A rule stating that a trust cannot be considered valid unless the beneficiaries get vested in the trust property in the next 21 years.

(i) The intention of the parties to the contract must prevail. In the words of Lord Mansfield “these contracts are to be taken with great latitude, the strict letter of the contract is not to be so much regarded as the object and intention of it.” (ii) The Policy is to be interpreted in its entirety. To quote Lord Halsbry “in looking to a document between the businessmen, I do not think it is wise to look at technical rules of construction. I think it is well to look at the whole document, to look at the subject matter with which the parties are dealing, and then to take the words in their natural and ordinary meaning, and construe the document in that way.” (iii) In Blockett V. Royal Exchange Assurance Co. the Court observed, “the rule of construction as to exceptions is that they are to be taken most strongly against the party for whose benefit they are introduced. The words in which they are expressed are considered as his words; and if he does not use words clearly to express his meaning. He is the person who ought to be the sufferer. Thus, if there is any doubt as to the meaning and effect of the words used or if there is any ambiguity in the Policy, the benefit of doubt is given to the insured.”

The Customs of Lloyd’s were adopted by the Association of Average Adjusters which was formed in 1874 and were called the Rules of Practice. These are amended from time to time by the Association for the guidance of its members in adjustment of average. The object of the rules is to secure uniformity of practice in average adjusting.