“BRILLANTE VIRTUOSO”: Judgment [HD-UKLIVE.FID2551190]

Banking, Bribery and Corruption, Claims, Corruption, Disputes, Energy, Health and Safety, Insurance and Reinsurance, Legal, Marine Insurance, Maritime Accidents, Maritime Fraud, Maritime Fraud, Piracy and Terrorism, Safety and Security, Salvage, Towage, Wreck Removals, Seizures, Ship Finance, Shipfinance — By on January 15, 2015 at 11:54 PM
Rhys Clift

Rhys Clift

The “BRILLANTE VIRTUOSO” 

SUEZ FORTUNE INVESTMENTS LTD and PIRAEUS BANK SA
v
TALBOT UNDERWRITING LTD and others

On 5th-6th July 2011, the vessel Brillante Virtuoso was taken by pirates off the coast of Aden, Yemen. The pirates ordered the vessel to proceed to Somalia, but after the vessel’s main engine stopped and could not be restarted, the pirates detonated an incendiary device in the vessel’s engine room. The explosion caused a fire which substantially damaged the vessel’s engine room, funnel casing and accommodation block.

The Claimants (the vessel’s owner and mortgagee bank) claimed an indemnity for
the constructive total loss, alternatively a partial loss, of the vessel under the war
risks insurance policy issued by the Defendant insurers. The policy incorporated the
Institute War and Strikes Clauses – Hulls – Time (1983), as amended by the Violent
Theft, Piracy and Barratry Extension.

The Court directed that issues of quantum (whether the vessel was a CTL, the
measure of indemnity for a partial loss, and the recovery of sue and labour
expenses) be tried first (Stage One) before issues of liability (based on an alleged
breach of warranty) are tried (Stage Two).

After a four week trial of the Stage One issues in November-December 2014, the
Commercial Court (Flaux, J) made the following findings on 15th January 2015,
namely that subject to the defences and issues to be determined at the Stage Two
trial:

1. The vessel was a CTL and the Claimants are entitled to an indemnity for
US$76, 328, 000. The Court laid down the principles to be applied to the
determination of whether a vessel is a CTL caused by damage.

2. The Claimants are entitled to reimbursement of the costs of salvage and other
sue and labour expenses. The Court explained the principles applicable to
determine the recovery of sue and labour expenses.

As a result of these findings, the issues relating to partial loss did not arise.
Nevertheless, the Court held that, if the vessel had been a partial loss, the Claimants
would have been entitled, not only to an indemnity for a partial loss and for sue and
labour expenses, but also to an indemnity against Loss of Hire under the LPO454
wording.

Claimants’ Solicitors: Hill Dickinson (Rhys Clift) and ReedSmith (George
Panagopoulos).
Claimants’ Counsel: Peter MacDonald Eggers QC, Tim Jenns, Richard Sarll (7 King’s
Bench Walk).
Contact:
Rhys Clift
Partner, Marine Trade & Energy
Hill Dickinson LLP
The Broadgate Tower, 20 Primrose Street, London, EC2A 2EW
Tel: 020 7280 9199
Fax: 020 7283 1144

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