Great Lakes Transit Corp. v. Interstate Steamship Co. - 301 U.S. 646 (1937)
U.S. Supreme Court
Great Lakes Transit Corp. v. Interstate Steamship Co., 301 U.S. 646 (1937)
Great Lakes Transit Corp. v. Interstate Steamship Co.
Argued April 28, 29, 1937
Decided June 1, 1937
301 U.S. 646
1. Where a common carrier by water, by its bills of lading and tariffs, waives the exemptions of the Harter Act and accepts liability as insurer of cargo against marine perils, it is entitled to insure itself against that liability. P. 301 U. S. 651.
2. Where a carrier, by agreement with shippers, assumes liability as insurer of cargo against marine perils, the liability is not diminished by a further stipulation that the carrier will obtain marine insurance from others. P. 301 U. S. 652.
3. Policies of insurance issued to a steamship company, naming it as the assured, contemplated that the assured, as common carrier, would take upon itself full liability to cargo owners for damage and loss due to perils of the sea, and expressly agreed to indemnify the assured against that liability.
(1) That ambiguities, if any, raised by other clauses, must be resolved so as still to give effect to this dominant purpose to insure the carrier. P. 301 U. S. 652.
(2) The facts that the policies insured the carrier "for account of whom it may concern," and that loss was payable to the carrier "or order," and that the cost of the insurance was included in the carrier's rates to cargo owners, did not justify treating the policies as taken out by the carrier not for its own protection, but for insurance of cargo owners. P. 301 U. S. 653.
4. A carrier's rate to cargo may properly cover all reasonable expenses incident to the transportation, including the cost of insuring the carrier against liability which it has assumed to cargo for damages and losses caused by marine perils. P. 301 U. S. 653.
5. A policy insuring a carrier against loss and damage to cargo from marine perils may inure to the benefit of shippers. P. 301 U. S. 653.
6. Where a carrier, having assumed liability to cargo for loss or damage from marine perils and having insured itself against that liability, pays its shippers for losses suffered in a collision in which both vessels were at fault and collects the amount from its underwriters, the underwriters may have an equity of subrogation against the other vessel for a moiety of what they paid; but they cannot use that right to recover over against the carrier they insured. P. 301 U. S. 653.
86 F.2d 740, reversed.
Certiorari, 300 U.S. 650, to review the affirmance of a decree in admiralty adjudging two vessels at fault and adjudging that intervening underwriters recover, from each of the vessels and their respective owners, a moiety of payments made under policies insuring one of the carriers against liability to cargo.