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Pan American World Airways, Inc. v. Aetna Casualty & Surety Co.

United States Court of Appeals for the Second Circuit

April 2, 1974, Argued ; October 15, 1974, Decided

Nos. 73-2604, 73-2606, 73-2766

Opinion

 [*993]  HAYS, Circuit Judge:

On September 6, 1970 Pan American Flight 083, while on a regularly scheduled flight from Brussels to New York, was hijacked in the sky over London about 45 minutes after it had taken off from an intermediate stop in Amsterdam. Two men, Diop and Gueye, acting for the Popular Front for the Liberation of Palestine [the "PFLP"], forced the crew of the aircraft to fly to Beirut, where a demolitions expert and explosives were put on board. The aircraft, a Boeing 747, was then flown to Egypt still under PFLP control. In Cairo, after the passengers were evacuated, the aircraft was totally destroyed.

We are asked on this appeal to determine [**3]  which of the various underwriters that insured the aircraft must bear the cost of the loss. This determination depends on whether the September 6 hijacking was proximately caused by an agency fairly described, for insurance purposes, by any of the exclusions contained in a group of identical all risk aviation policies -- policies which, if not for the exclusions, would cover the loss.

The district court held that the all risk policies covered the loss. Pan American World Airways, Inc. v. Aetna Casualty and Surety Co., 368 F. Supp. 1098 (S.D.N.Y. 1973).

I. Insurance Policies in Suit

There is no dispute as to the fact of the loss of the 747, as to the amount of the loss, or as to the provisions of the various insurance policies potentially covering the loss. The controversy on this appeal involves the interpretation of those policies.

The aircraft in question was covered by "a more or less seamless mosaic" of insurance policies, 368 F. Supp. at 1101, distributing among three classes of insurers, the risk of loss depending on the proximate cause of the damage.

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505 F.2d 989 *; 1974 U.S. App. LEXIS 6498 **

PAN AMERICAN WORLD AIRWAYS, INC., Plaintiff-Appellee-Appellant, v. THE AETNA CASUALTY & SURETY CO. et al., DAVID LINTON DANN, et al., & FEDERAL INSURANCE CO., Defendants-Appellants, and THE UNITED STATES OF AMERICA, Defendant-Appellee-Appellant, and PHILIP GAYBELL WRIGHT et al., Defendants-Appellees

Prior History:  [**1]   Consolidated Appeals from a Judgment for the Plaintiff entered in the United States District Court for the Southern District of New York, Marvin E. Frankel, Judge, finding the Defendants Aetna Casualty Surety Co., et al., liable on aviation all risk insurance policies for the loss of the plaintiff's aircraft due to hijacking by Palestinian terrorists.

Disposition: Affirmed.

CORE TERMS

insurers, hijacking, riot, usurped, district court, coverage, military, aircraft, policies, insurrection, warlike, terms, cases, war risk, Fedayeen, commotion, rebellion, peril, contra proferentem, overthrow, proximately cause, Flight, risks, explosion, insurance policy, hostilities, premium, civil war, destruction, ambiguity

Insurance Law, Property Insurance, Obligations, Covered Losses, Types of Insurance, Business Insurance, General Overview, Claim, Contract & Practice Issues, Policy Interpretation, Exclusions, Exclusions, Coverage, All Risks, Criminal Law & Procedure, Criminal Offenses, Miscellaneous Offenses, Transportation Law, Air & Space Transportation, Air Piracy, Premiums, Ordinary & Usual Meanings, Real Property, Civil Procedure, Appeals, Standards of Review, Clearly Erroneous Review, Marine & Inland Marine Insurance, Claims, Proximate Cause, Terrorism, Aircraft Hijacking, Crimes Against Persons, International Law, Laws of War, Individuals & Sovereign States, All Risk, Definitions, Disruptive Conduct, Riot, Estate, Gift & Trust Law, Wills, Will Contests, No Contest Clauses, Governments, Courts, Common Law, Evidence, Inferences & Presumptions