# Hughes v. The Union Insurance Company of Baltimore

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United States Supreme Court
21 U.S. 294
Hughes v. The Union Insurance Company of Baltimore
ERROR to the Circuit Court of Maryland. This was an action of debt, upon a policy of insurance, in the usual form, dated on the 27th of May, 1807, on the ship Henry, 'lost or not lost,' 'at and from Teneriffe to Havanna, and at and from thence to New-York, with liberty to stop at Matanzas.' Eighteen thousand dollars were insured on the ship, valued at that sum, and two thousand dollars on the freight, valued at twelve thousand dollars; and the property was warranted American.
On the 1st of June, in the same year, a policy was executed on the freight of the ship Henry, by the same Company, for the same voyage, to the amount of 10,000 dollars; the whole freight being valued at 12,000 dollars. In this policy also, the property was warranted American; but there was no liberty to stop or touch at Matanzas, or any other place.
Both these policies were effected under an order for insurance, by Henry Thompson, of Baltimore, as agent for the plaintiff, an American citizen, who was master for the voyage, as well as owner. The order bears date on the 18th of May, 1807, and is in the following words:'Baltimore, May 18th, 1807.
'GENTLEMEN,
'Insurance is wanted on 18,000 dollars, on the American ship Henry, Capt. Henry Hughes, and 12,000 dollars on her freight, each valued at the same; at and from Teneriffe to Havanna, and at and from thence to New-York, against all risks.
'The Henry was expected to sail on or about the 12th ult.; she is a remarkably good vessel, about 270 tons burthen, and now on her first voyage. Said ship and freight are the sole property of Capt. Hughes, who gives the following particulars in his letter of instructions to N. Talcott, of New-York.
"We are to clear out for New-Orleans; the property will be under cover of Mr. John Paul, of Baltimore, who goes supercargo on board, yet Mr. Paul will only have part of the cargo to his consignment. There will be three other persons on board, that will have the remainder of the cargo in their care. We are to stop at the Matanzas, to know if there are any men of war off the Havanna.
"When you make insurance, which I expect will be done low, you will state the whole of this business; so that there will be a right understanding of the voyage.'
'At what premium will you insure the above risks?
(Signed) HENRY THOMPSON.'
The Henry sailed from Teneriffe on the 17th of April, 1807, with a cargo for the Havanna, which belonged to Spaniards, but appeared as the property of John Paul Dumeste, (the person mentioned in the order for insurance by the name of John Paul,) a citizen of the United States, who went as supercargo. She took a clearance for New-Orleans. This cargo was laden at Teneriffe, under a charter party, which bore date the 10th of March, 1807, and represents New-Orleans as the port of destination, without any mention or notice of the Havanna. The parties to it were Dumeste, and Henry Hughes, the master. The freight mentioned was 11,000 dollars; of which it was stipulated that 5000 dollars should be paid at New-Orleans, and the remaining 6000 dollars at New-York.
The ship proceeded to the Havanna, where she arrived on the 7th of July; having put into Matanzas on the 2d of June, to avoid British cruisers then in sight, and unladed the cargo, which was there delivered to the real Spanish owners. The real freight to the Havanna, amounting to 7000 dollars, was paid at Matanzas to the plaintiff, who received it 'in full of all demands for freight or otherwise, under or by virtue of the aforesaid charter party and cargo.' It was proved that this unlading did not produce any additional delay or increase of risk; for the ship left Matanzas and proceeded to Havanna in ballast, as soon as there was any reasonable prospect of escaping the cruisers stationed in the way, and was enabled to proceed sooner and more safely, by being in ballast, which put it in her power to keep closer in shore. At the Havanna she took in a new cargo, belonging to persons in New-York, and consisting of 120 boxes of sugar, at a freight of 3 dollars and 50 cents the box. On the voyage she sprung aleak, soon after which she transhipped a part of her cargo, consisting of 60 boxes, into the Rising Sun, a vessel bound to Norfolk, where the property was safely landed. Within about two days after the transhipment, the Henry sunk, and was totally lost, with the rest of the cargo. The master and crew escaped in their boat. In attempting to make their may to New-York, they were taken up at sea, in an almost desperate situation.
The freight was abandoned to the underwriters, and a demand was made of payment for that and and ship; which being refused, this action was brought to recover both. The sum demanded by the writ and declaration was 20,000 dollars, and the loss declared on was by the dangers of the seas, one of the perils mentioned in the policy. On the plea of nil debet, issue was joined, and the case went to trial.
At the trial, the plaintiff gave the charter party in evidence, as one of the documents necessary or proper for establishing the neutral character of the vessel and freight; but there was no evidence of its having been at any time produced or mentioned to the defendants, or in any manner known to them. He also proved his own national character, and that of the ship, his interest in the ship and freight, the commencement and prosecution of the voyage, and the loss and abandonment. By an admission at the bar he expressly limited his demand of freight to that earned on the 120 boxes of sugar, amounting to 420 dollars; and renounced all claim to any further or other sum on that account.
The defendants then gave in evidence the separate policy on the freight, which is mentioned above; and also produced evidence tending to show, that the plaintiff, in his management respecting the said ship, after the leak was discovered, was guilty of gross negligence, in not using such means as were in his power for conducting the said ship into a place of safety in the Delaware; and that he might have conducted her into a place of safety there, had he used those means.
The plaintiff then gave evidence of the causes, nature, and duration of the delay at the Matanzas, as stated above, and of the effect produced on the risk by unlading the cargo there. He also gave in evidence, that after the said leak was discovered, the plaintiff did all in his power, according to his skill and ability, to save the said ship, and to conduct her safely to her port of destination; and that there was no place of safety in the Delaware to which the said ship could have been conducted, nearer, or more easily reached, in the state of the wind and weather at that time, than New-York.
The defendants then prayed the opinion of the Court, and their direction to the jury:
1. That if the jury should be of opinion, from the evidence, that the cargo shipped at Teneriffe, which the order for insurance of the 18th of May, 1807, mentions, and which the charter party, and the policy of insurance upon freight of the 1st of June, 1807, read in evidence on this trial, also mentions, was landed, and finally separated from the ship at Matanzas, and was there delivered by the plaintiff, at the instance of the freighters, and accepted by the freighters, the plaintiff receiving from the said freighters 7000 dollars, in lieu of all demands upon the said charter party, including the whole freight to the Havanna; and that a cargo of sugar, for an entirely new account and risk, to wit, for the account and risk of Le Roy, Bayard & M'Evers, of New-York, was, by the plaintiff, taken in at the Havanna, with which the ship sailed upon her voyage to New-York, as proved by the plaintiff's testimony, then the plaintiff is not entitled to a verdict for any freight, upon the issue and pleadings in this cause.
2. That if the jury should find, from the plaintiff's declaration, and the evidence, that the cargo shipped at Teneriffe, which the order for insurance of the 18th of May, 1807, mentions, and which the charter party, and the policy of insurance upon freight of the 1st of June, 1807, read in evidence on this trial, also mention, was landed, and finally separated from the ship, at the Matanzas, by the freighters and the plaintiff, and was there delivered by the plaintiff, and accepted by the freighters, and their contract of freightment abandoned, the plaintiff receiving from the said freighters the sum of 7000 dollars, in lieu of all demands upon the said charter party, including the whole freight to the Havanna; and that a cargo for an entirely new account and risk, to wit, for the account and risk of Le Roy, Bayard & M'Evers, of New-York, was, by the plaintiff, taken in at the Havanna, with which the ship sailed to New-York, as proved by the plaintiff's testimony; and further, that in the course of her said voyage to New-York, a part of the said cargo was transhipped into the Rising Sun, as stated in the plaintiff's evidence; and if they also find, that the risk was increased by taking in the new cargo aforesaid, and the transhipment aforesaid, beyond what it would have been, had the said ship proceeded in ballast from the Havanna to New-York, then the policy was wholly discharged, and the plaintiff cannot recover as to the vessel, on the issue and proceedings in this case.
3. That if the jury should be of opinion, from the evidence, that the plaintiff had an opportunity of causing the said ship, after the discovery of the leak, to be carried into the Delaware, or elsewhere, and there saved from the total loss which afterwards happened, and that he did not act with proper and reasonable care, in forbearing to do so, he is not entitled to recover in this action.
These directions were given by the Court, who further instructed the jury, that this was a valued policy, on which an action of debt lies; the sum claimed being specified by an agreement of the parties. But the whole must be recovered, or no part of it can be recovered. In this suit, the action is for two distinct sums, 18,000 dollars on the ship, and 2000 dollars on the freight. The party can recover either entire, and not the other; but not a portion of either, without accounting for the residue.
To these opinions and directions, the plaintiff took a bill of exceptions, on which judgment was rendered for the defendants, and the cause was brought by writ of error to this Court.
Mr. Harper, for the plaintiff, made the following points:
1. That there was no connexion whatever between the policy and the charter party; which not having been made known to the underwriters, can make no part of the contract, nor in any manner affect it.
2. That the policy on the freight alone, however it might have been cannot affect the present case; the policy at the Havanna, had an action been brought on it, cannot affect the present case; that policy in which expressly declares, that the whole freight on the whole voyage insured, should be valued at 12,000 dollars, of which only 2000 were to be covered by that policy; a declaration entirely conformable to the order on which both policies were made.
3. That the receipt of 7000 dollars at the Havanna, if it had been in full of all claims under the charter party, could not affect the plaintiff's claim in this case; because the policy has no connexion with the charter party, and the freight now claimed arose on a voyage entirely different from the one described in that instrument.
4. That the receipt of the 7000 dollars at the Havanna was not in full satisfaction of all claims and rights under the charter party; but merely 'in full of all demands for freight or otherwise, under or by virtue of the aforesaid charter party and cargo;' that is, in full payment of the freight due, under the charter party or otherwise, on the cargo brought from Teneriffe, and landed at Matanzas.
5. That although the action brought is debt, and the sum declared for on account of freight is 2000 dollars, yet less may be recovered in such a case as the present; where the right to recover depends not on the contract alone, but on matter dehors and independent.
6. And, consequently, that the first direction was wrong, and also the third, which applies to the form of the action; a point equally open under the first application.
And as to the second instruction,
1. That for the true construction and character of this contract, we are to look to the policy alone, or at most to that and the order for insurance. The charter party not being referred to in the order, or in any manner made known to the defendants, cannot be taken into view.
2. That the policy and the order make two distinct voyages, or one voyage divided into two distinct parts; so that, at the termination of the first voyage, or of the first section, the first cargo might be discharged, and a new one taken in for the second section.
3. That the plaintiff thus having a right to take in a new cargo at the Havanna, for the residue of the voyage, it was his duty to use all proper means for the preservation of that cargo; and, consequently, no delay, deviation, or increase of risk, arising from the use of such means, can affect his claim on the underwriters on the ship.
4. And, consequently, that the second direction also was erroneous.
Mr. D. B. Ogden, contra, argued, that the insurance was altogether restricted to the voyage mentioned and stipulated in the charter party, and that the voluntary surrender of that contract at the Matanzas, annihilated the contract of insurance on the freight. That the receipt of a compensation by way of compromise for the freight, as stipulated, on the voyage from the Havanna to New-York, was, in fact, the receipt of the whole freight for that voyage. And that taking in a cargo at the Havanna, not provided for by the charter party, or mentioned in the representation to the underwriters, terminated the insurance on the vessel, and discharged the underwriters altogether. He also insisted, that the direction of the Court, as to the form of action, was correct.
Mr. Justice JOHNSON delivered the opinion of the Court.

## Notes

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This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
Public domainPublic domainfalsefalse
* 1 2 Incledon v. Crips, 2 Salk. 658. S.C.. under the name of Ingledew v. Crips, 2 Lord Raym. 814.
* 1 2 1 Marsh. on Ins. 92, 93. Thompson v. Taylor, 6 Term Rep. 478. Horncastle v. Stewart, 7 East's Rep. 400.
* 1 2 The United States v. Colt, 1 Peters' jr. Rep. 145. and the authorities there cited.