Kastor Navigation Co Ltd. & Anor v AGF M.A.T & Ors, Court of Appeal - Commercial Court, December 04, 2002, [2003] 1 Lloyd's Rep 296,[2003] 2 CLC 489,[2003] 1 LLR 296,[2003] 1 All ER (Comm) 277,[2002] EWHC 2601 (Comm),[2003] 1 Lloyd's Rep IR 262

Extract

---

Kastor Navigation Co Ltd. & Anor v AGF M.A.T & Ors, Court of Appeal - Commercial Court, December 04, 2002, [2003] 1 Lloyd's Rep 296,[2003] 2 CLC 489,[2003] 1 LLR 296,[2003] 1 All ER (Comm) 277,[2002] EWHC 2601 (Comm),[2003] 1 Lloyd's Rep IR 262

Case No: 200 Folio 1196

[2002] EWHC 2601 (Comm)

IN THE HIGH COURT OF JUSTICE

QUEENS BENCH DIVISION

COMMERCIAL COURT

Royal Courts of Justice

Strand, London, WC2A 2LL

Date: 4 December 2002

Before :

THE HONOURABLE MR JUSTICE TOMLINSON

- - - - - - - - - - - - - - - - - - - - -

Between :

- - - - - - - - - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - -

Mr Stephen Hofmeyr QC and Mr Andrew Baker (instructed by Ince and Co.) for the Claimants

Mr Steven Berry QC (instructed by Holman Fenwick and Willan) for the Defendants

Hearing dates : 1,2,3,4,8,9,11,15,16,17,18,22,24,25,29,30,and 31 July 2002.

- - - - - - - - - - - - - - - - - - - - -

Mr Justice Tomlinson :

1. This is a claim against underwriters in respect of the total loss of a ship. ``Kastor Too'' was a steel-built four hold geared motor bulker of 17,665 tonnes deadweight, 148 metres in length built in Japan in 1977. The First Claimant was the registered owner of the vessel. The Defendants subscribed to a contract of marine insurance contained in a slip policy on the MAR 1991 Form insuring the First Claimant's interest in the hull and machinery of the vessel against marine risks for a period of 24 months at 30 December 1999. The vessel was valued at US$3M. The Defendants insured 80% of the risk. The insured perils included fire, explosion and perils of the sea. The Second Claimant was mortgagee of the vessel and the assignee of and loss payee under the policy.

2. On 29 February 2000 the vessel sailed from Aqaba bound for Vizagapatnam laden with a cargo of rock phosphate in all four holds. At about 1420 hours on 9 March when the vessel was in a position between the island of Socotra and the coast of South Yemen a fire was discovered at the purifier flat level in the engine room. The fire was observed by the Chief Engineer and the Third Engineer through a window in the engine room control room where they then were. The Third Engineer took a 5 kg CO2 fire extinguisher from the control room but he could get no closer to the fire than the stairway on the starboard side of the engine room because of the smoke and flames so he emptied the extinguisher from there in the general direction of the fire to no effect. There were no further efforts to fight the fire and the engine room was abandoned within two or three minutes of the initial observation of the fire. Although the emergency fire pump located in the steering gear room was started the main fire pump at bottom plate level was not. The emergency fire pump was used for boundary cooling. After closing of all openings in the engine room the fixed CO2 system was activated. This appeared initially to have the effect of reducing the amount of smoke issuing from the funnel area. This effect was shortlived. Within thirty minutes smoke escaping from the funnel area and the starboard engine room ventilator began to increase significantly. The crew abandoned ship and took to the two lifeboats. All personnel including the Master and Chief Engineer, the last to leave, were in the boats by about 1700. Between 0500 and 0600 hours the next morning, ie, about 15 hours after the initial observation of the fire, the vessel sank stern first.

3. The ship would not have sunk with the engine room alone flooded. In order for her to sink at least two compartments must have been flooded, the only realistic contender here in addition to the engine room being No.4 hold, which is immediately forward of the engine room bulkhead. A steel ship constructed in accordance with the Load Line and other conventions in force when this ship was built should not sink as a consequence of a fire in the engine room. For a steel ship constructed in this way to have sunk as a consequence of fire in the engine room within only 15 hours or so of the outbreak of the fire would be very remarkable. That is no doubt why the underwriters have declined to pay the Claimants' claim for the total loss. Although the underwriters adduce no positive case as to the cause of the sinking, no one could have been in any doubt as to the underwriters' suspicion that the vessel had been scuttled.

4. This action was begun on 1 November 2000. Initially the Claimants claimed for an actual total loss, allegedly caused by fire and/or explosion and/or perils of the sea. I leave out of account a subsequently abandoned allegation of crew negligence. I can also henceforth omit reference to perils of the sea. The Claimants' only case was that the fire and/or explosions caused a fortuitous entry of seawater, so reliance upon perils of the sea adds nothing. Initially, underwriters neither admitted nor denied that there had been a fire but denied that, if there had been, it had caused the sinking of the vessel. By an amendment to their pleadings introduced in August 2001 the Claimants claimed additionally or in the alternative for a constructive total loss of the vessel. They alleged that prior to her sinking the vessel was so da...

See the full content of this document

---