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Rule 35 Effects of Cesser and Cancellation of Insurance
35.1
When an Insured Owner’s insurance ceases under or by reason of the operation of any of these Rules other than Rule 34:
35.1.1
Such Insured Owner and his Successors shall be and remain liable for all Contributions, Additional Premiums, Premiums and any other sums whatsoever payable in respect of the Policy Year in which the insurance ceases, and in respect of previous Policy Years, unless and to the extent that Rule 37 is applicable and/or the Insured Owner’s liability may have been otherwise agreed under Rule 38;
35.1.2
Subject to Rule 35.2 and to the other provisions of these Rules and to the terms of entry in the Association of the Entered Ship or Ships in respect of which insurance has ceased, the Association shall remain liable in respect of such Entered Ship or (as the case may be) Ships for all claims under these Rules arising out of any event which has occurred prior to the time of cessation of the insurance, but shall not otherwise be under any liability whatsoever by reason of anything occurring after such time.
35.2
When an Insured Owner’s insurance is cancelled in accordance with Rule 34 (which time is hereinafter in Rule 35 referred to as “the date of cancellation”):
35.2.1
Such Insured Owner and his Successors shall be and remain liable for all contributions, Additional Premiums, Premiums and other sums payable in respect of the Policy Year in which the date of cancellation occurs pro rata only for the period up to the date of cancellation or such earlier date as the Managers in their discretion decide and stipulate in writing, and in respect of previous Policy Years;
35.2.2
The Association shall with effect from the date of cancellation cease to be liable for any claims of whatsoever kind under these Rules in respect of any and all ships entered in the Association by or on behalf of such Insured Owner irrespective of whether:
35.2.2.1
Such claims have occurred or arisen or may arise by reason of any event which has occurred at any time prior to the date of cancellation, including during previous Policy Years;
35.2.2.2
Such claims arise by reason of any event occurring after the date of cancellation;
35.2.2.3
The Association may have admitted liability for or appointed lawyers, surveyors or any other person to deal with such claims;
35.2.2.4
The Association at the date of, or prior to the date of, cancellation knew that such claims might or would arise, and as from the date of cancellation any liability of the Association for such claims shall terminate retrospectively and the Association shall be under no liability to such Insured Owner for any such claims or on any account whatsoever.
35.3
PROVIDED ALWAYS that: the Directors may in their discretion and upon such terms as they think fit, including but not restricted to terms as to payment of Contributions, Additional Premiums, Premiums or other sums, agree to pay either in whole or in part any claim in respect of any ship entered by an Insured Owner for which the Association is under no liability by virtue of Rule 35, whether such claim has arisen before or arises after the date of cessation or the date of cancellation, as the case may be, or remit wholly or partly any payment of Contributions, Additional Premiums, Premiums or other sums paid or payable to the Association.