Commercial Law, 2011 Bar — Question 21

MULTIPLE CHOICE

T Shipping, Co. insured all of its vessels with R Insurance, Co. The insurance policies stated that the insurer shall answer for all damages due to perils of the sea. One of the insured's ship, the MV Dona Priscilla, ran aground in the Panama Canal when its engine pipes leaked and the oil seeped into the cargo compartment. The leakage was caused by the extensive mileage that the ship had accumulated. May the insurer be made to answer for the damage to the cargo and the ship? A) Yes, because the insurance policy covered any or all damage arising from perils of the sea. B) Yes, since there appears to have been no fault on the part of the ship-owner and ship captain. C) No, since the proximate cause of the damage was the breach of warranty of seaworthiness of the ship. D) No, since the proximate cause of the damage was due to ordinary usage of the ship, and thus not due to a peril of the sea.

You can write freely without an account. Sign in to reveal the suggested answer and track your progress.