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Abandonment, the Doctrine (Marine Insurance)

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Law and Sea.

Infringement of customs regulations
Last updated: 11-Dec-2014

Per Flaux J in Atlasnavios - Navegacao, LDA v Navigators Insurance Company Ltd & Ors [2014] EWHC 4133 (Comm) at paras 258, 260:

258. Wide though the words of the exclusion in clause 4.1.5 of the Institute War and Strikes Clauses are, in my judgment they must be subject to the implied limitation that they do not apply where the only reason why there has been an infringement of the customs regulations by the vessel is because of the malicious acts of third parties, whether the authorities themselves or their agents in the conceded case or the blackmailer or person acting with actual malice in my two examples or the drug smugglers in the present case who strapped the drugs to the hull for their own ends, knowing that or being reckless as to whether the vessel would be detained by the Venezuelan authorities if they discovered the drugs. In each case, the "infringement" brought about by the drugs being strapped to the hull of the vessel is no more than the manifestation of the relevant act of persons acting maliciously.

260. Accordingly, in my judgment upon the correct construction of the policy and reading the malicious acts cover and the exclusions together, "infringement of customs regulations" in the exclusion does not include an "infringement" which is itself no more than the manifestation of the relevant act of third parties acting maliciously and the exclusion is subject to that limitation, equally applicable on the facts of this case as in the cases of the various "put-up jobs" I have identified above.

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