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Lloyd's Maritime and Commercial Law Quarterly

WHO PAYS THE PIPER—WHO CALLS THE TUNE? RECENT ISSUES ARISING IN THE CONTEXT OF S 53 OF THE MARINE INSURANCE ACT 1906

Dame Elizabeth Gloster *

This article discusses possible targets for reform of the Marine Insurance Act 1906, namely s 53 and the responsibility of the broker for payment of premium; the tension between the basis for the old fiction that the broker is deemed to have paid the insurer and the formulation of the statutory provision, Chapman v. Kadirga; the effect of the default clause in the context of the fiction, Prentis Donegan v. Leeds and Heath Lambert v. Sociedad de Corretaje de Seguros; the effect of the fiction upon the date when the broker’s right to an indemnity from his principal arose; and the questionable need for the provision to remain in the future, as well as its non-application to non-marine insurance.
It is, for me, a somewhat daunting privilege to have been asked to deliver the 24th Donald O’May lecture in the centenary year of the Marine Insurance Act. Charles Debattista generously said: “You can talk about anything you like … .” But I recognized, as did Donald O’May, when invited to give the Fourth Annual Lecture, that this was a dangerous offer. Unlike Donald, I did not take Charles at his word. Indeed, I knew that he didn’t really mean it, when he added by way of apparent afterthought (but, in reality, by way of diktat) “ … but it might be nice if you were to say something about the Act”. Since my judicial relationship with the 1906 Act has been limited to a brief encounter with ss 27 and 28, this was a somewhat forbidding prospect.
I am only sorry that I never met Donald O’May, that legend in marine insurance law after whom these lectures are named. He was, from all accounts, a delightful man. But I am not sure what he would have made of a woman judge giving this lecture! And I was entertained to read in The Times that Donald’s own son, Neal, preferred murder as an area of professional practice to the more rarefied atmosphere of marine insurance.
Donald O’May regarded the Act as a marvellous piece of legislation and said in his book, O’May on Marine Insurance ,1 that the “survival of marine insurance into the 20th century can be attributed to its immortalisation in the Marine Insurance Act 1906”. The question which faces us today, however, is whether the Act can survive largely intact into the 21st century, or whether there are some priority areas for its reform. This lecture (with its somewhat inappropriate title, conjured up on a beach somewhere in south-west France during the summer) seeks to address a few particular areas that, if not ripe for repeal, are at least candidates for some legislative clarification.


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