In Atlasnavios-v-Navigators Insurance, the Court of
Appeal (the highest court within the Senior Courts of England and
Wales) found that Insurers were entitled to rely on a literal
interpretation of a standard war risks exclusion to deny coverage
for the detainment of a vessel, despite the fact that the
detainment was caused by a "malicious act," which was
itself a covered peril.
In August 2007 a routine underwater inspection by divers
discovered 132 kg of cocaine strapped to the hull of the vessel
"B Atlantic" in Venezuela. The vessel was detained by the
Venezuelan authorities, and ultimately abandoned to the Court.
The ship owners presented a claim to their Insurers for the
total constructive loss of the vessel on the basis that the
detainment constituted a malicious act. Insurers declined cover,
relying on the standard war risk exclusion in the ship owner's
policy to exclude losses from "arrest restraint detainment
confiscation...by reason of infringement of any
