# Olivera v. The Union Insurance Company/Opinion of the Court

* Court Documents
* Case Syllabus
* Opinion of the Court
On the part of the plaintiff in error, it has been contended, that the assured have sustained a technical total loss, by a peril within that clause in the policy, which insures 'against all unlawful arrests, restraints, and detainments of kings,' &c.
He contends, 1st. That a blockade is a 'restraint,' of a foreign power. 2d. That, on a neutral vessel, with a neutral cargo, laden before the institution of the blockade, it is 'an unlawful restraint.'
The question, whether a blockade is a peril insured against is one on which the court has entertained great doubts. In considering it, the import of the several words used in the clause has been examined. It certainly is not 'an arrest,' nor is it 'a detainment.' Each of these terms implies possession of the thing by the power which arrests or detains; and in the case of a blockade, the vessel remains in the possession of the master. But the court does not understand the clause as requiring a concurrence of the three terms, in order to constitute the peril described. They are to be taken severally; and if a blockade be a 'restraint,' the insured are protected against it, although it be neither an 'arrest,' nor 'detainment.'
What, then, according to common understanding, is the meaning of the term 'restraint?' Does it imply, that the limitation, restriction, or confinement, must be imposed by those who are in possession of the person or thing which is limited, restricted, or confined; or is the term satisfied by a restriction, created by the application of external force? If, for example, a town be besieged, and the inhabitants confined within its walls by the besieging army, if in attempting to come out, they are forced back, would it be inaccurate to say they are restrained within these limits? The court believes it would not; and, if it would not, then with equal propriety may it be said, when a port is blockaded, that the vessels within are confined, or restrained from coming out. The blockade force is not in possession of the vessels inclosed in the harbour, but it acts upon and restrains them. It is a vis major, applied directly and effectually to them, which prevents them from coming out of port. This appears to the court to be, in correct language, 'a restraint' of power imposing the blockade, and when a vessel, attempting to come out, is boarded and turned back, this restraining force is practically applied to such vessel.
Although the word, as usually understood, would seem to comprehend the case, yet this meaning cannot be sustained, if, in policies, it has uniformly received a different construction. The form of this contract has been long settled, and the parties enter into it without a particular consideration of its terms. Consequently, no received construction of those terms ought to be varied.
It is, however, remarkable, that the industrious researches of the bar have not produced a single case, from the English books, in which this question has been clearly decided. In the case of Barker v. Blakes, which has been cited and relied on at the bar, one of the points made by the counsel for the underwriters was, that the abandonment was not made in time, and the court was of that opinion. Although, in this case it may fairly be implied, from what was said by the judge, that a mere blockade is not a peril within the policy, still this does not appear to have been considered, either at the bar or by the bench, as the direct question in the cause, nor was it expressly decided. The opinion, of the court was, that the blockade constituted a total loss, which was occasioned by the detention of the vessel, but that the abandonment was not made within reasonable time after notice of that total loss. In forming this opinion, it had not become necessary to inquire whether the blockade, unconnected with the detention, was, in itself, a peril against which the policy provided. The judgment of the court could not be in the most remote degree, influenced by the result of this inquiry; and, consequently, it was not made with that exactness of investigation which would probably have been employed, had the case depended on it. It is also to be observed, that the vessel did not attempt to proceed towards the blockaded port, but lay in Bristol when the abandonment was made. The blockading squadron, therefore, did not act directly on the vessel, nor apply to her any physical force. It is not certain that such a circumstance might not have materially affected the case. This court, therefore, does not consider the question as positively decided, in Barker v. Blakes.
The decisions of our own country would be greatly respected, were they uniform; but they are in contradiction to each other. In New-York, it has been held, that a blockade is, and in Massachusetts, that it is not, a peril within the policy. The opinions of the judges of both these courts are, on every account, entitled to the highest consideration. But they oppose each other, and are not given in cases precisely similar to that now before this court. The opinion that a blockade was not a restraint, was held by the courts of Massachusetts; but was expressed by the very eminent judge who then presided in that court, in a case where the vessel was not confined within a blockaded port by the direct and immediate application of the physical force to the vessel herself.
Believing this case not to have been expressly decided the court has inquired how far it ought to be influenced by its analogy to principles which have been settled.
It has been determined in England that if the port for which a vessel sails be shut against her by the government of the place, it is not a peril within the policy. In Hadkinson v. Robinson, a vessel bound to Naples was carried into a neighbouring port by the master in consequence of information received at sea that the port of Naples was shut against English vessels. In an action against the underwriters the jury found a verdict for the defendants, and, on a motion for a new trial, the court said 'a loss of the voyage to warrant the insured to abandon must be occasioned by a peril acting upon the subject matter of the insurance immediately, and not circuitously, as in the present case. The detention of the ship at a neutral port, to avoid the danger of entering the port of destination cannot create a total loss within the policy, because it does not arise from any peril insured against.'
It will not be denied that this case applies in principle to the case of a vessel whose voyage is broken up by the act of the master on hearing that his port of destination is blockaded. The peril acts directly on the vessel not more in the one case than in the other. But if, in attempting to pass the blockading squadron, the vessel be stopped and turned back, the force is directly applied to her, and does act directly and not circuitously.
Without contesting or admitting the reasonableness of the opinion, that the loss of the voyage occasioned by the detention of the ship by her master in a neutral port is not within the policy, it may well be denied to follow as a corollary from it, that a vessel confined in port by a blockading squadron, and actually prevented by that squadron from coming out, does not sustain the loss of her voyage from the restraint of a foreign power, which is a peril insured against.
Lubbock v. Rowcroft, which was decided at nisi prius, is in principle no more than the case of Hadkinson v. Robinson. Having heard that his port of destination was blockaded by, or in possession of, the enemy, the master stopped in a different port, and the insured abandoned. The loss was declared to be produced by a peril not within the policy. It is unnecessary to repeat the observations which were made on the case of Hadkinson v. Robinson.
An embargo is admitted to be a peril within the policy. But as has been already observed, the sovereign imposing the embargo is virtually in possession of the vessel, and may, therefore, be said to arrest and detain her. Yet, in fact, the vessel remains in the actual possession of the master or owner, and has the physical power to sail out and proceed on her voyage. The application of force is not more direct on a vessel stopped in port by an embargo, than on a vessel stopped in port by a blockading squadron. The danger of attempting to violate a blockade is as great as the danger of attempting to violate an embargo. The voyage is as completely broken up in one case, as in the other, and in both the loss is produced by the act of a sovereign power. There is as much reason for insuring against the one peril as against the other; and if the word restraint does not necessarily imply possession of the thing by the restraining power, it must be construed to comprehend the forcible confinement of a vessel in port, and the forcible prevention of her proceeding on her voyage. If so, the blockade is in such a case a peril within the policy.
The next point to be decided is the unlawfulness of this restraint.
That a belligerent may lawfully blockade the port, of his enemy is admitted. But it is also admitted that this blockade does not, according to modern usage extend to a neutral vessel, found in port, nor prevent her coming out with the cargo which was on board when the blockade was instituted. If, then, such a vessel be restrained from proceeding on her voyage by the blockading squadron, the restraint is unlawful. The St, Francis de Assise was so restrained, and her case is within the policy.
It has been contended that it was the duty of the neutral master to show to the visiting officer of the belligerent squadron his right of egress, by showing not only the neutral character of his vessel and cargo, but that his cargo was taken on board before the institution of the blockade.
This is admitted; and it is believed that the bill of exceptions shows satisfactorily that these facts were proved to the visiting officer. It is stated that the vessel and cargo were regularly documented; that the papers were shown, and that the cargo was put on board, and the vessel had actually sailed on her voyage, before the institution of the blockade.
There is, however, a material fact which is not stated in the bill of exceptions with perfect clearness. The loss, in this case, is technical, and the court has decided that such loss must continue to the time of abandonment. It is not necessary that it should be known to exist at time of abandonment, for that is impossible; but that it should actually exist; a fact which admits of affirmative or negative proof at the trial of the cause. Upon the application of this principle to this case, much diversity of opinion has prevailed. One judge is of opinion that the rule, having been laid down in a case of capture, is inapplicable to a loss sustained by a blockade. Two judgesa re of opinion that proof of the existence of the blockade having been made by the plaintiff, his case is complete; and that the proof that it was raised before the abandonment ought to come from the other side. A fourth judge is of opinion, that connecting with the principle last mentioned, the fact stated in the bill of exceptions that the abandonment was 'in due and reasonable time,' it must be taken to have been made during the existence of the technical loss. Four judges, therefore, concur in the opinion that the plaintiffs are entitled to recover; but as they form this opinion on different principles, nothing but the case itself is decided: That is, that a vessel within a port blockaded after the commencement of her voyage, and prevented from proceeding on it, sustains a loss by a peril within the policy; and if the vessel so prevented, be a neutral, having on board a neutral cargo received before the institution of the blockade, the restraint is unlawful.

## Notes

* ↑ 3 Bos. & Pull., 388.
* ↑ See Rhinelander v. The ware Ins. Com. Id. 202. Alex-Ins. Com. of Pennsylvania, 4 ander v. The Baltimore Ins. Cranch, 29. Marshall v. Delaware Ins. Com. Id. 202. Alexander v. The Baltimore Ins. Com. Id. 370. three things must be proved: 1st the existence of an actual blockade; 2dly, The knowledge of the party; and, 3dly, some act of violation, either by going in, or by coming out with a cargo laden after the commencement of blockade. The Betsey, 1 Rob. 93.
The government and courts of the United States have constantly maintained, 'that ports not actually blockaded by a present, adequate, stationary force, employed by the power which attacks them, shall not be considered as shut to neutral trade in articles not contraband of war; that, though it is usual for a belligerent to give notice to neutral nations, when he intends to institute a blockade, it is possible that he may not act upon his intention at all, or that he may execute it insufficiently, or that he may discontinue his blockade, of which it is not customary to give any notice: that consequently, the presence of the blockading force is the natural criterion by which the neutral is enabled to ascertain the existence of the blockade at any given period, in like manner as the actual investment of a besieged place is the evidence by which we decide whether the siege, which may be commenced, raised, recommenced, and raised again, is continued or not; that of course a mere notification to a neutral minister, shall not be relied upon, as affecting with knowledge of the actual existence of the blockade, either his government or its citizens; that a vessel cleared or bound to a blockaded port, shall not be considered as violating in any manner, the blockade, unless, on her approach towards such port, she shall have been previously warned not to enter it; that this view of the law, in itself
perfectly correct is peculiarly important to nations, situated at a great distance from the belligerent parties, and, therefore, incapable of obtaining other than tardy information of the actual state of their ports; that whole coasts and countries shall not be declared (for they can never be more than declared) to be in a state of blockade, and thus the right of blockade converted into the means of extinguishing the trade of neutral nations; and lastly, that every blockade shall be impartial in its operation, or, in other words, shall not open and shut for the convenience of the party that institutes it, and at the same time repel the commerce of the rest of the world, so as to become the odious instrument of an unjust monopoly, instead of a measure of honourable war.' For the conduct of the government in this respect, see the documents in the Appendix to this volume, NOTE 1. The decisions of the courts, are collected in Mr. Condy's edition of Marshall on Insurance vol. 1. p. 81. note (3.) To the cases there cited, add the following: Williams v. Smith, 2 Caines' Rep. 1 Radcliff v. The United Insurance Company, 7 Johns. Rep. 38.
In the case of Fitzsimmons v. The Newport insurance company, (4 Cranch, 185. 198.) it was laid down by this court, that the 18th article of the treaty of 1794, between the United States and Great Britain, seems to be a correct exposition of the law of nations, and is admitted by the parties to the treaty, as between themselves, to be a correct exposition of the law, or to constitute a rule in that place of it. 'Neither the law of nations, nor the treaty, admits of the condemnation of a neutral vessel for the intention to enter a blockaded port unconnected with any fact. Sailing for a blockaded port, knowing it to be blockaded, has been in some English cases construed into an attempt to enter that port, and has, therefore, been adjudged a breach of the blockade from the departure of the vessel. Without giving any opinion on that point, it may be observed, that in such cases, the fact of sailing is coupled with the intention, and the sentence of condemnation is founded on an actual breach of blockade.'
'It is impossible to read that instrument, (the treaty) without perceiving a clear intention in the parties to it, that after notice of the blockade, an attempt to enter the port must be made, in order to subject the vessel to confiscation. By the language of the treaty it would appear, that a second attempt to enter the port must be made, in order to subject the vessel to confiscation.' 'It is agreed,' says that instrument, 'that every vessel so circumstanced' (that is, every vessel sailing for the blockaded port, without knowledge of the blockade) 'may be turned away from such port or place, but she shall not be detained, nor her cargo, if not contraband, be confiscated, unless after notice she shall again attempt to enter.'
As to violating a blockade by coming out with a cargo, the time of shipment is very material, for although it might be hard to refuse a neutral liberty to retire with a cargo already laden, and by that act already become neutral property; yet after the commencement of a blockade, a neutral cannot be allowed to interpose in any way to assist the exportation of the property of the enemy. After the commencement of the blockade, a neutral is no longer at liberty to make any purchase in that port. The Betsey, 1. Rob. 93. The Frederick Molke, Id. 72. The Neptunus, Id. 180. A neutral ship departing can only take away a cargo bona fide purchased and delivered before the commencement of the blockade: if she afterwards take on board a cargo, it is a violation of the blockade. The Vrow Judith, Id. 1 Rob. 150. The Rolla, 6 Rob. 364. Where a ship was transferred from one neutral merchant to another in a blockaded port, and sailed out in ballast, she was determined not to have violated the blockade. The Potsdam, 4 Rob. 39. The Juffrouw Maria Schroeder, Id. note (a.) But a ship which had been purchased by a neutral of the enemy in a blockaded port, and sailed from thence on a voyage to the neutral country, was held liable to condemnation. The General Hamilton, 6 Rob. 61. And where the vessel was captured on a voyage to the blockaded port, in ballast, she having sailed for the purpose of bringing away goods which had become the property of neutral merchants before the date of the blockade, she was held liable to condemnation. The rule of
blockade permits an egress to ships innocently in the port before the restriction was imposed, and even with cargoes, if previously laden; but in the case of ingress, there is not the same reason for indulgence; there can be no surprise upon the parties, and, therefore, nothing short of a physical necessity is admitted as an adequate excuse for making the attempt of entry. The Comet, Edwards, 32. A maritime blockade is not violated by sending goods to the blockaded port, or by bringing them from the same, through the interior canal navigation of the country. A mere maritime blockade, effected by a force operating only at sea, can have no operation upon the interior communications of the port. The Ocean, 3 Rob. 297. The Stert, 4 Rob. 65. But goods shipped in a river, having been previously sent in lighters along the coast from the blockaded port, and under charterparty with the ship proceeding also from the blockaded port in ballast to take them on board were held liable to confiscation. The Maria, 6 Rob. 201. The penalty for a breach of blockade is remitted by the raising of the blockade between the time of sailing from the port and the capture. When the blockade is raised, a veil is thrown over every thing that has been done, and the vessel is no longer taken in delicto. The delictum completed at one period is by subsequent events entirely done away. The Lisette, 6 Rob. 387. A neutral ship coming out of a blockaded port in consequence of a rumour that hostilities were likely to take place between the enemy and the country to which the ship belongs is not liable to condemnation, though laden with a cargo, where the regulations of the enemy would not permit a departure in ballast. The Drie Vrienden, Dodson, 269. But the danger of seizure and confiscation by the enemy, must be immediate and pressing. The mere apprehension of possible and remote danger will not justify bringing a cargo out of a blockaded port. The Wasser Hundt, Id. 270. note.
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