Consideration and disposition
51 Resolution of the arguments is not straightforward. The able arguments of Mr Cox and Mr Owens have been of great assistance. There was no debate about the relevant principles of construction. It can be taken that the various contractual documents: the operative placement slip, the Liberty International Underwriters policy wording, including the HST Endorsement, and the 2009 ICC (A) must be read together, and as a whole, giving effect where possible to all provisions: Re Media, Entertainment and Arts Alliance; ex parte The Hoyts Corporation Pty Ltd [1993] HCA 40; 178 CLR 379 at 386-387, in an harmonious construction reflective of business common sense. In doing so, the Master Slip is to be recognised as not without its importance. It was not a contractual document. This was common ground. However, it is, without doubt, an aspect of the surrounding circumstances admissible to assist in the interpretation of the contract of insurance.
52 The operative placement slip was issued in furtherance of the extant commercial arrangement reflected by the Master Slip. A reasonable business person looking to the terms of the operative placement slip and the incorporated wording, including the 2009 ICC (A), would seek to understand the meaning and effect of them in the context of, and by reference to, the Master Slip and the commercial undertakings in the future which it envisaged (of which the insurance of helicopter number 56044 was one example).
53 There are a number of aspects of the Master Slip that give important context and contextual understanding to the contractual terms in, and incorporated by, the operative placement slip. First, the insurance anticipated by the Master Slip was for a single transit helicopter cargo policy, including various Institute Clauses (including, amongst others, cargo, war and strikes), but relevantly in particular, the 2009 ICC (A). The attachment of any policy to be issued was therefore anticipated to be by cl 8.1 of the 2009 ICC (A) modified by the operation of the Static Cover extension, up to 5 days prior to loading.
54 Secondly, this attachment up to five days prior to loading or by reference to cl 8.1 assists in understanding the period of insurance referred to in the Master Slip. It anticipates insurance for risks attaching from 23 May 2017 to 22 May 2018 both inclusive "LST", which can be taken to be local standard time. See Eric Sullivan's Marine Encyclopaedia Dictionary (LLP, 6th ed, 1999) p 275 where LST or l.s.t. is identified as Local Standard Time or Landing Ship Tank. The latter is obviously irrelevant; and the former obviously apposite.
55 The dates and times as local time in the context of attachment by, or by reference to, an activity - "loading" for the Static Cover extension, or movement of the helicopter "in the warehouse or at the place of storage … for the purpose of the immediate loading" - assist one to understand that it is the time and date by reference to the activity at the place it occurs that is referred to. The risk must attach by the terms of the policy as a whole prior to midnight on 22 May 2018 by reference to local time of the events that would give rise to attachment. That is not the contractual provision for the policy in question; rather it is what the Master Slip provides as will fall within the facility provided by it.
56 One then comes to construe the contractual documents. The facts reveal that the operative placement slip was proffered and was accepted prior to midnight 22 May 2018, Picayune, Mississippi time. To the extent it is relevant, the broker expressed to the employee of the underwriter that the insurance was "placed under our existing facility": see the email at 1:48pm AEST Saturday 19 May 2018 ([15] above); and the employee of the underwriter saw the date in the way expressed in the email on Tuesday 22 May 2018 at 1:39pm AEST: "I confirm cover bound with effect from the 19th May": [18] above.
57 No one put the submission that these emails were contractual or that the subjective views of Mr Williams (the broker) or Ms Baker (the employee of the underwriter) were relevant.
58 The operative placement slip identified the voyage as from Picayune (Mississippi) to the Sunshine Coast. The characterisation of the insurance as a voyage policy from the date of the attachment pursuant to its terms to the date of termination of cover pursuant to its terms is assisted by the identification of the voyage. The question is what part does the identified date, "19 May 2018" adjacent to the phrase "Period of Insurance" in the operative placement slip play in the cover?
59 The cover was arranged by accepting a placement slip within the period of, and under, the facility which provided for acceptance of risks that attach prior to midnight on 22 May 2018, Picayune, Mississippi time. The question is whether, in this context, by acceptance of the placement slip a business person would understand the parties to have agreed that cover was to attach or commence not by reference to the terms of the anticipated (now actual) voyage policy (the Static Cover extension and cl 8.1 of the 2009 ICC (A)) but by reference to a nominated time, 12am 19 May 2018, Picayune, Mississippi time; even if it be the case that by reference to the terms of the voyage policy otherwise, cover would attach within the facility period. The insurer's positon is that even though in one sense the cover was confirmed under the existing facility recognised by the Master Slip and even though the cover fell within the terms and boundaries of that facility, cover did not attach until a particular time in Picayune. This was brought about by giving contractual force to the words adjacent to "Period of Insurance" on the face of the operative placement slip. There was no doubt that cover was given after that date, but, as it happens, cl 4.3 of the 2009 ICC (A) applied to exclude indemnity for this loss which was caused by the insufficiency or unsuitability of packing or preparation carried out prior to attachment of the insurance.
60 This approach might be said to change the nature and form of the actual insurance from that which was anticipated by the Master Slip. The Master Slip might be seen to have anticipated that the cover would be a single transit voyage policy attaching by reference to the terms of the wording prior to midnight on 22 May 2018, Picayune, Mississippi time. If contractual force and meaning is given to "19 May 2018" as the attachment time (by Picayune, Mississippi time) the policy became partly a time policy (from a particular time in Picayune) and partly a voyage policy to the termination of the cover by reference to the terms of cl 8 of the 2009 ICC (A). The applicant did not put the matter precisely thus, but the mixed character of a time/voyage policy was said to be something that required clear terms: cf The 'Al-Jubail IV' [1982] 2 Lloyd's Rep 637; and The 'Marina Iris' [2007] 1 Lloyd's Rep 66.
61 The applicant submitted that the reasonable business person would not read "19 May 2018" adjacent to "Period of Insurance" as precisely and demandingly contractual. A number of matters may, perhaps, be seen to tend in the direction of that submission. First, no precision as to it being local standard time is given in the operative placement slip. Such precision was given in the Master Slip when identifying the times after and before which the risk must attach (by the terms of the policy) to fall within the facility being provided for. Secondly, and relatedly, such clarity and precision might perhaps be expected if one were changing the nature and form of the cover from an anticipated voyage policy, its attachment and termination determined by the understood terms of the incorporated wordings, to a time and voyage policy with its inception by attachment of cover importantly changed to a precise time in Picayune. Thirdly, and also relatedly, this change in the nature and form of the cover (if it be correct so to characterise it) is done by reference to the placement of a date in the place on the form of the operative placement slip that was previously used in the Master Slip for dates fulfilling another purpose, that is, identifying the local Picayune dates and times between which attachment must occur by reference to the terms of the anticipated wording. Fourthly, objectively, there was no expressed or apparent intention to depart from the nature, form and structure of a policy anticipated by the Master Slip: a voyage policy whose attachment occurred by reference to identified wording as long as that attachment, referable to anticipated terms, occurred prior to an identified date within a given range, being prior to midnight on 22 May 2018. I am not intending to give any relevant contractual force to the Master Slip. But it was a document that reflected a commercial relationship for anticipated cover for risks attaching within a range of dates and attaching by reference to identified policy wording. One might perhaps expect some objective expression through the terms of the cover for it to be importantly different from that anticipated by the facility under which it was arranged.
62 These considerations then lead one to ask what was the purpose (the objective contractual purpose) of placing the words and numbers "From: 19 May 2018" adjacent to the phrase "Period of Insurance" on the operative placement slip if it did not mark out the commencement or attachment of risk of the cover, by, on this hypothesis, the wording of the cover? The answer given by the applicant is that it was indicative only, indicating that the insurance fell, as it did, within the cover and adequately identified by reference to an unidentified time zone or unidentified time zones the likely date of the commencement of the voyage. This way of looking at the date in the operative placement slip would make it unnecessary to be overly precise as to Picayune time as long as the risk attached by 19 May 2018 that is within the range identified in the facility, ending midnight 22 May, Picayune time. Yet, the parties did not use the expression "From: On or before 22 May 2018, LST"; rather they identified a date (being the same date for both shipments) that was the date of the anticipated voyage - the anticipated commencement or duration of transit.
63 On this way of looking at the matter, attachment takes place in accordance with the terms of the wording without being limited by having to await 12am 19 May 2018, Picayune time. So, attachment took place on 13 May, five days before loading on 18 May (Picayune time) or on 14 May five days before loading on 19 May (AEST).
64 One of the difficulties of this approach is that it is somewhat ungainly in failing to give contractual force and operation to apparently important words marking out the commencement of cover: "Period of Insurance". Also, it fails to give the underwriter any clear knowledge of when it comes on risk for Static Cover until it is known when loading occurred.
65 The above arrangements in favour of viewing "From: 19 May 2018" in the operative placement slip as not contractually binding, but merely indicative of the likely time of the voyage may, perhaps, be seen not to recognise appropriately the importance of the Static Cover extension. It may be seen as too simplistic to call this a voyage policy and to identify some change by the creation of a partly time policy. The Master Slip always anticipated Static Cover prior to loading. It was, and was described as, an extension. The Master Slip identifies a range of dates within which the Static Cover and voyage policy is to attach. The commencement of transit cover under cl 8.1 will be by activity about which it may be difficult to be precise. As to goods that are stationary in a place, it is easy to understand cover for them (from damage or destruction while the helicopter is static before loading) being identified as attaching from a particular time. The underwriter then knows that it is on risk for Static Cover. Although, even if the goods are damaged or destroyed, the underwriter may not be liable to indemnify in the circumstances. The words "up to" before "5 days" can be seen to make its risk of liability to indemnify ambulatory. Nevertheless, it knows that risk attaches from that date (Picayune time, being the local time of the casualty causing damage or destruction for the Static Cover). So, if goods are destroyed such that they are never loaded the insurer may be on risk and may be liable to indemnify. The transit cover will commence by reference to cl 8.1. The exclusion in cl 4.3 for insufficiency or unsuitability of packing or preparation may now have little work to do if the "attachment of this insurance" is the earlier attachment of the Static Cover risk, as the underwriter conceded in argument here. In this way, giving 19 May 2018, Picayune time, as the contractual commencement of the Static Cover nominates a date at which risk attaches under the terms of the anticipated policy wording such that there can be seen to be no fundamental change to the character of the insurance placed from that anticipated in the Master Slip. Further, the insurer has certainty as to when risk attaches from the Static Cover extension and knows that the policy falls within the facility period since the risk attaches according to the policy terms prior to 12am 22 May 2018, Picayune time.
66 If 19 May 2018, Picayune time, can be taken as the time that Static Cover commences, the insurer is on risk from that date. Risk has attached during the facility period. If loading is delayed until 25 May, the cover, though initially attached on 19 May, will only respond for damage to the static property occurring from 20 to 25 May. This way of looking at the matter resolves a number of difficulties. First, the operative placement slip by identifying 19 May 2018 (Picayune time) does not change any features of the policy. It gives a starting date for cover under the Static Cover extension. If loading takes place within five days, say on 23 May 2018, the Static Cover is for four days (contemplated by the words "up to 5 days" in the Static Cover extension). If the loading takes place outside five days, say on 25 May 2018, the Static Cover is for five days (up to 5 days), but from 20 May. This time from which risk attaches (19 May 2018) is within the facility period, and so risk under the policy attaches within the facility period, even if the transit cover commences from loading (on 25 May on this hypothesis).
67 If the date adjacent to "Period of Insurance From:" in the operative placement slip is a reference to when Static Cover risk attaches it makes plain that the time and date used is, as is express in the Master Slip, local standard time, or Picayune, Mississippi time.
68 This approach gives effect to the whole policy, including the Static Cover extension. It gives a clear and certain time for insurer and insured for when this pre-loading property risk attaches. Being by reference to an act in Picayune (loading) it is most naturally assessed by local time, as was expressed in the Master Slip by the known acronym LST. All the placing broker requires are some instructions as to likely loading date and then the broker can nominate a date within the range of the Master Slip as to the preferred date for the commencement of the Static Cover.
69 This approach provides relevant work to do for all provisions of the wording. The plain words of the operative placement slip are given effect: "Period of Insurance: From 19 May 2018". No part of the terms of the policy is otherwise compromised or made uncommercial. The date chosen operates to commence the insurance as extended by the Static Cover extension. In point of fact, by 19 May, Picayune time, the loading had finished and the voyage had begun. There is no evidence that there was any communication between broker and underwriter as to where the helicopter was, or what had happened about packing and loading. The underwriter was being asked to go on risk from a particular day in circumstances where the cover provided included Static Cover from a particular date and transit cover from (and including) loading. That cover was granted, with 19 May identified as the commencement of the period of insurance. In the context of the Master Slip and the reference therein to LST, and the extent of Static Cover being calculated by a local Picayune act (loading) the date is to be construed as by reference to Picayune time. On this basis, the exclusion in cl 4.3 plainly applies: the insufficiency or unsuitability of packing or preparation (packing including stowage into a container) was carried out prior to the attachment of the insurance.
70 The position is not alleviated or changed by recognising that the broker could just as easily, without prejudice or concern of anyone, have put 18 May 2018, and not 19 May 2018. The broker was putting in a date on which the insurance commenced. The broker did not give evidence. There is no evidence that the broker and the underwriter had any mutual knowledge of, or communication about, the state of the facts as they had occurred. It was within the broker's power to obtain the complete facts and to assess precisely when the cover should commence.
71 The result is unfortunate: a one digit change to 18 from 19 would see the insurer liable. But it is not reliance on a technicality. The reference to 19 May 2018 was a statement with contractual force as to when the insurance commenced.
72 I do not see any basis for reading a part of the operative placement slip, the first of the contractual documents, as non-contractual and only indicative as to when the commencement of the voyage was anticipated. It says no such thing.
73 The above makes it unnecessary to discuss the cases as to calculation of time. The context of the cases referred to by the insurer were quite different. In any event, all the cases speak as one that it is ultimately a matter of construction of the contract in question. I have also given consideration to the decision in 1849 of the Supreme Judicial Court of Maine in Walker v Protection Insurance Co 29 Me 317 (1849) (WL 1742, 16 Shep 317), referred to by Gilman J and Merkin RM, Arnould's Law of Marine Insurance and Average (17th ed, Sweet & Maxwell, 2010) at p 427 [13-06], where it was held that the time which determines the duration of the risk is that of the place where the contract was executed, unless it be shown that a different computation of time was contemplated. Here, the terms of the Master Slip (LST) and the identification of a date to commence insurance that contained as its earliest element Static Cover, the liability for which (up to 5 days) was by reference to an act done locally (loading) require the conclusion that it was local (Picayune) time, not AEST, that was intended. This was a single transit policy. There was no risk of multiple time zones demanding the simplicity of one time zone of the place of contracting.
74 The above makes it unnecessary to deal with a number of arguments. I will, however, briefly indicate my views as to them. First, as to the argument of the need for clarity if the unusualness of a mixed time and voyage policy was to be created, the words are clear. The date marks out the commencement of the policy. Further, with the Static Cover, it is a form of mixed policy if that characterisation be relevant: Static Cover for damage pre-loading and voyage cover thereafter.
75 Secondly, if it were necessary to address cl 8.1 of the 2009 ICC (A), the insurance attached when the helicopter moved in the hangar to take it outside for the purpose of loading. The container arrived at 3pm, the helicopter was moved in (that is from) the hangar to outside to be stowed into the container for placement immediately thereafter on to a truck for immediate departure. The immediacy required for cl 8.1 was present and satisfied.
76 Thirdly, the HST Endorsement did not amend cl 4.3 of the 2009 ICC (A). The risk of loading that was included was the risk of damage during loading. The risk of disassembly and packing that was not included was the risk of damage during those undertakings. Clause 4.3 deals with damage in transit caused by insufficiency or unsuitability of packing or preparation. This is not the risk of damage during disassembly or packing.
77 For the above reasons the question posed should be answered "No, the Applicant is not entitled to indemnity." The parties should bring in short minutes to finalise the matter.
I certify that the preceding seventy-seven (77) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice Allsop.