Samuel v. Dumas

A ship was scuttled — deliberately holed — with the connivance of her owner. Water flowed in through the openings and the ship sank. A claim was made on the marine policy on the footing that the loss was caused by the entry of sea water, which is a peril of the sea.

Where a vessel is scuttled with the owner's connivance and then sinks because of the inflow of water, is the loss proximately caused by a peril of the sea?

No. The dominant reason for the loss was the scuttling, not the inflow of water which followed from it. The insurer was not liable.

Section 55(2)(a) of the Marine Insurance Act 1963 states the rule and its limit in a single sentence, and the two halves must be given together:

• The insurer is not liable for any loss attributable to the wilful misconduct of the assured.
• But the insurer is liable for a loss proximately caused by a peril insured against, even though the loss would not have happened but for the misconduct or negligence of the master or crew.

The contrast is the whole of the law here. Misconduct of the assured defeats the claim. Misconduct or negligence of the master or crew does not, provided an insured peril is the proximate cause. That is why a barratry clause can exist at all: barratry is by definition a wrongful act of the master or crew to the prejudice of the owner, and it is insurable precisely because the owner is not party to it.

• Assured connives — Samuel v. Dumas: no recovery.
• Master commits barratry without the owner's knowledge — insurable; and where barratry is one of the perils insured against, deviation caused by the master's barratrous conduct is an excused deviation under s. 51(1)(g).
• Master smuggles and the ship is seized — Cory v. Burr: the insurer was not liable on the policy as written. Smuggling by the master is barratry, so the answer turns on whether the policy covered barratry.
• Ship sent to sea unseaworthy with the privity of the assured under a time policy — s. 41(5): no implied warranty of seaworthiness in a time policy, but the insurer is not liable for loss attributable to the unseaworthiness. Thomas v. Tyne: no connivance proved, insurer liable.

Samuel v. Dumas is usually taught as a proximate cause case, and it is one. But its real interest is that it shows proximate cause and the exclusion of wilful misconduct doing the same work from two directions. One could say that the inflow of water was the last cause and the scuttling a remote one, and reach the opposite answer on a mechanical application of the last-cause formula in Pink v. Fleming. The court did not do that. It asked which cause was dominant and efficient, and answered that it was the human act that made the inflow inevitable.

That is the strongest marine illustration that the modern test is dominant cause, not last cause — and it is the argument to make when a question asks whether Pink v. Fleming still states the law.

The assured must prove that the loss was proximately caused by a peril insured against. Where the insurer relies on a warranty or an express exception, the insurer must prove it. In a scuttling case the practical question is therefore whether the insurer can prove connivance, and Thomas v. Tyne shows what happens when it cannot.