assured. Who may be IN treating of persons as parties to a contract of marine insurance, we shall find that the general doctrine of law, as to the capacity and incapacity of persons to make a contract, is essentially modified by the peculiar nature of this contract, the sole object of which being indemnity against certain losses, requires in the person contracting for indemnity an interest in the subject insured in respect of which he may be damnified. Even that general rule is liable to be further modified by express prohibitions of the municipal law, and by the necessities of our war policy, and the principles of international law. It is obvious that a contract, which purports to provide an indemnity for the assured against loss, becomes, when perverted to the purposes of one who has no interest in the subject insured in respect of which he can suffer loss, nothing better than a bet or wager upon the event of the voyage or adventure described in the policy. Such policies, with no interest to justify the assured in making them, came into frequent use in the reign of Charles the Second, and in the time of Queen Anne our Courts of justice unfortunately pronounced them to be valid and legal. An Act of Parliament (19 Geo. 2, c. 37) afterwards declared them illegal in respect of the property of British subjects; and the consequence is, that as to all that is not the property of British subjects there may still be a contract of insurance made with those who have no interest whatever in the subject insured.1 As to British property, however, the statute in effect reduces the policy once more to a contract of indemnity, and raises the legal presumption, which may be challenged by way of defence, that the assured in every instance has in the subject of insurance an interest at risk. We have already considered the Subjects of Insurance. The term Interest, as we are now using it, does not denote any one of these Subjects, but rather the commercial advantage arising to the person assured out of some beneficial relation which he has with the subject insured. may be in insurable By the very nature therefore of the contract, as now Those only enforced in the Courts of this country, those who are parties mid who to a policy of marine insurance in respect of British property have an are presumed to have an insurable interest in the property interest. specified, and are deemed without such interest incapable of putting the policy in suit on their own behalf. This insurable interest, indispensable to one who on his own account would attempt to enforce a contract of marine insurance, is thus described by a Judge of the highest legal reputation:-"A man," says Lawrence, J., "is interested in Description a thing to whom advantage may arise or prejudice happen interest. 1 Unless indeed this be now altered by the declaration that all contracts by way of gaming or wagering are null and void under the 8 & 9 Vict. of insurable What is an Insurable the chattel indefinitely modified. from the circumstances which may attend it; and whom it The plainest instance of an insurable interest is the ownership of the subject of insurance. The variety of ways in which this ownership may be modified suggests again the Ownership of various questions, some of them of considerable nicety, by which the inquiry as to the insurable interest of the assured may be perplexed. The chattel owned may be held in trust, or may be subjected to incumbrances, such as mortgages and liens, or to rights in other persons, as by deed of demise or contract of charter-party, or it may be sold under a reservation of rights or liabilities in the vendor, or may be possessed so conditionally as to be liable to defeasance at the 1 Lucena v. Craufurd, 2 B. & P. N. R. 269, 302; and by the same learned Judge, Barclay v. Cousins, 2 East, 514; see also on the same sub ject, 1 Marshall, Ins. 101, 102; 1 Phillips, Ins. no. 172 et seq.; 3 Kent's Comm. 276, 277. 2 will of another,1 or to seizure for a forfeiture incurred before the voyage described in the policy. In all these instances an insurable interest undoubtedly exists, and independent insurable interests may co-exist in several persons at the same time, but whether under certain modifications such as may be supposed in the circumstances an insurable interest does exist in a particular person may be a somewhat difficult question. Besides "the property of the thing," there may be an Benefit, advantage, or "interest derivable from it," a "benefit or advantage directly liability. arising out of or depending on such thing," or a liability coupled with the loss of the thing, constituting an insurable interest in the person for whom such benefit or on whom such liability exists. It may be but an expectancy founded on a present existing legal title, or an inchoate right under a contract made indeed, and already in the inception of execution. Freight, for instance, in its various acceptations under insurance law,3 whether it be ship's earnings, chartered hire, or enhanced value, becomes an insurable interest the moment that a title to it so accrues from the circumstances as that nothing but the intervention of the perils insured against could intercept the benefit. Profits and commissions are similar instances of insurable interest, consisting of expectancy founded upon existing title, and liable only to be prevented by the perils insured against, although in the second of these two instances there is generally a total absence of ownership of the chattel from which the commissions are derivable. So, the liability of canal owners, or carriers by water, or of insurers, to compensate or indemnify in respect of losses affecting the property carried or insured by them, is such an interest as is insurable." 1 Per Lord Ellenborough, Stirling v. Vaughan, 11 East, 629. 2 Wilkes v. People's Fire Ins. Co., 19 N. Y. 184; 1 Phillips, no. 195; per Lord Eldon, Lucena v. Craufurd, 2 B. & P. N. R. 319, 320. 4 Crowley v. Cohen, 3 B. & Ad. Must be liable to the against. Again, an interest, in order to be insurable must be such perils insured as to be immediately, and not only by way of consequence, affected by the perils insured against in the policy. Thus profits, by evidence of the state of the market, would have been secured but for the loss of the goods, commissions but for the same calamity, freight but for the disabling of the ship by the perils of the sea. A person, however, who advances money in this country to a British shipowner for the repair of his ship, acquires thereby no insurable interest, unless the money be secured by some such legal interest in the vessel as a mortgage, or bottomry lien, and yet the loss of the ship may by way of consequence involve the loss of the money. The following case furnishes both an affirmative and negative illustration of the principle under consideration. The assured held shares in the Atlantic Telegraph Company, but his shares could not be exposed to the perils insured against, and consequently were not insurable; the cable might be exposed to the perils, but could not be the property of the assured, for it was the property of the company; both the shares and the cable, however, were described in the policy in such a way that this, coupled with other parts of the description, led the Court to the conclusion that the adventure of laying the cable was the intended subject of insurance, and as his shares gave him a direct interest in that, which, moreover, was exposed to the perils insured against, this was held to be such an insurable interest as sustained the policy.1 When possessed. Again, the time of the loss is the moment at which the assured's rights under the policy are determined, according as his title, whence flows his insurable interest, was then valid and complete or otherwise. So that one who is merely in L. R., 8 C. P. 18. "So the liability neutral”—per Lord Eldon, in Lucena v. Craufurd, 2 B. & P. N. R. 323. 1 Wilson v. Jones, L. R., 1 Exch. 193; 2 Exch. 139. |