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St. Thomas Law Review

First Page

133

Document Type

Article

Abstract

The doctrine of utmost good faith is a fundamental tenet of the law of marine insurance. In both Britain and the United States (majority view) the law of marine insurance imposes a duty of "utmost good faith," or uberrimae fidei. This duty sets a high standard: the to contracts of marine insurance must not only avoid fraud and misrepresentation, but they are required to disclose voluntarily "every material circumstance." This principle dates back to the seminal 1766 English case Carter v. Boehm, and has gradually been adopted by a majority of the American courts. However, something unusual happened in February of 2015. On February 6, 2015, the First Circuit decided Catlin (Syndicate 2003) At Lloyd's v. San Juan Towing And Marine Services, Inc., making the solemn announcement: "Although this court had not yet held definitively that uberrimae fidei is an established rule of maritime law, we do so now, thus joining the near-unanimous consensus of our sister circuits. ' Not even a week later, on February 12, 2015, the Queen gave Royal Assent to the Insurance Act 2015, containing the opposite announcement: "Any rule of law permitting a party to a contract of insurance to avoid the contract on the ground that the utmost good faith has not been observed by the other party is abolished." This contrast may look ironical at first sight, but a close analysis and a view from a proper perspective shows that it is not. This article supplies a history of the making of the Insurance Act, presents a summary and review of the Insurance Act, and examines the many innovations therein contained together with an updated comparative view of the American and British legal systems of marine insurance. After a wholesome fresh review of the famous opinion of the Fifth Circuit in Albany Ins. Co. v. Anh Thi Kieu, this article suggests that Anh Thi Kieu was not, after all, so heretical as other circuits, but rather a kind of "prophet in homeland" for the many affinities between Anh Thi Kieu and the newborn Insurance Act. This article concludes with a review of the possible consequences of the new United Kingdom legislation and of the possible influence on future American case law. The Insurance Act contains, in fact, many other revolutionary provisions, such as on warranties, actions against third parties, variations to insurance contracts, and more.

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