A policy upon a ship is an insurance of the ship for the voyage,
not an insurance on the ship and the voyage. The underwriters
undertake for the ability of the ship to perform the voyage, not
that she shall perform it at all events.
The loss of the voyage as to the cargo is not a loss of the
voyage as to the ship. If at the time of the offer to abandon, the
ship be in possession of the master, in good condition, and at full
liberty to proceed on the voyage, the loss of the cargo will not
authorize the owner of the vessel to recover as for a total loss of
the vessel.
THE CHIEF JUSTICE, in delivering the opinion of the Court,
stated the material facts found by the special verdict to be as
follows,
viz.:
This action was brought against the underwriters to recover the
amount of a policy insuring the ship
John and Henry, from
Charleston to Port Republicain or one other port in the Bite of
Leogane. On 2 October, 1803, the
John and Henry, while
prosecuting her voyage, was seized by a French privateer and
carried into the port of Mole St. Nicholas, where the cargo
Page 8 U. S. 371
was taken by M. de Noailles, the French commandant, for the use
of the garrison. On the same day, the master of the vessel received
a written engagement from M. de Noailles to pay for the cargo in
coffee, after which the vessel was unladen. The captain remained at
the Mole in expectation of receiving payment until 29 October, when
he sailed in the
John and Henry for Cape Francois, with an
order on that place for payment in coffee. On 4 November she was
seized by a British squadron then blockading Cape Francois and
condemned as prize. Cape Francois is not in the route to Port
Republicain nor to any port in the Bite of Leogane, nor in the
route to return from Mole St. Nicholas to the United States. The
abandonment was made in December on account of the capture by the
French privateer. The declaration claims the amount of the policy
in consequence of that capture. The judgment of the court below was
for the defendant.
The only question decided by this Court was whether the
plaintiff had a right to abandon and recover as for a total
loss.
Page 8 U. S. 373
MR. CHIEF JUSTICE MARSHALL, after stating the facts of the case,
delivered the opinion of the Court as follows:
It has been decided in this Court that during the existence of
such a detention as amounts to a technical total loss, the assured
may abandon, but it has also been decided that the state of the
fact must concur with the state of information to make this
abandonment effectual. The technical total loss therefore
occasioned by the capture and detention at Mole St. Nicholas, must
have existed in point of fact in December, when this abandonment
was tendered, or the plaintiff cannot succeed in this action.
Previous to that time, the vessel had been restored to the
captain; all actual restraint had been taken off; and it does not
appear that her ability to prosecute her voyage was in any degree
impaired. But her cargo had been taken by Monsieur de Noailles, the
commandant at Mole St. Nicholas, and had not been paid for. The
restoration of the vessel, without the cargo, is said not to
terminate the technical total loss of the vessel.
The policy is upon the vessel alone, and contains no allusion to
the cargo. Had she sailed in ballast, that circumstance would not
have affected the policy. The
Page 8 U. S. 374
underwriters insure against the loss or any damage to the
vessel, not against the loss or any damage to the cargo. They
insure her ability to perform her voyage, not that she shall
perform it.
If, in such a case, a partial damage had been sustained by the
cargo, no person would have considered the underwriters as liable
for that partial damage; why then are they responsible for the
total destruction of the cargo? It is said that, by taking out the
cargo, the voyage is broken up. But the voyage of the vessel is not
broken up; nor is the mercantile adventure destroyed from any
default in the vessel. By this construction the underwriter of the
vessel, who undertakes for the vessel only, is connected with the
cargo, and made to undertake that the cargo shall reach the port of
destination in a condition to answer the purposes of the assured.
Yet of the cargo he knows nothing, nor does he make any inquiry
respecting it.
If it be true that the technical total loss was not terminated
until the cargo was paid for, because the voyage was broken up,
then the underwriters would have been compellable to pay the amount
of the policy, although the vessel had returned in safety to the
United States. To prosecute the voyage, it is said, had become
useless, and therefore the engagement of the underwriters was
forfeited, although this state of things was not produced by any
fault of the vessel. If this be true, it would not be less true if,
instead of proceeding to Cape Francois, the
Henry and John
had returned from Mole St. Nicholas to the port of Charleston. The
contract, then, instead of being an insurance on the ability of the
ship to perform her voyage, an insurance against the loss of the
ship upon the voyage, would be a contract to purchase the vessel at
the sum mentioned in the policy, if circumstances not produced by
any fault or disability in the vessel, should induce the captain or
the assured to discontinue the voyage after it had been
undertaken.
This is termed pushing a principle to an absurdity, and
therefore no test of the truth of the principle. But if it be a
case which would occur as frequently as that which has occurred,
and if the result which has been
Page 8 U. S. 375
stated flows inevitably from the principle insisted on, the case
supposed merely presents that principle in its true point of view,
deprived of the advantages it derives from its being adapted to the
particular and single case under argument. Either the technical
total loss of the ship did or did not terminate when she was
restored to the master uninjured, and as capable of prosecuting her
voyage as when she sailed from the port of Charleston. If it was
then terminated, this action cannot be sustained. If it was not
then terminated, on what circumstance did its continuance depend?
At one time it is said to depend on the ability or inability of the
owner to employ her to advantage. But this position requires a very
slight examination to be discarded entirely. So far as respected
the vessel herself, and her crew, she was as capable of being
employed to advantage as she had ever been. Only the funds were
wanted to enable her to purchase a return cargo on the spot, or to
proceed to her port of destination, and there purchase one. Or she
might have returned immediately to the United States, and if any
direct loss to the vessel was sustained, by being turned out of her
way, that, after restoration, would be a partial, not a total loss.
Besides, what
dictum in the books will authorize this
position? And what rule is afforded to ascertain the degree of
inconvenience which, when in point of fact the vessel is in safety,
in full possession of the master, and capable of prosecuting her
voyage, shall warrant an abandonment?
No total loss of the vessel, then, existed after her
restoration, so far as that total loss depended on the incapacity
of the owner to employ his vessel to advantage. If the total loss
continued after the restoration, that continuance was produced
singly by the nonpayment for the cargo, which is said to have
broken up the voyage. If, then, the vessel had returned to a port
in the United States, the voyage would still have been broken up,
and the right to abandon would have been the same as it was while
she was on the ocean, in full possession of her captain.
Page 8 U. S. 376
But it is apparent that the captain had terminated the voyage on
which the vessel was insured. Had his contract with De Noailles
been complied with at Mole St. Nicholas or at Cape Francois, he
would not have proceeded to the Bite of Leogane. Had it not been
complied with, he would have had no more inducement to go to a port
in the Bite of Leogane from Cape Francois than from Mole St.
Nicholas. The voyage to Port Republicain, then, which was the
voyage insured, was completely terminated at Mole St. Nicholas; the
voyage to Cape Francois, in making which she was captured, was a
new voyage undertaken not for the benefit of the underwriters of
the vessel, but for the benefit of the owners and underwriters of
the cargo. Consequently, so far as respects the underwriters of the
vessel, who insured only the voyage to the Bite of Leogane, the
capture at Cape Francois is an immaterial circumstance, and the
technical total loss produced by carrying the vessel into Mole St.
Nicholas was either terminated when she was restored without her
cargo or would have continued had she returned to an American port
without her cargo.
Upon principle, then, independent of authority, it is very clear
that the underwriter of the vessel does not undertake for the
cargo, but engages only for the ability of the vessel to perform
her voyage and to bear any damage which the vessel may sustain in
making that voyage.
But it is contended that adjudged cases have settled this
question otherwise.
The case has frequently occurred, and a direct decision might be
expected on it if a construction so foreign from the contract had
really been made. It often happens that the cargo of a neutral
vessel is condemned as enemy property, and the vessel itself is
discharged. Not an instance is recollected in which the right to
abandon in such a case, after the vessel was restored, has been
claimed. Yet if the loss of the cargo amounted to a destruction of
the voyage so far as respected the vessel, and thereby created a
total loss of the vessel
Page 8 U. S. 377
herself notwithstanding her restoration to the captain uninjured
and in a full capacity to prosecute her voyage, such claims would
be frequently asserted and vessels would be valued high in the
policy for the purpose of selling them on a contingency, which so
often occurs. It would be strange indeed to admit that if this
cargo had been condemned in Mole St. Nicholas and the vessel had
been liberated, the right to abandon would not have been produced
by the loss of the cargo, and yet to contend that nonpayment for
the cargo does produce that right.
In recurring to precedent, no direct decision by a court on the
point, no direct affirmance of the principle has been adduced, but
the counsel for the plaintiff relies on general
dicta in
the books which are used in reference to other principles. Thus, in
1 Term 191, Judge Buller says "It is an assurance on the ship for
the voyage. If either the ship or the voyage be lost, it is a total
loss."
In that case, the counsel for the plaintiff contended that the
insurance was on the ship and on the voyage, and insisted that as
the vessel returned unfit for use, it was a total loss. The counsel
for the defendants was stopped, and judge Buller said "Allowing
total loss to be a technical expression, the manner in which the
plaintiff's counsel have stated it is rather too broad." Why too
broad? Judge Buller answers
"It has been said that the insurance must be taken to be on the
ship as well as on the voyage, but the true way of considering it
is this: it is an insurance on the ship for the voyage. If either
the ship or the voyage be lost, that is a total loss."
In what consists the difference between an insurance on the ship
and the voyage, which is laying down the principle too broad, and
an insurance on the ship for the voyage, which is the true way of
considering it? If the destruction of the voyage by the loss of the
cargo is a loss of the ship, then it is an insurance on the ship
and the voyage. But this, according to Judge Buller, is not the
true principle. The true principle is that "it is an insurance on
the ship for the voyage" --
Page 8 U. S. 378
that is, that the voyage shall not be destroyed by the fault of
the ship, or in other words that the ship shall be capable of
making her voyage. And when he says that if either be lost it is a
total loss, he must be understood to mean if the voyage be lost by
the happening to the ship of any of the perils insured against. To
understand Judge Buller otherwise would be to make him inconsistent
with himself, to illustrate a proposition by cases incompatible
with that proposition, and to support a distinction by cases which
confound the principles intended to be distinguished from each
other. But these expressions are used in a case in which the whole
contest respected the damage actually sustained by the ship
insured, and must be understood in reference to such a case.
So in 1 Term 615,
Mitchell v. Edie, Buller says
"A total loss is of two sorts -- one where in fact the whole of
the property perishes [that is, the property insured], the other
where the property exists but the voyage is lost or the expense of
pursuing it exceeds the benefit arising from it."
This was a case in which the cargo, which was the thing insured,
was, by one of the perils insured against, prevented from reaching
its destined port and was greatly damaged. The expressions must be
explained by the case, for the case itself is in view when the
expressions are used.
A
dictum of judge Buller in 1 Term 310 is more
applicable to this case than either of those before quoted. He says
"If the ship had arrived and the goods had been lost, the assured
could not have recovered." That was an insurance on the arrival of
the ship. It is said that
dictum was founded on its being
a wagering policy, but it appears to be a construction of the terms
of the policy. He proceeds to say that "in policies on interest, if
the voyage be lost, it is not necessary to proceed on with the hulk
of the ship." But to what case does this apply? To an insurance on
goods or on the ship? To a loss of the voyage by default of the
thing insured and abandoned, or by default of the thing not
insured? The
dictum is too vague and too unsatisfactory to
form the basis of a great
Page 8 U. S. 379
legal principle, of infinite importance in commercial
transactions. If that case be read throughout,
dicta may
be found interspersed through it which militate against the
doctrine this single sentence is supposed to support.
In the case of
Goss v. Withers, there were two
policies, one on the ship and the other on the cargo. The language
of Lord Mansfield in delivering the opinion of the court with
respect to the ship does not even insinuate the idea that any
damage sustained by the cargo would have affected the policy on the
ship.
In deciding on the claim for the cargo, his language is to be
considered with reference to the case itself. It does not appear
whether, in the passage quoted from Le Guidon, the author of that
work was treating of an abandonment as to the ship or the cargo or
both. Nor does it in any degree tend to establish the principle
contended for, that after stating the actual total loss of the
goods, Lord Mansfield mentions, as an additional circumstance,
showing the complete destruction of the voyage, that the ship was
lost also.
In the case of
Hamilton v. Mendez, neither the ship nor
cargo was lost. Lord Mansfield puts cases in which there might be a
total loss, but those cases are not stated with such precision as
to throw any light on the present question. He says it does not
absolutely follow that because there is a recapture, the loss
ceases to be total. "If the voyage is absolutely lost, or not worth
pursuing," and in many other instances the owner may disentangle
himself and abandon notwithstanding there has been a recapture.
It is extremely dangerous to take general
dicta upon
supposed cases not considered in all their bearings, and, at best,
inexplicitly stated as establishing important law principles. Let
the
dictum in the present case be examined. Suppose the
ship and cargo to be owned by different persons and insured by
different underwriters. If the voyage be lost by the infirmity of
the ship, the abandonment might unquestionably be made. If the
goods be damaged or injured so as to occasion a technical
Page 8 U. S. 380
total loss, so as to render the voyage not worth pursuing, the
owner of the cargo may abandon; but how does this render the voyage
not worth pursuing by the owner of the vessel? The value of the
cargo does not affect him or injure his vessel. With respect to
him, the voyage is not destroyed. These
dicta of Lord
Mansfield are uttered in terms which demonstrate that no case like
the present was in his view at the time, and they are not adapted
to such a case.
The cases from Weskett are upon a peculiar kind of policy. They
are in the nature of wager policies, and the nature of the
undertaking is said to be that the ship shall perform her voyage in
a reasonable time. "In these two last kinds of policies," says
Weskett, "valued free from average" and
"interest or no interest, it is manifest that the performance of
the voyage or adventure in a reasonable time and manner, and not
the bare existence of the ship or cargo, is the object of the
insurance."
This remark applies only to policies of the particular specified
description, and even with respect to them it would not appear that
the fate of the ship depended on that of the cargo. In illustration
of this principle, he states the case of
The Ludlow
Castle, insured from Jamaica to England. She was compelled by
one of the perils insured against to put into Antigua, where she
was stopped from proceeding on her voyage, and her cargo was sent
to England in another vessel. At the time of the abandonment, and
even at the time of the trial, the vessel had not arrived in
England, and was not restored to the owner. In this case, the
voyage was lost by the inability of the vessel to prosecute it.
The case of
The Sarah Galley bears a much stronger
resemblance to that under consideration, but is not so fully stated
as to give the court all its circumstances. It does not precisely
appear what damage was sustained by the seizure at Gibraltar, nor
what effect that loss might have on the jury. Nor are we informed
at what time and for what cause the abandonment was made.
But the great objection to that case is that it was the verdict
of a jury, not the solemn decision of a court,
Page 8 U. S. 381
which verdict was rendered at a time when the law of insurance
was not settled, and most probably on a point which has since been
overruled in England and in this country. The loss of the ship on a
voyage from Gibraltar to Dunkirk could not be the fact on which the
plaintiff recovered, because that was a voyage not within the
policy. The seizure at Gibraltar was the fact on which the jury
founded their verdict. The defendant contended that this total loss
was terminated by the restoration of the ship; "yet as the taking
at Gibraltar was a taking whereby the return voyage was prevented,
a special jury gave the plaintiff a verdict for a total loss." The
verdict, then, is found not on the subsequent actual loss of the
vessel, but on the technical loss occasioned by the seizure. This
verdict was rendered in the reign of George II. At that time, it
was doubtful whether a technical total loss occasioned by capture
did not vest in the assured a right to abandon, which right was not
divested by restoration. In the case of
Hamilton v.
Mendez, which came on afterwards, this point was perseveringly
maintained at the bar, and settled by the court. Had the case of
The Sarah Galley been decided after the case of
Hamilton v. Mendez, a different verdict must have been
rendered. But this decision was given exclusively on the
circumstances which had befallen the ship, without a view, so far
as is stated, to any loss of the cargo, and is considered by Millar
(288) as not being law.
The case of
The Anna turned entirely on the inability
of the ship to prosecute her voyage.
The case of
The Dispatch Galley is a case in which we
are not informed of the amount of loss occasioned by capture and
recapture, and is also a case decided before
Hamilton v.
Mendez, most obviously upon the principle that the right to
abandon, which was vested by the capture, was not divested by the
restoration of the vessel. This case serves to show that the
verdict in the case of
The Sarah Galley did not turn on
the subsequent loss of the vessel, for this vessel was not lost.
There is in it no allusion to any influence which the loss of a
cargo might have on the insurance of a vessel.
Page 8 U. S. 382
The principles laid down by Millar do not militate against those
which are contained in this opinion. When he speaks of a loss which
defeats the voyage, he alludes to a loss which has befallen the
thing insured.
The Court can find in the books no case which would justify the
establishment of the principle that the loss of the cargo
constitutes a technical loss of the vessel, and must therefore
construe this contract according to its obvious import. It is an
insurance on the ship for the voyage, not an insurance on the ship
and the voyage. It is an undertaking for the ability of the ship to
prosecute her voyage and to bear any damage which she may sustain
during the voyage, not an undertaking that she shall in any event
perform the voyage.
It is the unanimous opinion of the Court that the judgment must
be affirmed with costs.
Judgment affirmed.