Smith v. Universal Insurance Company
19 U.S. 176

Annotate this Case

U.S. Supreme Court

Smith v. Universal Insurance Company, 19 U.S. 6 Wheat. 176 176 (1821)

Smith v. Universal Insurance Company

19 U.S. (6 Wheat.) 176

Syllabus

Where, in a policy of insurance, a technical total loss is asserted as the ground of recovery, the loss must be occasioned by the immediate operation of some of the perils insured against, and it is not sufficient that the voyage be abandoned for fear of the operation of the peril.

The insurers do not undertake that the voyage shall be performed without delay or that the perils insured against shall not occur; they undertake only for losses sustained by those perils, and if any peril does begin to act upon the subject, yet if it be removed before any loss takes place and the voyage is not thereby broken up, but is or may be resumed, the insured cannot abandon for a total loss.

Insurance on munitions of war laden on board a neutral vessel on a voyage from New York to and at a port or ports, place or place in the Gulf of Mexico from the Balize to Campeachy, both inclusive, and from either back to New York, &c., with a memorandum that the insurers should be free from any loss arising from illicit or prohibited trade. The goods insured were prohibited from being imported into the ports of New Spain, in possession of the royalists, by the laws of old Spain, but were permitted to be introduced into such ports as were in possession of the insurgents. The vessel and cargo arrived off a place in possession of the patriot General Mina, and the master made an agreement to sell the cargo to him, deliverable from time to time, as he should want it, at St. Ander.

But before the cargo could be delivered, the vessel was chased off by Spanish armed ships, and after making several attempts to return was compelled to proceed to the Balize for repairs, after which she again approached the coast, but found it still in possession of the royalists, General Mina having retired into the interior. The objects of the voyage being thus defeated, the vessel returned to New York with the original cargo on board, and the insured then abandoned to the underwriters, not having before had information of the breaking up of the voyage. Held that the insured were not entitled to recover as for a total loss of the voyage.

Page 19 U. S. 177

This was an action of covenant on a policy of insurance underwritten by the defendants for the plaintiffs on 4 February, 1817, on a voyage at and from New York to and at a port or ports, place or places, in the Gulf of Mexico from the Balize to Campeachy, both inclusive, and from either back to New York, or a port of discharge in the United States, upon all kinds of lawful goods and merchandises laden or to be laden on board the schooner Ellen Tooker. In another part of the policy it is stated to be "on cargo, consisting chiefly of munitions

Page 19 U. S. 178

of war." There is a memorandum also in the policy whereby the underwriters are warranted by the assured free from any charge, damage, or loss which may arise in consequence of a seizure or detention of the property for or on account of any illicit or prohibited trade. The declaration alleges that the vessel, with the cargo, proceeded on the voyage, and asserts as a loss within the contract that while on the voyage, the schooner, with her cargo, was restrained and detained by certain persons acting under the authority of the King of Spain, whereby the goods and merchandises became wholly lost.

The material facts, as they appeared on the trial, are these -- The Ellen Tooker, having on board property of the plaintiff of a greater value than the sum insured, sailed from New York on the voyage insured on 31 January, 1817. On 25 February, she arrived at the Balize, where the master left the vessel and went to New Orleans, and having obtained information that Nantla and Talacuta were in possession of the Independents, to which places American vessels might proceed, on his return to the Balize, the schooner proceeded for Nantla, and arrived off that place on 23 March, and found it in possession of the Royalists. The schooner then proceeded to Talacuta, and having arrived off that place, a boat was sent ashore for information, the crew of which were made prisoners. Concluding from this occurrence that the place was in possession of the Royalists, the schooner put to sea, and on 5 April fell in with a fleet

Page 19 U. S. 179

of six sail under the command of General Mina, with troops on board, bound for the bar of St. Ander. The master having had communication with General Mina and received encouragement from him that he would purchase the cargo, the schooner kept company with the fleet and arrived off the bar of St. Ander on 28 April, where the schooner came to anchor in the open sea, the entrance being too shoal to permit her to cross the bar.

On 11 May, the master left the schooner and went up the river to Porto La Marina (where General Mina had his headquarters) for the purpose of selling the cargo, which he accordingly did, deliverable to General Mina as he should want it from time to time at St. Ander, the whole delivery to be completed by the first of July. On 18 May, while the master was on shore, a Spanish frigate and two armed schooners of the Royalists hove in sight and the schooner was immediately gotten under way for the purpose of escaping them, and after four hours' chase effected her escape. The schooner made several attempts to return, but was prevented by Spanish ships hovering about the place; on 26 May, finding the coast clear, she returned to St. Ander, which was still in possession of the Independents, and the master was taken on board. The foremast of the schooner, being found to be loose in the step and injured, and the crew being short of water, the schooner proceeded to the mouth of the Rio Grande for water and to examine the foremast, and there, the heel of the foremost being found to be good, the schooner proceeded to the Balize for repairs and arrived there on 6 June. The foremast was there repaired and the schooner sailed again for St. Ander for the purpose of delivering the cargo to General Mina according to contract, and on her arrival on 22 June, the place was found to be in possession of the royalists, who occupied it with a military force. In consequence of this, the schooner did not approach the shore, but proceeded along the coast northward to a place called Pass Cavallos, about 270 miles from St. Ander, where information was received that St. Ander and the coast were completely in possession of the royalists.

The objects of the voyage being in this manner defeated, the schooner returned to New York with her original cargo on board, and arrived there on 22 July, 1817. The plaintiffs had no intelligence of the breaking up of the voyage until the return of schooner to New York and then abandoned to the underwriters in due time, assigning as a cause that the Ellen Tooker was "compelled by an armed force to leave St. Ander in the Gulf of Mexico," where she had arrived and was about to deliver her cargo, and was prevented thereafter by a like force from reentering that place.

Where, in a policy of insurance, a technical total loss is asserted as the ground of recovery, the loss must be occasioned by the immediate operation of some of the perils insured against, and it is not sufficient that the voyage be abandoned for fear of the operation of the peril.

The insurers do not undertake that the voyage shall be performed without delay or that the perils insured against shall not occur; they undertake only for losses sustained by those perils, and if any peril does begin to act upon the subject, yet if it be removed before any loss takes place and the voyage is not thereby broken up, but is or may be resumed, the insured cannot abandon for a total loss.

Insurance on munitions of war laden onboard a neutral vessel on a voyage from New York to and at a port or ports, place or places in the Gulf of Mexico, from the Balize to Campeachy, both inclusive, and from either back to New York, &c., with a memorandum that the insurers should be free from any loss arising from illicit or prohibited trade The goods insured were prohibited from being imported into the ports of New Spain in possession of the royalists by the laws of old Spain, but were permitted to be introduced into such ports as were in possession of the insurgents.

The vessel and cargo arrived off a place in possession of the patriot General Mina, and the master made an agreement to sell the cargo to him, deliverable from time to time, as he should want it, at St. Ander. But before the cargo could be delivered, the vessel was chased off by Spanish armed ships, and after making several attempts to return, was compelled to proceed to the Balize for repairs, after which she again approached the coast, but found it still in possession of the royalists, General Mina having retired into the interior. The objects of the voyage being thus defeated, the vessel returned to New York with the original cargo on board, and the insured then abandoned to the underwriters, not having before had information of the breaking up of the voyage.

Held that the insured were not entitled to recover as for a total loss of the voyage being found to be loose in the step and injured, and the crew being short of water, the schooner proceeded to the mouth of the Rio Grande for water and to examine the foremast, and there the heel of the foremast being found to be gone, the schooner proceeded to the

Page 19 U. S. 180

Balize for repairs, and arrived there on the sixth of June. The foremast was there repaired, and the schooner sailed again for St. Ander for the purpose of delivering the cargo to General Mina according to contract, and on her arrival there, on 22 June, the place was found to be in possession of the Royalists, who occupied it with a military force. In consequence of this, the schooner did not approach the shore, but proceeded along the coast northward to a place called Pass Cavellos, about 270 miles from St. Ander, where information was received that St. Ander and the coast were completely in possession of the Royalists. The objects of the voyage being in this manner defeated, the schooner returned to New York with her original cargo on board, and arrived there on 22 July, 1817. The plaintiffs had no intelligence of the breaking up of the voyage until the return of the schooner to New York, and then abandoned to the underwriters in due time, assigning as a cause, that the Ellen Tooker was "compelled by an armed force to leave St. Ander in the Gulf of Mexico, where she had arrived and was about to deliver her cargo, and was prevented thereafter by a like force from re-entering that place." This abandonment was not accepted. It was also in evidence that the cargo of the Ellen Tooker was shipped and intended to be sold to the Independent party of Mexico, which was waging war with the King of Spain, and that the same was prohibited from importation into Mexico by the laws of Spain, and would have been seized and confiscated if it had been carried into any of the ports in

Page 19 U. S. 181

possession of the Royalists, but would have been freely admitted into any ports in possession of the Independent party.

Upon these facts a verdict was given and judgment rendered for the defendants, and the cause was brought to this Court by writ of error.

Page 19 U. S. 184

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