#### William G. Hotchkiss, plaintiff, *vs.*The Commercial Mutual Insurance Company, defendant.

1. The defendant insured the plaintiff’s assignor the sum of §2100, on 700 barrels of apples, upon a voyage from New York to Liverpool. The apples were insured as being of that value. The memorandum clause of the policy declared *flash fruits {inter alia,)*were “warranted by the assured'free from average, unless general.” The ship, being in great peril of being lost, the master and mariners, for the general safety and preservation of the ship and the other goods and merchandise on board of her, threw overboard 476 of the said barrels of apples, whereby they were lost, and the remaining 224 barrels were wetted and injured. The ship arrived at Liverpool with the 224 barrels of damaged apples on board. The plaintiff’s loss in general average had been satisfied by general average contributions which he had received, except the sum of £2,10, 6, which he paid in contribution on 700 barrels of apples, at the contributory value of £66. *Held*that the rule in such cases is, that where the contributory value exceeds the insured value, whatever is paid in contribution, by the excess of the contributory value over the value in the policy, is paid by the assured. On this proportion he is his own insurer. Tor whatever is paid on a contributory value not exceeding the value in the policy, the assured is indemnified on the proportion insured.

2. *Held, also,*that this rule, applied to the facts of this case, entitled the plaintiff to a verdict for £2,10, 5, or whatever the sum was which he had paid in general average contributions. That this exonerated the insurers from all liability *for a partied loss, as a partial loss,*and made them liable to the plaintiff for the actual general average loss; the insured value of the memorandum articles being greater than their contributory value.

(Before Bosworth, Ch. *J.*and White and Monell, JJ.)

Heard November 12,1863;

decided December 6, 1863.

This case came before the court on questions of law; there being at the trial no disputed facts. The defendants, by their policies of insurance, insured the plaintiff’s assignor, the sum of $2100, on 700 barrels of apples, on a voyage on the ship Ohio, from New York to Liverpool. The apples were insured as being of that value, at the rate of one and a half per cent upon such value, as the premium paid.

The *memorandum*clause of the policy declares that *fruits (inter*alia) “are warranted by the assured free from average, unless general.”

On the voyage, the ship “ was, by storms and tempests, and *490perils and dangers of the seas, brought into great distress, and in danger of perishing and being lost and destroyed in the sea, wherefore, the master and mariners of the ship, for the general safety and preservation of "the ship, and of the other goods and merchandise on-board of her, were obliged to, and did remove from the said ship and throw overboard into the sea, 476 of the said barrels of apples, whereby they were entirely lost; and that, in removing and casting into the sea the said 476 barrels of apples, and other portions of the goods and merchandise laden on board of the said vessel, of which jettison was made on the occasion aforesaid, the hatches of the said vessel were opened, and by reason thereof, and of the exposure resulting therefrom, the remaining 224 barrels of the said apples were wetted and injured by sea water which washed through the hatches,-whilst they were so open, and the said apples were thereby damaged to the extent of $448; and that afterwards, the said ship arrived at the said port of Liverpool, with the said 224 barrels of apples so damaged as aforesaid, on board of her, and that they were, in consequence of the general average losses, sustained by the said vessel and by - the cargo on board of her upon the said voyage, subjected to charges and liabilities which abated the remaining value thereof.”

By the general average statement duly made in Liverpool, on the arrival of the ship there with her cargo, the apportionment of the general average loss and contribution on the cargo interest was as follows, viz:

The 476 hhls. jettisoned were valued at (8 s. per hhl.) .............£90, 8, 0

Charges for freight, primage, duty, dues, landing charges and

brokerage were,_______________________________________£13, 15, 6

£ 59, 12, 6

The consignees of the cargo were charged on the apples delivered (224 hhls.) at the value of ............ £ 6,

jettisoned (476 hhls.) £60, 2, 10, 5

£57, 2, 1

They received value of the apples jettisoned, £59, 12, 6

And paid general average, 2, 10, 5

£57, 2, 1 -

*491The only allegations in the defendants’s answer denying the allegations in the complaint, are that the 224 barrels were not, in consequence of the general losses sustained by the vessel and cargo, in the complaint mentioned, subjected to charges and liabilities which abated the value thereof.

It then states, as a further defense, that in the general average contribution and charge upon the vessel, her cargo, and freight, made at Liverpool in respect to the said voyage, the loss on the apples by reason of the jettison, and the other losses sustained by the said goods by reason of the said disaster, distress, and jettison, in the complaint mentioned, was made good to the plaintiff, subject only to a general average charge of small amount, as the proportionate contribution of the plaintiff and his goods to the loss and charges appertaining to the said jettison, viz. to the amount of £2,15,5, amounting to $13.50, which amount, it avers, the defendant has always been willing to pay. It contains an offer that the plaintiff take judgment for $25, to coyer the said general average contribution, and interest thereon.

It alleges, as a further defense, that, except as to the last named amount of general average contribution, the plaintiff has received and been paid the value, at Liverpool, of the apples jettisoned, as in the complaint mentioned, from the owners of the ship, freight, or other cargo, or from agents of the ship.

The verdict was in favor of the plaintiff, for $2094.86, being made up of the sum of $1428, the value in the policy .of the apples jettisoned, and $448, the amount of damage to the residue of the apples, with interest on the aggregate of these two sums from July 14, 1861, to the time of the trial, March 27, 1863.

The question was, what was the nature and extent of the defendant’s liability, and what sum was the plaintiff entitled to recover.

*W. M.*Evarts, for the plaintiff.

*D. D. Lord,*for the defendant.

*492I. The subject insured was not specifically totally lost. A part (224 of 700 barrels) arrived at the destination and was received by the consignees. The extent of the damage on this part was ascertained by a sale, at 2s. on a barrel, valued sound at 8s. This, therefore, was clearly but the case of. an absolute loss of a part only of the subject.

II. . The subject insured,, *“fruits,”*being a memorandum article, was. by the policy *“free from average unless general.”*The insurers in such a case are not liable for any amount or extent of partial loss. (*Wadsworth*v. *Pacific Insurance Co.,*4 *Wend.*33, *and cases cited, Jamson*v. *Ralli,*36 *English Law and Eq. R.*201. *2 Phillips’ Insurance,*460, 20, § 1773. 2 *Parsons’ Mer. Law,*274, *n.)*The terms, *“free from average, unless general,” apply*to averages, whether • damages or charges of .every kind, unless general average. ' They do not let -in an absolute liability for all kinds of loss bn the occurrence of the slightest injury, ’ whether by way of damage of charge, if that could be the1 subject of general average. The exclusion is not the expression of a condition, the occurrence of which frees the policy of a condition-: as in the stranding clause in English- policies. But it is the exclusion of all claims for losses or damages, by way of specific injury or charge, unless it be a general average.

III. There being no absolute total loss and no abandonment, the insured could claim only the actual damage. This is fully comprehended in the value of the goods1 jettisoned and the damage to the goods delivered. The freight and charges on the goods delivered, are no part of’the loss by-the sea; perils, and are.not charges against the insurers. The: loss- by the jettison was secured by the vessel and cargo, by" a .maritime lien thereon1; which was in the hands of the consignees -as agents of the insured, and was actually realized by them in money, before this action was brought. The proceeds were received March, 1861. The action was commenced February 10th, 1862. : . '■

IV. On both grounds of defense, the judgment should be in favor of the defendants. ! 1

*493By the Court, Bosworth, Ch. J.

The plaintiff’s proposition is that, as the cause of the loss" was a general average sacrifice, the case is taken out of the exception contained in the *memorandum*clause, and that he is entitled to recover the insured value of the apples jettisoned, (viz. $1428 for 476 barrels at $3 per barrel,) and also the sum of $448 for damage to the 224 barrels delivered.

The defendants’ proposition is, that the loss is partial, and is controlled by the memorandum clause. That, it not being a case of absolute total loss, and there being no abandonment, only the actual damage can be claimed ; and that the actual damage is measured, as to the goods jettisoned, by the value thereof at the port of delivery and specified in the general average statement, and as to the residue of the apples, by the actual damage thereto, which is the sum they were compelled to contribute in general average. That these losses, or the whole of this damage, has been made good to the plaintiff by the contributions in general average received by him or his agents, except the small sum of £2, 15, 5, sterling, or as the general average statement shows, of £2,10, 5.

Both parties concede that there is a loss for which the defendant is liable, but they differ as to the measure of the defendant’s liability.

I think it may be considered settled that a plaintiff is not entitled to recover in case of an injury to memorandum goods, merely because they were injured, and there was a general average sacrifice in the course of the voyage. And also that he may recover in general average where there is a loss upon his goods by a general average sacrifice.

"Whether, in the latter case, he is to recover his whole actual damage, to be ascertained by the rules applicable to articles not included in the memorandum clause, or whether the damage he can recover is to be measured by the difference between the sum which they justly contribute, and the sum which they are justly contributed for in general average, is the important question in this case.

The usual memorandum clause in the English policies is *494. *that,*fruits, &c. “are warranted free from average unless general, or the ship .he stranded.” In the policy before us, fruits, &c. “are warranted by the assured free from average, unless general.”

In *Wilson*v. *Smith,*(3 *Bur.*1550,) in 1764, it was decided that insurance free from average unless general, does not extend to damage to the goods in a storm. The storm, which made it necessary to cut away and leave the cable and an anchor of the ship, damaged the cargo, which was wheat. But it was not damaged by the act of cutting away and leaving the anchor and cable, or as a direct or remote consequence of that act. Lord Mansfield *held*that “ the insurer is liable to all losses arising from the ship being stranded, and in all cases where there is a *general*average; but all other partial losses are excluded by the express terms of the policy. That the word *unless*means the same as *‘except,’*and is not *to he*construed as a condition, in the sense that the counsel for the plaintiff would put on the word *‘ conditions,’*which was that, £ if either of the two specified conditions should happen, (if either the ship should be stranded, or any thing should happen which created a general average,) then the warranty, to be free from average, was thereby discharged/ That the words, ‘free from average, *unless general,’*can never mean to leave the insurers liable to any particular average.”

In *Burnett*v. *Kensington,*(7 *T. R.*210,) in 1796, the opinion of Lord Mansfield in *Wilson*v. *Smith*was. much, commented upon, and his view, that, in a case of stranding, only the damage caused by the stranding could be recovered, was overruled ; and after full argument it was held that, if a ship be stranded, the insurer is liable for an average loss arising from the perils of the seas, though no part of the loss arose from the act of stranding. The court treated the words, “ or unless the ship be stranded,” as a *condition,*and where that event happened, that the warranty was ■ discharged. But Laurence, J. in his opinion, says : “How the words of the exception are not warranted free from average ‘unless there be a general average, or unless the ship be *stranded)’*but *495warranted free from average, ‘unless general, or the ship be strandedtherefore, as there is a difference in the expression of these two exceptions, perhaps it may be considered as a condition as applied to the stranding, though it be not a condition as applied to general average.” As he was discussing the exceptions applicable to the case of stranding, and only expresses himself *•with: a, perhaps,*as to the other exception, the true meaning of which was not involved in the judgment, the obsei-vation quoted may not be very material, in the decision of the case before us.

In *Jamson et al.*v. *Ralli,*(36 *Eng. L. and Eq.*198,) where the policies contained the clause, “ warranted free from average unless general, or the ship be stranded,” and linseed, in bags, was shipped, it was *held, (first,)*that in the absence of any separate valuation, or any other stipulation in the policy showing that it was intended to distinguish one portion of the seed from another, and to make a separate insurance upon each portion, as well as a joint one upon all, the policy was on the whole of the seed; and *(second)*that although the seed was packed in packages, each capable of a distinct valuation, and some of the packages were totally lost, yet, as the rest of the. packages arrived safe, the loss was a partial loss only of the subject matter insured, arid the underwriters were protected by the ordinary memorandum, there being no general average or stranding, and were not liable as upon a total loss of some of the packages.

The ship sailed from Calcutta with 2688 bags of linseed on board ; 505 bags were thrown overboard, in a hurricane, to-lighten the ship ; when the ship arrived at the Cape of Good Hope, 1023 bags were found to be rotten and worthless, and most of them were thrown into the sea, and the rest of them were sold for a few shillings, and had it been sent on would have lost the character of linseed before arrival in England. The remaining 1160 bags arrived safe. There was no abandonment, and the ship was not stranded. The plaintiffs sought to recover for the 1023 bags "as a total loss.

The opinion of the court states that no question arose as to *496the 505 hags jettisoned. *(Id.*202.) There is no fact in that case, as in this, that it appeared that the damage to the 1023 bags was caused by a sacrifice which created a general average.

The court, after criticising and explaining *Davy*v. *Milford,*(15 *East,*559,) and overruling it, so far as it was a judgment against the underwriters, conclude their opinion thus : “We are of-' opinion that where memorandum goods of the same species are shipped, whether in bulk or packages, not expressed by .distinct valuation or otherwise in the policy to be separately insured, and *there is no general average,*and no *stranding,*the ordinary memorandum exempts the underwriters from liability for a total loss, or destruction of part only, though consisting of one or more entire packages, and though such package or packages be entirely destroyed, or otherwise lost by the specified perils.” *(Id.*211, 212.) That case holds the rule as it was declared in *Wadsworth*v. *The Pacific Ins. Co., (4 Wend.*33,) but does not seem to decide any thing controling in the case before us.

*Mr. Arnould, (vol.*2, *p.*857,) says, “it was decided that the true construction of the words 6 warranted free of average *unless general,’*was that the underwriter is exempted by the memorandum from liability for any thing less than a total loss, ■ except it be of the nature of general average, but that for general average losses he is in all cases liable.” He cites *Wilson*v. *Smith, (supra.)*What was *decided,*and what was said in that case by *Lord Mansfield,*has been already stated.

At page 859, in a summary of his conclusions as to the general meaning of the whole, memorandum, he states its meaning to be, (1st.) “ That all losses, in the *nature of general average,*are to be paid by the underwriter, as though the policy did *not contain*the memorandum,” and (3d.) “if the ship be stranded while the memorandum articles are on board, then the underwriter is liable to, pay all particular average losses, whether caused by the stranding or not, just as though the memorandum did not exist.”

Under the construction for which the defendant contends, the insurer’s liability, unless the loss be "total, is, practically, *497nominal. For, although there he a general average sacrifice by a destruction of a part of the apples, and though the residue be injured by the act of sacrificing the part totally destroyed, the assured, practically, recovers nothing for the physical destruction of the apples jettisoned, and certainly nothing for the physical injury to those carried to the port of delivery. For the purposes of the general average statement, the apples jettisoned are deemed to have arrived sound, and are valued at their market value at the port of destination, (however much that may fall below the insured value,) after deducting freight and other specific charges, and the net value as thus ascertained is the sum or value on which they contribute and are contributed for. And though the apples be totally destroyed, as a voluntary but necessary sacrifice, all the assured could recover would be the sum which they paid by way of contribution, if he had received their value, as thus determined in the general average statement, diminished only by the sum which they must contribute.

And as cargo damaged, but not totally destroyed, only contributes on its net value at the port of destination in the condition in which it arrives, ascertained as before stated, it follows that the greater the damage to it the less its value, and the smaller the contribution it is liable to make, and the smaller the loss for which the insurer is liable.

In the present case, the two hundred and twenty-four barrels of apples which arrived are valued at £6, as their contributory value, and although insured at $3 per barrel and damaged by the general average sacrifice to the éxtent of one quarter of their value, the loss for which the insurer is liable can not exceed six sixty-sixths of *£2,*10s, *5d.*

To hold that the insurer of memorandum articles is only liable to reimburse a general average contribution, is to place the assured in a worse position, in respect- to the extent of his claim against the insurer, where his goods are damaged or destroyed by a general average sacrifice, than where they are physically uninjured and the only loss the owner suffers is the payment he makes as a general average contribution.

*498In *Maggrath & Higgins*v. *Church,*(1 *Caines,*196,) it was held by Kent, J. that all' damage immediately arising from a jettison is to be contributed for, though it happen to perishable articles, which are enumerated in the .memorandum, and remain in specie. Kent, J. says : “ The corn being damaged by the cutting away of the mast, is to be considered equally with the mast a sacrifice for the common benefit; a price of safety to the rest; and it is founded on the clearest equity that all the property and interest. saved ought to contribute their due proportion to this sacrifice. The plaintiff is, therefore, entitled to recover as for *a general average,*for the loss sustained by the injury done to the corn.” Lewis, Oh. *J.*expressed great doubts “ whether the injury received by the corn from the jettison of the mast and consequent irruption of the sea water, could entitle it to a general average as between insurer and insured. He was strongly inclined to think it within the-spirit and meaning of the terms of the exception ; the object and design of which was to avoid and shut out, between the parties to the policy, every question on the *cause*of injury to the corn, where it might equally arise from the perishable nature of the commodity, as from external causes.” Livingston, J. gave no opinion, and the plaintiff had judgment, according to an agreement of the parties at the foot of the case, as for a total loss.

In *Saltus*v. *Ocean Ins. Co.,*(14 *John.*138,) it was held that where *corn*was thrown overboard for the preservation of • the ship and lading, in a storm, by which the residue was greatly deteriorated, and, the vessel having put into a port of necessity, was found to be unfit to be reshipped, and was sold, it was held that the insured was entitled to contribution for the corn thrown overboard, but the insurer was protected by the *memorandum*from any loss on what remained *in specie,*although it had been reduced by sea damage, to less than half its value. Tates, J. in delivering the opinion of the court, says, that “No claim can be sustained for a total or a partial loss on the cargo policy. It consisted of perishable articles included in the *memorandum,*and it was not lost, excepting *499the articles thrown overhoard to lighten the ship. The defendants, therefore, are *only liable*to pay their *portion in contribution*towards the value of the articles which constitute the *jettison;*a principle repeatedly recognized by this court. (1 *John. Cas.*226. 1 *Caines,*196. 3 *id.*108.”)

Where *memorandum*articles are damaged by a general average sacrifice, but arrive in *specie*at the port of destination, if the underwriter is not liable for any partial loss *except for general average,*and if the loss in the present case, under the rule declared in *Wadsworth*v. *Pacific Ins. Co.,*(4 *Wend.*33;) and *Jamson et al.*v. *Ralli,*(36 *Eng. Law and Eq.*198,) is only a *partial loss of the whole,*and there can be no recovery *as for a total loss of the part jettisoned,*it would seem to follow that the underwriter is only liable to the plaintiff in respect to his general average contribution, as owner of the apples.

That such is the nature and extent of his liability, seems to me to be in harmony with all the views upon this subject declared by the courts of this state ; and to be virtually decided by them.

As to the extent of the underwriter’s liability:

*Arnould, (vol.*2, *p.*950, § 10,) states that underwriters never contribute *directly*to general average losses; they are only bound to reimburse the assured their proportionate of rateable amount of his contrihution. They are not bound to reimburse him the *full*amount of his contribution, but only that proportion of it which the value of his interest *as insured,*bears to its *value as estimated*for the purposes of contribution. In other words, whatever *per centage*on the *contributory value*the assured may be compelled to pay in general average, the *like per centage on their insured value*must be paid to him by the underwriter.

The plaintiff’s loss in general average has been satisfied by general average contributions which he has received, except the sum of £2, 10s, 5d, which he paid in contribution on the seven hundred barrels of apples, at the contributory value of £66. Whatever per centage £2, 10s, 5d, is of £66, the plaintiff *500would be entitled to a verdict, according to a strict and technical application of the rule above stated, for such sum as is a like per centage of .$2100, the insured value of the apples.

But it is obvious that the *insured*value may so largely exceed the *contributory*value, that an application of this rule would make the insurer liable in such a case for a larger sum than the assured was compelled to contribute in general average.

The rule seems to be that where the contributory value' exceeds the insured value, whatever is paid in such a case in contribution, by the excess of the contributory value over the value in the policy, is paid by the assured. On this proportion, he is his own insurer. For whatever is paid on a contributory value' not exceeding the value in the policy, the assured is indemnified on the proportion insured. (2 *Arnould,*950, § 10. *Clarke*v. *United F. and M. Ins. Co.,*7 *Mass. R.*365.)

This rule, applied to the facts of this case, entitles the plaintiff to a verdict for £2, 10, 5, or whatever the sum is which he paid in general average contribution. This exonerates the insurers from all liability *for a partial loss, as a partial loss,*and makes them liable to the plaintiff for the actual general average loss; the insured value of the memorandum articles being greater than their contributory value.

The case will be-reconstructed so as to show that the plaintiff, by order of the court at the trial, had a verdict for such sum as will be correct according to the rules above stated, and that such exceptions were there taken, by either party, as will enable him to present the questions raised by the propositions here decided and the application made of them in this disposition of the action.