Miller's Marine War Risks

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Strikers, locked-out workmen or persons taking part in labour disturbances, riots or civil commotions

The “strikes risk” Clause

16.1 The standard clauses providing war risks cover for “Strikers, Locked-out Workmen or Persons taking part in Labour Disturbances, Riots or Civil Commotions” have a lengthy history, but have generated relatively little litigation. There appears to be no case in which strikers or their counterparts, workmen who have been excluded from their workplace by their employer locking the factory gates, or persons taking part in labour disturbances, have been judicially considered in the context of a War Risks Policy. The overlapping limits of “riot” and “civil commotions” as civil disturbances of a serious nature are discussed in . In determining the limits of cover, reference will therefore be made to disputes arising outside of the insurance arena. The reported cases are drawn from other areas of international trade (notably, in respect of laytime/demurrage) and from civil and criminal cases testing the definitions of “riot”, “lock-outs” and “civil commotion”. The decision to “read across” from trade union litigation and charterparty cases is justified by the reciprocal use of shipping cases in recent decisions of the Court of Appeal and Employment Appeal Tribunal.1 Whilst the precise limits of the contractual and regulatory definitions of key terms might not be identical, the courts have identified a broad range of common principles. Although most of the above definitions are given in laytime cases, there would appear to be no reason to suppose that these should not apply to the insured perils in the War Risks Policy. Moreover, there is no reason to limit the “strikers” to those who are engaged in the business of the ship in some way, such as stevedores, tug crews, crane drivers, linesmen, pilots or customs officers, who render some services to her; strikers from other places of work or interests, even those that have no connection with the ship or even with shipping in general, can give rise to the insured peril. 16.2 The strikes clause was taken from the S.G. Form with Institute War and Strikes Clauses attached. It has never been regarded as a well-drafted or happily worded clause and has given rise to difficulties in its interpretation. It is a pity that “riots and civil commotions” were not in 1983 removed to Clause 1.1 of the MAR Form, leaving this clause to deal with the consequences of industrial action which are themselves serious enough to merit a clause of their own. Had this been done, then the true intentions of the War Risks Policy would have been better expressed, namely

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that the policy should give cover for a number of violent disturbances, as expressed in Pan American World Airways Inc v. The Aetna Casualty & Surety Co. 2 as being in descending order of seriousness whoever caused them, and a separate clause would be left to deal with loss or damage caused by industrial disputes or disturbances which can be of a violent nature. 16.3 It has been suggested that “persons” should be read ejusdem generis with “strikers” and “locked-out workmen”.3 If this were so, then some very odd results would follow. Cover would only be given in riots and civil commotions if the perpetrators were strikers or locked-out workmen or something akin, and it would not be given in the case of anyone else who could not be so described. Alternatively, it could also be argued that damage done by strikers and locked-out workmen and other persons would not be covered at all unless it was a riot or civil commotion or a labour disturbance of a most violent nature which would involve considering if an insured peril had arisen simply because of the degree of violence used. If this were correct, then there would be an important gap in the insurance cover where stevedores, workmen or other persons like them caused damage to a ship, because the War Risks Policy would not pay for it and Clause 24 of the Marine Policy would be strong enough to exclude it from that policy’s cover. 16.4 Furthermore, if two strikers of an alarming appearance should damage a ship, there would be no cover because two people cannot form a riot; they would need to be joined by more people before there could be a riot, when cover would be given by the War Risks Policy.4 This would effectively frustrate the intentions of the new Institute Time Clauses, both marine and war that, like the old S.G. Forms which they were replacing, there should be no gaps in the insurance cover that was provided. A very artificial position would arise if this reading were adopted as the correct one. It is suggested that the following summary truly reflects the intention of the Institute War and Strikes Clauses and is consistent with the wording that is used in it. These clauses give insurance against loss or damage caused by (1) strikers, or (2) locked-out workmen, or (3) persons (whoever they are) taking part in labour disturbances, riots or civil commotions.


16.5 Turning now to considering the three separate insured perils, there is an enormous body of case law on “strikers” in the maritime field out of charterparty and bills of lading disputes, mostly on laytime. Aligned with this is a further body of trade union disputes which have been resolved on similar principles. There is one important limitation on most forms of war risks marine cover. Apart from the special cover given by the Mutual War Risks Associations, where in one narrow instance “strikers” has a wider application, it must be remembered that the Institute War and Strikes Clauses are solely concerned with physical loss or damage that they cause to the insured object. Whilst this might arise by way of an act or an omission, we are not

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concerned with the consequences of delay to the vessel or the cargo, as in laytime/demurrage disputes. 16.6 The definition of “strikes”, as with many forms of industrial action, has developed through case law and statutory intervention over the past 150 years. English judges resolving commercial disputes have stressed its mutable and non-exhaustive nature, as in The Laga, where McNair J. stated:

one has got to bear in mind that the meaning of the word “strike” must change with the progress (if that is the right word) of industrial history and it may have a different meaning today from the meaning given to it a century ago.5

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