LIABILITY FOR G.A. SACRIFICE: JETTISON 121 be called upon to contribute on the basis of a value exceeding that named in the contract between the assured and him. That value being as much a portion of the contract as any other express provision in the policy. But in the case of General Average sacrifices the Act declares that the assured may recover direct from the underwriter in respect of the whole loss without having previously enforced his right of contribution from the other parties liable to contribution. This is the result embodied in the decision in Dickenson v. Jardine, 1868. Until that date it was universally held that the liability imposed on underwriters under the name of General Average meant contribution to General Average. In the case of Dickenson v. Jardine, 1868, a shipment of 641 packages of tea was insured per Canute, from Foochow to London, including the risk of particular average, the policy in the usual form expressly naming jettison as one of the perils insured against. The vessel struck a reef, and in the efforts made to refloat her 607 packages of tea were jettisoned. The merchant claimed the insured value of these packages from his underwriters, who refused to pay, alleging that their only liability was for General Average contribution. It was held by the Court (Bovill C.J., Willes J., and Montague Smith J.) that the owner of the jettisoned goods having insured them against jettison inter alia, "has two remedies-one for the whole value of the goods against the underwriters, and the other for a contribution in case the vessel arrives safely in port; and he may avail himself of which he pleases, though he cannot retain the proceeds of both so as to be repaid the whole of his loss twice over." Consequently, if the owner of the sacrificed goods recovered the amount sacrificed in the shape of contributions from other interests in the venture, he was obliged to hand over those amounts to the underwriter who had already paid him a direct claim for loss of the same goods. Unfortunately, in the decision of Dickenson v. Jardine, it was not stated whether the direct liability of underwriters for loss by jettison came under the head of General or Particular Average, and most average adjusters stated direct claims for ship's sacrifices or sacrifices of cargo, as if they were claims for Particular Average, and consequently subject to the special terms of the policy as to Particular Average. But in 1889 the Court of Appeal decided in Price v. Ar Ships Small Damage Association, that General Average sacrifices and Particular Average losses are so entirely different in character that they cannot be added together to make up the percentage of franchise stipulated in the policy. The result of this is that the direct liability of an underwriter for a General Average sacrifice is unaffected by the memorandum or any other warranty respecting Particular Average. It is respectfully submitted that the whole development since the decision in Dickenson v. Jardine is based on a misconception. The reason why the assured in that case could recover from two sources was that the accident which happened was one of the perils specifically named in his insurance policy giving him a contract right to recover, and that he had at the same time a common law right to have his loss made good by contributions from others interested in the venture. But the fact that the latter right is a right in General Average does not seem to imply of necessity that the assured's direct claim against his underwriter must be a claim of the same class. Examination of earlier policies of insurance, such as the Tiger, the Maria, reveals no mention of General Average, although they both specify jettison. Similarly, although Lord Ellenborough in Blankenhagen v. London Assurance, 1808, stated that "fear of capture is not a risk contemplated under the policy," that did not prevent Chief Justice Abbot in Butler v. Wildman, 1820, from deciding that when the captain of a ship threw a large quantity of dollars overboard to prevent their falling into the hands of an enemy, the loss " if not strictly speaking jettison, is ejusdem generis, and therefore falls within the general words," thus showing the great virtue possessed by the specification of a peril in the policy. Consequently, it is submitted that had the casualty in Dickenson v. Jardine not been a named peril of the policy, there would have been no opportunity to resort to analogy and bring in the idea of a direct claim for General Average sacrifice, such as is now legalised by the enactment of Section 66, Sub-section 4. § 66. (5) Subject to any express provision in the policy, where the assured has paid, or is liable to pay, a general average contribution in respect of the subject insured, he may recover therefor from the underwriter. The remark made above with respect to insured value and the amount insured on the policy holds with respect to this sub-section. § 66. (6) In the absence of express stipulation, the underwriter is not liable for any general average loss or contribution where the loss was not incurred for the purpose of avoiding, or in connection with the avoidance of a peril insured against. It is understood that this sub-section has been introduced in order to exempt English underwriters, using the form of policy given in the Schedule, from liability to contribution for general average for losses and expenses not arising from perils insured against in the policy. Such cases have actually occurred in the past. For instance, the collection as general average of an amount paid by cargo at destination abroad as an additional bottomry debt; in which case the deficiency arose not from any peril insured against, but merely owing to the captain's want of funds. At Bremen, the port in question, deficiency of funds in these circumstances constituted a case of general average. Although the underwriter in this case was finally held liable, it was solely on account of the clause in his policy reading " To pay general average as per foreign statement, if so made up" (Harris v. Scaramanga, 1872).1 § 66. (7) Where ship, freight, and cargo, or any two of these interests, are owned by the same assured, the liability of the underwriter in respect of general average losses is to be determined as if these subjects were owned by different persons. This sub-section gives an insurance-life to a liability which has no existence in common law or apart from insurance, for the owner of a ship could not sue himself as the owner of its cargo for the liability of the cargo to the ship for 1 Similarly, when owing to the insufficiency of coal with which a steamer started on her voyage, no bad weather or other sea peril occurring or intervening in any shape or way, the master had to engage a trawler to tow her to her port of discharge, the Admiralty Court awarded £350 for this service, it was held that there was no claim upon a policy against sea perils (Ballantyne v. Mackinnon, 1896). ship's sacrifices made for the common safety. But presumably in order that he may not be placed in a worse position with regard to insurance, the shipowner is permitted by this sub-section to receive from the underwriters on ship, freight, and cargo, the same contributions as would have been claimable from them if the shipowner and the cargo-owner had been different persons. But there remains a still more difficult question, which has not been handled in the Act, the case of sacrifices of expenditures made on a ballast voyage. There are two varieties of such a voyage. (1) A vessel may have no charter ahead. (2) A vessel may be chartered for a voyage commencing at the end of her ballast voyage. (1) In case of disaster involving sacrifices or expenditure there would only be one interest concerned, that is, the ship herself. And it is conceived that if those expenses were of the nature of salvage charges incurred to prevent a loss by a peril, they would, under Section 65, be recovered as a loss by that peril. If not salvage charges they would be, under Section 64 (2), particular charges. (2) Would this case be adjusted as general average in agreement with the sub-section now under discussion ? The sacrifice or expenditure necessary to put the ship in safety is not so directly connected with the chartered freight as with the vessel herself. The fulfilment of the charter depends not only on the vessel being brought into a position of physical safety after the sacrifice or expenditure in question, but also on her reaching her destination where the charter is to be taken up, and before the cancelling date stipulated in the charter-party. It is certainly fair to say that the relation of the chartered freight to the sacrifice or expenditure in question is not so immediate as that of the ship. The question is, is it too distant to entitle the ship to call upon the freight for a contribution? If a vessel is chartered for several successive voyages or for a period of months or years, to what extent are these forward engagements liable to contribution? These questions really belong to the law of General Average, and only arise in connection with insurance where ballast voyages are concerned. MEASURE OF INDEMNITY Having dealt in detail with the various classes of losses and misfortunes imposed upon the marine underwriter, the Act now proceeds to consider the Measure of Indemnity afforded to the assured by the underwriter in respect of these different classes of disaster. It is worth observing that the policy form given in the first Schedule to the Bill gives absolutely no indication of the extent to which that liability may go or the principles upon which the amount of it is to be ascertained. That form having been adopted by English underwriters generally, both private underwriters at Lloyd's and elsewhere in London, at Liverpool, Glasgow, Hull, Newcastle, Cardiff, and Belfast, as well as by all the Marine Insurance Companies at their Home and Colonial Offices and agencies, and most of their foreign branches and agencies, must be regarded as the typical British policy of Marine Insurance, and is, in fact, accepted as such. But the sole indication of the force and effect of a policy, as stated in itself, is that "it shall be of as much force as the surest writing or policy of insurance heretofore made in Lombard Street, or on the Royal Exchange, or elsewhere in London." What exactly constitutes the full force and effect of the contract has been discovered from the decisions of the law courts in the course of the three hundred and fifty years during which this form of policy has prevailed. Consequently, in dealing with the measure of indemnity granted by a Marine Insurance policy, we are dealing with a tradition which can be traced back to August 1555. The tradition in question is embodied in a clause of the earliest policy yet discovered in English, copied in the file of De Salizar (or Salazar) v. Blackman (Admiralty, File 29, No. 45). No such clause is found in the Italian form prescribed by the Statute of Florence, dated 28th January 1523, as the standard form for all underwriters within the jurisdiction of Florence. It is indeed difficult to gather from that form what risks, if any, except total loss arising from named perils, were recoverable. But at its close there is a clause by which the underwriters |