Case Name: Edward St. Loe Livermore, Assignee of Edmund Bartlet, Jun., a Bankrupt, versus The Newburyport Marine Insurance Company
Court: Massachusetts Supreme Judicial Court
Jurisdiction: Massachusetts
Decision Date: 1806-11
Citations: 1 Tyng 232
Docket Number: 
Parties: Edward St. Loe Livermore, Assignee of Edmund Bartlet, Jun., a Bankrupt, versus The Newburyport Marine Insurance Company.
Judges: 
Reporter: Massachusetts Reports
Volume: 2
Pages: 218–220

Head Matter:
Edward St. Loe Livermore, Assignee of Edmund Bartlet, Jun., a Bankrupt, versus The Newburyport Marine Insurance Company.
After a default in an action upon a policy of insurance, in which it was agreed that the premium due shall be deducted out of any loss claimed, the Court will set off the premium due against the amount of a partial loss ascertained by assessors.
The Court having determined that the defendants were answerable only for a partial loss, and they having been defaulted according to the agreement of the parties, assessors were appointed by the Court to ascertain the plaintiff’s damages, who reported, as follows: —
“ We, the subscribers, assessors, &c., have met, and fully heard the parties on the matters referred to us, and we find [ * 233 ] * that the whole loss on the vessel and cargo, insured by the policy in the case, amounts to 792 dollars, together with the further sum of 177 dollars 21 cents for interest, from the 1st day of August, A. D. 1802, to the 22d day of April, A. D. 1806. We also find that the note given for the premium on said policy is not wholly paid, but there remains due, on the said note to the defendants, over and above the eight per cent, warranted in the policy; the sum of 820 dollars for the premium earned, and the further sum of 183-^q dollars for interest on the samé. And if the said premium ought by law to be first deducted from the loss according to the terms of the policy, then we assess the damáges for said partial loss at nothing, it being overbalanced by the premium. And if the said premium is not to be first deducted out of said loss, then we assess the damages at the first-mentioned sum of 792 dollars, with the further sum of 177-j^ dollars for interest.”
Livermore objected to the acceptance of that part of the report which relates to the premium due, on the ground that no demands which the defendants might have pleaded as a set-off were within the submission.
Jaclcson, for the defendants.
There is not a set-off, but a sum originally.agreed by the parties to be deducted out of any eventual loss under the policy. By the terms of the agreement in this case, if the Court had determined that the plaintiff was entitled to recover as for a total loss, yet assessors were to be appointed. But the only question that could have come before assessors, in case of a total loss, would have been the amount of premium due and to be deducted from the loss, the amount of which last was previously ascertained by the policy itself.
The duty of the assessors in this case was precisely similar to that of a jury, who should be directed by the Court that, upon the facts, the plaintiff was entitled to recover for a partial loss only ; viz. to ascertain the amount of such loss, and deduct the amount of the premium, according to the terms of the policy under which the plaintiff claims his loss.
* On the distinction between a cross-demand and a [ * 234 J charge on the money to be recovered by the plaintiff, Jackson cited the case of Dale vs. Sollet. He also referred to the 42d section of the U. S. bankrupt law, and observed that, if the defendants were held to pay this loss, they would be without any remedy for the premium due them.
Livermore contended that this demand for premium is no part of the action, and does not arise out of it; that the assessors, in reporting upon it, had gone out of their commission, and he insisted that, if it had been referred to a jury to assess the damages in this case, they would not have taken this cross-demand (as he held it to be) into consideration. It was a claim of the defendants upon the plaintiff wholly independent of the plaintiff’s demand in the action If a defendant in an action for an assault and battery is defaulted, the court or jury, in assessing the damages, cannot receive any evidence in mitigation of damages.
Jackson, in reply, was stopped by the Court.
Vide 1 Mass. T. R. 269.
4 Burr. 2133

Opinion:
Parker, J.
I really perceive no question in this case. It was the express agreement of the parties in the policy that this premium should be deducted out of any loss that might be claimed. There was then no need of filing it, or pleading it by way of set-off, as is necessary in case of independent demands. This demand is connected with that of the plaintiff, and the court or jury would receive evidence of it in inquiring of the damages after a default. There is no suggestion that this premium has been paid. I am therefore for allowing it to be deducted from the amount of the loss.
Sewall, J.
It appears to me that the contract of the parties ought to govern in this case; and it is beyond question that their intention was a mutual allowance of loss and premium; that the sum to be eventually recovered upon the policy in any case of loss should be subject to a deduction of the premium, which should be due at the same time. The assessors have reported both sides of the case, the mutual demands of the parties * to [ * 235 1 this policy, viz., the amount of the partial loss, and of the premi urn due against the same policy.
The only objection argued against this report is, that the assessors have exceeded their authority. But I think they had the power to consider and report upon both these points, as they both grew out of the contract referred to them, and upon which they were to assess the plaintiff's damages, in consequence of the defendant's being defaulted.
But this is not important to decide; for, it their authority had been more limited, and strictly confined to the estimation of the partial loss, — and the question before the Court was, for what sum judgment should be entered upon a report thus limited, —a suggestion of this contract would effectually introduce the premium due, which the Court would then set off and allow, in furtherance of the original contract between the parties, against the amount of the loss so stated by the report.
Sedgwick, J.
The only question is, Can the intentions of the parties in their original contract be carried into effect? Here was an agreement to set off premium against loss. The assessors were to determine the amount of the partial loss. This they have done, and have found a sum of money due to the defendants, by the very agreement itself, greater than the amount of such loss. I confess I see no valid or sound objection to the setting off one of these against the other.
Judgment was entered as follows: —" All which being seen and understood by the Court, and mature deliberation thereof had, — because it appears to the Court that the said premium mentioned in the said report ought by law to be first deducted from the loss, according to the terms of the policy, and _ because it appears that the same exceeds the said loss as aforesaid, — It is therefore considered that the said Livermore take nothing by his writ aforesaid, and that the said Newburyport Marine Insurance Company go thereof without day."
Dodge vs. The Union M. I. Co. 17 Mass. Rep. 471. — Cleveland vs. Clapp & Al. 5 Mass. Rep. 201.