Marine Insurance Fraud (In International Trade)
This book is a worthy addition to the two related areas of maritime insurance and fraud. It covers the extent to which fraudulent activity is covered by standard marine policies, and the effect upon the validity of both contracts of insurance and claims that might be made upon them of frauds committed by assureds, brokers, assignees and others.
1. CHAPTER 1: IDENTIFYING FRAUD
Identifying maritime fraud – defining marine insurance fraud – categories and classification.
9. CHAPTER 2: THE CLIMATE FOR FRAUD
Historical and economic perspectives – the London Market – the dominance of English maritime law – the climate for fraud in world markets – growth of maine fraud – South East Asia – the 1990’s – China and Hong Konh.
27. CHAPTER 3: CRIMINAL FRAUD
English law of criminal fraud – elements of a crime – the deception offences – assured, brokers, insurers – silence, concealment and deception generally – false document offences – the concept of conspiracy – brief comparisons with other countries.
49. CHAPTER 4: CIVIL FRAUD
The meaning of civil fraud in marine insurance. The rule in Derry v Peek, defining English law of civil fraud – representations and formation of the contract – utmost good faith – disclosure by assured and brokers – fraudulent and innocent misrepresentation contrasted with negligence – good faith by under writers – materiality of circumstances for disclosure.
Pre-contractual concealment and overvaluation 0 fraud or not fraud – the U.S. position. Defences to overvaluation – contractual illegality – mistake, the failure of insurance – the premium.
77. CHAPTER 5: BROKERS
Brokers’ duties of disclosure – the Lloyd’s Code – Brokers’ role in settlement of claims – the dual broker – conflicts with the courts – the Lloyd’s position – fiduciary duties of brokers – brokers’ duties, obligations and offences under Prevention of Corruption Act 1906 – the meaning of corruption in a commercial market – making and use of false statements – criminal misappropriation of clients’ funds – possible defences.
Brokers; secret profits – the criminal cases – loopholes and dangers – agents misuse of funds – post contractual fraud. Reinsurance, brokers’ duties of honesty and disclosure. Negligence. Brokers’ duties as to unauthorised or secret profits – duty to account in civil law – defences to claims. Rules as to bribes.
117. CHAPTER 6: ASSURED – FRAUDULENT CLAIMS
The assured – proving a claim – causation – fraudulent claims – pleading fraud – the absolute obligation of disclosure – consequences of concealment and non-disclosure by an assured – standard of proof in civil fraud – limits of disclosure – post contractual concealment, the test for fraud and concealment – voyages under warranty.
Assured’s wilful misconduct – negligence and carelessness distinguished. Proving misconduct – consideration of evidence; the approach to proof by a court or arbitrator. Proving included and excluded losses – ‘privity’ by assured – the American position. Acts of criminality and fraud ships.
145. CHAPTER 7: SCUTTLING (‘WILFUL CASTING AWAY’)
Scuttling – criminal conduct, commercial consequences. Samuel Dumas and the Elias Issaias cases examined. Questions of proof – the presumption of innocence, an overlap of criminal and civil concepts – motive and proof of scuttling – proving scuttling for civil purposes distinguished from proof of criminal act of scuttling – privity by owners and the burden of proof.
Arson and fraud – barratrous fire – special rules of proof – the judicial approach to analysing evidence. Damaging or destroying a vessel – the criminal law offences.
163. CHAPTER 8: THEFT, DEVIATION AND BARRATRY
Marine insurance ‘theft’ distinguished from criminal theft – the Nishina Trading case – the conflicting strict and traditional approaches to the meaning of ‘theft’/ On-shore theft within the Transit Clause. Marine and purely land policies distinguished – brief considerations of non-marine cover outside Transit Clause, Grundy v Fulton discussed – deviation and theft on land.
Insurance fraud at sea – justice and injustice. Marine ‘theft’ – the rules prior to Theft Act 1968 – the Salm case analysed – deviation and ‘taking at sea’.
Marine theft defined – the two categories of marine theft Institute cover against ‘violent theft’ defined - ‘theft’ post 1968 defined – proving ‘theft’ in a marine policy.
Barratry, fraudulent and criminal conduct considered – duties of master and crew of shipowners – insurer’s liability for barratry claims by cargo owners – illegal sea-trade and seizure cases.
187. CHAPTER 9: JURISDICTION IN MARINE FRAUD
Civil and criminal jurisdiction in marine insurance cases. Territorial jurisdiction – extraterritoriality widening the weapons state – criminal fraud jurisdiction. Western and South East Asian countries compared.
199. CHAPTER 10: ARBITRATING MARINE FRAUD DISPUTES
The resolution of disputes – the limitations of litigation – the advantages of arbitration and conciliation in marine insurance cases – London and Hong Kong, two international arbitration centres compared. International arbitration bodies arbitrating marine fraud disputes.
- Witherby Seamanship International