Reflections on The Cendor MOPU

AuthorViktor Weber
Pages19-21
SSLR Reflections on The Cendor MOPU Vol 1(2)
19
Reflections on The Cendor MOPU
Viktor Weber
he Cendor MOPU 1 concerned a mobile off-shore production unit
characterised by three legs of 312 feet each which was carried on a barge.
During the transit the legs broke off. While the structure of the legs was
weakened as a result of the motion of the waves, expert evidence established
that this weakness was not in itself sufficient for the loss to occur and that the
first leg to fall off had to be hit by a particular wave to collapse. The two other
legs broke off as a result of the strain on the structure caused by the collapse of
the first leg.
The Institute Cargo Clauses (A), on which the policy was written, provides in
cl 4.4 that “[i]n no case shall this insurance cover loss damage or expense
caused by inherent vice or nature of the subject-matter insured”. Section
55(2)(c) of the Marine Insurance Act 1906 states that “...the insurer is not
liable for...inherent vice or nature of the subject-matter insured...”.
The insurer rejected the claim on the ground that the loss was caused by
inherent vice, and the question arose whether the assured should be able to
recover. As a preliminary step the following scenarios should be considered:
A) The cargo is loaded on board having a vice and this vice causes further
damage to the cargo irrespective of the prevailing state of the sea. This
is clearly a case of inherent vice.
B) The cargo is loaded on board in a good condition and the prevailing
state of the sea damages the cargo. This is a clear case of damage
caused by the sea.
C) The cargo is loaded on board having a vice; this in itself would not
cause further damage, but the prevailing conditions of the sea cause
further damage as a result of the initial vice of the cargo. In other words,
the prevailing state of the sea in itself would not cause damage to the
cargo if the cargo had been loaded on board in good condition. This is a
case of inherent vice.
D) The cargo is loaded on board in good condition but
a. the prevailing state of the sea causes damage to it (the cracks on
the legs) and
b. as a result of the first damage and the state of the sea further loss
occurs (the legs falling off)
In The Cendor MOPU the cargo was loaded on board in good condition, and
therefore, following the ordinary meaning of the words, the case falls under
Scenario B. The insurer argued that the concept of inherent vice includes the
1 Global Process Systems Inc v Syarikat Malaysia Takaful Berhad (The Cendor MOPU) [2011] UKSC
5
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