SUPPLEMENTAL.

Speaking, in 1791, of a marine policy, Buller, J., says, "it is founded's on usage and must be governed by usage." This proposition must now be taken with qualifications. A usage may be either a general usage of trade, or a particular usage, prevailing only among particular classes or in particular localities. When a general usage has been affirmed by judicial decision, it becomes incorporated with the law merchant, and thenceforward evidence of any usages inconsistent therewith, is inadmissible. A particular usage must be proved by evidence in each case, at any rate till it becomes so notorious that the Courts will take judicial notice of it.3 It is only binding in so far as it forms an implied term of the contract between the parties concerned.

As a marine policy is an instrument in writing, evidence of usage is not admissible to contradict anything which is plainly expressed.1 Such evidence is only admissible to explain what is technical or ambiguous, or, as lawyers put it, to annex incidents to the contract.5

a question

§ 88. Where by this Digest any reference is made to Reasonable reasonable time, reasonable premium, or reasonable dili- time, etc., gence, the question what is reasonable is a question of of fact. fact."

§ 89. Where there is a duly stamped policy reference Slip as

evidence.

1 Brough v. Whitmore (1791), 4 T. R. at p. 210.

2 Goodwin v. Robarts (1875), L. R. 10 Ex. at p. 357, Ex. Ch.

3 Cf. Ex parte Turquand (1885), 14 Q. B. D. at p. 645.

♦ Arnould, Ed. 6, p. 291; Parkinson v. Collier, 2 Park. Ins. 653.

5 For illustrations of the part played by usage, see Universo Ins. Co. v. Merchants' Mar. Ins. Co. (1897), 2 Q. B. 93 (liability of broker for premium); Atwood v. Sellar (1880), 5 Q. B. D. 286, C. A. (practice of average adjusters to charge certain general average expenses to particular average, invalid); Stephens v. Australasian Ins. Co. (1872), L. R. 8 C. P. at p. 23 (declarations on floating policies); Dickinson v. Jardine (1868), L. R. 3 C. P. 639 (special usage as to jettison, invalid); Sweeting v. Pearce (1861), 30 L. J. C. P. 109 (usage of Lloyd's as to settlement of losses); Blackett v. Royal Exchange (1832), 2 Cr. & J. 244 (usage not to pay for boat slung outside, invalid); Palmer v. Blackburn (1822), 1 Bing. 60, 64 (measure of indemnity, gross freight).

As to reasonable time, see Carlton Steamship Co. v. Castle Mail Packets Co. (1898), A. C. at p. 491, per Lord Herschell; Currie v. Bombay Native Ins. Co. (1869), L. R. 3 P. C. at p. 79; as to premium, see note to § 32.

I

SECT

Interpretation of terms.

may be made to the slip or covering note, in any action for rectifying or avoiding the policy.1

NOTE.-Lord Blackburn says, " As the slip is clearly a contract for marine insurance, and is equally cleraly not a policy, it is, by virtue of these enactments (the stamp laws) not valid, that is, not enforceable at law or in equity; but it may be given in evidence, wherever it is, though not valid, material."2 For example, the slip is evidence for the purpose of correcting an error in the name of the ship. So, too, if the insurer seeks to avoid the policy on the ground of concealment of a material fact, the date of the slip would be material to show whether, when the fact came to the knowledge of the assured, the contract had or had not been concluded.3

§ 90. In this Digest, unless the context or subjectmatter otherwise requires—

66

5

"Action" includes counter-claim and set off: 4
"Assured" includes the agent of the assured:
Freight" includes the profit derivable by a ship-
owner from the employment of his ship to carry
his own goods or movables, as well as freight pay-
able by a third party, but does not include passage

"Insurer" includes the agent of the insurer: 7

"Movables" mean any movable tangible property,

1

1 McArthur, Ed. 2, p. 23; Arnould, Ed. 6, p. 260; Leake on Contracts, Ed. 3, pp. 270, 342; Ionides v. Pacific Mar. Ins. Co. (1872), L. R. 7 Q. B. 517, Ex. Ch.

2 Ionides v. Pacific Mar. Ins. Co. (1871), L. R. 6 Q. B. at p. 685 (name of ship).

3 Cory v. Patton (1872), L. R. 7 Q. B. 704; cf. Lishman v. Northern Mar. Ins. Co. (1875), L. R. 10 C. P. 179, Ex. Ch.

4 Cf. § 62 (1) of the Sale of Goods Act, 1893 (56 & 57 Vict. c. 71).

5 Arnould, Ed. 6, p. 158; Ocean Steamship Ins. Assn. v. Leslie (1889), 22 Q. B. D. at pp. 724, 726.

6 Arnould, Ed. 6, p. 31; Flint v. Flemyng (1830), 1 B. & Ad. 45; see note, post.

'Arnould, Ed. 6, pp. 150, 271; McArthur, Ed. 2, p. 50.

66

SUPPLEMENTAL.

other than the ship, and include money, valuabl

securities, and other documents: 1

Policy" means a marine policy.

ity

NOTE. In ordinary shipping law the term "freight " is sometimes used to denote the goods or cargo laden on board ship. More commonly it is used to denote the sum payable to a shipowner by a third person for the use of a ship as a vehicle for merchandise.2 In insurance law the term has a wider meaning. In a case where it was held that an insurance on freight" did not cover coolies' passage money, Willes, J., after commenting on the different meanings of the word, says it has been "decided that 'freight' sufficiently represents the interest of the shipowner in the carriage of his own goods, and includes the value of their carriage.” "93 It is immaterial to the insurer whether the ship be regarded as hired to an actual or to a hypothetical charterer. As to “advance freight," see § 12.

§ 91.-(1.) Nothing in this Digest affects:-
(a.) The provisions of the Stamp Act, 1891, or any
enactment for the time being in force relating
to the revenue;' or

(b.) The provisions of the Companies Act, 1862, or
any enactment amending or substituted for the

same.5

(2.) The rules of the common law, including the law merchant, save in so far as they are inconsistent with the express provisions of this Digest, and in particular the rules relating to the effect of fraud, illegality, misrepre

1 See Baring Brothers v. Marine Ins. Co. (1893), W. N. p. 164 (postal packet containing stock certificates); The Pomeranian (1895), P. 349 (live cattle); Sleigh v. Tyser (1900), 2 Q. B. 333 (live cattle). The term "goods" in a marine policy has a restricted meaning. See post, p. 130.

2 By English law, apart from special contract, freight is only payable on right delivery of the cargo, and freight pro ratâ itineris is not recognized. Cf. Carver's Carriage by Sea, Ed. 3, § 542.

3 Denoon v. Home and Col. Ass. Co. (1872), L. R. 7 C. P. at p. 349. * See the stamp provisions set out, post, p. 136.

See the notes to § 85.

Savings.

SEC

Conflict of laws.

116

Calculation of time.

aration, and mistake, apply to contracts of marine insurance.1

NOTE.-In continental countries marine and mercantile cases are relegated to special commercial tribunals. In England, as in the United States, they are dealt with by the ordinary courts of justice. The law merchant is part of the common law, and its special rules are enforced as part of the ordinary law of the land. Marine insurance is a contract, and, in so far as that contract has not special incidents peculiar to itself, it is dealt with on the same footing as other contracts. If the law of contract were codified in England, the special rules relating to marine insurance would form a chapter in that code. Conflict of Laws.-Mr. Dicey sums up the decisions in the following rules. An underwriter is bound by an average adjustment duly taken according to the law of the place of adjustment, that is to say, when the voyage is completed in due course, by the law of the port of destination, or, when the voyage is not so completed, by the law of the place where the voyage is rightly broken up and the ship and cargo part company. An English insurer of goods shipped by an English merchant on board a foreign ship is not affected by the law of the flag.2

As Lush, L.J., says, an insurer on an English policy may, if he chooses, stipulate "that such policy shall be construed in whole or in part according to the law of any foreign state, as if it had been made in and by a subject of the foreign state, and the policy in question does so stipulate as regards general average; but, except when it is so stipulated, the policy must be construed according to our law, and without regard to the nationality of the vessel.” 3

The differences in time in different places raise some curious points. Suppose a ship is insured in London with A up to midnight of the 31st of December, without any special provision as to time, and with B from the 1st of January. The ship founders in the West Indies on the 31st of December at 10 p.m. according to ship's time. According to London time A's policy would have expired, and the risk

As to fraud and misrepresentation, see Leake on Contracts, Ed. 3, pp. 291, 330; as to illegality, ibid. p. 620; as to mistake, ibid. pp. 262-287, and Spalding v. Crocker (1897), 13 Times L. R. 396.

2 Dicey's Conflict of Laws, pp. 597, 598; cf. Wavertree Co. v. Love 1897), A. C. 373, P. C.

3 Greer v. Poole (1880), 5 Q. B. D. 272 (English policy with foreign adjustment clause).

would be on B's policy. In the case of an English policy it seems that, in the absence of any provision to the contrary, the liability must be determined according to Greenwich time; see the Statutes (Definition of Time) Act, 1880 (43 & 44 Vict. c. 9), which applies to every English "Act of Parliament, deed, or other legal instrument." But if the policy were effected in India the point would be a debatable one.