THE following case was stated for the opinion of the Court:
'Case. On the 24th of September 1799, the defendant, Samuel
Gatliff, underwrote seven hundred and fifty dollars upon a policy
of insurance on the schooner Little Will, belonging to John Dutilh
and Thomas Lillibridge, for whom the plaintiff was agent, on voyage
at and from Philadelphia to Havanna.
On the 26th of September 1799, the Little Will sailed on her
voyage; from Philadelphia for Havanna, and on the 8th day of
October following, she was captured by three British privateers,
and carried into the port of Nassau, New-Providence, where she
arrived on the 13th of the same month.
Upon her arrival in Nassau, the said schooner was libelled in
the Admiralty Court, and on the 9th day of November following, was
regularly acquitted; and in the whole, she remained thirty seven
days at Nassau, during thirty five of which she was in custody of
the captors; but the fact of her acquittal was not known
Page 4 U.S.
446, 447
to the plaintiff, until subsequent to the abandonment hereafter
mentioned: although it was known to John Dutilh, one of the owners,
and supercargo, who was with her at Nassau.
On the 13th day of November, the plaintiff wrote the letter of
abandonment, enclosing the papers therein referred to, which was
received by the defendant the same day.
On the 20th November, the said schooner sailed from Nassau for
Havanna, where she arrived on the 21st of the same month, and sold
her cargo, except three boxes plundered at New-Providence.
Afterwards the said schooner sailed from Havanna for Philadelphia,
where she arrived on the 26th or 27th of February in the year 1800,
with a cargo of sugars, on which freight became due and was
received by Stephen Dutilh, for the benefit of those who were
entitled to it. Each party refusing to accept the schooner, she was
sold for wharfage, and the whole proceeds of sale applied to the
payment thereof.
The schooner Little Will was American property, as
warranted.
The QUESTION for the Court is, whether the plaintiff is entitled
to recover as for a total loss?
If the Court shall be of opinion that the loss was total, then
it shall be referred, in the usual form, to three person , to be
appointed by the Court, to ascertain what is due, after the legal
and just deductions.
If the Court shall be of opinion it was not a total loss, it
shall, in like manner, be referred to three referrees, or any two
of them, to be appointed by the Court, to ascertain the partial
loss, to which the defendant is liable.
J. Ingersoll, for the plaintiff.
W. Lewis, for the defendant.' [447-Continued.]
After argument, the chief justice delivered the unanimous
opinion of the Court.
TILGHMAN, Chief Justice.
On the case stated, the question submitted to the Court is,
whether the plaintiff is entitled to recover for a total loss?
In resolving this question, I shall divide it into two
points.
1st. Did there ever exist a total loss?
2d. Supposing that there once existed a total loss, has any
circumstance occurred, which excludes the plaintiff from recovering
for more than a partial loss?
1st. The case before us, includes one of the risks expressly
mentioned in the policy, a taking at sea. But it has been objected,
that this taking was not by an enemy; and that when a belligerent
takes a neutral, it is to be presumed that the taking is only for
the purpose of searching for the property of his enemy, or goods
contraband of war; and that, in the end, justice will be done to
the
Page 4 U.S.
446, 448
neutral. To a certain extent, there is weight in this
distinction; but it must not be carried too far. At the time when
the capture in question was made, the United States acknowledged
the right of the British to detain their vessels, for the purpose
of a reasonable search. The bare taking of the vessel, therefore,
could by no means constitute a loss; and if under suspicious
circumstances, she should be carried into port, to afford an
opportunity for a complete investigation, perhaps, even that ought
not of itself to be considered as a total loss. On this, however, I
give no opinion. But when the captor, having carried the vessel
into port, and completed the examination of the cargo and papers,
instead of discharging her, proceeds to libel her as prize, I think
the loss is complete. The property is no longer subject to the
command of the owner, and it is unreasonable that he should wait
the event of judicial proceedings, which may continue for years.
The case of an embargo is less strong; because, there the
confiscation of the property is not intended, and a temporary
interruption of the voyage is all that, in general, is to be
apprehended. Yet the assured is not obliged to wait the result, but
may abandon immediately on receipt of intelligence of the embargo.
Not many judicial decisions have been produced on the point in
question. Where principles are strong, it is sufficient that there
have been no decisions to the contrary. It appears, however, that
in the state of New-York, the precise point has been determined. In
the case of Mumford v. Church, decided in the Supreme Court of
New-York, July term, 1799, the assured recovered for a total loss,
where there was a capture, carrying into port, and libelling by a
British captor, although after the abandonment the property was
restored. It is necessary that some general rule should be
established, some line drawn, by which the assured may know at what
time he has a right to abandon. In most cases, the voyage is
extremely injured by proceedings in the Court of Admiralty, and the
event is doubtful. For it cannot be denied, that of late years,
such extraordinary occurrences have taken place in war and
politics, as have very much affected the principles and practice of
foreign Courts of Admiralty. Whatever may be said of the law of
nature and nations, and the immutable principles of justice, we see
very plainly that the Courts obey the will of the sovereign power
of their country; and this will fluctuates with the circumstances
of the times. I am, therefore, of opinion, that both by the words
and spirit of a policy of insurance, the assured may abandon, when
he receives intelligence of the libelling of his vess l.
2d. This brings me to the consideration of the second point: Has
any circumstance occurred, which limits the plaintiff to a recovery
for only a partial loss?
It is contended, that such an event has occurred: that the
vessel was acquitted by the decree of the Court of Admiralty; that
after acquittal, she proceeded on her voyage, and that one of
the
Page 4 U.S.
446, 449
owners was on the spot, and knew of the acquittal. I do not
think there is much weight in the circumstance of one of the owners
being on the spot; because the general agent of all the owners was
in Philadelphia. This general agent effected the insurance, and
conducted all the business with the underwriters, and the owner,
who was in New-Providence, gave him intelligence of what occurred
from time to time, and by no means intended, from any thing that
appears, to restrain him from making an abandonment. It is true,
that the vessel proceeded on her voyage after she was restored: but
it is not stated, nor can the court presume, that any of the owners
acted in a manner inconsistent with the abandonment made by their
agent. It was proper, at all events, to pursue the voyage for the
benefit of whoever might be interested in it. This is the usual
practice, and a practice authorized by the policy, and very much
for the advantage of the underwriters.
The only difficulty in the case before the Court, arises from
this circumstance; that before the action was brought, the vessel
was restored, and even at the time of the abandonment, there was a
decree of acquittal, although restitution does not appear to have
been actually made till some days after. The counsel for the
defendant have relied much on the opinion of Lord Mansfield in the
case of Hamilton v. Mendez, to establish this principle, that a
policy of insurance, being in its nature a contract of indemnity,
the plaintiff can recover no more than the amount of his actual
loss at the commencement of the action. There is no doubt of the
soundness of the principle: I mean that a policy is a contract of
indemnity. The only question is, at what period the rights of the
parties are to be tested by this principle; whether at the time of
abandonment, or of the commencement of the action. I have
considered attentively the case of Hamilton v. Mendez. It must be
obvious to every one, that the decision in that case was perfectly
right. It was simply this; that a man shall not be permitted to
abandon, and recover for a total loss, when he knew, at the time of
his offer to abandon, that his property, which had been lost, was
restored, and the voyage very little injured. But in reading the
opinion of Lord Mansfield, we find a want of accuracy, with which
that great man was seldom chargeable. Sometimes it appears as if he
thought the period, for fixing the rights of the insurers and
insured, was the commencement of the suit; sometimes the time of
abandonment; and sometimes he even seems to extend his ideas so far
as the time of the verdict. But, finally, he explicitly declares,
that he decides nothing but the point before him. He seems to have
felt a little sore, at the improper application of some general
expressions used by him, in the case of Goss v. Withers. Anxious to
cut off all pretence for doing the same in Hamilton v. Mendez, he
has taken too much pains to avoid the possibility of
misrepresentation. Hence his argument, considered in the detail, is
not altogether clear and consistent. Upon the whole of this case of
Hamilton v. Mendez, I think it most safe to confine its authority
to the point
Page 4 U.S.
446, 450
actually decided, which was very different from that we are now
considering. Some period must be fixed for determining the right of
the parties. To limit it to the time of commencing the action would
be of little service to the insurers; for the law being once so
established, an action would be brought in every instance on the
first default of payment. The time of abandonment seems the most
natural and convenient period; because the assured must m ke his
election to abandon or not, in a reasonable and short time after he
hears of the loss, and the property, being transferred by the
abandonment, can never after be reclaimed by the assured. Want of
mutuality is want of justice. There is no reason why the assured
should be bound, but the assurer left free, to take advantage of
events subsequent to the abandonment.
It has been contended by the plaintiff's counsel, that the right
to abandon would not have been affected, even if the property had
been restored at the time of abandonment, because the restitution
was unknown to the plaintiff. As to this, I give no opinion. It is
unnecessary; because it is stated that the vessel remained in the
custody of the captors at the time of abandonment. The defendant's
counsel have urged, that this was the fault of the captain, or of
one of the owners, who was at New-Providence; because, after a
decree of acquittal, a writ of restitution might have been sued
out. But it not being stated, that there was any fault or
negligence in the captain or owner, I do not think that the Court
can infer it. It being stated that the vessel remained in the
custody of the captors, we must presume that the custody was legal.
Whether for the purpose of giving the captors an opportunity of
entering an appeal, or for what other purpose it was that the
restitution was delayed, we are at a loss to determine. But, as
restitution was not actually made, and as the plaintiff was
ignorant, even of the decree of acquittal, his right to abandon
remained unimpaired.
Upon the whole, we are of opinion, that the plaintiff is
entitled to recover for a total loss.
Judgment for the plaintiff. [
Footnote 1]
Footnotes
Footnote 1 Since the
decision of this case, the case of Rhinelander v. The Insurance
Company of Pennsylvania, was argued in the Supreme Court of the
United States, at Washington, in February term 1807, upon a writ of
error from the Circuit Court of the Pennsylvania district; and that
Court ( consisting of MARSHALL, Chief Justice, CHASE, JOHNSTONE,
and LIVINGSTONE, Justices) were of opinion, that in the case of
neutral, as well as of belligerent, property, the assured has a
right to abandon, and to claim for a total loss, as soon as the
vessel is arrested, taken possession of, and carried out of the
course of her voyage.
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