Liability Insurance in International Arbitration by Richard Jacobs Lorelie S & Paul Stanley

Author:Richard Jacobs, Lorelie S & Paul Stanley
Language: eng
Format: epub
Publisher: Hart Publishing

THE ‘ADVERTISING’ EXCLUSION[162]

10.89

Although advertising liability is covered by the Bermuda Form policy and is a defined term,[163] exclusions qualify the cover. Advertising liability is not, in our experience, a matter that becomes the subject matter of disputes under the Bermuda Form, and we do not deal with the topic here.[164]

THE ‘WAR’ EXCLUSION

10.90

The war exclusion excludes coverage for:

Personal Injury, Property Damage or Advertising Liability directly or indirectly occasioned by, happening through or in consequence of war, invasion, hostile action of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion, revolution, insurrection, military or usurped power or confiscation or nationalization or requisition or destruction of or damage to property by or under the order of any government or public or local authority; provided, however, that this Exclusion G shall not apply to Personal Injury, Property Damage or Advertising Liability:

(1) taking place in and caused by the foregoing events in the land area of the United States of America, its territories or possessions, Puerto Rico or Canada; or

(2) caused by any act or acts committed by one or more persons, whether or not agents of a sovereign power, for political or terrorist purposes where (a) such person or persons are not acting on behalf of a government, governmental authority or other power (usurped or otherwise) which exercises de facto jurisdiction over part or all of the populated land area of the country in which the Personal Injury or Property Damage takes place; and (b) if such person or persons are acting as an agent or agents of any government recognized de jure by a majority of Belgium, Canada, France, Germany, Japan, the United Kingdom and the United States, such person or persons are acting secretly and not in connection with the operation of regular military or naval armed forces in the country where the Personal Injury or Property Damage takes place.[165]

10.91

Although both wars and conflicts over terrorist incidents have taken place since the Bermuda Form was introduced, we are not aware of any arbitration in which this clause has arisen as a defence to coverage. An exclusion of this kind is, generally speaking, more likely to be relevant to first-party losses, rather than to liability claims by third parties. The clause might become relevant if, for example, a defective product resulted in injury or death to servicemen serving in a war taking place outside the United States, its territories or possessions, Puerto Rico or Canada; for example, the faulty operation of a component designed to prevent friendly-fire incidents.[166] The exclusion also might come into play in lawsuits brought against a company providing services to the military in war zones. Because the United States government has been outsourcing to private companies many functions necessary to ongoing operations in Iraq and Afghanistan, commercial policyholders in the United States have faced lawsuits alleging injuries as a result of their activities in those conflict zones.[167] Although suits seeking to recover for such activities have arisen, as yet, the ‘war risk exclusion’ does not appear to have arisen frequently in connection with disputes over coverage for such activities.

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