The plaintiff claims from the defendant insurance company under a policy of marine insurance for damage to its cargoes of sugar and rice on four ships, the ss Tejo, the ss Montrose, the ss Milvia and the ss Bramante. The plaintiff submitted its claim to the defendant through its agents in Cyprus, but the latter rejected the claim.

Held: Judgment for the plaintiff.

One of the complaints of the defendant concerns the failure of the plaintiff to notify the shipowners/carriers of damage to its cargoes. On the facts of the case the plaintiff notified the carriers on 4 February 1957 of the damage and about a proposed survey, without specifying the exact date. But even if the carriers were not duly notified by the plaintiff, paras (a) and (b) of the 'Important Notice' in the insurance certificate are not conditions precedent. Even if they were conditions precedent, they were waived by the conduct of the defendant who did not take this particular objection in any of its letters to the plaintiff. Furthermore, under the provisions of the Schedule to the Carriage of Goods by Sea Act 1924 (UK) (incorporating the Brussels Convention of 1924, known as the Hague Rules), the giving of notice to the carriers is not a condition precedent for the enforcement of a claim against them (art 3.6 in the Schedule to the Act). In any event the burden of proving loss or damage is on the consignee. Article 3.6 reads as follows:

Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the carrier or his agent at the port of discharge before or at the time of the removal of the goods into the custody of the person entitled to delivery thereof under the contract of carriage, or, if the loss or damage be not apparent, within three days, such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of lading.

The notice in writing need not be given if the state of the goods has at the time of their receipt been the subject of joint survey or inspection.

In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered.

In the case of any actual or apprehended loss or damage the carrier and the receiver shall give all reasonable facilities to each other for inspecting and tallying the goods.

It will thus be seen that only the third para must be complied with, and that the cargo owner will lose any remedy it has against the carrier unless it issues a writ against the carrier within one year, or the carrier waives that requirement.

Another complaint of the defendant is that: (i) the plaintiff delayed in submitting the matter to the defendant in time; (ii) it failed to sue the carriers within the time allowed by law or usage, that is within a year; and (iii) it failed to safeguard its rights against the shipowners for the damage or loss, whereby legitimate claims against the shipowners and/or third persons were lost.

These complaints of the defendants were based on para (d) of the 'Important Notice' concerning loss by pilferage, the principles of subrogation, the alleged duty of the plaintiff to institute proceedings against the carrier within a year under the provisions of the Carriage by Sea Act 1924 (UK), art 3.6 of the Schedule, and s 78 of the Marine Insurance Act 1906 (UK), which provides that it is the duty of the assured vis-a-vis the carrier to minimise loss.

From a perusal of paragraph (d) of the Important Notice it becomes abundantly clear that that para refers to losses by pilferage only and not to any other risks. In the present case the loss is shortage due to tearing of bags through the use of hooks and damage by water. Consequently, there is no question of pilferage and para (d) is inapplicable.

With regard to the duty of the assured to minimise loss vis-a-vis the carrier under the provisions of s 78 of the Marine Insurance Act 1906, the provisions of that section are not applicable to this case, but even if they were the assured has done everything within its power to minimise loss.

On the findings of fact in this case it is obvious that the plaintiff did not delay in submitting the matter to the defendant in time. It applied for a survey on 4 February 1957 and as soon as it received the survey report on 20 November 1957 it submitted its claim to the defendant. This was more than two months before the close of the year after delivery of the goods. In fact, the defendant concedes that it neither paid the plaintiff nor did it require the plaintiff to bring an action against the carriers. That puts paid to the argument that the plaintiff failed to sue the carriers within a year under the 1924 Act as aforesaid. There is no express provision in the policy or any other agreement between the parties making it a condition precedent to the satisfaction of the plaintiff's claim that it should first enforce its claim against the carriers.