Court Opinion

ID: 6414332
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:55:01.466129+00
Date Added: 2024-06-11T15:51:29.141969
License: Public Domain

Hoar, J.
The court are of opinion that only the mast and boom, stored for sale, and the small railroad car, of the articles named in the statement of Bishop, can be considered as merchandise, within the meaning of the policy of the Alliance Insurance Company, and that they are to be so regarded. The word “ property ” has a much more extended meaning, and that being the word used in the policy of the New England Mutual Marine Insurance Company, we have no doubt that it includes all the articles enumerated in the statement.
The principal question is common to both cases, and it is this: whether, in case of a partial loss of property situated in another country, and insured here, in computing the sum to be recovered, anything is to be allowed for the expense of transmitting to that country the sum of money, which, paid there, would furnish an equivalent for the value of the property destroyed by fire ? And we are of opinion that no such allowance can legally be made. In other words, nothing can be added for the cost of exchange in transmitting the funds which are of intrinsically equal value in this country with those which represent the pecuniary measure of the loss in the country where it occurred.
The cases of Adams v. Cordis, 8 Pick. 260; Alcock v. Hopkins, 6 Cush. 484; Lodge v. Spooner, 8 Gray, 166; and the recent case of Hussey v. Farlow, 9 Allen, 263, are decisive as authorities upon the point in this commonwealth, and we are satisfied with the correctness of the principle in its application to the cases now before us.
The argument for the plaintiffs is, that the contract of insurance is a contract of indemnity; and that an indemnity for the loss recovered here is such a sum of money as would purchase a remittance, which, when collected at the place where the loss occurred, would be a a exact equivalent there to the value of the nroperty destroyed. And it is urged that this view is sustained *227by the clause in the policy which gives the insurer the right to replace the property destroyed by other property of like kind and equal value.
The latter provision is made for the benefit of the insurer, and serves to protect him from an over valuation. If he elects to avail himself of it, he must of course replace the property at the place of the loss. But in that case he may avail himself of means which he may have there, or which he may procure from any other quarter. The expense he incurs has no necessary relation to the rate of exchange between the country of the loss and any other country in particular. On the other hand, if he does not elect to repair the loss, the obligation to pay the value of the property in money is not confined in its operation to any country. It may be enforced in any country in which the debtor may be found, or wherever jurisdiction can be obtained of the cause or the parties. There is nothing local about it. The debtor must pay where he is found or can be sued, and the creditor may not wish to transfer the money to the place where the cause of action accrued; certainly he is under no obligation to do so.
In the same country, the matter is very plain. If a man loses by fire property in New Orleans valued there at $1000, would it be contended that he would recover a different sum if he sued his insurer in New Orleans, or in Mobile, or St. Louis, or Boston ? The only difference in principle between such an example and a loss in a foreign country would seem to be, that the loss is estimated in a different currency from that in which judgment is recovered in the latter case, and in the same currency in the former. Suppose the insurance companies, immediately after the loss occurred in Cuba, had ascertained its amount in Spanish dollars, and had given a promissory note for that number of dollars, without specifying the place of payment, would there be any allowance made for exchange if the note were afterward sued in another country 1
It is true that the object of a policy of insurance is indemnity to the insured; but the standard df value used in estimating the amount of the loss may not under all circumstances produce the *228result of giving an exact indemnity at the place where a judgment is recovered upon the policy. The best practical rule for indemnity seems to us to be, to estimate the loss at the place where it occurred in the currency of that country, and then to find the equivalent in the country where suit is brought by determining the actual intrinsic value of the currency of that country as compared with that of the other, thus computing the value according to the real par of exchange. If the market value of exchange be regarded, the amount to be paid to constitute an indemnity would depend on the rate of exchange when the debt should finally be collected on the execution. .
We are aware that the doctrines of this court on this subject are not uniformly approved by text writers,- or by other courts, and that a considerable diversity of opinion has prevailed upon it. But it has been sanctioned by those whose opinion is entitled to respect, and best accords with our own judgment of the law. 1 Arnould on Ins. 330. Marsh. Ins. (4th ed.) 502-3, note k. The cases will therefore be sent to an assessor, according to the agreement of the parties, to fix the sums which the plaintiffs shall recover in pursuance of the views of the court above expressed.