The moisture emitted from the cargo was understood to have mixed with the atmospheric moisture and condensed on the walls of the holds as also the beams of the ship, and when this water fell on the cargo, it was no more exclusively the moisture from the cargo. It was agreed that the heating was caused by the presence of moisture in the cargo, thus being caused by “inherent vice”, but the “sweat” was considered not entirely the result of the moisture inside the cargo.
#Condensation meaning trial#
In CT Bowring case, the policy covered against “sweating and / or heating when resulting from external cause”. Though the trial court ruled in favour of the insurers, declaring the loss to have been caused by inherent vice of the cargo, the Court of Appeal reversed the decision. However, the reason given in the judgements makes it clear that they are not. On the surface, the two decisions appear to be inconsistent. This case was considered not payable, i.e. The loss was said to have been caused by condensation of excessive moisture in the cargo when it was shipped. Harding, a cargo of gloves was shipped in containers from Calcutta during the monsoon period, and reached Rotterdam in severely damaged and mouldy condition.
Such cargo being hygroscopic in nature, can be generally said to attract the Exclusion 4.4. Amsterdam London Insurance Co., a cargo of ground nuts imported from China to Rotterdam and Hamburg was damaged by heating and “sweat” from the ship’s holds. Some other examples are fruit becoming rotten, flour heating, or wine turning sour, etc. So, what is meant by inherent vice of a cargo? A loss by inherent vice is one which is proximately caused by the natural behaviour of the subject matter insured, being what it is, in the circumstances in which it was expected to be carried. Condensation loss, when emanating from the moisture inside the cargo, is a kind of inherent vice. So, are such losses covered? Let’s look at some losses which became the subject matter of litigation.īut before we do that, let’s look at the Exclusion 4.4 of ICC ‘A’ –Įxcl 4 - In no case shall this insurance coverĤ.4 loss damage or expense caused by inherent vice or nature of the subject-matter insured. This water may often cause loss to the cargo. When this moisture condenses on the walls or beams of the ship, or the ceiling of the container, it falls in the form of water which is referred to as sweat or container rain. it absorbs, stores and emits moisture, moisture from the cargo may get mingled with the atmospheric moisture in case of bulk cargo, and in case of containerised cargo, may remain inside the container. If the cargo being carried is hygroscopic in nature, i.e. The atmospheric moisture condenses on the ships sides or beams whenever the movement is from hot and humid to cold. There are also temperature variations between day and night time.
Generally, a ship sails through different climatic regions, covering hot and cold climatic zones.
So, are all condensation losses not payable? To discuss this, let’s first see how a condensation loss takes place.
#Condensation meaning professional#
Brokers particularly find themselves in a precarious position having to explain the situation to the client who considers it their failure to provide the professional services they had been mandated to do. Most of us have also faced the problem of having to explain to the insured why a particular condensation loss, which occurred because of the inherent vice of the cargo, is not payable even when the coverage is on ICC ‘A’ (All Risk) terms. Such losses are encountered in bulk cargoes as well as containerised cargoes. Most of us working in the insurance industry have had to deal with condensation losses under Marine policies.
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