Dharsi v South British Insurance Co. Ltd (Civil Appeals Nos. 40 and 41 of 1953) [1955] EACA 93 (1 January 1955)

## COURT OF APPEAL FOR EASTERN AFRICA

Before Sir Newnham Worley (Acting President), Sir Enoch Jenkins (Acting Vice-President) and BRIGGS, Justice of Appeal

## THE SOUTH BRITISH INSURANCE CO., LTD., Appellant (Original Defendant)

MOHAMED G. DHARSI, Respondent (Original Plaintiff)

AND

THE SOUTH BRITISH INSURANCE CO., LTD., Appellant (Original Defendant)

A. H. JUMA, Respondent (Original Plaintiff) Civil Appeals Nos. 40 and 41 of 1953

(Appeals from the decisions of H. M. Supreme Court of Kenva, Connell, J.)

Marine Insurance—Total loss of goods by absolute total loss of vessel—Burden of proof that vessel is an absolute total loss—Actual and constructive loss— Salvage—Notice of abandonment—Perils of the sea.

Three days after sailing from Zanzibar on a voyage to Mogadishu, with two motor vehicles, an Anglia and a Vauxhall on board, the vessel was abandoned by its captain and crew.

A day or so later, the vessel was towed to the shore and beached by salvors, during which operation the Anglia slipped off and disappeared.

Some days later the Vauxhall was sold by order of the Receiver of Wrecks for Sh. 455.

The damage to the vessel at the time the Anglia slipped off consisted of a hole near the steering and possibly a broken mast, but the main hull was intact and was still intact at the time of beaching and repairs were possible.

The owners of the two vehicles were each insured with the appellant company under a marine insurance policy against "total loss by absolute loss of the vessel" on its particular voyage.

The only evidence given as to the condition of the Vauxhall was that "she was much damaged by sea-water". No evidence was given as to the cost of its repair.

Notice of abandonment, valid in form, was given, but was not accepted by the appellant company.

A total loss of a vessel may either be an actual total loss, sometimes called an absolute total loss, or a constructive total loss.

The headnote to Farnworth $v$ . Hyde states: "Where goods are in consequence of the perils insured against lying at a place different from the place of their destination, damaged, but in such a state that they can, at some cost be put into a condition to be carried to their destination, the jury, in order to ascertain whether $\cdot$ there is a constructive total loss of the goods, must determine whether or not it is practically possible to carry them on—that is, whether to do so will cost more than they are worth; and, in determining this, the jury are to take into account all the extra expenses consequent on the perils of the sea, such as drying, landing, warehousing, and reshipping the goods".

Held $(30-9-54)$ .—(1) The onus of proving that a vessel is a total loss (either an actual or constructive total loss), is upon the person so alleging, and, in the instant case the breaking up of the vessel, i.e. its total loss, was not due to the perils of the sea.

(2) In respect of the Anglia it was a total loss when it slipped off and disappeared from the vessel into the sea, but such loss was not due to the absolute loss of the vessel<br>because the respondent/owner had failed to prove that when the vehicle slipped off, the vessel was an absolute total loss and he had also failed to prove that the vessel had been a constructive total loss, because, in face of the fact that the hull was intact when beached, it had been for him to show that the aggregate cost of salvage repairs and<br>incidental expenses could not prudently be undertaken, viz. would be greater than the value of the vessel.

(3) In respect of the Vauxhall, it was never a total loss. It was landed intact after the vessel was beached and the loss due to the sale was not due to the perils of the sea. It could not be considered as a constructive total loss as no evidence to enable a determination to be made within the rule in *Farnworth v. Hyde* had been given.

Appeals allowed.

Cases referred to: Montreal Light Co. v. Sedgwick (1910) A. C. 598; Barker and<br>another v. Janson L. R. 3 C. P. 303; Knight v. Faith 117 E. R. 605; Cates Tug & Wharfage<br>Co. v. Franklin Insurance Co. (1927) A. C. 698; Farnworth v The common vector of the common vector of the common vector of the common vector of the common vector of the common vector of the common vector of the common vector of the common vector of the common vector of the

## Cleasby for appellant.

## Hassan for respondents.

JUDGMENT (prepared by Jenkins, Acting Vice-President).—These consolidated appeals are from decisions of the Supreme Court of Kenya. The appellant company in both cases was sued in the court below for the value of a motor-car insured under a marine insurance policy against total loss by absolute total loss of the vessel on a voyage from Zanzibar to Mogadishu in the dhow Muhammady of $80-90$ tons. The two policies are identical except that the value of the Vauxhall car in the first policy is Sh. 12,500, and the value of the Anglia car in the second policy is Sh. 4,000. The vessel sailed from Zanzibar on 15th April, 1950, with the motor-cars on board and three days later was anchored and abandoned by the captain and crew off Malindi. A day or two later she was towed to the shore and beached by salvors, the Anglia during this operation<br>disappearing apparently into the sea. The Vauxhall was got ashore seven to ten days later and was sold by order of the Receiver of Wrecks. The evidence for<br>the plaintiff/respondents is that the *Muhammady* was "a waterlogged wreck" when found at anchor by the salvors, that "the hull was intact when beached", and that "after ten days there was nothing of the main hull left; it was a gradual process of breaking up". The learned trial Judge gave judgment for the full amount claimed in both cases. We allowed the appeals and now give our reasons for so doing.

Mr. Cleasby, counsel for the appellant company, based his appeal on the following argument, viz. that the cars were insured under the policies "against total loss by absolute total loss of the vessel", that the vessel was not an absolute loss when the Anglia disappeared and the Vauxhall was never a total loss.

As regards the first point, that the vessel was not an absolute total loss when the Anglia disappeared, appellant counsel submitted that the learned trial Judge misdirected himself in law as to the meaning of the words "absolute total loss". The learned trial Judge in his judgment (pp. 3 and 4) states: $-$

"It should be stressed at the outset that the policy is one on cargo and, I think, that it will be useful to quote a passage from Lord Atkinson's judgment in Montreal Light Co. v. Sedgwick (1910) AC at p. 604: in that case a cargo policy in very similar terms to the present one came up for

construction and the facts indeed were somewhat similar; a cargo of cement being rendered useless by sinkage of the barge in comparatively shallow water. Lord Atkinson stated 'whether the barge, as she lay submerged, was so valuable or was so slightly damaged that a prudent owner would, with a reasonable regard to his own interest, most probably cause her to be raised and repaired, or was of such small value or so seriously damaged that he would most probably not think she was worth being raised and repaired but would abandon her, vital issues if the action was one for loss of the barge, were matters which in no way affected the loss the plaintiffs in fact sustained. Where a total loss of the cargo is brought about by such a wreckage of the barge as resulted in her sinking to the bottom of the river, becoming entirely flooded and almost entirely submerged, the peril which the parties to the contract meant to guard against must, their Lordships think, be held to have supervened and the total loss of the barge which they contemplated be held to have resulted.' It may be, however, that the answer found by the jury to question 12 distinguishes that case from the present one and I will quote it forthwith: -

'12. Could a portion of solid cement have been salved at small cost and delivered sound at Chambly Canton? No.'

$1$ am bound to say I find some difficulty in coming to a finding in regard to liability for the Anglia; is the word 'absolute' to be construed in its highly technical sense involving absolute loss (and not mere constructive loss) of the vessel at the time of the casualty? I agree that the policy in the Montreal Light case did not contain the word 'absolute'. The Privy Council had no difficulty in their interpretation as is shown by another passage 'It is difficult to suppose that the parties to this policy of assurance ever entered into it with the intention that these considerations (i.e. the considerations I have already previously quoted) not in any way affecting the loss the plainiffs sustained, should be made of the very essence of the contract and decisive in their right to recover'. The passage of the learned Judge in the Supreme Court of Quebec is also illuminating and 1 quote it: 'What was it to the owner of the cement after it had become a total loss to him whether the barge could be raised and repaired at a profit or a loss? That did not concern him in any way, no more than whether there was on that day an eclipse of the sun or the moon. He (i.e. the cement owner) proved, as the jury decided, that the cement was submerged with the barge and became a complete loss by reason of the wreckage and submersion of the vessel, and that was enough.'

In my view, the words 'absolute total loss' contain no extra or added significance than the words 'total loss': from a reference to $Arnould$ I understand that the more common words are 'actual total loss', when it is desired to contrast them with 'constructive total loss'. So far as the insurer was concerned the vessel was a wreck at the time the Anglia toppled off; further as an insurer in essence of the Anglia from Zanzibar to Mogadishu I can hardly see how it was his concern whether the ship agent could and should have adopted more reasonable means to tow the dhow into a safer harbourage where the possibilities of repairs might have been much greater. I think so far as the Anglia was concerned the car was absolutely lost and the dhow irretrievably and absolutely lost at the time the car toppled off."

The learned trial Judge is thus of opinion that the words "absolute total loss" contain no extra or added significance than the words "total loss". With due respect, we are unable to agree. (The Montreal Light Co. case, which is cited in the above extracts, does not throw any light on the question, as it is a case of constructive total loss; and is of little or no help generally as it concerns a special kind of cargo, viz.: cement, which alters rapidly in contact with water. Also, the law applicable was the special statutory law of Lower Canada.) Arnould on Marine Insurance, 13th Edition, makes it quite clear in his chapter on "actual total loss" (p. 966 et seq.) that "total loss" may be "actual" or "constructive", and that "absolute total loss" is synonymous with "actual total loss". Arnould describes these terms, which are terms of art and have a long line of indicial authority behind them, as follows:—

"1043. A total loss in insurance law is one on account of which the assured is entitled to recover from the underwriter the whole amount of his subscription.

It is stated in section 56 (2) of the Marine Insurance Act, 1906, that—

A total loss may be either an actual loss, or a constructive total loss.

An actual total loss is also sometimes called an absolute total loss, the latter being the term which has previously been used to describe it in this work. The meaning of the expression actual total loss is reasonably clear on the face of it. The meaning of constructive total loss is less clear. As we shall see it covers a state of affairs intermediate between an actual total loss and a partial loss, where for example, an actual total loss appears to be inevitable. or could only be prevented at incommensurate expense. In such a case by a happy invention of marine insurance practice the insured was given the option of treating the loss either as total, or, if he liked to take the risk of eventual recovery, as partial. If, however, he adopted the former alternative, the equity of the situation demanded that the underwriter should have the opportunity of taking such steps as might be practicable to recoup himself by salvage of the lost property, and was therefore considered to be entitled to have the property abandoned to him reasonably quickly and to have notice of such abandonment.

It is obvious that in the case of actual total loss there is no point in a notice of abandonment, and this is stated in section 57 (2) of the Act-

In the case of an actual total loss no notice of abandonment need be given.

An actual, or absolute total loss entitled the assured to claim from the underwriter the whole amount of his subscription without giving such notice.

A constructive total loss entitled him to recover for a total loss only on giving such notice. If he fails to do so the loss can only be treated as a partial loss.

According to section 57 (1) of the Act—

Where the subject-matter insured is destroyed or so damaged as to cease to be a thing of the kind insured, or where the assured is irretrievably deprived thereof, there is an actual total loss.

A constructive total loss takes place when the subject insured is not wholly destroyed, but its destruction is rendered highly probable, or where its recovery, though not utterly hopeless, is yet exceedingly doubtful."

This description contains references to the Marine Insurance Act, 1906, which does not apply to Kenya, but this is immaterial for the Act is a codifying one and in the relevant respects is the same as the common law which it codified,

Mr. Hassan, counsel for the two plaintiff/respondents, agreed that the learned trial Judge misdirected himself as to the meaning in law of the words "absolute total loss", and he also agreed with Mr. Cleasby's further submission that the consequential findings of fact made by the trial judge could not be supported. Mr. Hassan thereupon submitted that the only reasonable course to take, particularly in view of the conflict of evidence, was to remit the case back to the trial Judge to make new findings of fact based on the correct interpretation of "absolute total loss", or to order a retrial. With this submission we were unable to agree. We were abundantly satisfied on the evidence of the respondents alone, supplemented by that of the Customs Officer whose duty it was to examine the dhow and make an official report, that the Muhammady was not an absolute total loss when the Anglia disappeared and that the Vauxhall was never a total loss.

Shahab Habib, a dhow agent who travelled on the *Muhammady* on this voyage and who gave evidence for the respondents, says they left Zanzibar on 15th April, encountered a very heavy wind off Pemba which caused the dhow to roll, and on the second day it began to leak. Baling started on the 17th and went on continuously for two days and a night but "the captain and crew all tired" and finally, on the 18th, at 3 p.m., when the dhow was full of water, it was anchored off Malindi and abandoned. The two cars were left on deck, wheels half under water. The captain, crew and passengers went ashore in the dhow's small boat, reported to the Customs authority and the District Officer and went the following day, 19th April, to Mombasa, Arrived at Mombasa, Shahab Habib cabled to the respondents the information that the dhow had been wrecked off Malindi, and the latter, by letters dated 19th April, wrote to the appellant company asking for their claims under the policies to be registered. Habib says that nothing could have been done to save the dhow, that it would have sunk if an attempt had been made to tow it to Malindi and that it was not possible to effect any repairs "when we left her". In cross-examination he says: -

"I did not inquire what happened to dhow or its cargo. I did not take any interest in it as I left it sunk."

James Murray, who is an estate agent living at Malindi and who gave evidence for the respondents, says he saw the Muhammady anchored about a mile from the nearest beach and went to it in his motor-boat. It was between the outer and inner reef, approximately eight miles by sea from Malindi and three miles from Casuarina Point. It was riding at anchor in deep water, four to five fathoms, and appeared to be waterlogged. No one was on board. It lay over at an angle of $45^{\circ}$ to port and the starboard side showed 3 ft. above<br>the surface of the water. He went on board and climbed on to the roof of a Vauxhall motor-car on the port side; when he stood on the roof of the car the water was up to his waist. He says he saw the bonnet of a second car alongside the Vauxhall on his second visit to the dhow a day or two later. He describes the dhow as being a waterlogged wreck when he first boarded her, but says she would not have sunk. The next day certain timbers had broken away, but "the main hull was more or less intact: being wooden she could not sink". With the intention of getting salvage he towed the Muhammady a day or two later to a sandy bottom opposite Casuarina Point and beached her. He says: —

"Hull was intact when beached. It would be impossible to repair her in the position she was.

It would be possible for Mombasa tug to tow her to Malindi."

The Muhammady gradually broke up on the beach and after ten days there was nothing of the main hull left. During this period cargo consisting of boriti and soap was taken ashore and the Vauxhall car was got ashore seven to ten days after the beaching. It appears from the evidence, and this is common ground, that the Anglia car disappeared unobserved into deep water during the tow and was not seen again. The learned trial Judge says (p. 4 of judgment) "... it must, I think, have fallen off in between the time when Mr. Campbell Murray first saw the bonnet of the Anglia and before or during the earlier period of the tow which, of course, would be in pretty deep water". Counsel argued before us on the basis of this finding.

The Receiver of Wrecks, who is also Senior Harbour Master, gave evidence that his office at Mombasa was informed by telegram on 19th April, 1950, of the wreck of the *Muhammady* and his file of correspondence concerning the incident was put in evidence as exhibit 6 (p. 13 of record). During his crossexamination however (p. 14) it was apparently agreed that only two documents should be in evidence, for the learned trial Judge made the following note: "By consent the telegram and note of what was sold by auction are the only documents exhibited in this file for court". This note appears to have been overlooked by the learned trial Judge, for in his judgment (at p. 5) he states he has perused the correspondence and he refers to various documents other than the only two agreed to be in evidence. With this misdirection we shall deal later. The Receiver of Wrecks goes on to state that he ordered the District Officer, Malindi, who is the Port Officer, to sell by auction the salvaged car and parts of the dhow. The total amount realized was Sh. 2,075. He gives the date of sale as 6th June, 1950, but a perusal of the note of what was sold by auction (exhibit 6) shows that this was the date the note was signed. The receipts for the proceeds of the individual items are shown in the second column as dated 6th June for all items except the Vauxhall motor-car, the date of the receipt for that item being shown as 19th May, 1950. The learned trial Judge examines, on p. 5 of his judgment, the evidence concerning the date of sale but much of it he quotes from documents in exhibit 6 which were not put in. He does not, however, come to any decision as regards the date of sale, and it would seem that 19th May, 1950, is the most probable one. The Receiver of Wrecks, who had seen service in the Merchant Navy, was asked about the possibility of repairing the dhow on the beach to which the salvor had taken it. His answer was: -

"It is a feasible operation to get the dhow high and dry by using rollers. If she was left between high and low tide it would depend on the weather and the tide as to whether she could be got as far as the high-water mark...

Ship might be beached on shore at low water and when surf then comes in she might be broken up considerably; if dhow would hold there would be no difficulty in getting her up further above high-water mark if you had enough men."

This is most important evidence for it indicates, with the other evidence for the respondents, that there was a possibility of saving the dhow but nothing was done about it. It must also be remembered that the onus of proving that the dhow was an absolute total loss is on the respondents. Mr. Murray says (p. 10) that when they beached the dhow "we noticed no visible breaking up of the ship as it landed softly in the sandy bottom"; and that when they returned the next morning "the main hull was more or less intact". Again, in cross-examination, he says "Hull was intact when beached". This evidence is in accord with that of the Customs Officer, Kaim Abdulla, who gave evidence for the appellant but can be considered to be an independent witness. It was his duty as the local Customs Gifficer to examine the abandoned dhow and make a report. In fact, it was to him that the captain, crew and passengers went when, as Habib says (p. 16), "We left ship to save ourselves". Abdulla's evidence is as follows $(p. 27)$ :- "I remember a report about a dhow *Muhammady*; went to see it; it was far from shore; one mile off; I went aboard after it had been towed in. I examined it. It is my duty to examine and make office report: it was full of water; a hole near the steering about 7 in. diameter. I have sailed on dhows four times and know something about them. I could not say whether the hole was made purposely; it was strange to see it; it could not be caused. by striking a reef as hole was high; I could not find other damage.

The borite poles were not as high up as this hole.

The dhow, in my opinion, could be repaired.

The captain was in a hurry to leave Malindi."

The learned trial Judge does not deal in his judgment with this evidence about the hole near the steering. When Habib was asked about it in cross-examination (p. 19) he said he did not know anything about it. Murray was not asked about it. As the Customs Officer says "it was strange to see" and it raises a doubt as to the bona fides of the abandonment of the dhow, but this was not a part of the appellant's case and we do not propose to deal with it in that connexion. It is, however, pertinent to the question of the state of the dhow and the possibility of repair. Abdulla says that he could not find any other damage. Murray says the hull was intact. It seems, therefore, and this is fully consistent with the dhow becoming waterlogged so early in the voyage after setting off from Zanzibar in a seaworthy condition, that the hole near the steering was the only, or the only serious, damage and that the captain abandoned ship without adequate reason. Again we emphasize that the onus of proof that the dhow was an absolute total loss when the Anglia fell off and disappeared into the sea is on the respondents. The evidence quoted above is far from proving that the dhow was then an absolute total loss. On the contrary, it shows that the hull was intact and that the damage was easily repairable. The action of the captain was precipitate in the extreme. He seems to have come to the conclusion that the dhow had sunk and that it and the cargo were irretrievably lost. Habib says (p. 16) "we left ship to save ourselves" and that shortly after they got ashore they "went to a place at shore from where we saw the mast of the dhow". Abdulla says $(p. 27)$ that he told the captain and agent as they were in a hurry to leave that they could not leave without the District Commissioner's authority and that he, the District Commissioner, sent them to Mombasa under escort. The day following the abandonment of the dhow, Murray, who lives at Malindi, visited it in his motorboat and the following day towed it to the beach. This in itself indicates that the captain made no inquiry as to the availability of a rescue boat. All the evidence shows that he took no interest in the vessel or the cargo. The duty of the captain, or master, is stated in Arnould on Marine Insurance, 13th Edition, p. 197, as follows: $-$

"195. The duty of the master, in case of damage to the ship, is to do all that can be done towards bringing the adventure to a successful termination, to repair the ship (if there be a reasonable prospect of doing so at an expense not ruinous) and to bring home the cargo, and earn the freight if possible."

In the instant case the master did nothing to save the dhow and repair it. Instead of which he and the agent hurried to Mombasa from which place they informed the respondents on 19th April by cable that the dhow had been wrecked. The cases of Barker v. Jansen L. R. 3 C. P. 303 and Knight v. Faith 117 E. R. 605 set out the principles which apply to proof of absolute total loss. In Barker v. Jansen Willis, J., said, at p. $305$ : —

"If a ship is so injured that it cannot sail without repairs, and cannot be taken to a port at which the necessary repairs can be executed, there is an actual total loss, for that has ceased to be a ship which never can be used for the purposes of a ship; but if it can be taken to a port and repaired, though at an expense far exceeding its value, it has not ceased to be a ship, and unless there is a notice of abandonment there is not even a constructive total loss."

In *Knight v. Faith* Lord Campbell, C. J., said, at p. $608$ :—

"It was argued before us that the ship must be taken to have actually perished, because it is stated that, while under the protection of the policy, she "received her death blow" by the perils insured against: but we cannot give such weight to this metaphorical expression. We are bound to look to her actual condition after the injury she had sustained, and the manner in which she was treated. We still find her surviving as a ship, with her crew on board, several weeks after the risk had expired; and slight repairs might have been sufficient again to fit her for navigation. . . . It must be borne in mind that she remained in the character of a ship, capable of being repaired if there had been the means of repairing her at Santa Cruz: and that she might have been sent to other places where she might have been repaired although not prudently.... We have here, then, the case of a ship rendered unnavigable by perils insured against, and not capable of being repaired in the harbour into which she was carried, but still retaining her character as a ship without the title of the assured, the original owners, being properly transferred to a purchaser. This, we think, is not an actual total loss; and if a constructive total loss the insurers can only be rendered liable for the sum insured by a notice of abandonment."

In Cates Tug & Wharfage Co. v. Franklin Insurance Co. (1927) A. C. 698, the appellants were the owners of a tug which was sunk in collison in Vancouver harbour and went down in about 15 fathoms. She was insured with the respondents against constructive total loss. Salvors employed by the respondents raised the tug in a few days and notice of abandonment by the appellants was not accepted. The Privy Counsel held that the sinking was not an actual total loss nor even a constructive total loss for the estimated cost of repair was less than the insured value. Viscount Sumner in delivering the judgment of the Board says (at p. 702): $-$

"... the loss was not an actual total loss, for the tug was clearly capable of being salved and repaired, as any prudent uninsured owner would have seen; that on a comparison of the aggregate cost of salvage, repairs and incidental expenses with the insured value, there was such a margin as made the loss partial only."

In the instant case the dhow was not sunk, it was anchored in deep water in a waterlogged condition and was towed to the beach by a 10 h.p. motor-boat the following day. The evidence to which we have referred shows that the damage to the dhow when the Anglia car slipped off it consisted of a hole near the steering and possibly a broken mast; the main hull was intact. Mr. Murray says in evidence (p. 11) that when he returned to the dhow the following morning—

"certain timbers had broken away from the ship and reached the beach, spars and timbers; the main hull was more or less intact. There were definite open seams, they are clinker built; on port side especially were wide gaps but being wooden she could not sink."

That, however, was after the dhow had spent a night on its side on the beach and had been pounded by the waves. As Murray says: -

"There were bits and pieces from fore and aft breaking up daily; after ten days there was nothing of main hull left. It was a gradual process of breaking up."

The pounding by the waves must have been severe, and the vessel soon disintegrated. As regards the loss of the Anglia car, however, the condition of the vessel when the Anglia slipped off is the vital fact and, as we have already stated, the evidence shows that the damage to the vessel then was comparatively slight. Murray says (p. 11) that: "There are no facilities for major repairs at Casuarina or at Malindi". It can hardly be said that the vessel required major repairs. As the Receiver of Wrecks says (p. 14): "If only one hole it certainly could be repaired, if dhow safely beached", and as regards the mast the Customs and Excise note of the auction sale (exhibit 6) shows that three dhow masts were auctioned, presumably spares. It was not suggested that a shipwright could not be obtained from Mombasa to do such repairs.

We are thus of opinion that the respondents failed to prove that the dhow was an absolute total loss when the Anglia car was lost. Indeed, in our opinion, they failed to prove it was even a constructive total loss, for in face of the evidence that the hull was intact when beached and that repairs were possible, it was incumbent upon the respondents to show that the aggregate cost of salvage repairs and incidental expenses could not prudently be undertaken, i.e. would be greater than the value of the vessel. This they did not attempt to do. We accordingly allowed the appeal in respect of the Anglia car.

As regards the Vauxhall car different considerations arise. It was agreed by counsel before us that the questions to be answered in the case of the Vauxhall are: -

(a) Was the Vauxhall ever a total loss?

(b) If so did such total loss occur by the absolute total loss of the vessel?

The Anglia was undoubtedly a total loss for it disappeared into the sea and has not been seen since. The Vauxhall, however, was landed intact, although damaged by sea water, seven to ten days after the dhow was beached, and later was sold by auction at Malindi by order of the Receiver of Wrecks. The only evidence as to its condition is that of the Customs Officer, Kaim Abdulla, that "She was much damaged by sea water". The auction sale note (exhibit 6) shows that it was sold at the auction at Malindi for Sh. 455. The learned trial Judge examined the question of the condition of the Vauxhall in his judgment at the bottom of $p$ . 3, but his conclusion that "in one sense the car was not proved to be a total loss at all within the test laid down in *Farnworth v. Hyde*, 2 C. P. 204", is based on letters in exhibit 6 which were not in evidence. Whether or not the Vauxhall was a constructive total loss was a matter for the respondent owner to prove. He made no attempt to do so. Mr. Hassan, counsel for the respondent, argued before us that he relied on the above-mentioned evidence as to the damage and in the inference to be drawn from the low price, Sh. 455, realized at the auction sale. Counsel added that the respondent did not set out to prove the cost of repairing the car because he had no knowledge of the sale; his information was by cable from the captain that the dhow was wrecked and he could take no steps from Zanzibar. The test laid down in Farnworth v. Hyde is set out in the headnote as follows: -

"Where goods are in consequence of the perils insured against lying at a place different from the place of their destination, damaged, but in such $\frac{1}{1}$ a state that they can at some cost be put into a condition to be carried to their destination, the jury in order to ascertain whether there is a constructive total loss of the goods, must determine whether or not it is practically possible to carry them on—that is, whether to do so will cost more than they are worth: and, in determining this, the jury are to take into account all the extra expenses consequent on the perils of the sea, such as drying, landing, warehousing, and reshipping the goods."

In the instant case no evidence was given on which such a determination could be made. The plain fact is that the captain of the dhow, the agent Habib, and the respondent owner of the Vauxhall washed their hands of the matter. The captain and the agent hurried off to Mombasa and there is no evidence that they took any further interest in the vessel or the cargo. They informed the respondent on 19th April by cable from Mombasa to him at Zanzibar that the dhow was wrecked off Malindi, and the respondent wrote to the appellant company's agent. at Zanzibar on the same day registering his claim under the policy (exhibit 2). There is no evidence that the respondent did anything else whatsoever in the<br>matter from 19th April, the date of the cable, to 19th May, the probable date of the sale of the Vauxhall, except to write a further letter (exhibit 5) to the appellant on 24th April, this time submitting his claim for total loss of the car and asking for an early settlement. Mr. Hassan quoted Parry v. Aberdein, 109 E. R. 153, in support of his contention that the respondent had done all that was necessary in the circumstances. In that case the vessel carrying the insured goods was placed in so much danger by perils of the sea that the crew deserted her in order to save their lives, and the owners of the goods, upon receiving intelligence of this, gave notice of abandonment. A few days afterwards the vessel was found by some fishermen and towed into port and repaired, but the goods, which were of a perishable nature, had been so much injured by the salt water that they would not have been worth anything if forwarded to the place of destination. It was held that the assured were entitled to recover for a total loss.

It is difficult to see what relevance that case has to the instant one. In that case the goods were of a perishable nature and there was evidence that they had been so injured by salt water that they would not have been worth anything if forwarded to the place of destination. In the instant case we are dealing with a motor-car which cannot be said to come within the class of perishable goods and there is no evidence as to what it would have been worth if forwarded to its destination.

Mr. Cleasby, counsel for the appellant, concedes that a notice of abandonment was given which was valid in form, but it was not accepted by the appellant. and counsel submitted that it is only valid in substance if the facts upon which it is founded prove true at the time when it was actually given. With this submission we agree (v. Arnould op. cit., p. 1001.) It cannot be said that the facts in the instant case show that the Vauxhall was a constructive total loss at the time when notice of abandonment was actually given. The notice of abandonment is, therefor, a nullity: v. Arnould, p. 1001. But Mr. Hassan contended that the respondent was forcibly dispossessed of all control over the Vauxhall by the action of the Receiver of Wrecks who had the car sold, and that this, Mr. Hassan contended, was directly due to the perils of the seas insured against. With this contention we are unable to agree. Mr. Hassan referred for support of his contention to Arnould op. cit., para 1142, p. 1040, in which appears the following: $-$

"... an insurance on goods is a contract to indemnify the assured for any loss he may sustain by his goods being prevented, by the perils of the seas, from arriving in safety at their port of destination."

It goes on to deal with forcible dispossession which in para, 1138 on p. 1038 is described as dispossession by "capture, arrest, or embargo, if likely to be of long continuance, barbarous seizure, or total destruction at sea by the crewany forcible dispossession in short, or effective deprivation of the control over his property".

The first point in the instant case is whether the breaking-up of the dhow, i.e. its absolute total loss on or about 27th April was due to perils of the seas. Assuming that it was, the Vauxhall was landed about the same time but, as we have already indicated, the respondent has failed to prove that the Vauxhall was then a constructive total loss. Accordingly, the notice of abandonment being a nullity, the property in the Vauxhall did not pass to the appellant; (v. Arnould, p. 1100). Thus, it was incumbent upon the respondent, and upon the captain as his agent, to take all steps necessary to safeguard the insured car; (v. Arnould, p. 1119). The respondent took no action whatsoever. The Vauxhall was sold by the Receiver of Wrecks to cover import duty and expenses, including salvage -expenses. The Receiver said in his evidence $(p. 14)$ :—

"If the owner of car had applied for return of the car before sale it would have been returned to him less payment of import duty, expenses and salvage expenses; if it were eventually exported one could claim drawback of import duty."

In these circumstances it is clear that the loss by sale is not a loss due to perils of the seas. At the trial the respondent strongly relied upon Cossman v. West, 13 A. C. 160. That was a case in which a ship had been deserted by her master and crew, having been previously placed by them in a sinking condition, but had been subsequently taken possession of by salvors, towed into port, and there sold together with the cargo, by order of the Admiralty Court, for less than the actual cost of the salvage services. It was held that to constitute a total loss within the meaning of a policy of marine insurance it is not necessary that a ship should be actually annihilated or destroyed. If it is lost to the owner by an adverse valid and legal transfer of his right of property and possession to a purchaser by a sale under decree of a court of competent jurisdiction in consequence of a peril insured against, it is as much a total loss as if it had been totally annihilated. The important point in that case, however, which makes it inapplicable to the instant case is, as stated at p. 178 by Sir Barnes Peacock in delivering the judgment of the Privy Council, that "the salvage greatly exceeded the value of the property saved, and no prudent uninsured owner would have paid the salvage in order to redeem the ship." He also referred, on p. 177, to *Thornely v. Hebson*, 2 B. & A. 513, in which he states "it was held, under the particular facts of the case, that the sale of a ship under a decree of a foreign Admiralty Court for salvage did not constitute a total loss. In that case, however, it appeared that the value of the vessel, even under a forced sale, exceeded the amount of the claim of the salvors, and that the owners were near enough to have acted in the business, and that it was not proved that they had used all the means in their power to prevent the sale." In the instant case it was not proved by the respondent that the sum required by the Receiver of Wrecks was greater than the value of the car. Indeed the Customs and Excise note of the auction (exhibit 6) indicates that the sum required was less than the value of the car, for the car realized Sh. 455, the import duty, which is returnable on export, is shown as Sh. 59/35, and the salvage money as Sh. 113/75. It was suggested by counsel at the trial that the owner was not near enough to have acted in the matter for he was at Zanzibar. In view of modern facilities for communication and travel we are unable to agree. The plain fact is that the owner was content to sit back and do nothing, and the captain, whose duty it was to act as agent for him (v. Arnould, p. 1119), deliberately hastened away from Malindi without a thought for the vessel or the «cargo.

We are thus of opinion that the two agreed questions concerning the Vauxhall are answered as follows: $-$

(a) It was never a total loss, and

(b) Does therefore not arise. $(b)$

To sum up. Although the Anglia was a total loss it was not so by the absolute total loss of the dhow. The Vauxhall was never a total loss.

We accordingly allowed the appeals, setting aside the judgments of the Supreme Court and made orders dismissing the suits, the respondents to pay the costs here and below. We also directed that the Taxing Master should allow only half the costs of preparing the second record.

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