] 1 Lloyd's Rep 378 (Hirst J); [1993] 2 Lloyd's Rep 551 (Court of Appeal). That case concerned the Brussels Convention on jurisdiction, Article 11 of which provided that an insurer could bring proceedin......
-
Minister for Agriculture v Alte Leipziger
...alone"storage provided in the policy. 48 Mr. Shipsey submitted that, insofar as the English Court of Appeal in Charman .v. WOC (1993) 2 Lloyds Reports 551 had held that the words "and no other" should be implied at the end of Article 12(5), the decision was erroneous in law and should not b......
- Tradigrain SA v S.I.A.T Spa and Others