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Direct Action against the Insurer and its Limited Effect

Part of the Hamburg Studies on Maritime Affairs book series (HAMBURG, volume 5)

Keywords

Insurance Policy Insurance Contract Liability Insurance Fund Convention Environmental Liability 
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References

  1. 1.
    Arnould, Joseph/ Mustill, Michael J., Law of Marine Insurance and Average (1981), 16th ed., Volume 1, p. 155–156: “Questions have been raised as to the parties who may avail themselves of these very broad and comprehensive terms. In the first place it is clear they must be persons who may lawfully be insured. In the next place they must be persons who, at some time during the risk, have an insurable interest in the property, either as the persons originally insured or as their assignee. Beyond this, it must be shown that the person affecting the insurance either intended it for their benefit, or at all events did not intend it exclusively for the benefit of others having a conflicting or inconsistent interest, but mean it to apply generally, so as to cover the interests of those who should ultimately appear concerned...”Google Scholar
  2. 5.
    Clarke, Malcolm A., The Law of Insurance Contract (2002), p. 225. For instance, in England, the assignment of marine policies is now governed by the Marine Insurance Act 1906, sections 50 and 51: “50. (1) A marine policy is assignable unless it contains terms expressly prohibiting assignment. It may be assigned either before or after loss. (2) Where a marine policy has been assigned so as to pass the beneficial interest in such policy, the assignee of the policy is entitled to sue thereon in his own name; and the defendant is entitled to make any defence arising out of the contract which he would have been entitled to make if the action had been brought in the name of the person by or on behalf of whom the policy was effected. (3) A marine policy may be assigned by indorsement thereon or in other customary manner.” “51.Where the assured has parted with or lost his interest in the subject-matter insured, and has not, before or at the time of so doing, expressly or impliedly agreed to assign the policy, any subsequent assignment of the policy is inoperative: provided that nothing in this section affects the assignment of a policy after loss.”Google Scholar
  3. 6.
    Clarke, Malcolm A., ibid., p. 226: “A distinction is made between (a) assignment of the (entire) contract of insurance, and (b) assignment of the right to recover insurance money under the contract. (a) must also be distinguished from (c), the conclusion of a new contract between insurer and “assignee”. It may be difficult to distinguish (a) from (c), but it can be said that the consent of the insurer to the assignment is not of itself enough to indicate a new contract. In (a) and (c) the assignee becomes the insured under the contract, whether it be the old contract or a new contract, and the assignor drops out, a change described as a innovation, while in (b) the assignor remains the insured. This difference produces differences in the consequences of assignment. In any case, any contract which is normally assignable may be made expressly non-assignable.”Google Scholar
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    Arnould, Joseph/ Mustill, Michael J., supra, note 1, p. 174.Google Scholar
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    Long title of the Third Parties (Rights against Insurers) Act 1930, reprinted in: Rose, F.D., Marine Insurance: Law and Practice (2004), Appendices, p. 631.Google Scholar
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    Holmes, Eric M. (general ed.), supra, note 28, pp. 55, 56.Google Scholar
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    It has been suggested that: “although the direct action has been granted based on the general policy of protection of the weaker (third) party and the legal rules confirm this right explicitly, there seems to e a more important legal principle to protect the economic interest of the P&I Clubs.” See Fossion, Gregory, ‘An Eternal Triangle at Sea: Loss of Insurance Cover under a Direct Action in Marine Liability Insurance’, at <http://www.law.kuleuven.ac.be/jura/39n2/fossion.htm> (visited 10 October 2005).Google Scholar
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    Hazelwood, Steven J., supra, note 13, p. 113, the coverage takes great account of the individual characteristics and requirements of a member.Google Scholar
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    The general reference is from ibid., Chapter 9: “Exceptions and Limitation to Club Cover”.Google Scholar
  33. 45.
    The indemnity principle may not be so absolute to all types of insurance. As observed in Holmes, Eric M. (general ed.), supra, note 28, p. 4: “The most accurate conceptualization of insurance arrangements is to observe, first, that neither life insurance nor any other form of insurance is invariably a pure indemnity contract; second, that all forms of insurance are subject to the influence of the principle of indemnity; and third, that the influence of the indemnity principle is less pervasive in some forms of insurance, such as life insurance, than in other forms of insurance, such as property insurance. In other words, although the characterization of insurance as an indemnity contract is useful as a statement of a tendency or as a generalization, it is not always a reliable guide when answers are sought to specific problems of insurance law.”Google Scholar
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