Admiralty jurisdiction and party autonomy in the marine insurance practice in South Africa

Abstract

An increase in international trade has resulted in an increase in the carriage of goods by sea, which has also promoted the business of marine insurance on a very huge scale. Marine insurance contracts fall within both the admiralty jurisdiction where admiralty laws apply and special contract law where the rules and principles of contract law apply. In certain circumstance this has left the courts with a dilemma in deciding in particular cases which law should apply; whether maritime law, contract law or marine insurance law. There are certain principles under the law of contract that are said to be profound and cannot be ousted easily by substantive law. The principle of party autonomy is one of these principles and it has gained international recognition through a number of cases. However, to date, courts are faced with difficulties in deciding whether to uphold the choice of law on jurisdiction and governing law exercised by parties or resort to substantive law, either by virtue of admiralty law or any other statutes in a country, which provisions may be contrary to the clause on choice of law under the contract. In South Africa practice has shown that courts are always reluctant to apply the clause on choice of law if they believe such application is against the public policy and interest in South Africa. This begs the question as to the precise meaning and effect of “public policy and interest” and how this principle influences the long-standing and well-established principle of party autonomy in admiralty jurisdiction. This dissertation is aimed at providing a legal response to this problem by analysing case law and the different viewpoints of various writers. It is imperative to investigate if their decisions and views answer all the uncertainties with regard to the meaning and the effect of the concept of “public policy and interest” on the principle of party autonomy.