Introduction

1.01 In April 1760, a French man-of-war of 64 guns and a frigate of 20 guns audaciously raided and overran Fort Marlborough on the island of Sumatra. The attack was executed presumably in the milieu of the Seven Years’/Third Carnatic War. The Governor had foreseen the risk of an attack and considered it prudent to insure against this contingency. The seizure of the fort led to the presentation of a claim under the policy against the insurers. Six years later, the 18th-century champion of commercial law in the City of London, Lord Mansfield CJ,1 took the opportunity while presiding at Guildhall over the disputed claim to express his view on the principle of good faith, which he declared to be applicable to “all contracts and dealings”,2 although the case before him concerned only an insurance policy.