Case Name: Elizabeth Dodge, Executrix, versus The Union Marine Insurance Company
Court: Massachusetts Supreme Judicial Court
Jurisdiction: Massachusetts
Decision Date: 1821-10
Citations: 16 Tyng 470
Docket Number: 
Parties: * Elizabeth Dodge, Executrix, versus The Union Marine Insurance Company.
Judges: 
Reporter: Massachusetts Reports
Volume: 17
Pages: 382–388

Head Matter:
* Elizabeth Dodge, Executrix, versus The Union Marine Insurance Company.
The underwriters on a cargo are liable, whenever the assured is compelled to pay an increased freight, as an unavoidable consequence of the perils inn'"-nd against.
Of the subjects of general average and partial loss.
This was assumpsit on a policy of insurance, dated the 13th of October, 1817, for 1500 dollars, upon the brig Jason and appurtenances, and 5000 dollars upon effects on board her, at and from Hamburg, to one or more ports, one or more times, on the globe, and until her arrival at her port of discharge in Europe or America, the risk to commence from the time of her clearance, and to continue eighteen months ; premium five eighths of one per cent., warranting five per cent, premium.
The plaintiff declared for a total loss by the dangers of the seas, on the 25th of January, 1819; and there were the usual money counts in the declaration. The trial was had upon the general issue, before Putnam, J., at the last April term, at Ipswich.
The Jason sailed from Hamburg on the 17th of September, 1817, for Bourbon, from thence to Siam, where she arrived on the 22d of July, 1818. At this latter place she grounded on the bar, and wet some of her cargo of sugars, and sailed from thence to Malacca on the 18th of October, 1818, and from this last place for Europe, on the 22d of November following. On this passage she sprung a-leak, and put into the Isle of France in distress on the 2d of January, 1819, and was totally lost at that place in a hurricane, on the 25th of the same month. Before she was wrecked, the cargo had been discharged.
There was no dispute between the parties as to the loss upon the vessel; nor on the note given for the premium, which was tó be adjusted out of Court.
The plaintiff proved that her testator was owner of one fifth of the vessel and cargo; and she claimed a partial loss, arising from the extraordinary expenses incurred in the hire of a Dutch ship, at the Isle of France, to carry the cargo to Amsteraam, which was the port of destination, * giving credit to the [ * 472 ] defendants for what it would have cost to carry the same in the Jason, if she had not been lost.
The plaintiff claimed also, among other articles, as general average, 354 dollars for three months’ extra wages to a part of the crew, which had been paid, by direction of the United States’ consul at the Isle of France, to those of the seamen who were discharged at that place; 201 dollars for the board of the master, while on shore there; 234 dollars, 75 cents, for the master’s commissions on the disbursements at the same place; 375 dollars charged as agio or premium of exchange on the amount expended there; and 165 dollars, 32 cents, loss on ten bales of cotton sold at the Isle of France, because the vessel hired to carry the cargo to Amsterdam was not large enough to receive them. These items were all proved; but whether they constituted proper subjects of charge against the defendants for a general average loss, was reserved for the consideration of the Court.
It was proved that a vessel bound from Siam to Amsterdam, would earn half her freight on arriving at the Isle of France; and that the master of the Jason made as good a bargain as he could, for the hire of the Dutch ship. It was also in evidence, that masters are not in the habit of charging commissions on disbursements upon vessels; and in regard to the agio or premium of 15 per cent, on the moneys paid and advanced by the master of the Jason at the Isle of France, that the payment was made in currency, which was bank paper, and which is below specie currency; that at the time of the transaction in question, it was 22 per cent, below, and that bills were drawn at the Isle of France upon the United States, for money paid at the former place in bank currency, dollar for dollar payable in the United States; and that the master of the Jason had not received, and would not receive the charge of commissions on disbursements.
A verdict was taken for the plaintiff, subject to be increased ot
diminished in its amount, or to be set aside, as to the whole Court should seem proper. [ * 473 ] * Prescott and Oliver, for the defendants. The charge for wages paid the seamen is wholly untenable. The consul entirely misconceived his duty in requiring this of the master, who ought to have known what the law required of him in the case, and to have resisted this illegal demand. The statute of the United States authorizes consuls, &c., to demand three months’ wages of seamen, only when the vessel is sold in the foreign port, and the seamen discharged . But if this sum is recoverable at all, it is not of the defendants; but of the insurers of the freight.
If the board of the master, the payment for which the plaintiff demands, was before the loss of the ship, it is not shown to have been necessarily incurred; if after that event, it is not shown to have been for the benefit of the concerned. As to the charge of the agio, there is no ground for it; the exchange with the United States was then at par. There is no pretence for charging the loss on the ten bales of cotton to the underwriters. The master had no authority for selling it. It was his duty to bring it to Europe; and if the ship he hired was not sufficient, he should have shipped it on another. The sale was tortious, as in the case of Hunter vs. Prinsep Of Al. . A.s to the commissions of the master, nothing need be said in this case, since he has not received them, and wholly disclaims them. There was in truth no loss of the cargo. The plaintiff’s claim for any extra expense in transporting it, is a claim on the insurers upon the freight. The owner of goods on freight cannot be liable for more than the stipulated price, unless the accident to the ship occurs at so early a period of the voyage, that the master gives up the freight earned .
Saltonstall and Cummings, for the plaintiffs.
We admit that one who has insured a cargo of goods, cannot recover under such a policy the freight, which he has paid for the carriage of that cargo. But we contend that, where a disaster happens, as in the present case, by one or more of the perils insured against, the [ * 474 ] underwriter is obliged to * indemnify the assured, for all the losses and expenses which may be sustained in consequence of such disaster. After the loss of the Jason, the master, as was his duty, hired another vessel to transport the goods to Amsterdam; and the plaintiff now claims of the defendants, who insured those goods, the extraordinary expenses incurred in consequence of this necessary change of the ship.
These extraordinary expenses constitute no part of the ordinary freight. As between the owners of the goods and the underwriters upon the cargo, the latter have nothing to do with freight; but, according to all the authorities, they have something to do with a special damage charged upon the owner, by reason of a peril within the policy . Underwriters upon goods, as the law is understood in France, shall pay all the average losses on the goods, including warehousing and reloading, together with all duties that may have been paid, and the increase of freight, if any; in short, they must bear every expense, which is the necessary consequence of changing the ship .
The same principle is recognized in the case of Mumford vs. The Commercial Insurance Company. In that case, as in the case at bar, a change of the ship was rendered necessary, and an increased freight incurred in consequence of one of the perils insured against; and Kent, C. J., in delivering the opinion of the court, says, “ It is not a point any where adjudged in the English books, who shall bear the charge of the increased freight in a case like the present, where the ship becomes changed by necessity, during the course of the voyage. The increased freight certainly arose, as a direct consequence of the capture and detention of the goods; and the underwriter engages to indemnify the assured from all losses and damage, which may arise from capture and detention ” . In the case at bar, too, the increased freight arose in consequence of a loss by the perils of the sea, against which we were to be indemnified by the defendants.
* The board of the master was necessary to his con- [ * 475 ] tinuance at the place, and his continuance was essential to the preservation of the goods. If the loss on the cotton sold is not a proper subject of general average, it was a partial loss on the property insured, and the defendants must indemnify the assured for it. The three months’ wages were paid the seamen by order of the consul, and the hired vessel could not have obtained her clearance without complying with the order. It was therefore for the benefit of all concerned, that those extra wages were paid.
U. S. Laws, 7 Cong. 2 Sess. c. 62, § 3.
10 East 378
5 Mass. Rep. 522.—9 Johns. 19
Marsh. 728.—Park, 52.
Marsh. 172, cites Emerig. tom. 1. 432,576.
5 Johns. 262.

Opinion:
The opinion of the Court was delivered April term, 1822, at Ipswich, by
Wilde, J.
No question has been made as to the loss on the vessel in this case ; but the defendants resist the claim for a partial loss, and object also to some of the charges of general average. The Jason, it appears, having put into the Isle of France in distress, was there totally lost in a hurricane. The cargo, which had been discharged before the ship was wrecked, was transported to Amsterdam, the port of destination, in a Dutch ship hired for that purpose at the Isle of France by the master. The extraordinary expenses thus incurred, deducting therefrom the estimated cost of transportation by the Jason, if she had not been lost, constitute the plaintiff's claim for a partial loss.
It is generally true, that the underwriters on the cargo have nothing to do with the freight. They only guaranty the safe arrival of the goods, and have no concern with the expense of transportation . But Marshall observes that, " if, in the course of the voyage, the ship be disabled, by stress of weather, or any other peril of the sea, and a new vessel is hired for the transport of the goods ; in such case the insurers shall pay all average losses on the goods, the expense of salvage, unloading, warehousing, and reloading, together with all duties that may have been [ * 476 ] paid, and the increase of freight, if any . No * English case or authority is cited by Marshall, in support of this observation ; but he refers to Fmerigon, whose opinion is certainly of high authority. It is, however, opposed by Valin, who thinks that the additional expense of transportation ought to fall on the owner of the vessel; and Chirac considers it as general average.
But the observation of Marshall, if rightly understood, and with the limitations which fairly belong to it, is not inconsistent with the principles of the law of insurance. As I understand his remark respecting increased freight, it is no more than this; that the underwriter on goods is liable, whenever the freighter is compelled to pay such increased freight, by the unavoidable consequence of any of the perils insured against. And in this sense it agrees with the opinion of the Court in the case of Mumford vs. The Commercial Insurance Company, cited in the argument, which no one, I think, can doubt was rightly decided. That was a case of insurance on goods from Amsterdam to New Yorlc. The ship, during her voyage, was captured by a British ship, and sent to Halifax. The ship and cargo were libelled in the Vice-admiralty Court there. The ship being acquitted, and the cargo detained for further proof, the master made a tender of the ship to bring on the goods, whereby the ship-owner became entitled to full freight. The goods were afterwards released, and the underwriters were held liable for the expense of their transport to New Yorlc. If the underwriters were not liable in such a case, the loss must fall on the owner of the goods; and the contract of insurance could no longer be called a contract of indemnity.
But the case alluded to does not apply to the one under consideration, for two reasons. The one is, that in this case there has been no increase of freight in consequence of the loss of the Jason. If she had completed her voyage, her freight would have amounted to 9000 dollars; and it was proved, at the trial, that half the freight was earned on her arrival at the Isle of France; so that the * freight she would have earned on her passage from [ * 477 ] thence to Amsterdam, if she had met with no disaster, would have been 4500 dollars, and the Dutch ship was hired for a less sum.
If, however, the Dutch ship had cost more, the underwriters would not have been liable; because the extra expense would have fallen upon the ship-owner, and not on the owner of the goods. The ship-owner was bound to provide a new ship, after the loss of the Jason; and if he had refused so to do, he could have claimed no freight for the transportation of the goods to the Isle of France. We must therefore consider the master as acting for the ship-owner in hiring the Dutch ship; and that the owner of the goods was bound to pay only the stipulated or customary freight from Siam to Amsterdam. But if we were to consider the master as the agent of the owner of the goods, and as refusing to act for the ship-owner, then, the freight previously earned being forfeited, the freighter would only be bound to pay for the hire of the Dutch ship, which was less than half of the customary freight from Siam to Amsterdam.
It can make no difference to the underwriters, that the plaintiff's testator was owner both of vessel and cargo. He might have insured the freight; but surely his having neglected so to do, will not enlarge the responsibility of the underwriters on the cargo. The only loss the plaintiff has sustained is the loss of the vessel and part of the freight; and this certainly can, by no principle, be thrown upon the insurers of the goods.
We are next to consider the questions as to general average. The first charge objected to is, for three months' extra pay to part of the crew at the Isle of France. This was demanded by the American consul, who seems to have misconstrued the law relating to the discharge of seamen in foreign ports. This loss, therefore, arose, partly from the mistake of the consul, and partly from a casualty, viz., the loss of the vessel. It was not the necessary consequence * of putting into the Isle of France; [ * 478 ] it is not, therefore, a charge of general average. If chargeable at all, it must be charged to freight.
The board of the master, while on shore, ought to be allowed; but not his commissions on disbursements. Nor can there be any allowance for the agio, or premium of exchange, on the amount paid and advanced in the Isle of France; as it appears that payment was made in currency or bank paper, which, about the time of payment, was paid at par for bills drawn payable in the United States.
As to the loss sustained by the sale of the ten bales of cotton, this would have been a partial loss, if it had appeared that such sale was necessary. Unless such necessity appears, the master has no authority to sell the cargo, or any part of it, at an intermediate port . It was in evidence at the trial, that these bales of cotton could not be put on board the Dutch ship; but it does not appear that they could not have been sent by some other vessel; and it belongs to the plaintiff to show this, in order to justify the sale .
The property to contribute will be, the net sales of the cargo, deducting the customary freight from Siam to Amsterdam; the net salvage of the vessel, and freight from Siam to Amsterdam, deducting what was paid to the Dutch ship.
Whatever the plaintiff may be entitled to recover upon these principles, the defendants claim to deduct therefrom the amount of the premium note, agreeably to a stipulation in the policy. The plaintiff's counsel consider this stipulation as applicable only to cases of voluntary adjustment made by the parties. But it has been other wise decided in the case of Livermore vs. The Newburyport Marine Insurance Company ; and we can see no sufficient reason for overruling that decision.
Marsh. 628, Bailie vs. Modigliani.—3 Caines, 155.
Marsh. 379
10 East, 143, 378.
9 Johns. 28.
2 Mass. Rep. 232.