policies on the same ship at different values, and the assured has, on a total loss, received under some of the policies part of the sums insured, he cannot, in an action upon another of the policies, recover more than the difference between the value mentioned in that policy and the sums he has actually received from the other insurers (h). If the loss is only partial, the value in the policy must still Where loss be looked to as the basis of the calculation (i). This mode of partial. valuation cannot, however, be applied to all cases of partial loss under policies which are, in form, valued. Thus, where a ship was to proceed to the coast of Africa on a barter voyage, and to bring back a cargo, and an insurance was effected covering both cargoes at a value named, and the ship was totally lost before she took in any homeward cargo, with twothirds of the outward cargo on board, it was held that the valuation mentioned in the policy applied substantially to a full cargo, and entitled the assured to the value named, only in the event of the loss of a substantially full cargo, and to an indemnity, in case of any partial loss, not exceeding that sum; and as the value of the whole intended cargo was, under the circumstances, unknown, the Court was of opinion that the ordinary mode of estimating a partial loss under a valued policy could not be adopted, but that the claim must be dealt with as if it were a claim to an ordinary indemnity under an open policy underwritten for the sum mentioned as the value of the whole cargo (k). TIME, AND An insurance may be effected either for a voyage, or for a VOYAGE, number of voyages, in either of which cases the policy is called MIXED POLIa voyage policy; or the insurance may be for a particular period, CIES. irrespective of the voyage or voyages upon which the vessel may be engaged during that period, and the policy is then called (h) Bruce v. Jones, 1 H. & C. 769. See, however, Wilson v. Nelson, 5 B. & S. 354. (i) Lewis v. Rucker, 2 Burr. 1171; see also the judgment of Lord Ellenborough in Forbes v. Aspinall, 13 East, 327; and in Bousfield v. Barnes, ubi supra; also Rickman v. Carstairs, 5 B. & Ad. 651; and Lobare v. Aitchison, 4 App. Cases, 755. A contrary opinion obtained at one time, and it was argued that if the loss was only partial, the value must be proved as in an open (k) Tobin v. Harford, 13 C. B., N. S. RE-INSUR ANCE AND a time policy (1). In other countries the length of the time for which a ship may be insured is not limited, but in England time policies made for a longer period than one year are, by statute, void ab initio (m). In addition to the two last-mentioned kinds of policy there is a third, which is usually called a mixed policy; as, for instance, where a ship is insured "from A. to B. for a year.' This is in effect a time policy with the voyage specified, and runs for the whole period insured, irrespectively of the completion or non-completion of the voyage (n). A policy of this description does not attach, unless the ship sails upon the voyage named (o); but although the insurance is limited to commence at a certain time, it is not necessary that the ship should be then in the port specified as the terminus a quo (p). Where a policy was effected on goods to the value of 12,0007., in canal boats plying between London and Birmingham for twelve months, and the claim on the policy was warranted not to exceed a certain sum per cent., and it was stipulated that a given amount only was to be covered by the policy in any one boat, or any one trip, it was held that this was a continuing insurance, and applied to successive cargoes carried within the year, although goods exceeding 12,0007. in value had been carried (9). Fourthly, as to re-insurance and double insurance. Reinsurance is where an underwriter procures the sum which he has insured to be insured again to him by another underwriter. This is allowed in all cases by the law of France, and of the other maritime countries of Europe (r), and also in America (s). In this country, the right to re-insure was limited by 19 Geo. 2, c. 37, s. 4, to cases in which the insurer was insolvent, became bankrupt, or died. In the two former cases the underwriter (1) In Dudgeon v. Pembroke, L. R., 9 Q. B. 581; 1 Q. B. D. 96; 2 App. Cas. 284, it was held that a policy from 22nd January, 1872, to 23rd January, 1873, was a time policy, although the printed words "at and from," and "for this present voyage" were left in the printed form. (m) 30 Vict. c. 23, s. 8. (n) As to mixed policies see Gambles v. The Marine Insurance Company of Bombay, 1 Q. B. D. 507. (o) Way v. Modigliani, 2 T. R. 30. (p) Ib.; see also Martin v. Fishing Insurance Company, 20 Pickering (American) Rep. 389, cited in Phillips on Ins., Chap. 11, s. 1. (2) Crowley v. Cohen, 3 B. & Ad. 478. See further as to the construction of a policy covering the risks of river carriage, Joyce v. Kennard, L. R., 7 Q.B. 78. (r) See 3 Kent Com. 279; Arnould on Ins. 340, note (c), (2nd edit.). (8) Kent Com., ubi supra; Phillips on Ins., Chap. 3, s. 13. himself, and in the latter his executors, might insure to the amount for which he insured, provided it was expressed in the policy to be a re-insurance (t). In 1864, by the 27 & 28 Vict. c. 56, s. 1, the prohibition contained in the 19 Geo. 2, c. 37, against re-insurance was removed; but it was still necessary to state in the policy that it was a re-insurance. Both these statutes are, however, now repealed by the 30 Vict. c. 23, and the 30 & 31 Vict. c. 59; and by the 4th section of the 30 Vict. c. 23, the expression sea insurance is defined to include reinsurance. Re-insurances are, therefore, now regulated by the same provisions as apply to other contracts of marine insurance (u). Double insurance takes place when the same interest and the same risk is insured twice; a second insurance being often necessary where the precise value of the interest is not at first known. But if it appears, when the value of the interest becomes known, that there has been an over-insurance; that is to say, that the sum of the two or more insurances exceeds the interest of the assured, the excess cannot be recovered; for the insurance is, to this extent, an infringement of the rule against wagering policies. But although the assured is not entitled to be satisfied twice, yet he may proceed upon whichever of the policies he choses, and may recover from one set of underwriters the whole sum insured, leaving the latter to sue the other underwriters for contribution (v). The extent to which the underwriters are liable to return the premium where there is an over-insurance will be mentioned at the conclusion of (4) A mere parol transfer, however, of liability by one underwriter to another at a higher premium, in order to assign the intended benefit, was not prohibited by the statute, Delver v. Barnes, 1 Taunt. 48. (u) The extent of the risk in cases of re-insurance is often governed by the terms of the original policy. See Joyce v. The Realm Insurance Company, L. R., 7 Q. B. 585. See also Mackenzie v. Whitworth, L. R., 10 Ex. 142; 1 Ex. D. 36, where the law relating to re-insurance is dealt with, and the earlier cases are referred to. It was held in that case that the fact that the risk was a re-insurance, was not in itself so material that its noncommunication avoided the policy. (v) Newby v. Reed, 1 W. Bl. 416. The ruling of Lord Mansfield in this case is now always acted on in this country. 2 Park on Ins. 423; 1 Arnould on Ins. 346 (2nd ed.). A custom was, however, once proved to the contrary. See The African Company v. Bull, 1 Show. 132. The French rule is, that if the policies are made without fraud, and the first covers the whole value, it bears the whole loss, and the subsequent insurers are freed from liability on returning the premium, minus one-half per cent. Code de Comm., Art. 359. The convenience of some definite rule is so great, that in America the policy often contains a clause, providing that, if the assured shall have made any prior assurance, the subsequent assurers shall be answerable only for any deficiency not covered by it. See 3 Kent Com. 282; Phillips on Ins., Chap. 14, s. 3. SUBJECT MATTER OF this Chapter. In these cases payment by one of the insurers operates as a satisfaction by both (x). Fifthly, as to the subject-matter of insurance. An insurance INSURANCE. may be effected upon the ship or goods, or upon both; in the Ship, &c. and latter case the subject-matter is usually described by these goods. words: "any kind of goods and merchandizes, and also upon the body, tackle, apparel, ordnance, munition, artillery, boat and other furniture, of and in the good ship or vessel, called the An insurance may also be effected upon profits expected to accrue from the cargo, and in such cases it is sufficient to use the word "profits" generally, without further specifying what they may be (y). They may be insured either by a valued (2) or an open policy (a). The assured must, however, show that he has an insurable interest (b), which had attached at the time of the loss (c); and that but for the loss which intervened, profits would have been realized (d). Where a consignor had purchased rice and had resold it at a profit, and the vessel which was to carry it to the second vendee had been chartered, it was held that the consignor had an insurable interest in such profit, although a portion only of the rice had been shipped, and actually lost (e). As, however, the policy in this case limited the inception of the risk to "from and immediately following the loading" of the goods, it was held that the insurance applied only to profits arising from the rice actually put on board; and further, that even if the policy did attach to the profits of that portion of the rice which was left on shore, it only covered losses occasioned directly by perils of the sea, and not such as arose from the insurer being prevented, in consequence of the retardation of the voyage, from completing his contract of (x) Morgan v. Price, 4 Ex. 615. (y) Eyre v. Glover, 3 Camp. 276; 16 East, 218. Such an insurance is within the operation of the 19 Geo. 2, c. 37; see Smith v. Reynolds, 1 H. & N. 221. (z) Grant v. Parkinson, Park. on Ins. 402; Henricksen v. Margetson, 2 East, 549, note; Barclay v. Cousins, ib. 544. See the judgment of Lawrence, J., in this case as to the foreign law on this subject. (a) Eyre v. Glover, 2 Camp. 276. (b) Stockdale v. Dunlop, 6 M. & W. 224; and ante, p. 441. (c) Knox v. Wood, 1 Camp. 543. (d) Hodgson v. Glover, 6 East, 316. In the American Courts proof that profits would have arisen on the voyage, is not required if the cargo has been lost. The Patapsco Insurance Company v. Coultas, 3 Peters (Amer.) Rep. 222. (e) M'Swiney v. The Royal Exchange Assurance Company, 14 Q. B. 634. resale (f). Where profits were insured by a policy on goods "beginning the adventure upon the said goods and merchandizes from the loading thereof on board the said ship," and the ship was lost before she reached the port at which the cargo was ready to be shipped, it was held that the policy never attached, and that the owner of the cargo could not recover under it for the delay in the shipment of the cargo and consequent loss of profits (g). Profits likely to arise upon the success of an adventure may be insured, such as shares in a telegraph company (h). Freight, or the profit earned by the shipowner in the carriage Freight. of goods on board his ship (i), whether arising from a charterparty or the earnings of a general ship, may be insured either for the whole or a portion of the voyage (k); and this may be done by a time policy, though the freight is not to be earned till after the time expires. It must, however, be insured eo nomine, and is not covered by a policy on goods (1). Where an owner carries his own goods in his ship, the interest, which he has by reason of his saving the amount he would have been obliged to pay for their carriage had not the ship been his own, is covered by a policy on freight (m). Freight paid before or during the voyage may also be insured Advanced as freight advanced or money advanced on account of freight (n). freight. (f) The Royal Exchange Assurance Company v. M'Swiney, in Cam. Scacc., 14 Q. B. 646, overruling on this point the judgment of the Court below. See also Chope v. Reynolds, 5 C. B., N. S. 642, in which case the goods arrived without damage, but by a vessel into which they had been transshipped. (g) Halhead v. Young, 6 E. & B. 312. (h) Wilson v. Jones, L. R., 2 Ex. 139. (i) See per Lord Ellenborough in Forbes v. Aspinall, 13 East, 325, and ante, p. 362. (k) Where a charter involves more than one voyage, freight to be earned in a future voyage may be insured against perils to be incurred in the current voyage. Ex. gr., 4,000l. on homeward freight against perils on the outward voyage. Potter v. Rankin, L. R., 3 C. P. 562; 5 C. P. 341; L. R., 6 H. L. 83. So also a portion of the entire freight may be insured so as to cover a loss which may fall on the shipowner by reason (1) Michael v. Gillespy, 2 C. B., N. S. (m) Flint v. Flemyng, 1 B. & Ad. 45; Devaux v. Janson, 5 B. & C. 519. (n) Ellis v. Lafone, 8 Ex. 546; Hall v. Janson, 4 E. & B. 500. See also as todisbursements advanced by charterer out of freight, Currie v. The Bombay Native Insurance Company, L. R., 3 P. C. 72; Williams v. The North China Insurance Company, 1 C. P. D. 757. See also post, p. 465. |