Neuchatel Swiss General Insurance Co Ltd & Ors v Vlasons Shipping Inc [2001] VSCA 25

Neuchatel Swiss General Insurance Co Ltd & Ors v Vlasons Shipping Inc [2001] VSCA 25 - VSCA 2001 case summary — Zoe

[30]

Although the vessel had been cleared for sailing by late-morning on 14 August 1991, the engine trouble had delayed it so that it did not leave port until some time between 1730 and 1800 hours that day. However, during the day the storm had been placed in a higher category. At 0800, JMA had upgraded the storm to a severe tropical storm with an estimated wind intensity of 50 knots near its centre. By 1400 ROHK also described the storm as a "severe tropical storm" with winds near the centre of a similar intensity. The final tropical cyclone warning issued by ROHK before the vessel sailed was issued at 1700 hours. It took an almost identical form to the warning previously set out[1] except that it now described the storm as "severe tropical storm Fred". The central pressure was 980 hectopascals with maximum winds near the centre estimated at 55 knots. The radius of 47 knot winds was 60 nautical miles. The storm was then centred at 19.8 degrees north and 117.0 degrees east, somewhat closer to Hong Kong and the coast although still a few hundred miles away. It was now moving at an estimated eight knots and the two forecast positions were now: at 1700 on 15 August it was estimated to be at 21.1 degrees north and 113.8 degrees east; and for 1700 on 16 August it was estimated it would be at 22.7 degrees north and 110.8 degrees east. The first position would therefore have been not far from the projected line of voyage of the vessel and the second position would have the storm over the coastline of southern China to the west of Hong Kong. The equivalent JMA warning, described as a "typhoon warning", although the storm was still characterised as "severe tropical storm 9111 Fred", was issued at 1400 hours. Again it was estimated to be 55 knots near its centre but moving west north-west at seven knots. Its estimated position was not greatly different from that estimated by ROHK but its forecast position for 1400 hours on 15 and 16 August was, as to 15 August, 20.5 degrees north and 114.0 degrees east "with an uncertainty of 90 miles radius", and at 1400 hours on 16 August, at 21.0 degrees north and 109.5 degrees east with an uncertainty of 180 miles radius. The two positions would have taken the storm somewhat further south than the path forecast by the ROHK warning, the first position being about 50 miles to the east of the estimated line of voyage of the vessel, but the second position would have had the typhoon crossing the Chinese coastline on the Luichow Peninsula immediately north of the Hainan Strait and thus a little north of the vessel's line of voyage.

[41]

The appellants insisted that the interpretation favoured by the learned judge would make it hard for the insurers to establish a deliberate decision to go to sea in the face of knowledge of a typhoon or storm warning. They said that the master would not be there afterwards to answer questions for he would have gone down with the vessel, as would all the records including those relating to warnings. That seems to me to be an overstatement for, although the master and all hands were lost on this occasion as they must be on others, it does not follow that in the case of every sinking the master is not rescued or does not otherwise survive. Moreover, those who provided the information to the master, if that be relevant, would frequently have a record of that. It was said that although there was a record of certain telexes being sent to the master while he was at sea, there could not be any proof that he received those messages. Again, I think that overstates the case for there were notations which indicated that the messages were received or not received, as the case may be, and in any event, absent unusual factors, the sending of a message in those circumstances might fairly lead to an inference that it was received. More importantly, however, the relevant warning must have been received by the master before he left port and there would ordinarily be better records of any relevant matters at that time. For example, in the present case the appellants sought to prove that a telex was hand delivered containing some element of warning and that might have been established, if it were not for the fact that the witness was held to be unreliable. Although there may be difficulties because the insurers bear the onus of proof, it ought not to prevent the clause being construed as requiring knowledge, if that is the appropriate way to interpret it. Moreover, the appellants' argument failed to take account of the fact that the vessel, as might others affected by a similar condition, remained in radio contact with its agents right up to the time of the SOS message. It cannot be of consequence for this purpose that the particular messages did not prove that the master had knowledge, for they might otherwise have provided evidence if knowledge existed. In the present case, however, as will be seen, there was no such evidence and the inference to be drawn, rather, is that the master did not have any such knowledge.

[59]

Thus, in my opinion, weather forecasts and warnings of storms and other meteorological disasters ordinarily look to the future, providing warning of what may happen a day, two days or even further ahead. The universality of these considerations appears from the definitions appearing in the relevant manual of the World Meteorological Organisation, already set out[7] and apparently accepted by the learned judge. In each of the definitions of storm warning and typhoon warning the critical words defining the relevant message are that which is "intended to warn those concerned of the occurrence or expected occurrence of ..." the high wind speeds forecast. If, as seems highly likely, the reference in the condition to "typhoon or storm warning" was intended to incorporate that understanding of the expressions, then the understanding included not merely the existing occurrence of high wind speeds but, more especially, of the "expected occurrence" of high wind speeds likely to result in high danger to the vessel. Moreover, the condition should be read in the light of the kind of forecast warnings customarily put out and relied upon in the South China Sea, namely those of ROHK and JMA. They each gave an existing position and then, as part of the warning, proceeded to give a direction and speed of movement of the storm together with estimated positions thereof 24 and 48 hours in the future. There was much argument on the part of the respondent that the further one went away from the existing centre of the storm and the longer in the future the forecast was intended to cover, the more imprecise was the area affected by the warning, such that it was not fair or reasonable to require the warning to be accepted by the insured and made it unlikely the master would place reliance on it. There are some difficulties, as will be seen below, but coverage of a period of 48 hours seems not unreasonable to expect in warnings of this kind. One is aware that certain forecasters and bureaux attempt to give some form of weather forecast up to seven days into the future, but the present warnings were limited, fairly one might say, to 48 hours and that is a period which might reasonably be taken into account by the master of a vessel when setting sail, even if it be only for his own protection and that of the crew. The condition still must be interpreted to require some coincidence of the vessel's presence and the arrival of the storm.

[64]

There is, it must be conceded, a further difficulty upon which the learned judge and the respondent placed heavy weight in order to show that future warnings were not covered. That arises because the forecast path of any storm must have a further element of uncertainty in it. Of course, both the ROHK and JMA warnings gave precise positions, in a sense, for both their 24 and 48 hour warnings. The ROHK warning did not refer to the possibility of any deviation but the JMA warning did, in the case of the 24 hour warnings being expressed to have an "uncertainty of 90 miles radius" and, in the case of the 48 hour forecast position, expressed in terms of an "uncertainty of 180 miles radius". This was described as creating a "cone" effect or an area of expected occurrence which would spread wider, as time passed, in a way which could only be mapped in the form of a cone. This was said by the respondent to create too much uncertainty such as would affect a voyage which might pass temporarily through such a zone although the voyage might be in a "different direction" and therefore, because of timing and other factors, might be realistically outside any real risk. For the purpose of this condition, however, the forecast warnings must refer to mapped positions, the element of uncertainty being merely an indication to mariners that forecasting of this kind has its necessary element of uncertainty. For practical purposes, however, the path of the storm should be taken as an area or zone following the forecast mapped positions and extending on each side 20 or 30 miles according to the radius then existing (or forecast) of winds which satisfy the tests for severe storms or typhoons. Although that may not be necessarily a straight zone, the area affected could be understood and worked out by a master at the relevant time with reasonable certainty, upon which he might be expected to act. It should be remembered that, in the end, the master will not be so much influenced by the condition in the policy as by the practical dictates of seamanship and an appreciation of risks that a master would not ordinarily run as a matter of commonsense.

[68]

It is possible, however, to envisage timing difficulties which the parties may not have contemplated. A 48 hour warning, on the appellant's contentions, may be forecast to affect the first few miles of a proposed voyage many hours after the ship had sailed through those waters and was at that time many hundreds of miles away. Likewise, one can see in a longer voyage the possibility of a storm being forecast to affect the line of voyage or port of destination a day or more before the vessel could possibly arrive in those waters. Nevertheless, the condition is concerned with risks, risks of a serious kind, and it would not be inappropriate to apply a broad brush approach to the practical application of this condition having regard to the known nature and form of storm warnings. In practical terms, at least so far as the evidence in the present case goes, future warnings extend only to a period 48 hours from a time before the vessel departs and possibly from a time several hours before it departs. The kind of storm covered by the clause moves at considerable speed, indeed, at a speed often far faster than that which can be attained by the kind of vessels covered by this policy. There will always be doubt as to precisely where the storm will go and when it will arrive at any point on a predicted path. But the dictates of good seamanship would suggest that they are the kind of risks which a master would not run by sailing into an area covered by a forecast storm. The respondent put considerable weight on the fact that the ship went down at a point not on the path which was forecast by either bureau, indeed at a point which was never forecast to be crossed by the storm. That, however, only points to the fact that these are severe risks which the parties to the policy agreed ought not to be run by the master or any other person responsible for allowing the vessel to sail. If voyages ordinarily take a day or so to complete, so also should the relevant storms cover a period of 48 hours or, in the case of a shorter voyage, possibly only a period of 24 hours. The primary difficulty arises in cases of voyages which take longer and where the risk is not forecast to cover the line of voyage at a time likely to coincide with the passing of the vessel along that line.

At a glance

Court

Decision date

Before

Source

Judgment (104 paragraphs)

Parties