Sometimes it is useful to resort to the general principle and purpose of insurance, namely, that of giving indemnity against actual loss and no more, and apply this to the construction of doubtful phrases.1

In the same way it is often well to remember the especial subject-matter of the contract under consideration; for this may afford material assistance in its interpretation. And often some parts of the policy will explain other parts; for, if it be possible, that meaning shall be adopted which gives significance and validity to the whole instrument. It is however often said that written words control the printed part of the policy, because printed forms are made for cases generally, but seldom for any especial case, and that the written words determine the intention of the parties as to the meaning of the policy.2 This is true to a great extent, but the general rule must be that if the whole can be construed together, so that the written words and those printed make an intelligible contract, this construction is to be adopted. The reason of this rule is obvious, because the inten

Binn. 363, 373, the rule is stated as follows by Yeates, J.: "The intention of the parties, and not the literal meaning of the words, is to be attended to in the construction of policies. Their intention is, if possible, in the first instance, to be collected intrinsically from all the expressions contained in the written instrument; but where that is silent as to the object of research, it may be fairly inferred from extrinsic circumstances, the perils intended to be guarded against, and the relative state of the vessel at the time."

1 See Nelson v. Suffolk Ins. Co., 8 Cush. 477, 490.

2 Lord Ellenborough, in Robertson v. French, 4 East, 130, 136, stated the law as follows: "The only difference between policies of assurance, and other instruments in this respect, is that the greater part of the printed language of them being invariable and uniform, has acquired from use and practice a known and definite meaning, and that the words superadded in writing (subject indeed always to be governed in point of construction by the language and terms with which they are accompanied) are entitled nevertheless, if there should be any reasonable doubt upon the sense and meaning of the whole, to have a greater effect attributed to them than to the printed words, inasmuch as the written words are the immediate language and terms selected by the parties themselves for the expression of their meaning, and the printed words are a general formula adapted equally to their case, and that of all other contracting parties upon similar occasions and subjects." See also, Coster v. Phoenix Ins. Co., 2 Wash. C. C. 51.

3 Wallace v. Ins. Co., 4 La. 289; Cushman v. North Western Ins. Co., 34 Maine, 487; Alsager v. St. Katherine's Dock Co., 14 M. & W. 794, 799; Howland v. Comm. Ins. Co., Anthon, N. P. 26. In Goicoechea v. La. State Ins. Co., 18 Mart. La. 51, 55, Porter, J., said: "The rule invoked by this argument, that the written parts of the policy should control those that are printed, is correct,

tion of the parties is presumed to be "alive and active throughout the whole instrument, and that no averments are anywhere inserted without meaning and without use." 1

The law of place sometimes comes into consideration; and the general rule here is, that every contract is considered to be made in accordance with the laws of the place where it is made, and to be subject to their interpretation.2 If, however, the contract is made in one place, but is to be executed or to take effect in another, the general presumption of the law is, that the parties intended it to be governed and to be interpreted by the law of this latter place.

If a letter proposing insurance be written in one place to another in which the insurance is to be effected, the Supreme Court of the United States have held that the letter is to be construed by the usage of the place where it is written, overruling Mr. Justice Story's decision that it should be read as it would be understood in the place to which it was written, and in which insurance was requested.5 We cannot but think that

because the written words are the immediate language and terms stated by the parties themselves for the expression of their meaning, and the printed ones a general formula made for all cases that may be presented. But the rule cannot properly receive an application in cases other than those where the written and printed words so contradict each other, that the one must yield to the other." In Hunter v. General Mutual Ins. Co. of N. Y., 11 La. Ann. 139, a number of slaves were insured, by a written clause "solely against loss by drowning in consequence of the stranding or shipwreck of the vessel, the assurers being warranted against all other risks." There was a printed clause in the policy authorizing the recovery of a general average contribution. It was held that the two clauses would stand together, because “ a liability for a general average contribution cannot properly be called a risk; it is an obligation incident to a sacrifice made to avert a risk. It is based upon the equitable rule that no one should enrich himself at another's expense; but it is not itself a risk, according to any proper interpretation of that term."

1 Goix v. Low, 1 Johns. Cas. 341.

2 In Hyde v. Goodnow, 3 Comst. 266, an insurance company in New York had an agent in Ohio authorized to receive applications for insurance, but not to complete the contract. It was held under these circumstances that a policy issued by the company in New York to a person in Ohio, was to be governed by the laws of New York, and that a law of Ohio declaring all policies signed, issued, or delivered in the State by a company not chartered by a law of the State, or by a licensed agent, did not apply. 3 See 2 Parsons on Contracts, 95.

4 Hazard v. N. Eng. Mar. Ins. Co., 8 Pet. 557.

5 Hazard v. N. Eng. Mar. Ins. Co., 1 Sumner, 218. The question in this case was as to the meaning of the term " coppered vessel." The Supreme Court held it was to be construed according to its meaning at the place where the ship belonged and the

In the case in ques

the overruled opinion was the better one. tion the letter was written in New York and sent to Boston. But the principle, if a good one, will apply anywhere; and if a merchant in Mauritius writes to Boston proposing insurance, and uses phrases in his letter which have a definite and reasonable and well-established meaning in Boston, and insurance is there effected, can it be right that the duties or obligations of the insurers are to be measured by the very different meaning those words may have at Mauritius?

Every written contract is presumed to have been written and delivered at its date; this word being only a shortened form of "datum," and meaning that the contract was then given. But this presumption may be overcome by evidence, and the contract will then take effect from its actual making and delivery.1

In the construction of these words, it may be asked, at whose instance were they introduced? The rule, that every instrument shall be construed strongly against him who gives it, is of no great use generally, and has little or no application to contracts of insurance. But there are good reasons for saying, that where either party proposes and inserts especial phrases or provisions, and these are found to be ambiguous, and they must be construed either for or against the proposer, he must be satisfied with the construction which is unfavorable to him, because it is

owner lived. Mr. Justice Story had previously decided, in Tidmarsh v. Washington F. & M. Ins. Co., 4 Mason, 439, 442, that if there was any difference in respect to the standard of seaworthiness at the place where the vessel belonged, and that at which the insurance was effected, the former should be taken, on the ground that underwriters were presumed to know what constituted seaworthiness at a foreign port, and the Supreme Court were of the opinion that the same rule should apply to a representation.

1 Earl v. Shaw, 1 Johns. Cas. 313; Jackson v. Schoonmaker, 2 Johns. 230, 234. See Stone v. Bale, 3 Lev. 348; Hall v. Cazenove, 4 East, 477; United States v. Le Baron, 19 How. 73.

2 "It is to be noted," saith Lord Bacon, "that this rule is the last to be resorted to, and is never to be relied upon but where all other rules of exposition of words fail; and if any other come in place, this giveth place. And that is a point worthy to be observed generally in the rules of the law, that when they encounter and cross one another in any case, it be understood which the law holdeth worthier, and to be preferred, and it is in this particular very notable to consider, that this being a rule of some strictness and rigor, doth not as it were its office, but in absence of other rules which are of more equity and humanity." Bacon's Max. Reg. 3. See also, Love v. Pares, 13 East, 80; Doe v. Dodd, 5 B. & Ad. 689; Adams v. Warner, 23 Vt. 411.

his own fault that the words he used did not express his purpose and intention more plainly.1

B. Of Usage.

While the general rules and principles of construction which apply to other contracts apply also to contracts of insurance, it is obvious that there are none other which call so often and so forcibly as these upon usage for their interpretation. The policy itself is not a well-drawn legal instrument. It is, to the last degree ill-drawn; and except for the aid of ages of adjudication, and of practice under it, it would be impossible to determine with any accuracy what rights it conferred or what obligations it imposed.2

Moreover, most policies contain phrases made necessary by the peculiar circumstances of each case, or introduced for the especial purposes of the parties. These phrases are, for the most part, mercantile phrases. They are used by merchants. among themselves, and understood by them; and much injustice would be done if the law did not interpret them in the way in which they are used and understood. But this can be learnt only from the usage of merchants.3

There are, however, some rules in reference to usage, and interpretation by usage, which it is important to remember.

The usage must be reasonable in itself, and conformable to law.5 This is at once obvious and certain.

1 Blackett v. Royal Exch. Ass. Co., 2 Cromp. & J. 244, 251, 2 Tyrw. 266; Audley v. Duff, 2 B. & P. 111; Donnell v. Columbian Ins. Co., 2 Sumner, 366, 381; Palmer v. Warren Ins. Co., 1 Story, 360, 364; Louisville Mar. & F. Ins. Co. v. Bland, 9 Dana, 143, 151; Etna Ins. Co. v. Jackson, 16 B. Mon. 242.

2 See ante, p. 27, n. 1.

3 In one of the earliest cases on this subject, the court held that the clause, " warranted to depart with convoy," must be construed according to the usage among merchants, i. e. from such place where convoys are to be had. Lethulier's Case, 2 Salk. 443. See also, Mobile Mar. Dock & M. Ins. Co. v. McMillan, 27 Ala. 77.

4 Macy v. Whaling Ins. Co., 9 Met. 354, 363, per Hubbard, J.; Ougier v. Jennings, cited 1 Camp. 505; Barney v. Coffin, 3 Pick. 115.

5 Thus a usage for a master to sell a cargo without necessity is invalid on the ground of illegality. Bryant v. Commonwealth Ins. Co., 6 Pick. 131. So, it is illegal for the owner to purchase it when sold by the master through necessity, and a usage justi

It must be definite, for if obscure itself, it cannot make another obscure thing plain; reasonably well-established, or it cannot be supposed to have a binding force upon the parties; and distinctly brought home to the knowledge of the parties, either by its universal acceptance or by special evidence, for there is no reason why it should be permitted to affect those who did not know it.1 Indeed it has been said that "the true test of a commercial usage is its having existed a sufficient length of time to have become generally known, and to warrant a presumption that contracts are made in reference to it.2

But it may be, in some measure local and limited, provided it be general enough to embrace the parties, the contract, and the particular adventure or subject-matter of the contract. For a local usage cannot affect parties out of that locality, unless they

fying such a proceeding is invalid. Robertson v. Western Fire & M. Ins. Co., 19 La. 227. In Hone v. Mutual Safety Ins. Co., 1 Sandf. 137, affirmed Mutual Safety Ins. Co. v. Hone, 2 Comst. 235, Sandford, J., said: "We find it clearly settled that a general usage, the effect of which is to control rules of law, is inadmissible. So, of one which contradicts a settled rule of commercial law." It was accordingly held, that a usage that a reinsurer should pay to the first insurer only so much of the sum reinsured, as bore the same proportion to the property destroyed, which was covered by the first insurance, as the whole reinsurance bore to the original insurance, was inadmissible. And if the policy does not contain words which would, by construction of law, cover the interest of the assured, a usage to show that the words used are considered as equivalent to "for account of whom it may concern," or words of similar import, is not admissible. Turner v. Burrows, 5 Wend. 541, 8 id. 144; Wise v. St. Louis Mar. Ins. Co., 23 Mo. 80.

1 In M'Gregor v. Ins. Co. of Penn., 1 Wash. C. C. 39, the court said: "Customs acquire the force of law, because, as they must be ancient, uniform, and reasonable, they must have been generally received, known, and approved." It was held, in this case, that notice of a custom must be given, or the evidence must be such that the jury might presume the party knew it. And in Bentaloe v. Pratt, Wallace, 58, 64, it was said "that a usage ought to be clearly made out; its existence, its extent, and its notoriety should be indisputable."

2 Smith v. Wright, 1 Caines, 43, 45. See also, Trott v. Wood, 1 Gallis. 443. But the length of time is not a matter of so much importance as the question, whether during the time the usage has been uniform. Thus, in Noble v. Kennoway, 2 Doug. 510, the trade had existed to the place in question but three years, yet it was held that the way in which it was carried on might be shown for the purpose of establishing a usage. And Lord Mansfield said: "It is no matter if the usage has only been for a year." It is not, however, sufficient to constitute a usage, that there are some instances of a thing being done in a particular trade. Salisbury v. Townson, Millar, Ins. 418; Tennant v. Henderson, 1 Dow, P. C. 324; Martin v. Del. Ins. Co., 2 Wash. C. C. 254.