CA-2024-000950 - [2025] EWCA Civ 1019

From 17^th February 2019 until 9^th January 2020 the first respondent’s Capesize bulk carrier ‘WIN WIN’ was detained by the Indonesian authorities for having anchored inside Indonesian territorial waters without permission. As a result she became a constructive total loss in accordance with the terms of the war risks policy issued by the appellant insurers. The insurers defended the respondents’ claim on the policy on a number of grounds, all of which were rejected by the judge, Mrs Justice Dias.

The insurers have permission to appeal on two issues. The first concerns the application of the duty of fair presentation, imposed by section 3 of the Insurance Act 2015, to a one ship company with a sole nominee director who exercised his extensive powers as a director only in accordance with instructions received from the company’s beneficial owners. The second concerns an exclusion from cover in the event of ‘Arrest, restraint or detainment under customs or quarantine regulations and similar arrests, restraints or detainment not arising from actual or impending hostilities’.

The parties addressed these issues in reverse order during the hearing and I shall take the same course.

I have concluded that the appeal should be dismissed. It will therefore be unnecessary to decide the further issues raised by the Respondents’ Notice.