Insurance Law Implications of Delay in Maritime Transport

Aysegul Bugra

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CHAPTER 10 Delay in voyage

Introduction

10.1 The Marine Insurance Act 1906 provides that the adventure insured must be prosecuted with reasonable despatch and in the absence of a lawful excuse, the insurer is discharged from liability when the voyage is not so prosecuted.1 It is also provided that if the cause excusing the delay ceases to operate, the ship must resume her course and prosecute the voyage with reasonable despatch.2 The purpose of those provisions is ‘to minimise the period of risk while the ship and goods are at sea’.3 10.2 This chapter will analyse firstly the common law origins of the sections with a particular focus on the concept of alteration of the risk initially undertaken by the insurer and secondly the criteria in determining whether a delay is unreasonable. Furthermore it will assess whether the entry into force of the Insurance Act 2015 would affect in any way the operation of s 48. In addition to the foregoing, the chapter shall focus on the inter-relations of ss 48 and 49 with standard market terms currently used in the insurance market, particularly with the Institute Cargo Clauses.

Delay and deviation

10.3 Before the MIA 1906 was enacted, delay was held to be an instance of deviation in several cases4 on the ground that just as deviation, unreasonable or unexcused delay causes change in the risk undertaken by the insurer.5 At the time, ‘deviation’ was a concept akin to voyages where the purpose of the voyage was not followed although there was no strict deviation from the course of the voyage

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in the locality sense.6 The distinction between deviation and delay has been made clear in ss 46 and 48 of the MIA and deviation can now accordingly be regarded as a change of the voyage insured in terms of locality, whereas an unreasonable or unexcused delay is an instance of a change of the voyage insured in terms of time. A deviation does not necessarily delay an adventure insured, however should it do so, the policy will be discharged as from the time where the deviation occurs, i.e. before even delay is in place. This would be subject to the terms of the policy which may provide that the insurance shall remain in force during any deviation,7 in which case what could discharge the insurers can be an unreasonable delay caused by the deviation unless the policy contains a waiver on delay or qualifies the type of delay that would discharge the policy.8 10.4 The difference between delay and deviation has not been canvassed to a great extent by courts after the enactment of the Marine Insurance Act. The distinction between ‘prolongation’ of the voyage and deviation was nevertheless discussed in the context of their respective representation of time and locality. In Union Castle Mail Steamship Co Ltd v United Kingdom Mutual War Risks Association 9 a war risks policy taken out on time basis covering hull and machinery provided cover for the expenses incurred by the assured by reason of the prolongation of the voyage arising from the compliance with the directions of certain authorities; however the expenses incurred during the period of prolongation were not recoverable. In an obiter passage, Diplock J enunciated that prolongation of the voyage had merely a temporal and not a geographical meaning, referring also to the word ‘period’ preceding the word ‘prolongation’. Moreover he observed that prolongation had not started until the voyage would have normally ended. 10.5 On the facts of the case, the prolongation could have readily been determined given that the insured vessels were due to their ports of loading on specific dates. The vessels had also deviated multiple times and one of the points discussed in the obiter passage was the connection between deviation and prolongation of the voyage. If the prolongation of the voyage was going to be treated as having a geographical sense, then the assured would have to be given credits for savings made during the deviations such as savings of canal dues, port charges at ports omitted and additional freight earned. Diplock J observed that there can be deviation without prolongation of the voyage if the voyage is terminated within the expected period of time and assessed the prolongation of the voyage by reference to the dates the vessels were due at their port of loading from their round voyage.

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Liberty clauses on deviation and their impact on delay

10.6 In most of the pre-MIA cases on delay and deviation involving policies which contained clauses granting liberty to deviate, delay amounting to deviation was often considered within the scope of the liberty clause. In Hyderabad v Willoughby 10 the policy contained a clause covering the assured ‘in the event of deviation and change of voyage at a premium to be… arranged’. The goods having to be carried to a warehouse after having been rejected upon discharge had to be kept there for a month until the arrangements were made for delivery. Insurers sought to avoid liability on the ground that there was deviation and unreasonable delay. It was held that the deviation was for the purpose of the voyage and therefore justifiable; but the delay in the warehouse was unreasonably long and amounted to unjustifiable deviation. The insurers were nevertheless not discharged from liability because the liberty clause had allowed deviation upon payment of a reasonable additional premium. Delay was accordingly excused under a liberty clause allowing deviation. Other examples existed where ‘delay’ and ‘deviation’ were used interchangeably in the context of liberty clauses allowing delay, however ‘deviation’ was not used strictly in the locality sense. In Syers v Bridge 11 delay was allowed under a liberty clause excusing ‘cruising for six weeks’ and it was held that this deviation (in the sense of time and not locality) was allowed. 10.7 In the US case The Citta di Messina 12 a bill of lading contained a liberty clause which provided ‘to proceed and stay at any port or place for loading and discharging or for any other purpose whatsoever’. The ship had waited for nearly two weeks for cargo at a port, of which she had obtained a small amount. District Judge Hough recognised that the MIA in the UK distinguished delay from deviation, however at the time the decision was made, delay in the course of transit was still equivalent to deviation under the US law. The judge therefore cited the pre-MIA authority of The Company of African Merchants v Foreign Marine Insurance Company 13 and stated that delay amounted to deviation even upon the course of the voyage prescribed in the policy and that therefore the scope of the liberty clause comprised delay. 10.8 Before the enactment of the MIA, in Pearson v Commercial Union 14 where the policy contained a clause which read ‘liberty to go into dry dock’ and both the deviation and delay were usual in the circumstances of the case, Lord Cairns in the House of Lords noted that ‘any delay usual in the circumstances, any deviation usually or conveniently made from the straight line, provided the delay and deviation are connected with’ would be justifiable in the words of the

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policy.15 Albeit in this case the liberty clause had a reference to locality, it was nevertheless held to encompass delay upon the condition that delay be usual in the circumstances. 10.9 Following the enactment of the MIA which distinguished delay and deviation, the application of s 48 would have the result that liberty clauses that expressly excuse merely deviation may no longer be taken to encompass delay whereby the earlier authorities to that effect16 would no longer be good law. Nowadays, under the Institute Cargo Clauses, both deviation and delay beyond the control of the assured are enumerated separately as incidents which would not terminate the transit17 the operation of which is similar to a liberty clause. Two possibilities may arise in this context, i.e. where there is a mere delay and a delay arising from a deviation from the intended course of the voyage. In both cases whether the insurance remains in force would be answered according to whether or not the delay is of a nature that is beyond the control of the assured.

Time policies, mixed policies and s 48

10.10 The wording of the current s 48 is to the effect that an unreasonable delay discharges the insurers in the case of a voyage policy, therefore the rule does not apply to time policies. According to s 91(2) the common law authorities continue to apply following the enactment of the MIA except where they are inconsistent with the express provisions of the Act. On the ground that s 48 refers expressly only to voyage policies, the common law authorities on time policies where delay is involved would continue to apply. 10.11 In the House of Lords decision Pearson v Commercial Union Assurance 18 the policy was a time policy against fire which described the ship as ‘lying in the Victoria Docks’ and gave the ship ‘liberty to go into dry dock’. The ship before entering the dry dock had to remove paddle-wheels, which had to be refitted on the way back to the Docks. As it was more economic for the assured to re-fit the paddles before entering the Docks, they were re-fitted on a river which was not in the usual transit from the dry dock to the Docks, as a result of which a delay had occurred. The ship was covered by the policy for three months where she lay in the Docks, or where she proceeded to or was in a dry dock. In deciding whether the delay was occasioned by usage and therefore excusable, the Court approached delay in a time policy as a non-fulfilment of a contractual condition. It was held to be collateral to the object of the end in view and therefore

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unjustifiable, accordingly the ship was not covered by the policy as from the time when the delay occurred.19 10.12 Where the policy is both on voyage and time basis, i.e. where it is a mixed policy,20 the question would arise as to whether an unreasonable delay could discharge the insurers. In this case, in principle, s 48 would apply for the part of the policy that is on voyage basis unless the policy is not altogether considered as a time policy;21 and any delay would also discharge the insurers from liability where delay constitutes the breach of a condition that is found in the part of the policy that is on time basis. 10.13 In The Company of African Merchants v Foreign Marine Insurance Company 22 the policy was upon a ship at and from Liverpool to the west or south-west coast of Africa ‘during her stay and trade there’, at a premium varying with the duration of the risk. It was therefore a combination of a voyage policy and a time policy because the assured had the right to keep the ship in that area for an unlimited period upon the condition of staying and trading there.23 After arriving at the coast of Africa, the ship stayed there for some weeks for a purpose not connected with the voyage, however the delay was within the currency of the policy. It was held by the court that the delay discharged the insurers on the ground that the ship had stayed there for a purpose not connected with trading. Delay in this case had occurred during the period which, according to the Court, makes the policy partly a time policy. The decision is fairly similar to Pearson v Commercial Assurance in the sense that in both cases delay discharged the insurers from liability because a contractual obligation had not been fulfilled. 10.14 More recently the Singapore Court of Appeal tackled the issue of whether s 48 could apply to mixed policies in The Al-Jubail IV.24 The ship was insured ‘at and from Singapore to the Persian Gulf’ and ‘for the period of 12 months’ commencing from the date the ship left Singapore and was therefore held to be insured under a mixed policy.25 On its voyage, the ship encountered heavy seas and had to be repaired whereby the voyage was delayed. Insurers argued that they were discharged from liability according to s 48 as the delay was allegedly unreasonable. So far as the voyage was concerned, the part of the cover had the attributes

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of a voyage policy. Lai J decided that the time spent for repairs was reasonable and that the insurers were therefore not discharged from liability. 10.15 According to Pearson v Commercial Assurance and The Company of African Merchants v Foreign Marine Insurance Company, it would not be a fallacy to argue that as far as time policies are concerned where cover is for a certain period of time if a condition is fulfilled, delay can be considered as a breach of a contractual condition and discharge the insurers if the purpose of delay is unjustifiable. In mixed policies, s 48 would apply to the part of the policy that has the attributes of a voyage policy and a delay could discharge the insurers altogether where the assured cannot prove that delay had occurred for a purpose connected to the voyage.

The meaning of ‘unreasonable delay’

10.16 Section 48 of the MIA 1906 enunciates that the assured should prosecute the voyage with reasonable despatch and the insurers are discharged from liability when the delay becomes ‘unreasonable’. Several decisions prior to the enactment of the MIA touched upon this term26 and a recapitulation thereof is required so as to ascertain the criteria which determine when delay becomes unreasonable.

Common law authorities and unreasonable delay: purpose and length

10.17 Unreasonable delay was canvassed in many pre-MIA cases27 although its criteria had not been pointed out as clearly as they were in Langhorn v Alnutt.28 Prior to analysing this case and its significance, the decision in Hartley v Buggin 29 needs to be considered so as to determine the difference between the length and purpose of delay and their impact on the development of the concept of ‘unreasonableness’ of delay. In Hartley v Buggin, the policy gave the assured the ‘liberty to exchange goods and slaves’ during the voyage insured. Instead of exchanging goods and slaves, the ship was used as a floating slave depot which had occasioned a delay of seven months. As the use of the ship as a depot was not within the purpose of the voyage and the liberty granted, delay was held to be unjustifiable and discharged the insurers from their liability. The length of delay and whether it was unreasonable

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was not canvassed by the court. The fact that there was no account for delay was sufficient for the change of risk by delay and discharge of insurers from liability. 10.18 Langhorn v Alnutt 30 was delivered a few years later and clarified the position as to the criteria for deciding whether a delay is unreasonable. The policy contained a clause giving the assured liberty to touch and stay at all ports for all purposes whatsoever. The ship waited in port for about four months and according to the evidence provided, obtain forged documents. Chambre J stated that the ‘Length of delay creates a degree of suspicion and calls for explanation’31 and Gibbs J gave a detailed judgment as to the criteria of an unreasonable delay. He enunciated that whether the ship’s stay was for a purpose within the scope of the adventure was a question of law and would have to be answered by the courts, whereas whether the ship stayed for an unreasonable time for that purpose was a question of fact to be answered by the jury.32 According to this judgment, a delay that is of a nature to discharge the insurers from their liability has two components, namely the purpose and length of delay. If delay is incurred for an unaccountable purpose and is therefore unjustifiable, the insurers are discharged. It follows that in this case whether the delay’s length was unreasonable in the circumstances shall not have to be considered.33 Nevertheless if the delay is justifiable or otherwise is for a purpose connected with the purpose of the voyage insured, the next issue is whether the delay occasioned for the purpose of the adventure was unreasonably long.34 10.19 This reasoning was also followed in Phillips v Irving 35 where the purpose of delay was within the scope of the adventure insured as it was due to necessary repairs, and when she was ready to take in cargo, the freight market was unusually low and the port was crowded with shipping. The freights offered, if accepted, would have occasioned great loss to owners. The delay therefore being justified, the next question was whether the length of delay for that purpose was unreasonable. A similar example was found in Bain v Case 36 where a delay in waiting permission to land cargo was for the purpose of the voyage and therefore justified, and the length of delay of one hundred and nine days was held to be not so unreasonable. 10.20 After the enactment of the MIA, in British-American Tobacco Company Ltd v H.G. Poland 37 a delay of three months was occasioned due to waiting to obtain a permit to forward the goods under a cargo policy. Having decided that the delay was for the purpose of the voyage, the court agreed with the first instance judge’s finding that the goods were forwarded at the earliest convenience and

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therefore the length of delay was not excessive. On similar facts in Hyderabad v Willoughby,38 a delay for a month having occurred in corresponding to arrange how the cargo could be sent on in order to continue the transit was held to be unreasonably long although it was for the purpose of the voyage and therefore justified.39 10.21 In examining whether the length of delay was so excessive for the voyage insured, which is a question of fact, one of the issues that can be contended by the assured is that such delay is within the usage of trade in which the voyage is embarked upon. As was stated in Columbian Insurance v Catlett,40 whether delay is ‘unreasonable’ should depend upon the nature of the voyage and usage of trade.41 The delay in this case was justifiable as it was for the purpose of selling the cargo and a price limit was set by the assured for such sale. Although the delay was long, considerable delays at that port were not uncommon and therefore the length of delay was held not to be unreasonable. It was also noted that if the owner of the goods (who was also the owner of the vessel) had set a very high limit for selling the cargo and had further delay been caused accordingly, that delay could have been ‘unreasonable’. 10.22 However long a delay can be, it has to occur for the purposes of the voyage contemplated in the policy. It was noted by Blackburn J in Company African Merchants that the parties had known and contemplated that the ship could protract its course, yet the protraction could have been excused if it was for the purpose of trading as the policy covered the ship during her ‘stay and trade’.42 This case was cited as an illustration of a s 48 type of situation by the draftsman of the Marine Insurance Act 190643 and it is noteworthy that as the previously mentioned authorities, this decision supports the position that a delay incurred for a purpose unconnected with the voyage insured discharges the insurers. Because this requirement was not fulfilled by the assured, the court did not even assess whether the length of delay (on the facts of the case, four weeks) was excessive. 10.23 According to the common law authorities, it can be submitted that if a delay is incurred for a justifiable purpose and that the length of delay is not so excessive for that purpose, such delay does not discharge the insurers. The fact that the purpose rather than the length of delay is to be primarily looked at so as to determine whether a delay discharges the insurers can be further supported by the fact that unreasonable delay and deviation have the identical remedy44 and the excuses45 under the Marine Insurance Act rest solely on the basis of ‘purpose’.

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It may accordingly follow that there must be a change of risk in terms of purpose of the voyage and length of delay for that purpose that would make the delay discharge the insurers from liability.

Excessive delay and the knowledge of the assured

10.24 The knowledge of the assured at the time of the contract as to the probability of the occurrence of an excessive delay and its concealment may be considered as a fact material to the risk that could give the insurers the remedies available in the Insurance Act 2015.46 In Schloss Brothers v Stevens 47 it was argued on behalf of the insurers that it was known to the assured and concealed that the deficiencies of the means of transport were such as might involve an excessive delay. The court, without elaborating on the matter, pronounced that there had been no concealment of facts which were material to the risk and went on discussing whether an abnormal delay was within the wording ‘all risks by land and by water’. This issue would not arise where knowledge of an event which could cause an ordinary delay is concealed given that an ordinary delay resulting from the perils insured against ought, or be presumed to be known by insurers.48

Unreasonable delay under s 48 and the delay exclusion

10.25 According to s 48, insurers are discharged from liability as from the time the delay becomes unreasonable. When this provision is read in conjunction with the exclusion of delay losses in s 55(2)(b), the most obvious finding would be that the insurer would be discharged as from the time the delay becomes unreasonable and therefore no question would arise as to whether there would be cover for losses that arise following the unreasonable delay. The delay exclusion in the Marine Insurance Act would therefore only apply to the losses which occur prior to the unreasonable delay.49

Justifiable delays

(a) Unreasonableness under s 48 and excuses for delay

10.26 It is not clear whether the notion of unreasonableness referred to in s 48 reflects the common law position, i.e. whether it involves both the length and purpose of delay. This observation is based on several grounds. The scope of s 49 where excuses for delay and deviation are enumerated in a non-exhaustive way is

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not entirely clear when considered together with s 48 if the concept of unreasonableness under s 48 is taken to reflect the same position as under the common law. Reading s 48 in conjunction with s 49 results in the suggestion that delay has to be unreasonable in the first place so that the question whether such delay can be excused under s 49 could arise.50 This is given that not any delay, but unreasonable delays discharge insurers and therefore those are the only types of delays that can be excused under s 49. In other words, there has to be an unreasonable delay under s 48 which may or may not be excused under s 49. 10.27 Importing an element of excuse or justification into the concept of ‘unreasonableness’ under s 48 would therefore connote that delay, if justifiable and not extraordinary in its length for complying with the purpose of the voyage, would not be unreasonable as per s 48 in consequence of which s 49 would not need to be triggered. This accordingly raises the question of whether the concept of unreasonableness under s 48 refers mainly to the length of delay and not to its purpose. This reasoning can also be supported if the expression ‘lawful excuse’ in s 48 is taken to refer to s 49 excuses,51 whereby unless a lengthy delay is not excused by one of the circumstances enumerated under s 49 or like circumstances, it would discharge the insurers. It can therefore be concluded that the concept of unreasonableness under s 48 can arguably be different than its counterpart under the common law and relate merely to the length of delay, and not also to its justification despite the fact that the drafters of the Marine Insurance Act had cited cases such as Company of African Merchants as the background of s 48 where the length of delay had not even been looked at. 10.28 For the unreasonable delay to be excused, the excuse must be lawful;52 yet it is controversial whether lawful excuses are confined to the ones enumerated in s 49 or whether excuses such as delaying for the purpose of furthering the voyage insured or delays occurring in usage of trade could also be included in this wording. The way s 49 is drafted does not expressly result in an inference that the list of possible justifications for delay enumerated therein is exhaustive. This would give way to the argument that common law justifications for delay, i.e. delays incurred for the furtherance of the voyage insured and delays incurred in usage of trade could still excuse the assureds. As to the former, s 49 requires further elaboration. 10.29 The excuses in s 49 may or may not necessarily be triggered for the purpose of the adventure insured. By way of example, an instance similar to Hyderabad v Willoughby 53 may be an example for both delay for the furtherance

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of the voyage insured and s 49(1)(a),54 however delaying in order to help a ship in distress (as per s 49(1)(c)) would arguably not necessarily be for the purpose of a voyage insured. Therefore confining the phrase ‘lawful excuse’ in s 48 to circumstances mentioned under s 49 would considerably restrict the scope of justifiable delays and would oversee the approach taken in most of the pre-MIA common law authorities. It is also noteworthy in this context that nothing would prevent the assured to rely on excuses available under different subsections of s 49.55

(b) Excuses for alteration of the risk and not for breach of warranty

10.30 The breach of s 48 results in the discharge of insurers from liability which was identical to the consequence of a breach of warranty under the Marine Insurance Act 1906 prior to the entry into force of the Insurance Act 2015.56 This however did not in any way connote that the breach of s 48 was a breach of warranty. As part of their consultation which resulted in the Insurance Act 2015, the Law Commission of England and Wales and the Scottish Law Commission enumerated s 48 and other voyage conditions in their joint Consultation Paper57 under the title ‘implied warranties’ yet described them as ‘conditions which operate in the same way as warranties, in that the risk may never attach or the insurer may be discharged from liability’.58 The Commissions did not make any proposals about ss 48 and 49 given that they were voyage conditions and not warranties and that accordingly their proposals on warranties did not affect them.59 The Commissions merely asked the consultees whether these sections should in their view be retained60 and a majority of the consultees expressed that they were in favour of their retention.61 10.31 The Australian Law Reform Commission however, considered the provisions about delay62 in their Review of the Marine Insurance Act 1909 Report No 9163 and proposed that the equivalent of ss 48 and 49 of MIA 1906 should be treated in the same way as the reforms proposed in respect of warranties, i.e. that

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they should be repealed and be dealt with as an express term of the contract.64 The insurers’ remedies would also be limited to discharge from liability for loss proximately caused by the breach.65 If for a moment, the ALRC’s proposal as to repealing the relevant sections could be adopted in the United Kingdom, one of the questions that could be raised would be whether the standard wordings currently used in the market cover this aspect. The Institute Cargo Clauses 2009 for instance provide that the insurance remains in force during delay beyond the control of the assured, and that the assured shall act with reasonable despatch in all circumstances within their control.66 Whether these clauses are reflections of s 48 in the standard form cargo policies is a matter that would accordingly have to be determined and will be discussed in the following paragraphs of this chapter. 10.32 One of the reasons why the breach of the requirement that the assured should prosecute the voyage with reasonable despatch could not have been considered as a breach of warranty under the Marine Insurance Act 1906 prior to the entry into force of the Insurance Act 2015 is as follows: no cause however good or necessary would excuse a non-compliance with a warranty and merely two exceptions to this rule appeared under s 34 of the MIA 1906; these were 1) the warranty would cease to be applicable to the circumstances of the contract by reason of a change of circumstances; 2) the compliance with the warranty would become unlawful by any subsequent law. Section 49 excuses are fairly distinct from those exceptions and are based on the principle that delays with a cause mentioned in s 49 or another justifiable cause arising from common law would excuse the assured. Section 49 excuses may therefore not be considered as excuses for a breach of warranty, but for alteration of the risk insured.

(c) Excuses other than the ones enumerated in s 49

10.33 There is no clear authority as to whether justifications which are not enumerated in the MIA yet which had been the subject of the pre-MIA decisions could excuse unreasonable delays subsequent to the entry into force of the MIA. As pointed out before, in the assumption that the s 49 excuses are not exhaustive, excuses arising from common law could justify unreasonable delays along with s 49 excuses. One type of these excuses is where delay occurs in the usage of trade which will be elaborated below.

(I) Delay occurring in usage

10.34 Usage of trade may affect both the length of delay and the assessment of whether delay is necessary/justifiable in the field of trade in which the assured

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operates.67 It was stated in Pearson v Commercial Union 68 where the policy was on time basis that doing what is usual though not necessary is excused if it is done for the purpose of the voyage insured (i.e. in this case to go into dry dock).69 Therefore, so as to be justifiable, delay had to be incurred for the purpose of going back to the Docks, and not in re-fitting the paddles in the river which was not on the usual course of transit from the dry dock to the Docks.70 10.35 In Phillips v Irving 71 it was held that whether delay is unreasonable should be determined not by any positive or arbitrary rule but according to the state of things existing at the time at the port where the ship happens to be. This was a judgment where it was held that delay was for the purpose of the voyage insured given the circumstances at the port and was not unreasonable. However what establishes usage and its relevance to justification and length of delay need to be ascertained. The length of time usually spent in waiting to sell or to obtain a cargo at a particular port may assist an assured in proving that the actual delay incurred at the port was not unnecessary, yet may not establish a fixed period of time that could be considered as usage.72 Usage of trade may also well affect whether delay is unreasonable where the usage of trade limits the right to take in cargo to a particular period, and not to a certain amount of time.73

Ordinary course of transit and interruption of the voyage

Delay which is not in the ‘ordinary course of transit’ discharges the insurers

10.36 An interruption on the voyage has significance in respect of the transit clause under the Institute Cargo Clauses 2009, particularly cl 8.1 which states that the assured is covered during the ordinary course of transit and cl 8.1.2 which

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provides that storage other than in the ordinary course of transit terminates the insurance. The case law on this point has mostly been developed by the courts in Australia, South Africa and Hong Kong and will be analysed in detail hereunder. 10.37 Not any interruption during the transit but ‘… a delay or interruption which, objectively viewed, is not part of the usual and ordinary means of effecting transit, and which is occasioned by some collateral purpose, will disturb the ordinary course of transit’.74 Whereas cl 8.1.2 imports a subjective element into the election-making of the assured for storage,75 it also requires an objective test as to whether or not delay or interruption is part of the usual and ordinary means of transit.

(a) Interruption of transit brought about by the requirements of transport

10.38 Ordinary course of transit was taken to be when the goods are in transit for the reasonable furtherance of their carriage to their ultimate destination.76 More generally, ordinary course of a voyage or transit would involve the ordinary length of the voyage which can be determined according to the course of trade in question and any interruption of the voyage brought about by requirements of transport.77 This may be the reason why premiums are paid to insurers for the ordinary length of the voyage in that particular trade and not for an unnecessary interruption of the voyage.78 Such an ordinary interruption is diametrically opposite to the interruption of transit by the voluntary decision of the assured whereby the cover ceases. It was enunciated in Wiggins Teape Australia Pty Ltd v Baltica Insurance Co Ltd 79 that:

‘the purpose of a warehouse-to-warehouse clause is to insure during a limited land movement… it has never been suggested it is intended to cover indefinite storage at some place not brought about by the requirements of transport, but determined by the voluntary decision of the consignee’.80

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