Case Name: Francis J. Oliver and Another versus the Newburyport Insurance Company
Court: Massachusetts Supreme Judicial Court
Jurisdiction: Massachusetts
Decision Date: 1807-07
Citations: 2 Tyng 37
Docket Number: 
Parties: Francis J. Oliver and Another versus the Newburyport Insurance Company.
Judges: 
Reporter: Massachusetts Reports
Volume: 3
Pages: 32–58

Head Matter:
Francis J. Oliver and Another versus the Newburyport Insurance Company.
A ship is insured from Spain to Tenerife and Jamaica. During the voyage insured, she is captured by a French national ship, and re-captured by a British privateer, and carried into Antigua, where she is libelled in the Court of Vice-admiralty, and decreed to be restored on payment of one half the value as salvage ; upon the representation of the master, who was also a part owner, that he was unable to pay the salvage, the court order her to be sold The master becomes the purchaser, and on his return delivers her to hei former owners; after which the insured offer to abandon to the underwriters the proceeds of the sale at Antigua, but refuse to abandon the ship; the underwriters refuse to accept the abandonment as offered. It was held that the insured were entitled to recover for a partial loss only.
Case upon a policy of insurance on the hull and appurtenances of the ship Columbia, valued at 10,000 dollars, at and from Bilboa, or other Spanish ports without the Straits of Gibraltar to Teneriffe, and at and from thence to Jamaica. The defendants underwrote four thousand dollars. The plaintiffs declare on a total loss by capture by a French national corvette called the Curieux, whereby “ the said ship with her appurtenances has ever since been detained from the plaintiffs, and the same, by the capture aforesaid, was utterly lost to them.”
Upon the trial of the general issue in this cause, the following facts appeared, viz. The defendants made the policy * as declared on. The ship was owned, two thirds by [ * 38 ] the plaintiffs, and one third by the master. During the voyage insured, she was captured by a French national corvette, and eight days after was recaptured by two British privateers, sent into Antigua, and there with her cargo libelled by the re-captors in the Court of Vice-admiralty as prize, and the ship claimed by the master for himself and the plaintiffs as joint owners, the cargo being also claimed by the master in behalf of certain British merchants. The Vice-admiralty Court there decreed “ restoration of the ship and cargo to the claimant for the benefit of the respective owners, on payment of one half of the true value thereof to the recaptors, in lieu of salvage and all costs and charges attending the same.” The master claimed an appeal from that part of the sentence which related to the cargo; but he did not claim an appeal from that part of the sentence which related to the ship. Afterwards the master represented to the said Court of Vice-admiralty that he could not pay the salvage without selling the ship ; and thereupon the same court ordered the ship to be sold, and she was sold for the sum of £667, Antigua currency. The master was the purchaser, and received a bill of sale of her from the office!. The cargo was also sold by the same officer for £8991, 10s., of the same currency. The expenses of the sale were paid out of the proceeds of the ship and cargo, and the master received the net proceeds of the moiety restored, from which he retained the amount of the moiety of the proceeds of the ship, and £1600, same currency, in bills of exchange on London, as freight upon the cargo. The master returned with the ship to Boston, after which, and after the ship had been restored to the owners, the plaintiffs offered tv abandon to the underwriters all their interest in the proceeds of the sale of the ship, but refused to abandon the ship. The underwriters refused to accept the abandonment as offered. The master testified at the trial that, soon after his arrival at Antigua, he wrote and forwarded a letter to the plaintiffs, and soon after another letter, in both which he stated the situation of the ship. There was no evidence of the actual receipt of those letters.
[ * 39 ] * Upon these facts, the court, before whom the cause was tried, directed the jury that by law the plaintiffs were entitled to recover for a total loss, and the jury found accordingly. Whereupon the defendants moved for a new trial, and this motion came on to be argued in March last.
Dexter, for the defendants,
admitted that a partial loss had arisen equal to the salvage paid, and the ship’s proportion of the expenses; in other words, that the plaintiffs were entitled to an indemnity, which is the only honest and legitimate object of an insurance. The verdict in this case being for a total loss, a new trial must be had if we show the plaintiffs entitled only to a partial one.
No principle is more established than this, that when the assured demands for a total loss, he must previously abandon to the underwriter whatever remains capable of abandonment, and this in reasonable time . In this case there has never been an offer to abandon the plaintiff’s interest in the ship, but only in the proceeds of a sale made by virtue of an order procured by their agent and a part owner with them. This agent purchased the ship in effect of himself and his partners on the account and for the use of the former owners, as is shown by her restoration to them upon hei return, for a sum equal to about one seventh of her agreed value.
The letters of advice stated to have been written by the master, either were or were not received by the owners. If they were received, the owners ought then to have made their offer of abandonment ; if they were never received, then the first advice of the capture showed the property restored in safety. Upon one sup position the abandonment was too late; and upon the other there never was, at any moment, a right to abandon.
In the case of M’Masters vs. Shoolbred , where the facts were extremely like the present case, Lord Kenyon said it was impossible to make it more than an average loss. The captain was to be considered as the agent for the owners, as recovering so much [ * 40 ] property on their account, and * they had a right therefore to recover only so much as was the amount of the injury their property had sustained, which was an average loss.
In the case of Abbot vs. Broome , the principal question was whether the abandonment had been waived. The assured, in that case, having abandoned in due time, refused to accept the ship, which had been purchased by the supercargo, who was also part owner. The very able counsel for the assured in that cause, alluding to the case of Saidler &f Craig vs. Church, expressly agrees that the receiving and fitting nut of the ship by the assured, amounted to a complete adoption by the assured of the act of the agent, and converted into a partial the claim which had been made for a total loss. The case of Saidler Sf Craig vs. Church , though very like the present, is much stronger in one point; for in that case the ship was condemned as prize against the will of the concerned. In the case at bar, the order of sale was made on the application and at the request of the agent and part owner. Supposing the whole transaction to have been bon % fide, there was no. transfer of the property. The sellers and buyers were the same.
The facts in this case form a sufficient ground to presume fraud in the master, and for this reason also it ought to be sent to a new trial. Before the court were advertised of the master’s inability to pay the salvage, it had decreed a restoration to him of ship and cargo. Out of this latter he knew he had a right to deduct the freight due, and the papers in the case prove that he in fact received the bill of exchange for £1600 sterling, nine days before the sale of the ship. He would, therefore, if he had acted with good faith, have paid the salvage of the ship out of this fund, and so prevented a sale, which was expensive, and which was needful for no honest purpose. It is difficult to assign any motive but a fraudulent one to the conduct of this man in another instance. From the part of the decree respecting the cargo, in which he had no interest, he claims an appeal; while from that relating to the ship, of which he was part owner, and the agent for the other owners, he claims no appeal, but desires *to have her sold, and becomes him- [ * 41 ] self the purchaser. That be had grounds of appeal as to the ship, appears from his actually appealing as to the cargo; and it appears too from the enormous rate of salvage decreed, which was four times the usual rate in like cases.
The doctrine which is necessary to support this verdict leads to the most mischievous frauds. If by such a sale as this, and obtained in such manner, the property of a ship becomes vested in the master, nothing will be more frequent than for a captain of a vessel to sail on a voyage as master, and return as owner. He will represent his vessel to the Admiralty Court as needing repairs greater than he has funds to pay for, will procure an order of sale, purchase the ship, and set his owners at defiance. We contend that in such a case as this at bar, the master acts at his peril. If upon his return they see fit, the owners may adopt his transactions and take the ship, or they may disavow them and abandon the ship to the master, as in the case of a ransom. "
Amory, for the plaintiffs,
observed that this point of fraud in the master was now for the first time suggested. If there was ground for the suggestion, it ought to have been urged at the trial, and the jury, who are the proper forum to decide it, might have received directions from the Court different from those which are now excepted to, and the propriety of which is the subject of the present discussion. It is too late in the cause to suggest new points of .defence, the evidence of which was as much in the power of the defendants at the trial as it is now.
As to the excessive rate of salvage, it is well known that the British government raised their rates of salvage as it should respect vessels of the United States by way of retaliation, or to conform it in such cases to the rates established by our laws. So that, whether it was extravagant or not, it was fruitless for the master to appeal respecting the ship; but the cargo belonging to British subjects, who were not subjected to the same rules, it was manifestly proper to enter an appeal as to the salvage of that.
The object of this insurance being the ship for the voyage, upon her capture and recapture, and being condemned | * 42 ] * to pay a salvage greater than the owners had funds for, and for which the ship was a pledge, the voyage was completely defeated, and a total loss occurred. The restoration of the ship does not restore the voyage, which was absolutely broken up before. Marshal , in introducing the case of M’Masters vs. Shoolbred, says, “ If the ship be sold by the captors, and purchased by the captain, acting as agent for the owners, this shall be considered as a recovery for the owners, and the money thus paid as salvage ; and if the voyage can he prosecuted, this is only a partial, and not a total loss." If the voyage cannot be prosecuted, the loss is total.
In the case at bar, no instructions or special authority were given to tile master to purchase the vessel on account of the owners in case of capture. If, then, he had this authority, it must have been "in virtue of his general powers as master. But it will be well to see how far such a doctrine may lead If the master can do it once, he may do it twice or thrice in the same voyage, and thus the owners, and of course the underwriters, be liable for a double or treble loss on one voyage, perhaps to their ruin. But we deny any such doctrine. We deny that the ship was bought for the owners’ account. Suppose this ship had been lost on her passage from Antigua to Boston, could this master maintain an action against the owners for the money paid for the ship? Certainly not.
The bill of sale of the ship to the master was absolute to him, his executors and assigns. If he had chosen on his arrival here to make the owners a present of the ship, would such a fact weaken the demand of the owners upon the underwriters? The money which he paid for the ship was not the money of the owners of the ship, and he had no right to appropriate it to the purchase of the ship. It belonged either to the owners of the cargo, to" those to whom the freight was payable, or to the underwriters on the freight. The ship was then his own property, until, from some motives operating in his mind, but which, not being in the case, cannot be shown, he voluntarily transferred her to the present plaintiffs. The ship was his property, unless a master is by *some rule of law of which we are ignorant, prohibited [ *43 J from becoming a purchaser in such case.
In every case which has been cited on the other side of vessels purchased by the masters, it is expressly stated that the purchase was made on the account, and for the use of the owners. Nothing of that appears in the case at bar. If the master had contemplated that he had purchased for the benefit of the former owners, he would have found himself under obligation to complete his voyage. But the plaintiffs in fact became possessed of this ship under a new title, in no shape filling the place of that which they had lost by the capture; and therefore their right to abandon as they did, and to claim for a total loss, was not at all affected by their becoming again possessed of their ship.
After thus supporting the plaintiffs’ title to recover for a total loss, from what appears to us sound reason, we cite the case of Storer vs. Gray , decided in this Court, in confidence that it applies precisely to the case at bar.
Otis, on the same side.
Two questions present themselves for consideration in this cause.
1. Was there at any period a total loss, which entitled the assured to abandon ?
2. Have the assured, by any circumstances appearing in the case, waived their right to abandon, and to claim, in consequence, for a total loss ?
As to the first question, there can, I think, be no doubt. The property was as completely divested from the former owners by the decree of the Vice-admiralty Court for a sale to pay the salvage, as by a decree in case of capture for a sale for the benefit of the captors. There is nothing in the case which shows the purchase by the master to have been on account of the former owners, nor does it appear in what way they became repossessed of the vessel. For aught that appears, they might have given to the master a fair market price for her.
Whether the letters from the master were received or not, does not appear. They can therefore have no operation in [ * 44 ] *any view. But suppose them received, the owners were not bound to abandon, before they knew the ultimate state of things. They might expect a reasonable salvage to be awarded, which the captain would have been able to pay without a loss of the voyage, and upon which they might contemplate but a partial loss. But if they were not received, then the first account received by the plaintiffs of the capture, was by the return of the ship, and their offer to abandon was in reasonable time; provided, as we contend, the property had been divested from them by the sale in Antigua. The total loss continued to the time of abandoning and bringing the action . The voyage was defeated; the vessel was sold by order of law for the payment of one half her value as salvage. The freight was forfeited and lost. The reason ing of Lord Mansfield, in the case of Hamilton vs. Mendes, goes on the particular facts, which are very unlike those in the present case.
If, then, as we think is plainly shown, the plaintiffs had at one time a right to abandon, it remains only to be inquired whether they have, by any act of theirs since that time, waived their right.
That neither the purchase by the master in Antigua, nor the acceptance of the vessel by the plaintiffs after her return, amounted to a waiver, is established by the cases of Storer vs. Gray, and Welman vs. Gray.
Dexter.
In the case of Welman vs. Gray, there was a condemnation in the Admiralty, in virtue of which the sale was made.
Otis.
A sale under a decree of an admiralty court changes the property, let the cause of the decree be what it may. If the former owner himself is the purchaser under such sale, he holds under a new title.
These cases were in our own courts, and were both decided on solemn argument; and unless the principles of the decisions can be shown to be flagrantly wrong, they must govern in the decision of this cause. The point has been put at rest by them. To call them in question agitates underwriters and merchants needlessly. The maxim stare decisis is of peculiar weight in commercial questions, in which, * perhaps more than in any others, it [ * 45 | is more important that the law be settled, than how it is settled.
It is believed too that the principles of those cases are not opposed to principles adopted by the courts of other states and countries.
The case of Milles vs. Fletcher shows that the resuming possession and exercising ownership by the master does not deprive the assured of his right to abandon.
In the case of M’Masters vs. Shoolbred, which, by the way, was decided at nisi prius, the facts differ materially from ours. There the master made the purchase on account of the owners, and probably under orders from them. The sale was not by order of an admiralty court, but of a French consul, which being no legitimate authority, the sale would not change the property. The vessel in that case went on another voyage, perhaps as eligible a one, for the account of the same owners.
The case of Abbot vs. Broome is in point for the plaintiffs. The owners there, on the return of the ship to New York, caused the ship to be sold. In our case the plaintiffs could not do this, for they had no control of the ship. Neither could they abandon her. They did abandon all they had power to abandon, viz., the proceeds of the sale in Antigua. If they had undertaken to abandon the ship, the master would have had a right to retain it, notwithstanding such abandonment, as his property. If a stranger had been the purchaser, and he, on her arrival here, had sold her to the former owners, would the defendants insist that, when she came into the hands of the plaintiffs, they were still bound to abandon her to them ? Yet it is difficult in this view to distinguish between the two modes of reacquiring the property.
It was attempted to be shown by the defendants, that the master was in cash for the owners nine days before the sale of the ship. The fact was, as will appear from an inspection of the papers, that though the bill of sale to the master bears date on the 18th of June, jet the actual sale was on the 19th of May.
* Dexter, in reply,
cited the case of Hankey &f Al. vs. [ * 46 J Smith , to show that if the Court, after one trial, on hearing an argument on the case agreed, suspect fraud, they will send the cause to a second trial, that the question may be investigated.
As to the cases cited from our own courts, he trusted that some principles were of more authority than decisions. In the case of Storcr vs. Gray, it was understood that there was a division in the court. The public opinion still considers the question as undecided, and open to discussion, and it would be disrespectful to the court, to- suppose them intrenching themselves behind decisions, when opposed to sound principles, and to the opinions of wise judges in other states. But the case at bar differs from that case, and from that of Welman vs. Gray. In this latter case it was stated there was a condemnation as prize, and of course a compulsory order of sale previous to the purchase by the master. There are reasons of sound policy which permit captains to purchase after a condemnation, and hold against their owners, which do not apply in other cases; as, for instance, a decree of condemnation changes the property; it no longer belongs to the former owners, nor, when the ship is gone from them, is the master any longer their agent. Again, if, after condemnation as prize, the master uses his interest to reduce the price, he injures none but enemy captors; but when the sale is for the benefit in part of former owners, if he does the same thing he injures his principals, he is tempted to act fraudulently towards those who have employed and confided in him.
There was nothing in either of those cases which gave occasion to suspect fraud in the master, of which -it is contended there is much in the case at bar. The circumstance alluded to in the opening, as indicative of fraudulent views in the master, viz., his entering an appeal as to the cargo and not as to the ship, it has been attempted to account for, by the retaliating measures of the British government as to the salvage of American vessels. But shall this master be presumed to know British regulations, which [ * 47 ] were not known here to those * in the exercise of the * government ? Those regulations were afterwards altered when the United States altered theirs, and the Court of Appeals in England never enforced them.
The proceeds of the cargo had been ordered to be paid to the master as well as his freight, yet he prays for the sale of the ship. There could have been nothing wrong in his applying the money of the freighters to the relief of the ship, the owners being responsible for it. But the freight was five times the amount of the salvage which he had to pay.
In the case of Hamilton vs. Mendes, there was a sale of the ship by the recaptor, but it was considered as so immaterial a circum stance that no stress was laid upon it, but it came out incidentally from one of the counsel. Yet we are here told that the sale makes every difference. In that case also there was an offer to abandon the ship, which was refused here. There is no case to be found in the books of an abandonment of the proceeds of the sale of the ship, instead of the ship itself, where she was purchased by an agenl of the owners.
Otis
mentioned the case of Pringle vs. Hartley , and quoted the opinion ot Judge Livingston in the case of The United Insurance Company of Nt'o York vs. Robinson &f Hartshorne .
Dexter.
The great point on which the defendants rely in this cause is, that there never has been an offer to abandon to them the property saved by the assured. If this point is established, the plaintiffs cannot recover for a total loss.
This depends on the question whether the master had a right, upon his arrival here, to retain the ship from her former owners, who had intrusted him with her. The plaintiffs have in fact answered the question by taking the ship into their possession as their own, and sending her on another voyage. But, apart from this fact, the common principles of law, as well as justice, are against such right in a master.
When one acts as agent, whether he is bound to certain acts or not, yet when done, his principals have a right to the benefit of them. He is pledged to consult their interest exclusively * in every thing relating to the concern, so long as he re- [ * 48 ] tains the character of agent. Nor has he a right to terminate the character of agent at his pleasure, and especially when placed in such a situation as was the master in this case. He is bound to persevere as long as he can be useful' to his employers.
A master has a right to dispose of any part of the cargo for the preservation of the ship, and to hypothecate the ship itself for necessary repairs, &c. He-has no right to involve them in hazards not contemplated, by engaging in a new voyage aside of his orders, nor to pledge them beyond the value of the property intrusted to him. These are the only limits to his authority.
In the case under consideration, the master was a joint owner of the ship, and under an order of sale procured at his instance he becomes the purchaser of the whole, and we are told he has a right to hold against his former partners, whose agent he was, and with whose money he made the purchase. If masters are authorized thus to defraud their owners, it is against every principle which governs the cases of trustees and agents in all other cases. Let the principle be once established, and we shall find masters, whenever their vessels need repairs in a foreign port, applying for a survey and procuring an order for a sale of the ship, that they may themselves become the purchasers, instead of hypothecating the ship for the amount of expense. To justify themselves they will have only to say, we thought it convenient to drop our character as agent for the owners: in this transaction we acted solely for ourselves.
The decision in M’Masters vs. Shoolbred is strongly in point. It is true it was at nisi prius, but it was not stirred afterwards; though the counsel against whom the decision was, were amongst the first of the English bar. It is therefore to be understood that the decision was acquiesced in. The sale being by order of the French consul was not mentioned either by the counsel or the judge.
Though decisions in the courts of the other states are not of binding authority here, yet when we find as respectable a bench as any in the United States unanimously agreeing in [ * 49 ] * the principle we contend for, it certainly fortifies our arguments in no inconsiderable degree .
When any fact has happened constituting a technical total loss, the insured, by abandoning, substitutes the underwriter in his own place, so that the master from that event stands in the same relation to the underwriter as he did before to the assured. The underwriter becomes owner, and all chances of interest, as well as vested interest, become his. He pays the sum he engaged to pay, and is entitled to every possible gain or saving that may be made.
Goss & vs. Withers, 2 Burr. 683.—Hamilton vs. Mendes, 2 Burr. 1198
Livermore vs. N. P. Insurance Company, 1 Mass. Rep. 264.
1 Esp. Rep. 237.
1 N. Y. Term Rep 292.—See, also, 1 Dallas's R. 11.
Alexander Hamilton.
1 N. Y. Term Rep. 297, in notis.
Page 501.
See this case in 2 Mass. Rep. p. 565.
2 Burr. 1212.
Doug. 219, 231.
1 Burr. 507.
Mr. Dexter was, at the period when this transaction took place, secretary in the department of state.
3 Atk. 195, cited in Marshall, 485.
2 N. Y. Term Rep. 280
See the case of U. I. Company vs. Robinson & Hartshorne, 2 N. Y. Term R. 280—and Miller & Graham vs. Depeyster Charlton, ibid. 301.

Opinion:
The cause was continued for advisement; and now, at this adjournment, the Court delivered their opinions as follows, viz.
Sewall, J.
The facts material in deciding upon the motion in this case for a new trial are, that the insurance by the policy in question was of the ship Columbia, owned for two thirds by the plaintiffs, and one third by the master, for a voyage from Spain to Teneriffe, and at and from thence to Jamaica; that the ship in the course of the voyage insured was captured by the French, and recaptured by the English, who carried the vessel and cargo to the island of Antigua, where, upon a libel for salvage, they were decreed to be restored to the former owners, upon payment of the one half of their value to the recaptors; that the master, soon after his arrival at Antigua, and again during his stay there, advised the insured ot the capture of the ship and cargo; that the cargo was taken out and sold there, and that the vessel was also sold, under a decree of the Admiralty, at the instigation of the master, upon an alleged want of funds to pay the salvage; that the master became the purchaser of the ship, and returned in her to Boston, where she has since become the joint property, or is in the joint management and control of the insured and the master as before; that the assured, before bringing this action, offered to abandon to the underwriters all interest in the proceeds of the sale of the ship, but refused to abandon the ship.
Upon these facts the jury at the trial were directed to find a verdict for the insured as for a total loss. This direction * is complained of on the part of the defendants, who move [ * 50 j for a new trial.
The demand of the plaintiffs for a total loss is resisted by the defendants upon two grounds: because, 1st, the insured, at the time of their offer to abandon, had no right to abandon and to recover for a total loss; and, 2dly, if they then had the right, they have not entitled themselves to recover for a total loss, by their abandonment of the net proceeds of the sale of the ship, when the ship itself had been recovered, and was in safety in their possession and use, in consequence of a purchase by their partner and agent, either origi nally made for them, or which has availed to their benefit.
It seems admitted in the argument for the defendants, and if it were not, I think it unquestionable, that the events in this case, up to the time of the captain's purchase of the ship, constituted a technical total loss, if the assured had elected so to consider it. A capture and recapture, subjecting the property recovered to a charge of half its value to be paid upon the restoration of the vessel at a port out of the course of the voyage insured, where the cargo procured for the voyage was necessarily discharged and sold; and when by these events the voyage itself was entirely defeated,—are circumstances constituting a technical total loss, according to many decisions which might be cited. I shall mention only the cases of Goss Al. vs. Withers, 2 Burr, 683, and Milles vs. Fletcher, Doug. 219. But a loss of this kind is total only at the election of the insured ; and the rule adopted upon this subject is, that the election of the insured is to be made and notified as soon as may be after he has intelligence of the state of his property.
If the advice addressed by the captain from Antigua to the insured had been received by them before the arrival of the ship at Boston, their neglect to notify the insurers was a forfeiture of the right of abandonment.
This rule and the application of it were very fully discussed in the case of Mitchel &f Al. vs. Eddie, 1 Term R. 608, and the doctrines of that decision were recognized and enforced in the case of Livermore, Assignee of Bartlett, vs. the present defendants, [ * 51 ] recently decided by this Court . * But the facts before us do not warrant a conclusion that the insured had received any advice of the state of their property, until the return of their captain and vessel to Boston. And whether they could then abandon and demand a total loss, is a question to be decided upon the other circumstances of this case.
It the purchase of the captain may be considered in the event a recovery of the ship to the insured, it became so by their assent to it after his return, and the consequent restoration of the property to its original state. The purchase was not at the time necessarily or professedly for the account of the insured, nor does the general authority of a master extend to the power of binding his owners in a purchase of that kind; and there is no pretence of any special authority in this case. Nor will the mere safety of the vessel, ii the insured refuse to accept it, when the voyage has been entirely defeated, deprive the owner insured for a particular voyage of the right of abandonment. All the decisions in cases of detention by embargo, where a total loss has been recovered upon the insurance of vessels remaining in safety , and particularly the judgment by the King's Bench in the case of Rotch vs. Edie , are authorities to this effect.. The case of Goss & Al. vs. Withers may be cited to the same purpose.
The case of Poole vs. Fitzgerald has been relied on; but upon examination it will not be found to warrant a contrary doctrine. That was the case of an insurance upon a privateer for a cruise of four months, the vessel valued at £1000, without further account, and free from average. By the mutiny and desertion of her crew, the cruise was prevented for a part of the term insured ; but the vessel remained in safety at her accustomed port. The decision was against the plaintiff, the insured, grounded upon the peculiar terms of the policy, which was construed to entitle the insured to recover only in the event of a total loss ; the policy being for the sum insured without. account, and free of average; and it being impossible that the loss should be considered total, while the vessel itself remained in safety.
[ * 52 ] *Upon the ground, then, that the return of the ship to Boston was not for the account of the insured, unless by their election to receive it of the captain; and that the loss of the voyage insured, with the other facts stated, would entitle them to demand a total loss by the policy in this case, upon a suitable aban donment of the actual salvage, it seems necessary to come to the remaining question, whether there has been such an abandonment; and I have authority to say that the direction complained of was a decision upon this question only. It was the apprehension of the justices who presided in the trial, that in a decision not final upon any question of law, they were to govern themselves by the decisions of this Court, which have been cited in the cases of Welman vs. Gray, and Storer vs. Gray.
The acceptance by the assured of their shares in the ship purchased by their partner and general agent, was an assent equivalent in all respects to a previous authority; and having a retroactive effect, whatever had been done by the master of the vessel and the partner of the insured, in purchasing and refitting the vessel, and in prosecuting another voyage, is to be considered as the acts also of the insured in the disposal of their property, whether recovered and held in their former right, or by a new and distinct title.
If the purchase in this case was, in its effect upon the contract of insurance, a recovery of the property, to be treated as a recovery in the former right of the insured, their acceptance and subsequent disposal of the ship, and especially their refusal to abandon it to the insured, was a waiver of the right of abandonment. And upon the same reasoning an abandonment of the sales at Antigua was insufficient, because not made of the actual salvage, the ship recovered.
On the other hand, if the ship returned to the assured by a new and distinct title, affecting the insurers in their contract, as well as all other persons, then the loss continued in every respect total at the time of the offer to abandon ; and the abandonment offered in this case was valid and sufficient to entitle the insured to recover for a total loss.
When the case of Storer vs. Gray was decided, I had the honor to be a member of this Court, and I concurred in the * decision. The case was similar, in many respects, to the [ * 53 ] present; differing only in the circumstances of a decree compelling a sale ; whereas, in the present case, the sale was made at the instance of the party purchasing under it. That decision was, as I recollect, upon these grounds, that the decree of a court of admiralty in a foreign country, having jurisdiction in a case of capture and recapture, ordering a sale for payment of salvage, was in itself a change of property; that the master, either with or without the assent of his owner, the insured, might avail himself by purchasing at an authorized and compulsory sale ; and in any purchase made for the account of the insured party, he would become the owner in a new right; that the master had no general authority to purchase at the risk, or for the account of the insured, or the insurers; and that they could not justly claim the benefit of a purchase made by the master at his own risk; and a prevailing argument was, that these principles had governed the Court in the priai decision, which has been cited, in the case of Welman vs. Gray.
It must be allowed, I think, that there are difficulties attending any rule that can be contemplated for the decision oL cases of the kind which have been cited. If it should be decided that the insured were by a purchase of this kind, when fairly made for their account, chargeable absolutely with a new risk, very great and obvious objections occur on their part. And in adopting a rule less objectionable, which has been urged upon the attention of the Court, it is obvious that an agent by necessity, proceeding with fair intentions, for the apparent benefit of the concerned, may become a sufferer by his agency, and involve himself in expenses, from which, in a different event, he could derive no emolument, contrary to the maxim, cujus est commodum, ejus est onus. On the other hand, the Court have never been inattentive to the circumstance, that in their decisions which have been cited, as well as in the present case, the allowance of a total loss upon a policy, where the subject matter of it has been actually recovered at a comparatively small expense, gives an advantage to the assured, inconsistent with the principle, that contracts of insurance are to be construed and carried into effect as contracts of indemnity.
[ *54] *The decision by Lord Kenyon, in the case of M'Masters vs. Shoolbred, leaves that principle unimpaired, and confines the insured to an indemnity. In that case a vessel, insured for six months, was, after capture, but without any regular condemnation, sold by the captors and purchased by the master for the account of his owners. Lord Kenyon considered the master as the agent of the owners, and the vessel as recovered for their account, and the price paid as a salvage or ransom constituting an average loss.
The principle of this decision has been recognized in the Supieme Court of the state of New-YorJc, in the cases of Saidler &f Craig vs. Church, and of Abbot vs. Broome, and in the Court of Errors of that state in the case of Robinson & Hartshorne vs. The United Insurance Company. In those cases, purchases (or circumstances very similar to what are stated in the case before us) made by a master or general agent of the party insured, for the account of the concerned, were deemed recoveries of the property insured upon the original right of the owner; and when the purchase was accepted and confirmed by him, to be for his account; and to be for the account of thé insurers, when accepted by them after law fui abandonment. It is observable, however, that in the cases men tioned, with the exception of Saidler & Craig vs. Church, which in this respect goes beyond the English precedent in M'Masters vs. Shoolbred, there was no condemnation or compulsory sale of the property, by a regular decree of the Court of Admiralty. In the present case, the sale was not originally decreed, but was procured at the instance of the master acting for the concerned, and becoming afterwards the purchaser. Whether this circumstance makes an essential difference or not, between this case and the decisions of this Court which have been cited, it is unnecessary now to determine. Upon the general principle of not exceeding an indemnity to the assured, and upon the reason, rather than the direct authority of the cases cited, I am better satisfied to be able to form my opinion from what is known of the substantial condition of the property for which an indemnity is claimed, rather than from the formal changes of the title evidenced by writings managed solely by the party claiming a beneficial * interest under them, [ * 55 ] to the loss and injury of the party against whom the claim is made.
And upon the whole, my opinion in the case before us is, that a sale, procured at the instance of the master having charge of a vessel in a foreign port where he becomes a purchaser at a price very inadequate to the value of the vessel, when restored to her formel owners, is made for their account, if they elect to receive the vessel ; and that by receiving it they waive their right of abandonment, and cannot afterwards entitle themselves to recover for a total loss ; because these proceedings, in any question between the owners and their insurers, are to be construed a recovery of the property by the owners in their former right. I am therefore in favor of granting a new trial.
Sedgwick, J.
[After briefly recapitulating the facts in the cause.] The jury were directed that the plaintiffs, upon the foregoing facts, were entitled to recover as for a total loss; and they found a verdict accordingly. If this direction was right, the verdict ought to stand, and judgment to be rendered conformably to it; but if the evidence proves that the plaintiffs are entitled to recover for a partial loss only, then a new trial must of course be granted.
Two reasons are given why there ought to be a new trial.
1. Because from the evidence in the case there is reason to apprehend that the captain practised fraud, in procuring the sale of the ship., by order of the Vice-admiralty Court; although no question relative thereto was made at the trial.
2. Because the Court directed a verdict for the plaintiffs as for a total loss, when, admitting all the evidence to be true, they had sustained a partial loss only.
As to the first question, whether the evidence will warrant a suspicion of fraud, or whether, if it does, as it was all known to the defendants at the trial, and no question on that ground was then raised, it would be proper now to send the case back for a new trial, I give no opinion; because, should a new trial be had for that reason only, and the question of the fraud of the master be negatived, we should then be met with the great question in the [ *56 ] case, and obliged to decide it. * Besides, this course of procedure would, in the mean time, leave a very important principle of the law of insurance unknown and uncertain among those concerned in this branch of commerce, and the effects of that uncertainty could not fail to be embarrassing and mischievous. From this consideration, it has become the duty of the Court, however unpleasant, under the circumstances, the performance of it may be, by a decision to put this question at rest.
The question to be determined is, whether such facts and eircum stances were proved at the trial, as entitled the plaintiffs to recover as for a total loss. By sustaining the motion for a new trial, this question was considered by the Court as not definitively settled by the cases of Welman vs. Gray, and Storer vs. Gray, which have been cited and pressed upon the consideration of the Court; otherwise it is obvious that it would have been absurd to have received the motion and permitted it to have been argued. We have heard it argued repeatedly and ably. We have taken time to deliberate, and have given the subject much consideration, and the result we are now to pronounce.
It was attempted by the counsel for the defendants to distinguish this case from those of Welman vs. Gray, and Storer vs. Gray, as in the former there was a condemnation before the sale, and in thr latter there was a compulsory process to compel the sale; neither of which circumstances attended or preceded the sale in this case. Whether both or either of those cases are thereby distinguishable from this, I give no opinion ; and as they may again be brought before the Court, it would be wrong to do it.
As an insurance is a contract of indemnity, and nothing more ; as this is an attempt to recover more than ten times an actual indemnity ; as the sale was at the instance of the master, who was a part owner; as, by the restoration to the other owners, the plaintiffs, it is evident that the purchase was intended for the joint benefit of all the owners; as, by the plaintiffs' acceptance of the ship, they ratified the captain's act, and by retrospection the purchase must be considered as made jointly by the plaintiffs and the captain ; so that there never was a moment from the time of the con- * 57 ] tract till the * offer of .abandonment, such as it was, was made and refused, that the property in the ship was altered ;—it would, in my opinion, violate the very nature and chief principle of the law of insurance, and subvert the main intention, and destroy the utility of the contract, to authorize a recovery for a total loss, when in fact a very inconsiderable partial loss only has been sustained.
On the part of the plaintiffs it is contended that a sale in pursu anee of a legal order of court, in all cases, operates a change of property; and that it is indifferent whether the purchase be made by the owner, the assured, or by a stranger, that by the capture the plaintiffs had a right to abandon, which right was not affected by the recapture, as by it the recaptors were entitled to one half the value of the ship for salvage, being the amount of salvage to which American recaptors were, by a statute of the United States, at that time entitled; and that, by the purchase, the ownership of the plaintiffs was by a title altogether distinct from, and independent of, that which was insured by the policy.
I cannot but observe that if such a sale as that under consideration is of the nature, and to be followed by the consequences contended for, a door will be opened for the practice" of fraud, in all cases difficult, and in many impossible to be detected. A master in a distant region, by address and fraudulent representations, may obtain, under the most false pretences artfully disguised, an order of a judge to sell his vessel. This may be in a port where there are few or no buyers, and of consequence he may become the purchaser for a mere trifle, come home, and on abandoning the proceeds of the sale, retain the vessel, and receive her full value of the underwriters. This would be a commerce equally profitable and iniquitous, to which the establishment of such a principle would afford motives too strong in all cases to be resisted. To this it may be answered, that if the purchase be made by a stranger, by collusion with the captain, the same mischiefs will take place. It is true; but then it is equally true, that in a strange country it will be difficult to form such a combination, and, if formed, it is more easily detected than the same fraud would be, if practised by the captain alone; *and surely no facility ought to be afforded to [ *58 ] the practice of frauds so injurious to commerce. To support this principle no authority has been shown, and it is presumed none can be, unless the cases before referred to of Storer vs. Gray, and Welman vs. Gray, may be supported to warrant it; and I have already observed that, by permitting this case to be argued the Court has determined that it was not definitely settled by those cases.
In the case of Milles vs. Fletcher , Lord Mansfield said that he took great pains in delivering the opinion of the court in the cases of Goss vs. Withers, and Hamilton vs. Mendes; that he had, upon that occasion, read both those cases; and that he thought that from them the whole law between insurers and insured, as to the consequences of capture and recapture, might be collected.
The cases mentioned by Lord Mansfield were argued by the most able counsel in England, before the most learned court in Europe, at the head of which was the greatest man that probably ever sat in a court of justice. The law of nations, the law of England, and the laws of the other maritime nations of Europe, were all taken into consideration, and principles established which have ever since, I believe, been considered as perfectly sound and well founded. After an interval of twenty years , these principles are revised and reconsidered by the same court, and again receive their unanimous and unqualified approbation. Such principles, so deliberately adopted, and so gravely pronounced, ought not, for slight reasons, to be violated. If they remain unshaken, the present case must, I think, be governed by them.
In the case of Goss vs. Withers , Lord Mansfield says, " The insurer runs the risk of the insured, and undertakes to indemnify; he must therefore bear the loss actually sustained, and can be liable to no more. So that if, after condemnation, the owner recovers the ship, in her complete condition, but has paid salvage, or been at any expense in getting her back, the insurer must bear the [ * 59 ] loss so *" actually sustained." Here the true principle is laid down and illustrated. If the owner recover the ship in her complete condition, the insurer must pay the loss actually sustained, and he is liable to no more. In the case under consideration, the loss actually sustained was less than a thousand dollars; and this, according to the rule established, is all the plaintiffs ought to recover. The demand, instead of one thousand, is ten thousand dollars. A.nd this rule of apportioning the damages to the amount of the Jamnification, is to govern even after condemnation , which is certainly as efficacious, to divest the owner of his property, as a sale, as was the case here, at the instance of one of the owners, and a purchase by him, for, and on account of the joint owners, which was afterwards ratified by them. The owners did, after all the loss had happened, and before the pretended offer to abandon, recover the ship " in her complete condition." And it is afterward, in the same case , observed that " in questions upon policies the nature of the contract, an indemnand nothing else, is always liberally considered." That surely could hardly be considered as a liberal construction of a contract, which is entered into for the purpose of indemnity and nothing else, where he, who has the subject, for which the indemnity is stipulated, restored to him, in its complete condition, refuses to deliver it, and demands ten times the amount of the damnification: it would not be a liberal" construction which should determine that a demand so unreasonable was to be satisfied.
In the case of Hamilton vs. Mendes , Lord Mansfield, in delivering the opinion of the court, says, " The plaintiff's demand is for an indemnity. His action then must be founded upon the nature of his damnification, as it really is at the time the action is brought. It is repugnant, upon a contract of indemnity, to recover for a total loss, when the final event has decided that the damnification in truth is an average, or perhaps no loss at all." No words, which could have been selected, would, with more precision, have decided the question under consideration, against the plaintiffs.
* Lord Mansfield adds that " whatever undoes the [ * 60 ] damnification, in whole or in part, must operate upon the indemnity in the same degree." Now, in this case, the whole damnification to the assured, if the ship had been actually lost, would have been 10,000 dollars ; but the purchase by one of the owners, for the benefit of all, and her restoration to them in her complete condition, for less than 1,000 dollars, so far undid the damnification, and must of course, if the authority of the case of Hamilton vs. Mendes be respected, operate upon the indemnity in the same degree. In other words, the total is thereby reduced to an average loss.
The court, as if anxious to determine that the restoration of a ship, in her complete condition, to the assured, before abandonment, defeated his right to abandon, further say, " The notion of a vested right, in the plaintiff, to sue as for a total loss before the recapture, is fictitious only, and not founded in truth. For the insured is not obliged to abandon in any case. He has an election. No right can vest as for a total loss till he has made that election. He cannot elect before advice is received of the loss; and if that advice shows the peril to be over, and the thing in safety, he cannot elect at all; because he has no right to abandon, when the thing is safe." In this case the plaintiffs did not " elect to abandon" the ship, but refused. When the demand was made as for a total loss, the ship was in safety, and in the possession of the plaintiffs.
it is further added, " Writers upon the maritime law are apt to embarrass general principles with the positive regulations of their own country ; but they seem all to agree that if the thing is recovered before the money paid, the insured can only be entitled according to the final event."
Lord Mansfield, to express as strongly as he could, how altogether without foundation was the contrary doctrine, says , " The present is the first attempt that ever was made to charge the insurer with a total loss, upon an interest policy, after the thing was recovered." And in the same page he adds, " that if the thing in truth [ *61 ] was safe, no artificial reasoning * shall be allowed to set up a total loss." He afterw'ards says that " without dwelling upon principles and authorities, the consequences of the present question are decisive. It is impossible that any man should desire to abandon, in a case circumstanced like the present, but for one of two reasons, viz., either because he has overvalued, 6r that the market has fallen below the original price. The only reasons, which can make it the interest of the party to desire, are conclusively against allowing it." And what, I ask, is the object of the present action ? Certainly to recover more than an actual indemnity, and as that would be a violation of the very essence of the contract it is " conclusive against allowing " the demand, for with precision the true rule is laid down . " The insurer, by the marine law, ought never to pay less, upon a contract of indemnity, than the value of the loss ; and the insured ought never to gain more." According to the dictates of justice and common sense, it is said that " the daily negotiations and property of merchants ought not to depend on subtilties and niceties, but upon rules easily learned, and easily íetained, because they are the dictates of common sense, draws, from ihe ts-uth of the case."
The chief justice concludes one of the most able and enlightened arguments that he ever delivered, in these remarkable words : "To obviate too large an inference being drawn from this determination, I desire that it may be understood that the point here determined is, that the plaintiff, upon a policy, can only recover an indemnity, according to the nature of his case, at the time of the action brought, or (at most) at the time of the offer to abandon." The application of what I have cited from these cases is so obvious, and so exactly - suited to the case under consideration, that any additional, observa ticms would be not only useless, but a misapplication of our time. These opinions have never, hitherto, since they were delivered, been called in question; and, unless they are erroneous, they must be decisive in this case. These cases are cited by both Park and Marshall , who * are among the most [ * 62 j intelligent, able and learned elementary writers, in their treatises on the law of insurance, with approbation.
The case of M'Masters vs. Shoolbred is, in my opinion, in principle, directly in point. It was an action of assumpsit, on a policy of insurance. The insurance was on a ship called The Four Brothers, to commence from the 17th of March, 1793, for six months, from any port. The ship was valued at £1000.
It was proved, that the ship sailed from New Brunswick with a cargo of fish for Barbadoes, and was captured by the Ambuscade, a French frigate, and carried into Charleston, in the United States, where she remained upwards of a month, and was then sold by the authority of the French consul there, as a prize, by public vendue, and purchased by the captain (who had been exchanged) for £380, on account of the owners. In addition to this sum, so paid for the vessel, £230 were paid by the captain, after he had purchased her, for necessary repairs at Charleston, and for fitting her out again for a voyage ; after which she sailed for Jamaica.
Lord Kenyon, before whom the case was tried, said it was impossible to make this more than an average loss. That a policy of insurance was a contract of indemnity, to which, and which only, had the insured a right to look. This was the language of Roccus ; and its principle had been adopted in every decision on the subject. This was not only the decision of an able and learned judge, but it was confirmed, afterwards, by the whole court. For at the next term, when a new trial was moved for on the matter of law, it was considered that the question was so very clear, that a rule to show cause was refused. This case is cited by Marshall as undoubted law ; and the principle decided by it he lays down in these words:— "So, if a ship be sold by the captors, and the captain, acting as agent for the owners, purchase the ship on their account, this shall be considered as recovering the ship for the owners, and the money thus paid as salvage ; and if the voyage be prosecuted, this is only a partial, and not a total loss." It is impossible not to perceive * that the case under consideration is brought [ *63 ] precisely within this rule. This cannot be denied ; but it is said that the case of M'Masters vs. Shoolbred is distinguishable from this, inasmuch as the French consul had no legal authority to exercise judicial powers, in the condemnation, or in directing the sale of captured vessels at Charleston, which was within the limits of a neutral country; whereas the sale, in this case, was in pursuance of a legal order of a court of vice-admiralty. To, this I answer, in the first place, that this is a circumstance not at a3 adverted to either by the counsel or the judge, and does, in fact, make no part of the case, and that, in the next place, I apprehend that, in the reason and nature of the thing, it makes no sort of difference; that purchases and sales by a captain, if authorized by the existing circumstances, and made in the exercise of a sound and reasonable discretion, and for the interest of those concerned, must have the same construction, and be followed by the same consequences, whether made with or without an order of court. And this I think is proved by the case of Milles vs. Fletcher . In that case, in which the sale was the act of the captain without any order of a court, it was determined that a ship and goods, being insured for a voyage, if the ship be taken and recaptured, and on the recapture, the captain acting fairly, and for the benefit of his employers, sells the ship and cargo, and thereby puts an end, to the voyage, the insured shall recover as for a total loss. And surely it cannot be supposed, if the acts of the captain should, in that case, operate against the insurer, that equal justice does not require that in this case, he should not receive the benefit of them. Lord Mansfield, in delivering the opinion of the court, says, " The captain, when he came to New York" (the place of the sale), " had no express orders, but he had an implied authority, from both sides, to do what was right and fit to be done, as none of them had agents in the place; and whatever it was right for him to have done, if it had been his own ship and cargo, the underwriters must answer for the consequences of, because this is within the contract of indemnity."
[ * 64 ] *In the year 1799, the case of Saidler Craig vs. Church, involving the very principle now under consideration, was determined before the Supreme Court of the state of Neiv York—a court very respectable for learning and talents, and much conversant in questions of insurance. The case is not reported, but what the facts and the decisions were, appears in the report of the case of Abbot vs. Broome . The facts are shortly these—The vessel, in the due course of her voyage insured, was captured by a French privateer, and carried into Guadaloupe, and thereby the voyage was totally lost. At Guadaloupe the vessel was duly libelled in the Admiralty Court, and condemned, and after condemnation was purchased by the master, as for the account of the owners, for the sum of 1120 dollars. The master was also a part owner. The owners had since fitted out the vessel, and sent her on another voyage. As soon as the owners knew of the capture, and before they were informed of the condemnation, or of the purchase by the mas ter, they gave the underwriters notice of abandonment . It was determined that the assured had adopted the act of the captain as their own, and had thereby waived the abandonment, and had converted the total into a partial loss. If a restoration of the vessel, under those circumstances, was a waiver of an abandonment previously made, no one will doubt, that if the restoration precede the abandonment, it must destroy the right to abandon. Much information might be drawn from this case of Abbot vs. Broome ; but this opinion is already grown to an unexpected length.
There is one more case, which I will mention, determined in the same court—that of the United Insurance Company of New York vs. Robinson & Al. . In that case it was adjudged that, after an abandonment and payment of loss, a purchase of the property insured, by the agent or correspondent of the owner, though made after condemnation, is for the benefit of the insurer, if he elects; and that, therefore, the proceeds of a purchase so made, and any cargo, in which they may be invested, become, if he pleases, his property, and he * may maintain trover for it [ * 65 ] against the insured. It is most apparent, with what strength the decision last mentioned supports the principle contended for by the defendants, and to what length it carries it. This decision, however, is considered by the Court, and I think justly, as a consequence irresistibly flowing from the judgment in the case of Saidler & Craig vs. Church. The judgment in The United Insurance Company vs. Robinson & Al. has been affirmed in the Court for the Correction of Errors .
I mention these cases determined in a sister state, because it would be with much reluctance that I should feel myself bound to establish a rule, upon a subject so important as that of insurance, in opposition to one I found already established in a contiguous state so commercial as that of New York, and established by judges so respectable as I know them to be.
The case of Story & Al. vs. Strettell , determined in Penn sylvania in 1764, is confirmatory of the same principle.
But it is urged for the plaintiffs that they are entitled to íeeover as for a total loss, because the voyage was lost. This claim is found ed upon the judgment of the Court of King's Bench in the case of Manning vs. Newnham . This case was an insurance on the ship Grace, her cargo and freight, " at and from Tortola to London, warranted to depart on or before the first of August, 1781. The ship valued at £2,470, the cargo at £12,400, and the freight at £2,250, at 25 guineas per cent, to return 10 per cent., if she departed with convoy from the West Indies and arrived; the ship, freight, and goods warranted free of particular average." The ship by sea damage, being a peril insured, was soon obliged to put back into Tortola. The injury to the ship was irreparable, and no other ship could be procured for the cargo: the freight of course was lost: the cargo was sold for a sum within £700 of its value, and two thirds of it pv*-'.based by the owners. The insured claimed a total loss, and recovered. Lord Mansfield, in pronouncing judgment, said [ * 66 ] that the court were of opinion that the voyage * was totally lost; and that that was the ground of their determination. What was said must be taken in relation to the facts in the case. The insurance was on the ship, cargo, and freight. The ship was wholly disabled, the freight lost, and, what was the great object, the transportation of the cargo completely defeated.
It is impossible not to perceive the difference between that case and the one under consideration. In this last, the ship, on which alone was the insurance made, is in perfect safety, restored in her complete condition to the owners, and by them refused to be abandoned to the underwriters.
But the general position in this case, and which is laid down by elementary writers on the subject of insurance, that the assured are entitled to recover as for a total loss because the voyage is lost, has relation to a class of cases, as I apprehend, totally distinct from the one under consideration. In the case of M'Masters vs. Shoolbred, which has been already mentioned, the original voyage, which was intended to carry a cargo of fish to Barbadoes, was completely defeated, and the ship was fitted out for a new voyage to Jamaica. Yet it was determined that it was impossible to make the loss more than an average loss.
Suppose that the owner of a ship and cargo should insure by distinct policies on the ship and cargo, on a voyage from London to the United States ; that the ship should be captured on her voyage, the cargo condemned, and she restored and arrive in safety, and in good condition, and so come into the possession of the owners, no abandonment having been made ; and that the loss upon the cargo should be paid. It would, I believe, be against the very nature of the contract of insurance, to authorize the assured to abandon the ship, and to recover as for a total loss of her ; and yet the supposed case is in nothing different in principle, that I can perceive, from that under consideration.
It is very true, that in case of an embargo, or a capture, while they continue, and also during any obstruction of a voyage, from a cause within the contract of insurance, if the continuance be unknown, and not within the control of the assured, fie may, where the insurance is on the ship, abandon her: but if such causes of detention cease, and the ship be * restored to [ * 67 ] the use of the assured, and is received by him, or his agent, in good condition, the right to abandon ceases also.
And the case of Pole vs. Fitzgerald is directly in point to prove that this insurance must be considered as an insurance on the ship, and not an insurance on the voyage. That was an insurance on the body, tackle, &c., of the Goodfellow privateer, lost or not lost, from Jamaica to any ports or places, during four calendar months, beginning the adventure on the ship, from the 14th of June then last, and to continue until the ship, with her tackle, &c., should arrive at any ports or places where or whatsoever, or cruising from port to port or place to place, during the term, without further account, and free from average. The ship valued at £1000. The insurance was against the usual perils. The ship sailed on the voy age and cruise insured, and after taking a prize, within the term insured, the crew mutinied against their commander and officers, and by force, against their will, carried her back towards Jamaica, and before her arrival in port there seized the boat, fire-arms, &c., carried them off, and deserted the ship, by which the cruise was totally lost for the remainder of the term insured. The action was brought for a total loss. In the King's Bench the plaintiff recovered ; but upon a writ of error being brought in the exchequer chamber, the judgment, by the unanimous opinion of the eight judges, was reversed, and their judgment was afterwards affirmed in the house of lords. The decision is, therefore, of the highest possible authority. The question was, whether it was an insurance of the ship and voyage, or an insurance of the ship only; and the decision of the court was, that the insurance was on the ship only ; and that she being in safety, the plaintiff could not recover.
The chief justice, in delivering the opinion of the Court, undertook to prove that the notion, that the voyage was insured by an insurance of the ship, was absurd ; and among other consequences which he points out, he says, " In the first place it would be a double insurance —both on the ship, and on the voyage; for if the ship were [ * 68 ] lost before *the end of four months, the term insured, to be sure the voyage is lost; and if the voyage be lost, according to the plaintiff's construction, though the ship"- (as in the present case) "be in good safety at the end of the four months, yet the insurance must be forfeited " . And so very unreasonable did the claim of the plaintiff appear to the chief justice, that lie said, " If it were necessary to give my opinion of them," (policies on a voyage) " I should think (according to my present sentiments) that if a policy were so drawn, as that a voyage were insured by express words, such a policy would be void, both as illegal and unreasonable."
Upon the most mature consideration I am of opinion that the evidence in the case did not warrant a verdict for a total loss, and that therefore there must be a new trial.
Sedgwick, J.,
then observed that this opinion, as delivered by him had been submitted to his brethren, Thatcher and Parker, justices and that they fully concurred in it, and in the reasons adduced by him in support of it.
The chief justice, having been of counsel in the cause, gave no opinion .
New trial granted.
Ante, vol. 2. 232.
Marshal, 439, 441, 488, 505.
6 Term R. 425.
2 Burr, 683.
Willes's Rep. 641.—5 Brown's Parl. Cases, 131.—Park, 170.—Marshal, 504.
Doug. 220.
Goss vs. Withers was determined in 1758; Hamilton vs. Mendes, in 1761, and Milles vs. Fletcher, in 1779.
2 Burr. 694.
Park, 159.
Ibid '97.
2 Burr. 210
2 Burr 1212.
age 1213.
Page 1214
Pages 148,157.
Pages 486, 491.
1 Esp. Rep. 237
Page 501.
Doug. 219.
1 N. Y. Term R. 292
Page 297, in the note.
2 N. Y. Term R. 230.
1 Johnson's Rep. 592.
1 Dallas's Rep 10
Parl, 169.—Marshall, 505. S. C
Willes's Rep. 641.
3) Page 647.
[Hughes, 225, 226, 408.—Smith, Merc. Law, 215.—McIver vs. Hendreson, 4 M & S. 576.—Cologan vs. L.A. Co. 5 M. & S. 447.—Patterson vs. Ritchie, 4 M. & S 393 Queen vs. Union Ins. Co. Condy Marsh, 582. n.—Ed.]