Where a ship and cargo barratrously taken out of her course by the crew, and the ship and part of the cargo sold and the remainder sent home by another vessel it was holden*, that this was a total loss of the cargo from the time of the committing of the act of barratry. : Upon a hostile embargo in a foreign port', the ship-owner, who had separately insured ship and freight, abandoned them to the respective underwriters at the same time; the abandonment was accepted by the underwriters; afterwards the embargo was taken off, and the ship completed her voyage and earned freight. The freight having been paid by the freighters to the underwriters on the ship, the ship-owner, the assured, brought an action against one of the underwriters on freight, claiming as for a total loss; it was holden, that the assured could not recover, the freight not having been in fact earned: or supposing it to have been in any other sense lost to the assured, by the abandonment of the ship to the underwriters thereon, it was so lost, not by any peril insured against, but by the voluntary act of the assured in making such abandonment, with which, and the consequences thereof, the underwriters on freight had not any concern. Policy on fruit from Cadiz to London, with the usual memorandum. In the course of the voyage the fruit was so much damaged by the sea water that it became rotten and stunk, and on the ship's arrival at an intermediate port, into which she was driven, the government of the place prohibited the landing of the cargo. The ship also, being too much damaged to proceed on her voyage, was sold, and the cargo necessarily thrown overboard. It was holden, on a case reserved, that the assured were entitled to recover for a total loss; and Chambre, J. said "the ship is expressed to have been so much damaged that she could not proceed, but was sold; now this must certainly have made a complete end of the voyage. We do not construe special cases so strictly as we do special verdicts; on the whole, therefore, it seems to be that the loss was total, and though the cargo might be said to exist in specie, yet in value it did not exist at all. If that be so, the inference of law is plain. What is it against which the underwriters protect themselves by the memorandum? Against partial damage. For what reason? Because, as the commodities enumerated k Dixon v. Reid, 5 B. & A. 597. 1 M'Carthy v. Abel, 5 East, 388. See post. n. (33). Case v. Davidson. m Dyson v. Rowcroft, 3 Bos. & Pul. 474. are perishable in their nature, it might be impossible to ascertain, with exactness, what part of the loss arose from the nature of the commodity, and what from sea-damage. If ever there was a case of total loss, it certainly is the present." After satisfaction made as to the goods themselves", if restored in specie, or compensation made for them, the assured stands as a trustee for the insurer, in proportion for what he has paid. A ship-owner having chartered his ship to J. S.°, insured the ship and freight with different sets of underwriters. Having notice of an embargo laid on the ship in a foreign port, he abandoned the ship and freight to the respective underwriters, and received the whole amount of their subscriptions as for a total loss; first undertaking, by a memorandum on the ship policy, to assign to the underwriters thereon his interest in the ship, and to account to them for it; and afterwards undertaking, by a similar memorandum on the freight policy, to assign to the underwriters on freight all right of recovery, compensation, &c. The ship having been afterwards liberated, returned home, and earned freight, which was received by the assured; it was holden, that however the question of priority as to the title to the freight might have been, as between the different sets of underwriters litigating out of the same fund, and however the weight of argument might preponderate in favour of the underwriters on the ship (33), yet that the assured who had received the freight, was at all events liable on his express n Randall v. Cockran, 1 Ves. 98. o Thompson v. Rowcroft, 4 East, R. 34. See also Leatham v. Terry, 3 Bos. & Pul. 479. (33) See Sharp v. Gladstone, 7 East, 30. where Lord Ellenbo rough, C. J. observed, that as to the general question, whether an abandonment could be made to the underwriters on freight after an abandonment to the underwriters on ship, he desired to be understood as giving no opinion. But in Case v. Davidson, 5 Maule & Selwyn, 79. by three justices, Bayley, J. dissent. it was determined on a special case that an abandonment to the underwriter on ship transfers the freight subsequently earned as incident to the ship. Therefore where ship and freight were insured by separate sets of underwriters, and the ship, being a general ship, was captured, and ship and freight were abandoned to the respective underwriters, who paid each a total loss; and the ship, being recaptured, performed her voyage and earned freight; which was received by the defendant for the use of those who were legally entitled thereto; it was holden that the underwriter on ship was entitled to recover. This judgment was undertaking to pay it over to the underwriters on freight. But in a subsequent case, which arose on the same embargo, it was holden, that although the underwriter on freight was entitled to recover the freight received by the assured, yet the assured might deduct out of it the following expences: 1. The expences of ship and crew in the foreign port, including port charges, (besides the expences of shipping the cargo, which exclusively belonged to the underwriters on freight). 2. Insurance thereon. 3. Wages and provisions of crew from their liberation in the foreign port till their discharge here. 4. Wages (provisions were supplied by the foreign government) to the crew during their detention. But it was further holden, that the assured was not entitled to deduct out of such freight: 1. Charges paid at the port of discharge on ship and cargo. 2. Insurance on ship. S. Diminution in value of ship and tackle by wear and tear on the voyage home. In case of a total loss, where the policy is a valued policy, the value inserted in the policy must be paid by the underwriter. Goods protected by a valued policy, being captured, are condemned as lawful prize, the captors paying freight. The assured may recover as for a total loss. Where the subject matter of the insurance is at first of the value mentioned in the policy, and there is not any imputation of fraud, the underwriter will be bound, in case of a loss, by the valuation in the policy, although the loss happens at the latter end of the voyage, at which time the property insured is considerably diminished in value: as where an insurance was made on ship, stores, and provisions, valued, on a certain voyage, and the ship foundered on her arrival at the port of discharge; it was holden, that the loss being total, and no fraud, the underwriter was liable to pay the value inserted in the policy, although it appeared that the provisions to the amount of half that value had been expended (34). p Sharp v. Gladstone, 7 East, 24. q Marshall v. Parker, 2 Camp. N. P. C. 69. r Shawe v. Felton, 2 East, 109. affirmed, on error, in Exchequer Chamber, M. T. 1 Geo. 4. 2 B. & B. 379. See further as to abandonment of freight, Green v. R. Exch. Ass. 6 Taunt. 68. (34) Valuation at the sum insured is an estoppel in case of a total loss." Per Lee, C. J. in Erasmus v. Bank, M. 21 G. 2. and Smith v. Flexney, Dec. 13, 1747. An action upon a valued policy, the defendant paid into court 301. per cent. It was contended, that as the contract admitted the value, and as the payment of money into court admitted the contract, the defendant had made an admission, which furnished at least a primá facie case for the plaintiff, of a total loss to the amount insured, and that it was incumbent on the defendant to shew that the loss was less than the whole value in the policy. But the court were unanimous, that the defendant's rule was merely an admission that a loss of 301. per cent. had been sustained and no more'. Where there is not any valuation in the policy, the prime cost, or invoice price, together with all charges until the goods are put on board, and the premium of insurance, will be the foundation upon which the loss shall be computed. If part of a cargo, capable of distinct valuation, be lost, the value of such part must be paid'. When there is an insurance on goods, as may be thereafter declared and valued, the assured may, by duly declaring and valuing before the loss, make it a valued policy; but if the assured do not so declare and value, it is then an open policy, and the interest must be proved at the trial. VI. Of partial Losses. A partial loss upon a ship or goods", is such a proportion of the prime cost as is equal to the diminution in value occasioned by the damage. In the case of a partial loss, although the policy be a valued policy, yet the computation must be by the real interest of the assured on board, and not by the value in the policy; that is the policy, notwithstanding the valuation, must be considered as an open policy. In the case of a partial loss upon goods, by sea damage, the rule is, that the underwriter is not to be subjected to the fluctuation of the market, and that he is not liable for any loss which may be the consequence of the duties or charges to be paid after the arrival of the commodity at the place of Rucker v. Palsgrave, 1 Taunt. R. u Marsh. 535. 419. t Per Lord Ellenborough, C. J. Harman v. Kingston, 3 Camp. N. P. C. x Le Cras v. Hughes, Marsh. 541. y Lewis v. Rucker, 2 Burr, 1167. its destination. Hence, in computing the average in a case of this kind, the difference between the respective gross proceeds (35) of the damaged goods, and of the goods if they had arrived sound at the port of delivery, must first be ascertained. Then, whatever aliquot part of the gross proceeds of the sound commodity at the port of delivery such difference constitutes, the same aliquot part of the original value will be the sum for which the underwriter will be liable: e. g. Suppose a hogshead of sugar is insured on a voyage from London to Hamburgh: the original value is 301.; being deteriorated by sea damage, the gross proceeds at Hamburgh amount to 401. whereas, if the sugar had not been damaged the gross proceeds would have amounted to 501. The difference is 101. or one fifth part of 501. The sum then which the underwriter must pay, will be one fifth of 301. the original value, or 61. In cases where the sums are more complicated than in the preceding instance, the calculation may be made as follows; as the gross proceeds of the sound : the gross proceeds of the damaged : the original value a fourth quantity, which being found by the rule of three, must be subtracted from the prime cost, and the difference will be the average loss or sum for which the underwriter is chargeable. : : The proportion of loss is calculated through the same medium (that is by comparing the selling price of the sound commodity with the damaged part of the same commodity at the port of delivery) whether the policy be valued or open*. But the proportion of loss, when ascertained, is applied to different standards of value. For the original value in the case of a valued policy is the valuation in the policy; but in the case of an open policy, the original value is the invoice z Lewis v. Rucker, 2 Burr. 1167. a Usher v. Noble, 12 East, 639. (35) It was solemnly determined in Johnson v. Sheddon, 2 East, 581. recognised in Hurry v. Royal Ex. Ass. 2 Bos. & Pul. 308. that the gross proceeds, and not the net proceeds, must be taken as the basis of the calculation. A cargo insured by a valued policy was confiscated abroad and sold*; but the enemy permitted the foreign consignee to retain from the proceeds the amount of his acceptances which he had previously paid; the assured not having abandoned, the loss became partial only, and the assured was holden to be entitled to recover from the underwriter a sum bearing the same proportion to his subscription as the loss ultimately sustained bore to the whole value in the policy. ⚫ Goldsmid v. Gillies, 4 Taunt. 80. |