Imágenes de páginas

SECT. 4.

As to subsect. (2) (b), which reproduces the effect of §§ 1-3 of the Marine Insurance Act, 1745 (19 Geo. 2, c. 37), set out post, p. 133, the following points may be noted:

(1.) The statute is confined in terms to British ships, and goods and effects laden thereon. Therefore a p.p.i. policy on a foreign ship is not illegal if, as a fact, the insurer has a lawful interest and can prove it. As, however, such a policy bears the mark of wagering on the face of it, the Lords' Select Committee thought that the provision should be generalized.

(2.) The statute speaks of ships, and goods and effects laden thereon. But a wide construction has been put on these terms, and the scope of the Act has been extended to policies on profits, and commission on ships and goods, effected, "without benefit of salvage." 1

(3.) The scope of the Act is not confined to the exact terms prohibited. Any similar terms avoid the policy. Thus a policy on cash advances, "full interest admitted," is void.2

(4.) A distinction must be drawn between p.p.i. policies and policies" without benefit of salvage," that is to say, in modern language, "without benefit of abandonment." The nature of an insurance may be such that, in case of loss, there could be nothing to abandon to the insurer, and it seems that such a policy may lawfully be effected "without benefit of salvage." Nine judges, in giving their opinion to the House of Lords in Lucena v. Crauford,3 say that the 19 Geo. 2, c. 37," which prohibited insurances without benefit of salvage, was not to be understood as prohibiting the insurance of things not capable of salvage, but only as prohibiting the insertion of a clause to that effect in a policy upon things which were capable of salvage." Reinsurance seems to be a case in point. See § 63 (10), post.

(5.) The statute further contains two more or less obsolete exceptions, viz. policies on privateers, and policies on ships in the Spanish trade.

(6.) The statute does not extend to Ireland.1

(7.) It is an open question whether an honour policy (e.g. a p.p.i. policy on disbursements) can constitute a breach of a warranty to keep a certain proportion of the value of a ship uninsured.5

1 De Mattos v. North (1868), L. R. 3 Ex. 185; Allkins v. Jupe (1877), 2 C. P. D. 375; see at p. 388 as to possibility of salvage in such a case. Berridge v. Man on Ins. Co. (1887), 18 Q. B. D. 346, C. A; see, too, Gedge v. Royal Exchange (1900), 2 Q. B. 214.


3 Lucena v. Crauford (1806), 2 B. & P. at p. 310; 6 R. R. at p. 694. Keith v. Protector Mar. Ins. Co. (1882), 10 L. R. Ir. 51.

5 Roddick v. Indemnity Mar. Ins. Co. (1895), 2 Q. B. 380, C. A.

§ 5.—(1.) Subject to the provisions of this Digest, SECT. 5. every person has an insurable interest who, at the time Insurable of loss, is interested in a marine adventure.1

(2.) In particular a person is interested in a marine adventure where he stands in any relation (legal or equitable) to the adventure, in consequence of which he benefits by the safety or due arrival of insurable property, or is prejudiced by its loss, or by damage thereto, or by the detention thereof, or incurs any liability in respect thereof.2

(3.) A prospect or possibility of loss or gain, which, at the time of loss, is not founded on any right or liability (legal or equitable) in, or in respect of, the subject-matter insured, is not insurable.3

NOTE. Three questions, often confused, must be kept distinct, viz. : 1. Has the assured an insurable interest? 2. Is the subject-matter in respect of which his interest arises sufficiently described in the policy? 3. What is the quantum of his interest?

The definition of insurable interest has been continuously expanding, and dicta in some of the older cases, which would tend to narrow it, must be accepted with caution. The essence of interest is (a) that there should be a physical object exposed to sea perils, and (b) that the assured should stand in some relationship, cogrizable by law, to that object in consequence of which he either benefits by its preservation, or is prejudiced by its loss, or mishap thereto.

It appears to have been held that a person who had bought goods at sea under a verbal contract, which was unenforceable by reason of the Statute of Frauds, had not an insurable interest. But would this

1 Arnould, Ed. 6, p. 55, Wilson v. Jones (1867), L. R. 2 Ex. 139, Ex. Ch.

2 Arnould, Ed. 6, p. 101; as to equitable assignee of freight, see Wilson v. Martin (1856), 11 Ex. Ch. 684.

3 Lucena v. Crauford (1806), 2 B. & P. 269; 6 R. R. 623, H. L.; Seagrave v. Union Mar. Ins. Co. (1866), L. R. 1 C. P. 305, at p. 320 (cargo); Barber v. Fleming (1869), L. R. 5 Q. B. at p. 71 (freight); and see, e.g., Manfield v. Maitland (1821), 4 B. & Ald. 582 (loan to shipowner); Stainbank v. Fenning (1851), 11 C. B. 51 (invalid bottomry bond).

Stockdale v. Dunlop (1840), 6 M. & W. 224.



SECT. 5. be the case now that it is established that the statute affects the remedy only and not the right?

It is clear, since Wilson v. Jones (1867), L. R. 2 Ex. 139 (insurance by shareholder in an Atlantic Cable Company on the successful laying of its cable), that interest is not confined to rights in the nature of property or arising out of contract, for the assured had no property in the cable nor any contract respecting it.

But is not subsect. (2) still too narrow? Suppose A is offered an appointment abroad on the condition that his acceptance of the offer is received by return of post. Why should he not insure the safe arrival of the letter, although he has no legal rights in respect of it after it is posted? Subsect. (2) is, therefore, framed as being inclusive, not exhaustive.

Interest can hardly be defined exhaustively, and probably the criterion proposed by Lawrence, J., a century ago, cannot be improved upon: "Interest," he says, "does not necessarily imply a right to the whole or a part of a thing, nor necessarily or exclusively that which may be the subject of privation; but the having some relation to or concern in the subject of insurance, which relation or concern, by the happening of the perils insured against, may be so affected as to produce a damage, detriment, or prejudice to the person insuring. To be interested in the preservation of a thing, is to be so circumstanced with respect to it as to have benefit from its existence, prejudice from its destruction." "" 1 Elsewhere, speaking of liability to third persons, he says, "Did they mean to game, or was there not a loss against which they might indemnify themselves by insurance?" 2 "The general rule," says Willes, J., "is clear, that to constitute interest insurable against a peril, there must be an interest such that the peril would, by its proximate effect, cause damage to the assured."3

French law drew a distinction between "frêt acquis" and "frêt à faire," the former being insurable, the latter not.4 English law draws no such distinction. Thus chartered freight on homeward voyage may be insured against loss by perils on the previous outward voyage.5

1 Lucena v. Crauford (1806), 2 B. & P. at p. 302, cited and approved by Lord Blackburn in Lloyd v. Fleming (1872), L. R. 7 Q. B. at p. 302.

2 Boehm v. Bell (1799), 8 T. R. 162 (prize insured by captors).

3 Seagrave v. Union Mar. Ins. Co. (1866), L. R. 1 C. P. at p. 326. Code de Commerce, Art. 347; but it is believed that this rule has now been modified.

5 Rankin v. Potter (1873), L. R. 6 H. L. 83, at p. 114.

§ 6. (1) The assured must be interested in the SECT. 6. subject-matter insured at the time of the loss.1

When interest

Provided that where the subject-matter is insured, must "lost or not lost," it is immaterial that the assured may attach. not have acquired his interest until after the loss, if at the time of effecting the contract of insurance he was not aware of the loss.2

(2.) Where the assured has no interest at the time of the loss, he cannot acquire interest by any act or election after he is aware of the loss.3

(3.) Where the buyer of goods has insured them, he has an insurable interest, notwithstanding that he might, at his election, have rejected the goods, or have treated them as at the seller's risk, by reason of the latter's delay in making delivery or otherwise.1

NOTE. The section relates only to the existence of interest as a condition to effective insurance. A policy founded on interest may, of course, be assigned after loss.5

It has been argued that the rule contained in the proviso to subsect. (1) only applies to the case of a partial loss, but that is not so. Suppose a man buys a cargo while at sea. It turns out that before the purchase was completed the cargo had perished. As a rule, the contract is void, and, therefore, the buyer has no insurable interest; but there is such a thing as an emptio spei, as opposed to the purchase of a thing itself.

In the old form of pleading, interest was averred as existing during the risk and at the time of the loss. But if interest was traversed, it was sufficient to prove interest at the time of the loss (Bullen and

1 Rhind v. Wilkinson (1810), 2 Taunt. at p. 243; Anderson v. Morice (1876), 1 App. Cas. 713.

2 Sutherland v. Pratt (1843), 11 M. & W. 296, and post, p. 122.

3 Anderson v. Morice (1876), 1 App. Cas. 713, H. L.

See Col. Ins. of New Zealand v. Adelaide Ins. Co. (1886), 12 App. Cas. 128, P. C.


Sparkes v. Marshall (1836), 2 Bing. N. C. 761, and see further, Sched I. rule 1, post, p. 122.

• See Chalmers' Sale of Goods Act (1893), § 5, and notes thereto.

SECT. 6. Leake, Prec. of Pleading, Ed. 3, p. 611). Until interest was acquired, the policy could not attach.

Defeasible or contingent interest.

Suppose A makes a contract for the purchase of a cargo of corn, to be loaded on a certain ship, and insures his purchase. Part of the cargo is put on board, and then burnt. If, on the true construction of the contract, it appears that the property and risk in the corn were not to pass to A till the complete cargo was loaded, he has no insurable interest, and cannot acquire one.1

In the case provided for by subsect. (3), the assured has an actual interest, defeasible only at his own option. Suppose A buys goods by sample, to be shipped from abroad, and insures them. Goods which are inferior to sample are shipped, and then partially sea-damaged on the voyage. A may accept the goods, and claim on the policy. If A rejects the gcods, presumably he could not claim on the policy, but could he assign the policy to the seller, and then reject the goods? Probably not; but various complications may be suggested which still await decision.

§ 7. A defeasible interest is insurable, as also is a contingent [or inchoate] interest.

NOTE. Where captors of a ship insured her, but the Prize Court afterwards restored her to her owners, it was held that the premium was not returnable, for the risk had attached. The interest in this case may be regarded either as defeasible or contingent.2

In Lucena v. Crauford (1806), 2 B. & P. pp. 294, 295, seven of the judges, in their opinion to the House of Lords, say, "Inchoate rights, founded on subsisting titles, unless prohibited by positive laws, are insurable. Freight, respondentia, and bottomry are of this description." And then, after discussing various ancient definitions of insurance, they go on to say: "These definitions clearly embrace a contingent interest which is subject to the perils of the sea, and for the loss of which a compensation may be made." Re-insurance is a good example of a contingent interest.

In Clay v. Harrison (1830), 10 B. & C. 99, the seller stopped goods in transitu after partial loss. Held that the buyer could not recover on his policy, as his interest was defeated by the seller's resumption of possession. But how far would that case be followed,

As to when the risk passes from seller to buyer under a contract of sale, see Chalmers' Sale of Goods Act, 1893, §§ 20 and 32, and notes thereto. 2 Boehm v. Bell (1779), 8 T. R. 154.

« AnteriorContinuar »