Insurance Law Monthly
Piracy
In Masefield AG v Amlin Corporate Member Ltd [2011] EWCA Civ 24, the Court of Appeal was asked to overturn David Steel J’s conclusion that the detention of goods by pirates had not amounted to an actual total loss. The decision is discussed by David Turner QC of 4 New Square.
The facts
In August 2008
Bunga Melati Dua was seized by pirates off the coast of Somalia. At the time of seizure, she was carrying a cargo of biodiesel from Malaysia
to Rotterdam. The cargo owners served a notice of abandonment on insurers on 18 September 2008. Eleven days later, the ship
was released following payment of a ransom by the vessel’s owners, MISC, on behalf of the shipowners. By the time the ship
arrived in Rotterdam in late October 2008 the seasonal market for biodiesel had closed. Following storage until the following
year, the biodiesel was sold for substantially less than its insured value. The cargo owners brought a claim on the policy
for £7.6m.