Whether sales agent entitled to indemnity under marine policy

The head charterers of a cruise ship time chartered the vessel to Transocean Tours, a cruise and tour company. Transocean entered into a "General Sales Agency Agreement" with the claimant, pursuant to which the claimant marketed cruises on the vessel as the agent of Transocean. The claimant appointed tour operators who then contracted with the passengers.

The claimant was named as a co-insured on a marine policy taken out by the head charterers. The policy was a liability policy and the claimant claimed an indemnity against liabilities said to have been incurred by the claimant to the passengers following an outbreak of norovirus on the vessel.

Knowles J dismissed that claim on the basis that the claimant was not liable to the passengers under the Athens Convention 1974 because it was not a "contracting carrier". The passengers had contracted only with the tour operators.

Furthermore, the alleged liability did not fall within the scope of the policy, which covered only "losses, costs and expenses incurred as charterers": there was no charter of the vessel by the claimant and the claimant was not a charterer. This was a case where the claimant's name had been added to the policy without any real thought and for no additional premium. As the insurer's barrister put it: "the mere naming of [the Claimant] as co-assured does not of itself mean that the alleged liability in respect of which this claim is advanced fell within the Policy". It did not mean that the commercial purpose of the policy was to cover the claimant for any liability owed to passengers arising out of the operation of the Agreement.

Finally, it was noted that the mere outbreak of norovirus is not enough to establish fault or neglect, although the judge did not need to decide if there had been fault or neglect here.