ABSTRACT
With due respect, it is submitted that these comments are not quite so accurate. First, it is to be noted that s 55(2)(c) does not state that the insurer is not liable for any loss ‘caused by’ (or proximately caused by) inherent vice or nature of the subject-matter insured.26 As worded, it only excludes a loss ‘for’, and not ‘caused by’, inherent vice or nature of the subject matter insured. That s 55(2)(c) and this aspect of the clause do not overlap or contradict one another is clear. They are mutually exclusive applying to different types of loss; the former to the latent defect itself, and the latter to losses ‘caused by’ a latent defect.27 That the defence in s 55(2)(c) is not available to the insurer is correct, but the reason is not that to hold otherwise would render the clause meaningless, but that the section, by reason of its wording, has no relevance to a loss ‘caused by’ latent defect. In fact, the defence which would have been available to the insurer, if the policy had not otherwise provided, is the last exception contained in s 55(2)(c) which states that: ‘Unless the policy otherwise provides, the insurer is not liable ... for any injury to machinery not proximately caused by maritime perils.’28
