CHARTERERS' LIABILITY INSURANCE / PART I / Clause 2

COSTS AND EXPENSES, SUE AND LABOUR

2.1 Costs and expenses

Costs and expenses, including legal fees, which the Assured may incur in respect of any liability or expenditure against which the Assured is insured.

2.2 Sue and labour

Losses, costs and expenses necessarily incurred by the Assured after an incident in order to avoid or reduce a liability or expenditure against which the Assured is insured by the Association, even if such losses, costs and expenses would otherwise be excluded by the terms of the insurance.  Administrative expenses incurred by the Assured including the salary or retainer of any employee or third party shall be excluded.

2.3 Special direction

Losses, costs and expenses which the Assured may be required to incur by special direction of the Association in cases in which the Association decides that it is in the interests of the Association that the direction be given, even if such losses, costs and expenses would otherwise be excluded by the terms of the insurance.

2.4 PROVIDED ALWAYS THAT:

2.4.1 no such losses, costs or expenses shall be recoverable unless either they have been incurred with the prior agreement of the Managers or the Association shall determine that such losses, costs and expenses were reasonably incurred;

2.4.2 unless otherwise agreed the costs and expenses incurred under Clause 2.1 shall bear the same deductible as the liability or expenditure to which they relate; and the costs and expenses incurred under Clauses 2.2 and 2.3 shall bear the same deductible as the liability or expenditure so avoided or reduced would have borne;

2.4.3 costs and expenses incurred in respect of a formal enquiry shall be recoverable to such extent only as the Association may determine;

2.4.4 losses, costs and expenses arising from or related to ransom demands or extortion shall be recoverable only to such extent as the Association may determine.