276 XV. fecur. Not. 12. Le Guidon, c. 2. art. 19. CHAPTER THE FIFTEENTII. R Of Re-Affurance, and Double Infurance. CHAP. DE-ASSURANCE, as understood by the law of Eng land, may be faid to be a contract, which the first insurer enters into, in order to relieve himself from those risks which he has incautiously undertaken, by throwing them upon other underwriters, who are called re-affurers. This fpecies of contract has obtained a place in most of the commercial fyftems of the trading powers of Europe; and it is allowed by them at this day to be politic and legal. The learned Roccus has decided exprefsly in favour of it; and has cited many refpectable Roccus de Af- authorities in fupport of his opinion. "Affecurator, poft "factam affecurationem, poteft fe affecurari facere ab alio "affecuratore, et ifle fecundus affecurator tenetur pro affecu"ratione factâ a primo, et ad folvendum omne totum, quod "primus affecurator folverit, et ifta fecunda affecuratio valet." By the ancient law of France fuch affurances were reckoned valid, and perfectly confiftent with equity and good conscience. The author of the Guidon obferves, that if it fo happen that the infurers, after underwriting the policy, repent of their engagement, or are afraid to encounter the risk, they are at liberty to re-infure; but ftill they cannot prevent the infured from making his demand upon them in cafe of lofs, for having, by their fignature, promifed indemnity, they cannot, by any proteftations to the contrary, difcharge themselves from their refponfibility, without the confent of the infured. Lewis the Fourteenth, when, by the affiftance of the famous Colbert, he promulgated thofe ordinances, which will be a lafting honour to the French nation, adopted the idea that prevailed when the Guidon was written: for by an article in that celebrated code of laws, he exprefsly declared, "that it fhould be lawful to the infurers to make re-affurance with other men of thofe effects, which they had themselves previously infured." It is not in France alone that this law prevails; for by the pof Ord. Lewis 14. tit. Allur. art. 20. 2 Mag. 190. 233.419. XV. tive and exprefs regulations and ordinances of Koning fberg, CHA P. Hamburgh, and Bilboa, re-affurances are allowed to be effected, and confequently are lawful contracts. By the paffage cited from the Guidon it might be obferved, that it was a diftinguishing character of this fpecies of contract, that notwithstanding a re-infurance, the first contract fubfifls as at firft, without change or amendment. The re- 1 merigon, infurer is wholly unconnected with the original owner of the P. 247. property infured; and as there was no obligation between them originally, fo none is raised by the fubfequent act of the first underwriter. The risks of the infurer form the object of the re-infurance, which is a new independant contract, not at all concerning the infured; who confequently can exercise no power or authority with refpect to it. Agreeably to the laws of thofe countries juft referred to, and confiftently with the opinions of those refpectable writers, whole works we have had fuch frequent occafion to mention, the law of England adopted their regulations, and permitted the underwriters upon policies to infure themfelves against thofe rifks for which they had inadvertently engaged to indem nify the infured; or where perhaps they had involved themfelves to a greater amount, than their ability would enable them to discharge. Although fuch a contract seems perfectly fair and reasonable in itself, and might be productive of very beneficial confequences to thofe concerned in this important branch of trade; yet, like many other ufeful inflitutions, it was fo much abufed, and turned to purposes fo pernicious to a commercial nation, and fo deftructive of those very benefits it was originally intended to promote and encourage, that the legillature was at 1:ft obliged to interpofe, and by a positive law to cut off all opportunity of practifing those frauds in future, which were become thus glaring and enormous. P thiér, tit. Affurance, No. 96. Accordingly by the fourth fetion of that ftatute, which 19 Geo. II. formed the fubject of the preceding chapter, it was enacted, c. 37. f. 4. that it fhould not be lawful to make RE-ASSURANCE, unless "the affurer fhould be infolvent, become a bankrupt, or die; CH. A P. in either of which cafes, fuch affurer, his executors, ad XV. 19 Geo. II. 4. 32. 1. 2. "miniftrators, or affigns, might make re-affurance, to the "amount before by him affured, provided it should be expreffed in the policy to be a re-affurance." From this act it is apparent, that all kinds of re-affurance are not prohibited; but wherever fuch a contract tends to the advancement of commerce, or to the real benefit of an individual, in fuch a cafe it fhall be permitted. Thus in case of infolvency or bankruptcy, it is advantageous to the creditors in general, as well as to the individual, that a re-assurance fhould be made: for by these means the fund of the bankrupt's eftate is not diminished in cafe of lofs, and the infured has a better fecurity for the payment of the amount of his damage, or at least a proportion of it (a). If the infurer die, it is no (a) Formerly, if an underwriter became a bankrupt after he had fubfcribed the policy, and before a loss happened, the insured was not entitled to a dividend out of the bankrupt's estate. This being found a heavy inconvenience, and a discourage ment to trade, parliament was obliged to interpofe, and to alter the law in this refpect. The ftatute recited, that merchants and traders frequently lend moncy ❝on bottomry, or at refpondentia, and in the course of their trade, frequently cause "their fhips or veffels, and the goods and merchandizes loaded thereon, to be in"fured; and that where commiffions of bankruptcy have iffued against the obligor "in fuch bottomry or refpondentia bond, or the underwriter, or affurer in fuch in"furance, before the loss of the ship or goods, in fuch bond or policy of infurance "mentioned, had happened, it had been made a queftion, whether the obligee or "obligees in fuch bond, or the affured in fuch policy of infurance, should be let "in to prove their debts, or be admitted to have any benefit or dividend under "fuch commiffion, which might be a discouragement to trade." It was therefore enacted, "that the obligee in any bottomry, or refpondentia bond, and the affured "in any policy of infurance, made and entered into, upon a good and valuable "confideration, bona fide, should be admitted to claim; and after the lofs or con❝tingency fhould have happened, to prove his, her, or their debt and demands, ❝ in refpect of fuch bond or policy of insurance, in like manner as if the lofs or manner, as contingency had happened before the time of the iffuing of fuch commiffion of "bankruptcy against fuch obligor or infurer; and fhould be entitled unto, and fhould have and receive, a proportionable part, fhare, and dividend of fuch "bankrupt's estate in proportion to the other creditors of fych bankrupt, in like if fuch lofs or contingency had happened before fuch commiffion "iffued: and that all and every perfon and perfons, against whom any commiffion of bankruptcy should be awarded, should be discharged of and from the debt or debts, owing by him, her, or them, on every fuch bond and policy of infurance "as aforefaid, and should have the benefit of the several statutes now in force againft bankrupts in like manner, to all intents and purposes, as if fuch loss or contingency had happened, and the money due în refpe&t thereof had become payable, before the time of the iffuing out the commiffion," lef XV. lefs necessary and beneficial to his fucceffors, that there fhould CHA P. be a re-affurance, than it was in the former cafe of a bankruptcy: because it will provide affets to fatisfy the infured in cafe a lofs fhould happen, and thus fecure the eftate of the deceased for the benefit of his heirs. Indeed, in both cales, the intention of the legislature feems to have been, to provide a fund for the payment of that proportion, which, in cafe of an infolvency, the infured will have a right to demand, in common with the other creditors; ́and for the payment of the whole, without prejudice to the heir, even in cases where the ancestor, at the time of his death, was in folvent cir cumftances. This act is worded in fuch exprefs terms, excluding every fpecies of re-affurance, except in the three inftances of death, bankruptcy, or infolvency, that a doubt, as it should feem, could hardly be founded upon it. But as it was held, that the Vide ante, c, 14 Erft clause of the ftatute, prohibiting infurances, intereft or no intereft, did not extend to foreign fhips; fo it was argued, that re-affurances made here on the ships of foreigners did not fall within the act. It might have occurred, however, that the first clause of the statute is qualified, and only prohibits fuch infurances when made on his majesty's fhips, or the fhips belonging to his majefty's fubjects: whereas the clause in question is general and without reftriction; the inference from which is, that the legislature had both objects in view, and meant wholly to prohibit the one, but not the other. Fletcher, This point came on to be confidered by the court of King's Andree v Bench, in the year 1787, in the form of a special cafe, ftating, 2 Term. Rep. that a re affurance was made by the defendant on a French_161. veffel, firft infured by a French underwriter at Marfeilles, who was living, and who, at the time of fubfcribing the fecond policy, was folvent. The court (Abhurft, Buller, and Grofe, juftices) were unąnimously of opinion, that this policy of re-affurance was void : and that every re-affurance in this country, either by British fubje&ts or foreigners, on British or foreign fhips, is void by the eHA P. the ftatute; unless the first affurer be infolvent, become a bank rupt, or die. XV. Le Guidon, c. 2. art. 20. tit. Affu. art. 20. 2 Mag, 190. 419. There is another fpecies of re-affurance allowed by the laws of France, as established by an ordinance of Lewis the Four teenth, which was alfo taken from that ancient and excellent French treatife, that has been fo frequently mentioned. By Ord. of Lewis 14. this regulation, it is declared lawful for the affured to infure the folvency of the underwriter. By these means, the person infured gets rid of thofe fears, which he may have conceived concerning the ability of the infurers to pay, and he gains a fecond fecurity to answer for the fufficiency of the firft. But it is not to France alone that this kind of contract is reftrained; for by the pofitive laws of many other maritime ftates, fuch re-affurances are valid and binding contracts. The English statute, which has been the fubject of this and the preceding chapter, takes no express notice of this fort of infurance; because, in truth, I believe, it never was very much in practice in England but, however, it feems clear, that fuch a circumftance, as the folvency of the underwriter, is not an infurable interest; that a policy opened upon fuch an event would be treated as a wagerpolicy; and would confequently fall within the flatute of George the Second, which declares all policies made by way of gaming or wagering, to be abfolutely null and void to all intents and purposes. Donble Infurance. "Burr. 496. Having faid thus much of re-affurances, I fhall proceed to confider the nature of a double infurance, and to state the few cafes that have been determined upon the fubject. I treat of it in this place, because these two kinds of infurance have been fometimes confounded together, and supposed to mean the fanie thing: whereas no two ideas can be more diftinct. We have already feen what is meant by a re-affurance. A double infurance is where the fame man is to receive two fums inflead of one, or the fame fum twice over, for the fame lofs, by reason of his having made two infurances upon the fame goods or the fame fhip. The firft diftinction between thefe two contracts is, that a re-affurance is a contract made by the firft underwriter, his executors or aligns, to fecure himself, or his effate; a double |