The Court of Appeal allowed the insurers’ appeal in ArgoGlobal Underwriting Asia Pacific Pte Ltd v OCBC. It held that OCBC had not proved a loss caused by a “peril of the seas” because fortuity must be shown separately from seawater ingress. OCBC also could not rely on the presumption of loss in wholly unexplained circumstances, since the vessel remained available for inspection for 76 days and no proper causation investigation was carried out. The court rejected the idea that simply discrediting the insurers’ alternative theory was enough.

On the facts, the vessel was seaworthy when it sailed, but OCBC’s own expert evidence did not establish a definite cause of the capsize. The court also found that OCBC failed to prove a constructive total loss. It had not properly pleaded or evidenced the repair/recovery costs needed to show that those costs exceeded the insured value. Several documents relied on were inadmissible because they were prepared for the insurance claim rather than in the ordinary course of business. The case tightens the evidential burden on assureds, especially where a casualty is still under investigation.