Report No. 21
Clause 59
General.-This deals with actual total loss.
Analysis.-Actual total loss arises in the following cases
(i) where the subject-matter is destroyed; or
(ii) where the subject-matter is damaged so as to cease to be of the kind insured; or
(iii) where the assured is irretrievably deprived of the subject-matter. An example of the first would be-physical destruction of the ship or cargo.
An example of the second would be a consignment of dates which remains sunk for a number of days and is found to be contaminated by sewage.1 The dates in this case had a certain value for distilling purposes, but no longer answered the description of dates. (This was a case of insurance of freight; the charterer having chartered the ship for a lump sum, issued bills of lading to shippers. As a result of the damage, he lost his freight on the cargo in question, and was therefore entitled to recover the profit which he would have made from the transaction.)
As an example of the third may be cited the case where a ship deserted in a sinking condition is towed into port by salvors and sold under an order of the Admiralty Court for less than the salvage charges.2
The distinction between the first two and the third is that in the third the subject-matter may be in existence, but the assured does not get it.
1. Asfar & Company v. Blundell, (1895) 2 QB 198, approved, (1896) 1 QB 123: 73 LT 648 CA.
1. Cosmen v. West, (1887) 13 App Cas 160 PC.
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