Case Name: Riley against Delafield
Court: New York Supreme Court of Judicature
Jurisdiction: New York
Decision Date: 1811-02
Citations: 7 Johns. 522
Docket Number: 
Parties: Riley against Delafield.
Judges: 
Reporter: Johnson's Reports
Volume: 7
Pages: 522–527

Head Matter:
Riley against Delafield.
ALBANY;
Feb. 1811.
ji sold a vessel to Ji. in whose name she was it^was6a'°Teed should hcneh/ofV^the freight to arise from a voyage, for which Jl. liad previously chartered the vessel, and on which she was fasTreíthe'vesthe'voyage1 ami Jl. procured in-made on the freight of goods on board of the the same Voyg!eemcnttllebeorThe^pecniiar nature of vl’s interest,was not communicated to the insurer. It was held, that insurable intefiterest SU°h as could be insured under the name of freight, without disclosing and specifying £,rU“al na"
THIS was an action on a policy of insurance. Plea . . non assumpsit, and the statute of limitations.
The cause was tried at the New-York sittings, the 13th Junei 1810. The policy was dated the 29th of September, 1801, and purported that “ James Seton, on account of Afames Cumminses, as well in his own name, as _ u ° for and in the name and names of all and every other person, or persons, to whom the same doth, may or shall . « . , , ,, , 0 appertain, m part or m whole/7 made insurance, &c.. “ at and from New-York, to the port of discharge in the Mediterranean, with liberty to stop at Minorca or Malta, Upon the freight of goods laden, or to be; laden, on board of the brig Delia, Spraseue, master. The risk to continue until the goods should be safely landed, at her port of discharge in the Mediterranean, with the liberty aforesaid,” valued at 6,000 dollars.
The declaration averred, that the plaintiff, at the time cf making the insurance, was and continued to be inte- ° rested in the premises ; and that the insurance was made on his account and risk.
As the cause was decided on a single point, it is unnecessary to state the facts or arguments, which relate to ^]le other questions raised in the cause, *
The vessel sailed on the voyage insured the 27th of , . , , September, 1801, and arrived at Malta the 21st of No-vender, 1801, where she remained until the 9th oí December, 1801, and sold part of her cargo. She sailed from thence to Naples, and arrived in the roads of Naples the 17th of December, 1801, and on the same day was driven on shore, in a storm, and totally lost, only' 180 bags of pepper, part of the cargo, being saved.
Before the date of the policy, and before she sailed on the voyage, the plaintiff sold the brig to Howell, who caused her to be insured, as owner; but the plaintiff having previously chartered her to Isaac Kibbe, for the voyage insured, it was agreed, at.the time of sale, between the plaintiff and Howell, that the plaintiff should have the whole benefit of the freight arising from that voyage,, which was the one insured. The vessel was registered in the name of Howell, who testified that he had no interest or concern in the freight for that voyage. The bill of lading was produced, which stated that the goods were shipped by Isaac Kibbe, to be delivered at Venice, to the consignee there.
On the 12th of October, 1801, the plaintiff assigned the freight and policy to fames Cummings, as collateral security against a certain endorsement, made by Cummings, of the note of the plaintiff; the assignment was to be void, if the plaintiff paid the note, or indemnified Cummings. The note was not paid, and the assignment became absolute; but Cummings, who was a witness at the trial, declared that he had no interest in the cause.
It appeared that the plaintiff, afterwards, became a bankrupt, and his estate was regularly assigned on the Sd of February, 1803.
An abandonment was proved to have been duly made to the defendants on the 8th of May, 1802, and the preliminary proofs were exhibited.on the 23d of March, 1808. .
It did not appear that the agreement between the plaintiff and Howell, as to the freight, or the particular nature of the plaintiff’s interest, was communicated to the defendant, previous to his signing the policy.
Several objections to the plaintiff’s right of recovery were raised at the trial, which were overruled by the judge; and a verdict was taken, subject to the opinion of the court, on the points so overruled. A motion was made to set aside the verdict, and for a new trial.
Pendleton and Harison, for the defendant, contended that the plaintiff had no insurable interest. Though freight is distinctly insurable, yet no person can insure -freight generally, eo nomine, unless he be the owner of the ship. Freight is incident to the vessel, and unless otherwise declared, the insurer has a right to presume that the person who applies to insure the freight is the owner of the vessel, and interested to preserve and take care of the subject insured. At most, the plaintiff could be no more than an owner pro hoc vice, and entitled to freight under a charter or contract; and such an inte» rest must be specified or disclosed. Unless the peculiar nature of such interest is stated to the insurers, great frauds may be practised, by having a double insurance of the same subject; for Howell, as owner of the vessel, might have insured the freight, and would have recovered, m case of loss, on proving that there were goods on board.
But, admitting that the plaintiff had an interest, it was transferred first to Cummings, and afterwards to the assignees. Cummings declared he had no interest in the freight, and so no action could be brought in the plaintiff’s name, for his benefit. When the interest of Cummings ceased, it passed to the assignees of the plaintiff, under the general assignment of his property. It was enough, in the first instance, to show the bankruptcy of the plaintiff and the assignment. If the plaintiff after-wards acquired the property, it was incumbent on him to prove it.
Colden and T. A. Emmet, contra,
insisted that the plaintiff had shown a sufficient insurable interest. It is not necessary to prove a legal interest; an equitable interest may be insured. There was a charter-party to Kibhe, existing at the time. The plaintiff had as much of an insurable interest as Howell. The owner of a vessel may insure his interest generally, though there is a bottomry bond on the vessel; and the holder of the bottomry may also insure, eo nomine. In Cheviot v. Barker it was held, that the person hiring the vessel for the voyage cannot insure the freight, because he is to pay the freight, not to receive it. Howell could not insure it, for he was not, by his contract with the plaintiff, entitled to the freight. It is true, a peculiar interest like that of bottomry, must be specified; but if the plaintiff could not insure his interest under the name of freight, we know not by what name or description it could be insured. He was the only person entitled to receive the freight, and it has no other name or denomination.
The question is not, whether the plaintiff has, at this time, an interest, but whether he had an insurable interest at the time the policy was executed. In the eye of the law, the plaintiff must be regarded as having the right to the freight. It is not for the court to inquire who is the person ultimately to receive the money. It is enough that the plaintiff had an insurable interest at the time of the policy. The assignment to Cummings was by way of security j and if considered as a mortgage, yet the mortgagor has an insurable interest. Several persons may insure and sue, in regard to the same sub-O • ■ ___ - ject, according to their respective interests. The averment in the declaration, as to interest, has reference only to the time of making the policy. The plaintiff is not bound to prove a continuance of interest down to ilie time of loss, or bringing the action. The assignment under the bankrupt law was made three years after the loss happened. We could have shown, if it had been necessary, that the assignees had sold and transferred all their interest in this policy to the plaintiff. A suit could not have been brought in the name of the assignees. If neither the assignees, nor any other person but the plaintiff, had an interest, then the suit must be in his name; and we could have proved, that: no other person had an interest in the freight.
2 Johns. Rep. 346.
Dallas, 859.
1 Johns. Rep. 385.
2 Johns. Rep. 346.
2 Term Rep. 187.
Marshall, 683. 2 Bos. & Pull 155. noye.

Opinion:
Per Curiam.
_ There were several objections raised up* on the argument against the right of recovery in this case. It will be sufficient to notice only the first objection, that the plaintiff has not shown an insurable interest.
The policy was generally " upon the freight of goods laden on board the brig Delia" and the plaintiff was not owner of the vessel, he having, some time before the insurance was effected or the voyage begun, sold her to Howell, who caused the vessel to be insured for the voyage. Howell states that he had nothing to do with the freight for this voyage, as the plaintiff, according to an agreement made at the time of the sale, was to have the benefit of that freight. All the interest of the plaintiff was, then, founded upon this special agreement, and it could not strictly or technically be denominated freight, since it was not an interest accruing to the plaintiff, as owner of the vessel for the use of her. It was an interest founded entirely upon the agreement, and could not have been claimed or recovered under any other title. It could not be insured as freight, eo nomine, unless accompanied with a disclosure of the peculiar nature of the interest. It would otherwise be an imposition upon the insurer, who when he is asked to insure freight must presume that he is dealing with the owner of the vessel. The owner has a stronger interest in the equipment and management of the vessel than a stranger, having no such stake in the voyage. And to allow such an interest to be covered under the name of freight, without explanation, would lead to abuse and fraud, by affording an opportunity to cumulative insurances upon the same interest, and interested combinations to destroy it. In Cheriot. v. Barker (2 Johns. Rep. 346.) the court intimate and approve of this principle, that a concealed particular interest, contrary to usage, ought to be disclosed. 1 his case is brought fully within the reach of that doctrine. The contract ought to contain, within itself, the identity and certainty of the subject matter, so that the parties may understand the engagement with precision, and calculate accordingly.
Judgment ought, therefore, to be rendered for the defendant.