ABSTRACT
The most recent case which has queried whether a policy with specified dates for the commencement and termination of the risk, but incorporating an extension or cancellation clause, was still to be regarded as a policy for time is Compania Maritime San Basilio SA v Oceanus Mutual Underwriting Association (Bermuda) Ltd, The Eurysthenes.6 In this case, the club’s rule stated that the policy was for a year, but with the entry that the policy was ‘to remain in force until expiry or cancellation’. It was argued by the shipowner that as it continued indefinitely until determined by one side or the other, the insurance was not for a ‘definite period of time’ within the meaning of s 25 of the Act. Lord Denning MR had no doubt whatsoever that it was sufficiently specified, ‘… even though that period is determinable on notice, and even though the assurance will be renewed or continued automatically at the end of the period, unless determined; or will continue under a continuation clause’. In similar tone, Lord Justice Roskill’s comments were:7
Time policy with a geographical limit A policy for a definite period of time but with a clause specifying that the policy will only remain in force whilst traversing within a certain geographical limit is nonetheless a time policy. This was the ruling in the Australian case of Wilson v Boag,8 where the policy under consideration was for a period of four months, but with a clause that it will only remain in force ‘within a radius of fifty miles’. During a voyage when the vessel was taken outside the 50-mile perimeter, she became disabled, and salvage charges were incurred which the plaintiff now sought to recover from their insurers. The Supreme Court of New South Wales held that the policy was not a voyage but ‘a time policy in which is contained a limitation of the liability of the insurer to loss sustained while the launch is within a defined geographical area’. In each case, it is essentially a question of the interpretation of the terms of the policy.
