Case ID: mass_14/html/0100-01.html
Source: Caselaw Access Project
Author: {"author": "Putnau, J.,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Nathaniel Smith versus Abraham Touro.
    A vessel, being American property, but having an ostensible Spanish owner ana master, was insured from the Havana to the U. S. In case of a loss, no proof of property was to be required, and no return of premium; and the assured agreed, in case of capture, to claim the property as Spanish. The vessel was captured and libelled as prize, but was finally restored. While she ■was under detention, the assured abandoned. After the restoration, the ostensible owner, instead of proceeding with the vessel to the U. S., fraudulently took her on another voyage, without authority. It was holden, that the under writers were not liable for the loss.
    Assumpsit on a policy of insurance, dated February 8, 1814, whereby the defendant insured for the- plaintiff 600 dollars on the brig Maria Francisca and cargo, at and from the port of Havana to Boston, or port of discharge in the United States not blockaded. The policy was in the usual form, except an agreement that, in case of loss, no proof of property was to be required, and no return of premium ; and in case of capture, the assured agreed to claim and prosecute for the property as * Spanish, until acquittal or condemnation in a high Court of Admiralty, the underwriters and assured agreeing to pay their proportion of expenses in such case. The plaintiff declares as for a total loss by capture.
    The cause came before the Court upon an agreed statement of facts, to the following purport and effect, viz.: —
    The plaintiff was interested in the vessel insured to the amount of his insurance, and the defendant subscribed the policy to the amount stated in the declaration, at a premium of fifteen per cent.
    The vessel proceeded on the voyage insured, and was captured by a British vessel of war, carried to Halifax, and there libelled as a prize.
    On the 11th of July, 1814, and while the vessel was in possession of the captors at Halifax, and under process of the Admiralty Court of that place, the plaintiff abandoned, in due form of law, to the underwriters and to the defendant his interest insured in the vessel.
    On the 19th of the same July, pursuant to the claim made by the master of the vessel in the said Admiralty Court, the vessel was restored, on the payment of expenses; and the proportion of the said expenses attached to the vessel was 452 dollars 40 cents.
    The plaintiff had no interest in the cargo, and claimed no loss on account thereof.
    After the restoration of the vessel, the ostensible Spanish ownei and master put on board her a cargo, and proceeded to the Wtst Indies, without the consent, sanction, or authority of any one.
    
      Williams, for the plaintiff,
    contended that, an abandonment having been duly made while the vessel was under detention by a hostile capture, a right vested to recover as for a total loss. The abandonment changed the property, and by it the nominal owner and master became the agent of the underwriters, who must suffer the effects of their fraudulent conduct. 
    
    
      Welsh, for the defendant,
    cited 2 Carnes’s Rep. 286.
    
      
       3 Mass. Rep. 238, Lee vs. Boardman.
      
    
   Putnau, J.,

delivered the opinion of the Court. This *was a case where the assured, an American, was the real, but a Spaniard was the ostensible, owner of the ship, which was the subject of the insurance. The assured, in case of capture, undertook to claim as for Spanish property, and he made a successful claim. The ship was restored to the ostensible owner; but he afterwards employed her in a voyage which the assured never contemplated: he betrayed the trust reposed in him, and converted the property to his own use.

It has been argued, for the plaintiff, that, having abandoned when the ship was in the hands of the captors, the property vested in the underwriter, and he is answerable for it.

But did the abandonment change the property ? It was undoubt edly made for a sufficient cause, and in a reasonable time. The ship was under detention. But as this was temporary, and it does not appear that she sustained any damage while in the possession of the enemy, the plaintiff is not entitled to recover for a total loss on that ground,

If, as has been contended, the ostensible owner became the agent for the underwriters, after the restoration, the defendant would be answerable for a total loss, in the same manner as if he had himself received the property. But the ostensible owner was not the agent of the assurers, but of the assured. The defendant undertook that the ship might pursue her voyage in safety as a Spanish vessel, and that, if she should be captured, she should be restored.

upon a claim being made for her as Spanish property. The precise event has happened.

The loss has occurred to the assured by reason of the fraud of the ostensible owner. Suppose that he had proceeded from the Havana to London, instead of Boston, according to the voyage insured, would the underwriter be answerable ? It could not have been for the barratry of the master; because he was bound to obej the orders of the owner, and the underwriter would have been discharged in such a case by the deviation. In short, the assured has sustained a loss, not from any of * the perils in the policy, but from the act and fraud of one whom he trusted, and for whom the defendant is not answerable.

Plaintiff nonsuit. 
      
      
         [This decision cannot easily be reconciled with the doctrine generally received, in the United States at least, that the state of things at the time of the offer to abandon fixes the rights of the parties, (Rhinelander vs. Ins. Co. Pennsylvania, 4 Cr. 29.— Marshall vs. Delaware Ins. Co. 4 Cr. 202.—Dickey vs. American Ins. Co. 11 Johns 358.—Jusnel & Al. vs. The Mar. Ins. Co. 7 Johns. 412,) and that, by the abandonment, rightly made, the insurers become the owners of the property, and the master becomes their agent.— Coolidge vs. The Gloucester Ins. Co. 15 Mass. Rep, 346. — Scheffelin vs. New York Ins. Co. 9 Johns. 26. — Brig Sarah Ann, 2 Sam. 210. — Peele vs. The Suffolk Ins. Co. 7 Pick. 254. — Hall vs. The Franklin Ins. Co. Pick. 466.— Lovering vs. The Merc. Ins. Co. 12 Pick. 348. —-Ed.]