#### Stephen Higginson and Others *versus*Samuel W. Pomeroy.

An insurance was made upon the cargo of a ship, at and from *Boston,*to every port or place to which she might proceed, against the usual risks in policies of insurance. At the foot of the policy was the following memorandum, *viz.:*“ The *Diana*is cleared for *Rio Janeiro*and the *North-West Coast,*has goods on board contraband of war, and has no register. *This insurance is not against illicit trade with the*Spaniards; *but is understood to coves• the property, under whatever papers she may sail.”*

The ship, being bound to *IAma,*arrived off the port of *Callao,*and, before any traffic took place, was taken possession of by the officers of the government, and her cargo unladen and sold, the proceeds being placed in the treasury, until the *king of Spairds*pleasure should be known. The assured offered an abandonment. It was holden, that the loss was not within the policy, and that the underwriters were not liable.

This was an action of the case upon a policy of insurance, dated July 1, 1800, and subscribed by the defendant for 2000 dollars, upon the cargo of the ship *Diana,*at and from *Boston,*to every port and place to which she might proceed, except the *West Indies,*and until her arrival at her port of discharge in the *United States,*the time not exceeding twenty months, against restraints and detainments of kings, &c., and against the other risks usually expressed in policies of insurance, at a premium of one and a half per cent, per month. The plaintiffs declare on a total loss at *Lima,*in *South America,*by a forcible arrest and detention under the authority of the viceroy of *Peru.*

A trial was had upon the general issue, November term, 1812, before the present chief justice, and a verdict taken for the plaintiffs, subject to the opinion of the Court upon the evidence admitted, and upon the case as proved in the trial of an action upon the same policy, brought by the present plaintiffs against *William Gray,**103another of the underwriters, in which a verdict was found for the plaintiffs.

That case will be found fully stated by the chief justice in delivering the opinion of the Court in the present action.

* An argument was had, at the last March term in this [ * 105 ] county, by *Otis*and *Jackson*for the plaintiffs, and by *Dexter*and *Prescott*for the defendants; and the action being continued for advisement to this term, the decision of the Court was pronounced as follows by

Sewall, C. J.

In this action the demand of the plaintiff is upon a policy of insurance, and they aver a total loss to have happened within the voyage and risk insured. A verdict for them, subject to the opinion of the Court upon a report of the case, having been consented to on the part of the defendant, the merits of the controversy have been fully discussed on a motion for a new trial.

The case reported is according to the evidence offered, and considered at the trial of an action brought by these plaintiffs against *William Gray,*another underwriter, upon the same policy, for another portion of the same loss. In finding a verdict against *W. Gray,*the jury were directed by an opinion, which I expressed m committing the cause to them; and the present motion for a.new trial is, in effect, an exception to that opinion.

Two questions are brought into view, and necessarily arise, upon the facts stated in the report; — whether the loss proved is within the policy, or is to be attributed to a risk and misfortune excepted from the policy, and not insured against; and whether, if the defendant is liable at all, a seasonable abandonment has been proved, to entitle the” plaintiffs to recover as for a total loss.

The latter question, however, the counsel for the defendant have been disposed to waive in their argument; and they have insisted only upon their more general objection, that the loss demanded is not within the policy.

The contract averred and proved is an insurance upon the cargo of the ship *Diana,*at and from *Boston*to every port and place to which she may proceed, excepting the *West Indies,*until her arrival at her port of discharge in the *United States,*the time not exceeding twenty months, against restraints and detainments of princes, &c., with the * other risks usually undertaken [ ***106 ] by insurers. And in a clause added at the foot of the policy are these words: “ The *Diana*is cleared for *Rio Janeiro*and the *North-West Coast,*has goods on board contraband of war, and has no register. *This insurance is not against illicit trade with the Spaniards; but is understood to cover the property, under what ever papers she may sail.”*

*104The *Diana,*with a cargo protected by this insurance, sailed from *Boston*July 5, 1800, bound to *Lima,*in the province of *Peru,*and ultimately, according to the vessel’s papers, to *Sansonate,*in the province of *Guatimala.*On the 5th of December, 1800, she arrived off the port of *Callao,*and in the bay of *Callao*was boarded by officers of the viceroy of *Peru,*and prevented from entering the port, until permitted by the viceroy. This permission was presently obtained, and the ship entered the port of *Callao,*as a vessel in want of water and refreshment, but with a guard placed on board by the viceroy, and subject to other precautions, taken by his orders, to prevent smuggling or trade of any kind. After remaining some time under this restraint, liberty to depart, for the purpose of pursuing the voyage to *Guatimala,*was requested and refused; and finally, the case having been submitted to the royal tribunal or council of *Peru,*for their decision or advice, their decree, or the result of their deliberation upon the case, was submitted to the viceroy, and by him confirmed and adopted; and he thereupon directed the cargo of the *Diana*to be landed and sold, under a particular inspection of the revenue officers, the proceeds to be placed in the treasury, there to remain until the king’s pleasure should be known. And in this way the cargo insured had been disposed of, when the assured offered to abandon to the underwriters.

In several conversations with Mr. *Burling,*one of the supercargoes of the *Diana,*at the time when permission to enter the port of *Callao*was applied for and obtained, and afterwards, her arrival off that port, and destination to a port of a *Spanish*colony [ * 107 ] in the south seas for ' purposes of trade, * were stated by the viceroy to be causes to justify an arrest and detention. “The vessel and cargo,” he said, “ were thereby subjected to confiscation, and the ship’s company to imprisonment.” The royal tribunal or council appear to have considered the case in the same light, and the property as placed, in consequence, at the disposal of the government. But the viceroy and his council admit their decision to have been controlled, in this instance, by the peculiar circumstances and confidence under which the voyage of the *Diana*had been commenced, and was intended to be prosecuted.

In this view of the case, some other facts, proved and relied on at the trial, have been stated and considered ; particularly that the king of *Spain,*by an edict, dated November 8, 1797, authorized the viceroy of *Peru,*and the other viceroys of the *Spanish*colonies in the south seas, to grant licenses and permission of trade in neutral vessels, and expeditions and adventures in goods not otherwise permitted; that passports and licenses, by the viceroy of *Guatimala,**105were granted to one *Yrizarrere,*and to his agent, *Ramirez,*colonists of *Spain,*to permit *Ramirez*to embark at *Omoa*or *Truxillo,*and go to neutral ports of the *Anglo-Americans,*and purchase lawful goods, to be imported into the colonies, with such arrival and destination as should be specified by any *Spanish*consul residing in the *United States;*and that, acting under these licenses, certain contracts by *Ramirez,*dated in January, 1800, were made for *Yrizarrere*and himself with the present plaintiffs; by which the *Diana,*her cargo and, voyage, were covered as the property of *Yrizarrere,*and as under the direction of his agent, *Ramirez,*who was a supercargo and passenger in the ship, and arrived in her at the port of *Callao.*

it was also proved that, in January, 1800, the governor of *Guatimala*renewed the passports and licenses granted by him to *Yrizarrere*and *Ramirez,*and declared the same to be in full force; and that, in June, 1800, the *Spanish*consul residing at *Boston*granted certificates of the cargo of the * *Diana,*[ * 108 ] and specified her destination to *Callao,*in *Peru,*and *Sansonate,*in the province of *Guatimala.*

It also appeared, from documents produced by the defendant, that the king of *Spain,*by an edict, dated April 20, 1799, had repealed the edict of November, 1797, and had declared all passports and licenses, general and particular, which had been granted, to be null and void.

But it was admitted or proved at the trial, that this edict of repeal, which had been officially communicated tc the viceroy of *Peru,*before the arrival of the *Diana,*was unknown to the viceroy of *Guatimala,*when he granted his passports and licenses; and to the parties concerned in the *Diana*and her cargo when the voyage insured commenced.

The opinion now objected to, and contested for the defendant in this action, was, that the exception from the policy, or the limitation of the insurance expressed in the additional clause, respected seizures for an actual trading, or some "attempt to trade, with the *Spaniards*in an unlicensed manner; and that the voyage and destination to the port of a *Spanish*colony was within the policy; and that the cargo of the *Diana*was to be considered as insured against the risk of seizure and detention for that cause ; and the jury were directed to find for the plaintiffs, if a seizure and detention had been proved which had been enforced for no other cause than an arrival on the coast or within the port of a *Spanish*colony. This opinion, expressed with an expectation, stated at the time, that the question of construction would be reserved for further inquiry and *106consideration, was influenced in some degree by a circumstance which can have no weight in the present decision.

It may be recollected that, in a former action by the present plaintiffs against *William Gray,*(1) several suits, if not upon this policy, yet upon other policies, to insure the same risk with the same exception, or a limitation in words of the same import, had been brought within the notice of the Court; particularly two [ * 109 ] suits against public insurance * companies, in which, as it was then stated and understood, the plaintiffs had recovered judgments, which had been so far acquiesced in as to have been the foundations of compromises between the parties, and of payments to the assured, obtained from the defendants in those suits, and from several of the underwriters on the policy now in question. This seeming construction of an insurance of the same risk, under the direction of merchants respectable for their professional knowledge and accuracy, was, in my mind, an authority of some weight, sufficient at least to suggest the necessity of a further examination.

The case of *Church*vs. *Hubbard,*(2) decided in the Supreme Court of the *United States,*which was cited and urged upon the attention of the Court at the trial with *W. Gray,*differs from the case at bar in some circumstances material to be considered; because these are stated as the grounds of the decision, both in the Circuit Court and upon the writ of error. The evidence in that case proved, sufficiently as it was" supposed, an illicit trade in the sense of trafficking, attempted, if not effected. To this purpose, hovering upon the coast, and irregular conduct in many respects, are spoken of; and a particular stress is laid upon a judicial sentence, establishing the fact of a seizure for illicit trade. The policy of insurance in that case contained, however, an exception of the same import with the limitation of the insurance expressed in the policy now in question; and Chief Justice *Marshall,*in stating the opinion of the Court, and in reasoning upon the subject in a more general view of it, considers exceptions of illicit trade as capable of a more enlarged exposition than had been necessarily resorted to in deciding the case of *Church*vs. *Hubbard.*The exposition is given with great clearness and strength of argument. Its application in the case at bar is the only question that can be made respecting it. And upon the whole, after a full examination of that decision as it is reported, I concur with my brethren in adopting the *107exposition there given of an exception of illicit trade, and in considering it applicable * and conclusive upon [ * 110 ] the question now to be decided in the case at bar.

What is illicit trade with the *Spanish*colonists depends upon prohibitions of intercourse enacted by the sovereign, to be enforced in the colonies. There has been no evidence produced in the case at bar, unless the intimations from the viceroy may be regarded as evi fence, that the arrival of a foreign vessel in a *Spanish*colony, openly destined there for purposes of trade, if that was or should be permitted, is of itself a cause of forfeiture. The *Portuguese*edict, cited in the case of *Church*vs. *Hubbard,*does not import this degree of severity in their prohibitions. But such destination and arrival are of themselves cause of suspicion, and justify a restraint and detention to prevent smuggling and trade; and a seizure in such' a case is a direct and unavoidable consequence of the prohibitions of trade and intercourse; and whether made for an arrival on the coast of a *Spanish*colony, or for an act of traffic, attempted or accomplished in an illicit manner, is alike within the exception of seizure for illicit trade. Nor is it necessary to this construction that we should understand the voyage or destination as prohibited, or that these are included in the exception under any possible meaning of the word *trade;*for a seizure to prevent traffic, as well as on suspicion of trafficking, and every legitimate consequence of such seizure, and perhaps we may add, although not necessary to the present decision, even arbitrary acts of the *Spanish*colonial governments, if assumed to be justified on their parts by the prohibitions of trade and intercourse, are, we think, wfithin the exception of seizure for illicit trade; as much so as the most regular confiscation would be, when enforced for an act of trafficking, illicitly managed with the colonists or natives. The exception extends to every seizure and detention, suggested by the prohibitions of trade and intercourse as the means of enforcing them, and whether of prevention or of punishment for infraction ; and therefore to cases where the charge of illicit trade with the * *Spa?i-*[*111 ] *iards*might be ultimo*.sly repelled, and when the property seized might be in consequence acquitted under the circumstances of the particular case.

In the opinion brought in question on this motion, it is supposed, however, that voyages to the *Spanish*colonies for purposes of trade are ordinarily prohibited; and the opinion was, that a seizure for the voyage or destination, if no charge of illicit trafficking had occurred, was not withdrawn by the exception of illicit trade with the *Spaniards,*but continued to be a risk insured against; and "for this reason, principally, that the voyage described includes the ports of *108the *Spanish*colonies, as a - destination explicitly permitted to the assured ; and the insurance is upon a representation that the vessel is to be without a register, to have goods on board contraband of war; and the assured are also expressly permitted to disguise their vessel, cargo, and voyage, by papers of an illicit character, or simulated. So much may well be understood in “ covering the property under whatever papers the *Diana*should sail.” Construing these stipulations to be an insurance of a voyage and risk, as to the destination of the vessel and cargo represented to be illicit, against the perils to be so incurred, stipulations not included in the printed forms, but distinctly written and expressed, and, considering the exception relied on for the defendant is not to have a construction which entirely abolishes those stipulations, or renders them nugatory, and that the whole instrument is to be taken together, and that every part is to be preserved, if it may be by a reasonable construction, the inference seemed to be, that the terms “ illicit trade with the *Spaniards”*had, in the intention of the parties to this instrument, the sense of trafficking after an arrival, or in the course of the voyage, when not permitted, according to the facts supposed in the case of *Church*vs. *Hubbard,*upon which that decision rested.

The jury, in' the trial between the plaintiffs and *W. Gray,*were therefore directed that the voyage and destination of the *Diana,*and whatever was illicit in them, remained insured [ * 112 ] * against any seizure for that cause. Besides, this contract had been made, in point of time, before the decision in *Church*vs. *Hubbard,*or before it was known; and therefore these intentions of the parties might be understood from expressions less cautious and precise than would be required since that decision.

The obvious and most usual sense in which the word *trade*is employed, is to express traffic, commerce, exchange dealing, not the voyage or destination of a ship, although sometimes the term may be allowed that meaning, when the voyage or destination is named from the use or purpose to which it leads or is designed.

But, upon further examination, I have not found it necessary to adhere to this construction; and I am satisfied that the previous stipulations are not rendered nugatory, but have their full effect in many events that may be supposed; although a prohibited voyage or destination to the *Spanish*colonies should be understood as withdrawn by the exception. A seizure and detention for conduct illicit by the law of nations in the particulars mentioned, or for a want of papers, or for simulated or double papers, are cases provided for, to which the insurance extends. And if the voyage is *109insured, the insurers limit their undertaking by rejecting those risks which may be incurred from *Sjianisk*prohibitions, which include, as we have observed, seizures to prevent illicit traffic, as well as seizures to punish it; and without a critical definition of the word *trade,*the case at bar seems to be included ; or, at least, the construction suggested of the contract in question between these parties, and the direction to the jury, upon which the verdict against *IV. Gray*was found, are not to be supported. The defendant therefore is entitled to a new trial, according to the agreement of tie parties in reserving this case, *(a)*

*New trial granted.*

(1)

8 *Mass. Rep.*385, *Higginson & Al.*vs. *Gray,*

(2)

 2 *Cranch's Rep.*187.

(a)

*Smith & Al.*vs. *The Delaware Ins. Co.*3 *Wash. C. C. R.*127. — *Smith*vs. *Delaware Ins. Co.*3 *Serg. & R.*82. — *Fardell*vs. *Phoenix Ins. Co. 4 Serg. & Rawl.*29. — *Gracie*vs. New *York Ins. Co.*13 *Johns.*161.