Case ID: cai_2/html/0067-01.html
Source: Caselaw Access Project
Author: {"author": "Thompson, J.- Kbft, J. Lewis, Ch. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Kendrick against Delafield.
    In an action on a policy of insurance averring the loss by barratry, if the plaintiff show a loss from a fraudulent act of the master, the presumption of law is, that it was for his own benefit, and the assured, in order to entitle him to recover, need not affirmatively show it to have been so.
    This was an action on an open policy, “at and from New-York “ to Curracoa,” on goods shipped on board the schooner Reindeer, and consigned, by the bills of lading, to tbe captain, who bad been, together with the crew, provided by a person to whom the vessel was chartered. The declaration contained two counts, one stating the loss to be by the barratry of tbe master, the other by the perils of the sea.
    
    From the testimony of tbe master, it appeared that tlie .vessel, while chased and under a press of sail, sprung *a leak, in consequence of which he bore away for Santa Cruz; in running for which, he was obliged to throw overboard a considerable part of her cargo, in order to lighten the vessel; and even then the leak increased so much, that on his arrival at Santa Cruz, the water was up to the upper deck. This obliged him to run the vessel on shore, and sell her and her cargo. The latter was so much damaged, that the plaintiff’s goods sold for about one tenth of their prime cost.
    On the other hand, by the depositions of two persons, it was proved that the Reindeer was raised in seven hours after she had been sold, and that her leak proceeded from two auger holes bored in her bottom.
    The jury brought in their verdict for a total loss. They were, however, requested by the judge to inform the court, whether they found the loss to be from the perils of the sea, or the fraud of the master ? To this they answered, from the fraud of the master. They were then asked whether it was done for the benefit of the charterer ? To establish this fact, they said, the evidence was not sufficient. They 'were then interrogated whether, in their opinion,. they thought the evidence sufficient to show that the fraud was committed for any purpose of the captain’s ? To this they returned, there was not enough to enable them to determine who was to be benefited by the fraud.
    
    
      After tbe verdict thus rendered, a person of the name of Foster informed one of the owners of the schooner, that if he was not paid by him the amount of a debt due from the charterer, he would disclose the whole fraud, and tell where the very auger was bought which had bored the holes in the bottom of the Reindeer.
    On these facts, and this subsequent discovery of testimony an application was made to set aside the verdict, and grant a new trial.
    1. Because, to constitute barratry, it must appear that the fraud was committed for the benefit, or expected benefit of the captain.
    2. Because, where a shipper consigns the shipment by the bill of lading to the captain, he cannot commit barratry by embezzlement of these goods.
    3. Because new testimony has been discovered since the *trial, which it was hot in the power of the defendant to have obtained before.
    
      Pendleton, for the defendant.
    Barratry must be some act-done by the master for his own benefit,(a) to the prejudice of his owners, and so proved, 2 Marsh. 445, 456. n. 
      . It must be with an intention to defraud the owners. Phynn v. Boy. Ex. Ass., 7 D. & E. 505. Moss v. Byrom, 6 D. k E. 379. Hague v. Bordieu, 1 D. & E. The finding, therefore, wants tKis ingredient. To fix the loss on tha underwriters, it should state on whose account. The return of the master to be examined, is a proof that his actions were for the benefit of his owner — the owner pro hoc vice. Secondly, when the character of the captain is changed into that of a consignee, he becomes the agent of his. principal, the shipper; and though he may be liable for misconduct, it cannot be barratry so as to charge the underwriters. This principle is recognized in Fitzherbert v. Mother, 1 Marsh. 340, where the act of the agent exonerated the insurer, though the assured was perfectly innocent of the misrepresentation ; but in the present case the owner may well be presumed to have colluded for the fraudulent purpose. The bill of lading vests the property in the consignee, when possession of the goods passes with the bill. The consignor is then a cestui que trust, and the consignee accountable only on the equitable principles of the law. Had the goods been sold by the master at any intermediate port, the sale would have bound the property. The character of captain is lost in that of consignee ; for the owners of a vessel are liable for their captain’s acts only so long as he continues a simple carrier on their account. 2 Marsh. 444, after mentioning the Boman law, goes on and states that if the captain be commissioned to dispose of an adventure on board, the insurer of such adventure shall not be answerable for the loss of it; for this would make the insurer answerable to the insured for the faults of his own agents. The expectation of fully showing, on a new’trial, the fraud, from the testimony discovered, will, at least, induce the sending back for another investigation.
    
      Hoffman and Biggs, contra.
    The affidavit of newly discovered testimony is too loose; it ought to have specified a time when it might be expected to obtain the witness by whom it is to be shown, and have also gone to a full belief *of its truth. The jury had the whole evidence before them; and, if they believed the captain, it was ample. The plaintiff rested his cause there. The defendant set up the fraud of the master, and as it was relied on as a defence, it was incumbent on the insurer to show for whose benefit, because that is necessary to prove it was not barratry. To constitute an act barratry, it is enough to show it a pure fraud; for every species of fraud, cheating, &c. of the master, is barratry, without the plaintiff’s proving on whose account or for whose benefit committed. Marsh. 442; Millar, 105, 153. In a count for barratry, it is sufficient to state the loss by the fraud of the master, and it is unnecessary to prove more, than is alleged. Barratry may also be as well in respect to the cargo as the vessel. Lewin v. Suasso, Postle. Die. v. 1, p. 147; Marsh. 452, 453. The ownership, therefore, of one, does not affect the other subject. Millar, 165,167. Therefore, though the fraud of the hac vice owner, or his orders, might have prevented barratry as to his goods, it will not do away the effect as to the property of another, or an innocent shipper. Marshall, in page 444, where he cites Emerigon, tom. 1, 870, mistakes the sense of the author. Emerigon says, the captain, though consignee, may, whilst he continues acting as captain, be guilty of barratry against the cargo consigned, but not after they are on shore.
    When both characters are united, the former does not attach till the latter has expired ; for the consignee has no right over the goods till the voyage is at an end. This principle is found in cases of abandonment, where, till that period, the captain is agent for the owner of the ship, but afterwards he becomes that of the assurer. Besides, the presumption of law is that every man wbo commits a fraud does it for bis own 'benefit, and not for that of bis owners. Millar, 173. Boss v. Hunter, Marsb, 466, 467.
    
      Pendleton and Hamilton, in reply.
    
      Nutt v. Bordieu was tbe case of an innocent shipper, and yet because tbe fraud there was with tbe knowledge of tbe shipowner, it was decided not to' be barratry, though tbe sentence in France had pronounced that it was \ for it must be an act against tbe duty to tbe owner of tbe ship. The intent is part of tbe offence, and ought to be shown. Of this, tbe jury answer, there was no proof. In Boss v. Hunter, 4D.&E. 33, the act was proved to have been *done for tbe benefit of the captain. To show the character of master is sunk in that of consignee, had a shipper consigning goods to a captain brought an action against the owners for an embezzlement by the master, could there be a recovery? The argument from the innocence of the shipper is of no force, because barratry is a technical offence. Want of seaworthiness avoids a policy, though certainly no crime in the shipper. The contract in both cases is founded on certain fixed understandings. The as-surer being liable for barratry only when established, it must be proved by him who claims the benefit of that part of the engagement.
    
      
      
         Under a count alleging the loss by perils of tbe sea, if they be in truth the immediate cause of loss, the plaintiff it seems, will be entitled to recover, though the barratrous conduct of the master occasioned the loss by such perils: as if the master, while the ship is riding in safety, wilfully cut her cable, in consequencé of whicli she is driven on a ledge of rocks, and wreeked. Beymm and others v. Parish, 2 Camp. 149. Therefore, whore the loss waS stated to be by capture, proof of a barratrous capture by the collusion of the captain was held to maintain tho declaration. Arcangelo v. Thompson, 2 Camp. 620.
    
    
      
       Barratry is any act or conduct of the master or mariners in breach of the trust reposed in them, by and to tho injury of the owners of the ship, though intended for their benefit, and whether the master be benefited or not. Earle v. Rowcroft, 8 East, 126. But as volenti nonfttmjwria, when tho consent of the owners is shown there cannot be any recovery under a count for barratry. Vallejo v. Wheeler, Cowp. 143; Halletty. Col. Ins. Co., 8 Johns. Kep. 272. Where from gross negligence of the owner the mariners carry on a smuggling trade, in consequence of which the vessel is seized, the underwriter is discharged. Pipon v. Cope, 1 Camp. 434. Suol: negligence amounting to a consent. That the barratrous act is for the benefit of the master, is only an evidence of his fraudulent conduct. Per Aston, J., in Vallejo v. Wheeler, Cowp. 155, as explained by Lord Ellenborough, in S East, 137. See also Steinbach v. Ogden, 3 Caines’ Rep. 1, and Suckley v. Delafield, post, 222. Por a variety of decisions on barratry, by no means reconcilable, see 2 Cond. Marsh. 534, a. n.(84,)and Calhoun v. Ins. Co. Penns. 1 Binn. 293.
    
    
      
       Therefore it has been held, that though the master do the act for the benefit of himself and owners, it is not barratry, notwithstanding it be un-Vnown to the owners. Pools Executors v. Nesbit, 2 Dal. 137.
    
    
      
       In that case, however, it was expressly decided barratry could not arise between the master and shipper of goods. In the principal case, the ship was chartered by the owner of the cargo, so that he was owner ¡pro hac vice. Vallejo v. Wheeler, Cowp 143. Therefore, when the master hires the vessel for the voyage, he cannot commit barratry. Hallett v. Col. Ins. Co., 8 Johns. Rep. 272. But though a vessel be let to hire, if the owner man, and victual, and pay wages, the freighter is not owner, and a deviation by con sent of tile freighter only is barratry. M'Intyre v. Bowne, 1 Johns. Rep. 229
    
    
      
       So though he he supercargo. Earle v. Rowcroft, 8 East, 140.
    
   Thompson, J.-

The first question that appears to arise out of this case is, what we are to understand by the term barratry in a policy of insurance. In the case of Nutt v. Bordieu, (D. & E. 330,) Lord Mansfield says, barratry is something contrary to the duty of the master and mariners, the very terms of which imply that it must be in the relation in which they stand to the owners of the ship. An owner cannot commit barratry; he may make himself liable by his fraudulent conduct to the owner of the goods, but not as for barratry. It cannot be committed against the owner, with his consent, for though the owner may become liable, by the misbehavior of the captain, if he consents, jet that is not barratry. It must partake of something criminal, or fraudulent, and to the prejudice of the owner. Park. 84; Cowp. 155. We may therefore define barratry to be some fraudulent act of the master or mariners, tending to their own benefit, to the prejudice of the owner of the vessel, without his privity or consent. George Martin, the charterer of the vessel, must be considered the' owner pro hac vice, so that if any fraud has beén committed on the owner, it must be on him. The jury find that the loss was occasioned by the fraud of the master. But who was to be benefited or prejudiced by this fraud, the jury would not undertake to say; or whether committed with or without the knowledge of the owner, is not found. It appears to me, therefore, that the finding of the jury is nothing more than that the loss was occasioned by the fraud of the master, which is an imperfect verdict; that, of itself, not amounting to barratry.. The j ury, by their answers to the questions put by the court, have negatived some of the *material facts, necessary to constitute the charge of barratry. That there has been a gross fraud committed, I think manifestly appears, and to subject the. underwriter to the payment of the loss would seem to savor of injustice. If this fraud was practised with the knowledge and consent of the owner of the vessel, it would make him responsible, and discharge the underwriter. The case presents very considerable doubt and difficulty, and I think, for the purposes of substantial justice, another examination of the cause is necessary, and that a new trial ought to be granted, more especially, as some affidavits have been offered of the discovery of testimony since the trial, tending to show, though rather remotely, that George Martin was privy to this fraud.

Kbft, J.

I do not think that it is essential to be made appear that the fraud was committfejd for the benefit of the master. If the master commits a' fraudulent act, in his character of master, it is barratry. 2 Marsh. 444, 452. It is a criminal breach of duty in the relation in which ho stands to the owner of the ship. The person to be benefited by the barratry need not be made affirmatively. to appear. It is sufficient that the act was done with a fraudulent intent, and done by the captain, in his character of captain, and in breach of his duty and relation as captain. The,law will intend that it was done to the injury of the owner, until the contrary appears. Nor did the consignment of' the plaintiff’s cargo to the captain alter the case. The fraud of the master was not committed in the character of consignee of the plaintiff’s cargo, but in his character of master of the vessel. This is the true distinction on the subject, and which reconciles the doctrine in Emerigon with the plaintiff’s claim in the present case. The captain did not, and could not, lay aside his character and responsibility as master, until the vessel had performed'her voyage, and arrived at the port of destination. The accidental circumstance of the character of consignee being added to that of master, could not qualify or alter his acts as master; the two characters were totally distinct. The only question in this case that remains, is on the discovery of new testimony. I have examined the affidavit of "William Wilmerding; it relates some information he received of Peter Yan Wagener, who told him that one Foster, whose residence is unknown, *had called on him for some money that George Martin, who had chartered the schooner for that voyage, had promised to pay him, and threatened to disclose the whole fraud relative to the loss of the vessel. This affidavit does not even charge Martin with a concern or privity in the fraud, and leaves it only to be implied from the threat. It is a question whether even barratry, with the concurrence of the owners of goods, will exempt the insurer of goods belonging to an innocent shipper. Miller, 165, 167; Marsh. 452. The English authorities do, however, look very strongly to the opinion, that the insurer would not, in such case, be re-Bponsible. Assuming tbe law to be so, the question is on the weight of this newly discovered testimony; and, in my opinion, the evidence is altogether too loose and uncertain. There is nothing positive, or from which we can deduce any conclusion. To grant a new trial on this suggestion merely, would be to allow the party to fish for testimony, and would introduce endless contention on the subject of new trials. Even if Foster’s testimony was more definite, there is no reasonable ground to expect it could be procured. He was probably a seaman, and it appears that it is not known where he is, or where he resides. I am of opinion, therefere, that the plaintiff is entitled to judgment, and that the motion for a new- trial be denied.

Lewis, Ch. J.

I concur in the opinion last given. It is immaterial who was owner in this case. For, as the fraudulent act does does not appear to have been done for the benefit of any particular person, the law will necessarily presume it has beén for the advantage of the perpetrator.

LiviNGSTON and Spencer, Justices, gave no opinion.

New trial denied. 
      
      
         As to decisions concerning barratry, see M'Intyre v. Bowne, 1 J. R 129; Steinbach v. Ogden, 3 Cai. R. 1; Hallett v. Col. Ins. Co., 8 J. R. 272; Thurston v. Caine, 3 Cai. R. 89; Cook v. Com. Ins. Co., 11 J. R. 40; Grim v. Phœnix Ins. Co., 13 J. R. 451; Vos v. United Ins. Co., 2 J. C. 180; Grim v. Phœnix Ins. Co., 13 J. R. 459; S. C. ib. 460; Suckley v. Dalafield, 2 Cai R. 222.