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By reason of the above, alteration has been necessitated in the setting out of the clauses printed at the foot of the set. These are now as follows:
(a) F.C. & S. clause. (b) of the old set-p. 25.
(b) S.R. & C. C. clause. (c) of the old set.
(c) Frustration clause. Added to operate only if (a) above be deleted.
(d) As before.
INSTITUTE STANDARD PORT RISKS CLAUSES.
The designation “Institute" has now been prefixed.
The following alterations may be noted:
"Foreign General Average" clause. This clause (No. 3. in the new set-the old set were not numbered) is identical with the corresponding new clause (No. 7) of the Institute clauses for Builders' Risks.
New clause. The combined form of Tender clause has been added.
Protection and Indemnity clause. A minor alteration in the opening It is further agreed " in place of "And we further agree.' Subject to the exceptions mentioned below the clause is identical with that appearing in the Builders Risks clauses.
(i.) Whereas the Builders' clauses (P. & I. risks) exclude loss of life and personal injury, the Port Risks clause covers "Loss of life or personal injury or payments made on account of salvage, whether of life or property." (N.B. Property saved at the same time and by the same series of operations as by which life is saved from peril at sea must contribute towards life salvage under the provisions of the Merchant Shipping Act, 1894.)
(ii.) Whilst the employers' liability exclusion in the Builders' Risks clauses mentions "accidents to workmen only, the corresponding Port Risks clausing excepts "accidents to or illness of workmen or any other person employed in any capacity whatsoever by the assured or others in or about or in connection with the insured ship or her cargo materials or repairs."
The footnotes are as in the Institute Builders' Risks clauses. In effect, the two sets have been brought into line with one another as far as possible.
AMERICAN HULL FORM-ATLANTIC (A.H.U.A.).
Two alterations have been made in this, viz. :—
Foreign General Average" clause (p. 43 in the Clause Book). This is now as follows:
General Average and Salvage Charges payable in accordance with York-Antwerp Rules, 1890 (either including or excluding Rule 1), or York-Antwerp Rules, 1924, if so provided for in the contract of affreightment. As regards
matters not provided for in the York-Antwerp Rules, 1890, or York-Antwerp Rules, 1924 (when the contract of affreightment provides for such rules), and also when the contract of affreightment does not provide for such rules, General Average and Salvage Charges shall be payable in accordance with the laws and usages of the United States. Provided always that when an adjustment according to the laws and usages of the Port of destination is properly demanded by the owners of the cargo, General Average shall be paid in accordance with the same.
It has been suggested that the words italicised are anomalous in view of the fact that the introductory Rules A-G of the York-Antwerp Rules, 1924, provide principles which are to be applied to matters not specifically dealt with in the numbered Rules I.-XXIII.
Bottom Painting clause. Whereas previously underwriters agreed to pay such costs of scraping or painting the vessel's bottom as were allowable under Rule of Practice VIII. of the Association of Average Adjusters of the United States, under the new clausing no claim for scraping or painting will be admitted in any case. This revision is explained by reason of the fact that Underwriters under the old clausing have been called upon to pay sums under claims which they have felt should not have been presented.
The clause has been considerably amended. Firstly, it is now stated that the clause "is to be used in conjunction with (Institute) Hull clauses." Although the preceding
parts of the clause have been modified the effective difference of the new wording is contained in the following:-" Should the assured by reason of insured perils become entitled to abandon the vessel and to claim a Constructive Total Loss as above but refrain from doing so and the vessel be not repaired or if she be sold unrepaired, liability hereunder shall be determined as if notice of abandonment had been given and a Constructive Total Loss claimed."
The alteration was made because under the old clause insurers were placed automatically in the same position as if they had accepted abandonment, i.e., as if they admitted sufficiency of notice and liability to pay as for actual total loss. Although, as is well known, there is a paucity of authority on the subject, it has been suggested that the effect of the old wording was following on acceptance of abandonment "-to subrogate not only proprietary rights of the assured, but also responsibilities in the subject matter, e.g., the cost of removal when an impediment to navigation.
All that has been done in the case of this clause is to delete the R.S. and C.C. clause so that the new clause is now requisite to provide for "Strike "risks, and in future War and Strike risks will be incorporated separately as arranged, and not together as heretofore. The new Strike clause is considered below.
Nos. 1 and 2 have been completely revised. No. 1 now loses its old title, and is now simply the "North America
Warranty." The "not north of " limit is now fixed by latitude 43° 40′ N. on the East coast and 50° N. on the Pacific Coast. Halifax, ports and places on Vancouver Island, and Prince Rupert via Dixon Strait are excepted from the operation of the warranty, as are Louisburg and Sydney-in the case of the latter two ports for bunkering purposes only.
No. 2 (The No Baltic Sea Warranty) has also been drastically dealt with, the area being divided into zones to which different restrictive periods apply. The zone south of 64° 10' N. latitude has been entitled freed from the operation of the warranty. Reference to an atlas and to the new warranty will indicate the regional zones and the periods during which they are taboo.
INSTITUTE BAILEE CLAUSE.
This clause was issued by the Institute with a recommendation for its use in connection with North American shipments. Actually a good case has been made out for its inclusion in the Institute Cargo clauses. The aim of the clause is to prevent benefit of an insurance policy effected on goods inuring to the benefit of the carrier. Thus the assured, if he has any rights in respect of loss or damage to his interest, must treat the carrier as primarily liable. There is not to be contribution between insurer and carrier towards the loss, nor is the carrier to be subrogated to any rights of the assured against his insurer. Where the amount recoverable from the carrier does not suffice fully to indemnify the assured, the policy-subject to the terms hereof-will make good that proportion of the loss not claimable from the carrier. In other words, although freedom of contract between assured and carrier is not disturbed, under this clause the carrier is to be given no rights against the underwriter.