| Archives: February 2017

Award 1231 – Rice in bags – French marine cargo insurance policy – Ship damage during voyage – Cargo discharging and redirection – Goods depreciation due to late arrival near the use-by-date – Indemnification by insurer (no).

Following ship engine damages, a cargo of rice in bags loaded in Vietnam had to be discharged and stored in Port Elisabeth before being redirected, partly in bulker holds, partly in containers, to Abidjan, its ultimate destination. The insurers, having paid the expenses caused by this redirection, refused to pay an amount claimed by the cargo buyer, also ship charterer, on account of the depreciation of some goods resulting from the arrival at destination close to the use-by-date, such loss being allegedly covered by additional clauses attached to the insurance policy.

At first, the arbitral Tribunal decided in favour of the insured the question of time-bar opposed by the insurer and then examined the applicability of the insurance policy articles to the case. It judged that the additional clause 6 concerned a natural deterioration of the goods resulting from ship delay or engine damage but not their commercial value depreciation alone. As the proof of natural deterioration was not provided, the claim was dismissed.