General doc trine of the was held that an illegality committed in the course of the illegality of the ship's voyage between London and Canton could not possibly risk as it affects affect a policy intended to protect the voyage from Canton to the policy. If the policy be on ship "at and from" an illegality at the port will vitiate the policy, though it may cease before the ship sails. 701 * A policy on goods "at and from " a port only attaches Europe. (e) *If, indeed, a policy be effected on the ship "at and from," and there be any illegality in the risk while the ship is at the place, that will vitiate the policy on the entire voyage insured, though the illegality may cease before the ship sails. Thus, where a policy was effected on an American ship "at and from Canton to Hamburgh," and it appeared that the ship, on arriving at Canton, and for a short time while she lay in harbor there, (consequently after the inception of the risk on ship under this policy,) had on board an illegal cargo, which she had taken in at Bombay for sale at Canton, in the course of a separate and distinct voyage: this was held to vitiate the policy on the ship, though she disposed of all her illegal cargo at Canton, and sailed thence for Hamburgh with another. (ƒ) The principle is, that "an illegal cargo on board but for an hour after a policy attaches will avoid that policy and discharge from the load the underwriters from all subsequent liability." (g) ing the cargo on board; if, therefore, before the goods insured are loaded on board, all the the policy on goods is not : In the same case a policy was effected for the same voyage, i. e., "at and from Canton to Hamburgh," on goods which were purchased at Canton for the homeward voyage partly with the proceeds of the illegal cargo, and none of been unshipped, which were, consequently, shipped on board till the whole of the illegal cargo was unloaded: this policy the court held to avoided by such be good the risk on the goods under it did not attach till cargo's having been on board they were loaded on board, when all illegality was at an end by the prior discharge of the illegal cargo with whose proceeds they were purchased. There was, therefore, no illegality in this case, after the risk had once attached under the policy, on the voyage insured; and as to the illegality that had taken place on the ship's voyage outwards from London to Canton, that could not affect the question. "The voyage homeward from Canton," says Lord Kenyon, "being found to be a separate and distinct voyage from that to Canton, the the ship while at the port. (e) Bird v. Appleton, 8 T. Rep. 562. (g) Marshall on Ins. 68. homeward voyage cannot be affected by the former outward General docvoyage." (h) 1 a trine of the illegality of the risk as it affects the policy. * 702 The fact that the goods in sured have been *With regard to the objection that the risk on the goods insured was illegal, because they had been purchased with the proceeds of an illegal cargo taken on board in the course of separate adventure, Lord Kenyon and the rest of the court wholly refused to entertain it. "In such a case as the present," says Mr. J. Lawrence," we cannot inquire into the means by which the merchant gains the money that is afterwards laid out in the purchase of goods; if the obtained by robbery on the highway, and afterwards laid out ference to the in the purchase of a cargo, I do not know why that cargo may not be insured. (i) money were purchased with the proceeds of an illegal cargo, in the course of taken on board another risk, makes no dif policy. cases. The positions, therefore, derivable from the cases appear Result of the to be: 1. That any illegality in the prior stages or at the outset of an integral voyage vitiates a policy, though effected only to protect some later stage of it on which there is no illegality. 2. That an illegality in any part of an entire risk, or voyage insured, vitiates the insurance as to the whole of it. 3. That the illegality of a wholly distinct and separate voyage can have no effect on the voyage described in the policy. Where the polillegality, the icy is void for underwriter § 260. Where the policy is thus avoided in consequence of the illegality of the risk, the underwriter is entirely discharged from all liability, and this, although he himself was cannot be called aware of the illegal nature of the adventure. (j) Nor is the on to pay assured (even though a foreigner) entitled to any return of Nor is the aspremium (k), except under very special circumstances, from sured entitled to which the court may fairly infer that at the time of making the policy he was not, nor, in fact, could have been aware, of the real nature of the transaction. (1) (h) Bird v. Appleton, 8 T. Rep. 566. (i) Bird v. Appleton, 8 T. Rep. 566. (j) Bynkershoek, Quæst. Juris Public. lib. i. c. 21. Roccus (No. 21,) mistakenly advanced the opposite doctrine. See Lord Mansfield's judgment in Holman v. Johnson, Cowp. 343. And the circumstances (k) Vandyck v. Hewitt 1 East, 96. (1) Oom v. Bruce, 12 East, 225. Hen- 1 See Clark v. Protection Ins. Co. 1 Story, C. C. 109, 131; Polleys v. Ocean Ins. Co. 14 Maine, 141; S. C. 13 Peters, (U. S.) 157, 163, 164. losses. any return of premium except under very special circum stances. General doctrine of the illegality of the If premiums have not been paid, the underwriter cannot sue the broker for them, wherever the policy is, in its terms, large enough to com prise an illegal risk, and was, to be applied thereto. Power, 6 M. & must be very special to induce the court to depart from the general rule based on the broad and intelligible principle, that where the contract is founded on a consideration clearly illegal, neither party shall be allowed a locus standi so as to receive any assistance in a court of justice. (m) In further application of this principle the courts have also determined that, where the premiums have not been paid, the underwriter cannot sue the broker for them in cases where the policy, for affecting which they are claimed, is in its language large enough to comprise an illegal adventure, and was intended by the assured to be applied thereto. (n) In the case last cited, in reference to a point that had been in fact, intended made in the argument, viz. that, consistently with the words of the policy, the adventure might have been legal, and the underwriter had no means of knowing that it was not: Lord Ellenborough said, "The policies being large enough to cover an illegal adventure, and an illegal adventure being, in fact, intended to be covered by them, if the plaintiff (the underwriter) really meant to protect that adventure, his subscription was illegal, and consequently his present demand, being grounded on an illegal consideration, cannot be sustained. If he did not mean to protect that adventure, but supposed that some other lawful adventure was intended by the assured, then, admitting the subscription to have been an innocent act on his part, there will be no consideration at all to support his present demand." (0) Principles on which these decisions depend. The principles on which the foregoing decisions depend are, - 1. That no court of justice can interpose to assist either of the parties to an illegal contract; 2. That in pari delicto potior est conditio possidentis. (m) Per Lord Ellenborough in Palyart v. Leckie, 6 Maule & Sel. 293. (n) Jenkins v. Power, 6 Maule & Sel. 283. (0) Per Lord Ellenborough in Jenkins v. Power, 6 Maule & Sel. 259. *SECT. II. - Insurances on Voyages or Traffic illegal by the Laws of the Land. ART. 1. Risks illegal by the Revenue Laws of the United * 704 § 261. The most extensive branch of illegal traffic is that Voyages and trading illegal which is prohibited by the revenue laws of the state; in other by the revenue words, the smuggling trade. laws of the United King gling adven on property It is a clear, settled, and universal principle, that an in- dom: smugsurance on property intended to be employed in carrying on tures. trading adventures contrary to the revenue laws of the state All insurances where the contract is made, or sought to be enforced, is void. concerned in No court, consistently with its duty, can lend its aid to carry into execution a contract which involves a violation of the laws that court is bound to administer. (p) voyages or trading advenbrown tures prohibited Revenue Laws are void in this mon law. And are also declared void, and a penalty 8 & 9 Vict. All insurances, therefore, made or sought to be enforced country at comin this country on goods, the exportation or importation of which is prohibited by the revenue laws of the United Kingdom, are void on the principle just laid down, and they have also been declared so by a variety of acts passed at different times for the prevention of smuggling, the provisions of which are now consolidated by the 8 & 9 Vict. c. 87., the last "Act for the Prevention of Smuggling," the 48th section of which not only avoids the insurance, but imposes a penalty of 5007. upon the parties to the contract, if made in this country. In order to ascertain what goods they are, the importation or exportation of which is now either prohibited altogether, or restricted, except upon payment of certain fixed or ad valorem duties, reference must be had to the last "Act for the general Regulation of the Customs," the 63rd and 112th sec*tions of which contain full tables of prohibitions and restrictions inwards and outwards. (q) Except as mentioned in these two tables, there are no (p) Emerigon, chap. viii. sect. 5. vol. i. p. 215, 3 Kent's Comm. (5th ed.) 262. < U. States v. Sherman, 1 Peters (S. C.) 98. Richardson v. Maine Ins. Co. 6 35. Mass. 102. Russell v. De Grand, 15 Mass. For goods the port of which hibited or restricted, see the export or im is either pro tables of pro hibitions and restrictions, 8 & 9 Vict. c. 86. ss. 63. 112. *705 Voyages and trading illegal by the revenue laws of the United Kingdom: smuggling adven tures. tained in these tables, all restrictions and prohibitions on export and im port, as far as articles the importation or exportation of which is now prohibited in this country, or of which, consequently, the insurance would be void, as made in contravention of the revenue laws. From a misconception of the true principles of commercial Except as con- prosperity, the import and export, and consequently the insurance of many articles was absolutely prohibited, which now form lucrative sources of our revenue, or important branches of our foreign trade. Thus it was for a long time relates to Great considered to be of vital importance to the trade of this Britain, are now abolished. country, that all exportation of wool should be absolutely prohibited, and all insurances effected on exported wool were declared to be void (r); this impolitic prohibition continued down to the year 1825, when Mr. Huskisson, amongst many other commercial reforms, succeeded in procuring its total abolition. (s) But this country pays no atten laws of foreign states. 262. But although the subjects of every state are thus tion to revenue bound by all those positive laws which their own governments may from time to time have seen fit to establish for restraining the freedom of commercial intercourse, and interfering with the natural course of mercantile enterprise, yet they are not by any means obliged to pay the same respect to those laws which foreign states have enacted for similar purposes. Accordingly it was long ago declared by Lord Mansfield, and has never been doubted to be the clear rule of English law since his time, that this country "pays no attention to the revenue laws of another state," and, therefore, that no insurances can be void merely because effected on property embarked in enterprises which those laws would prohibit. (1) 1 *So far has this principle been carried in English law, that 706 (r) By 28 Geo. 3. c. 38. s. 45. See Marshall on Ins. 54, 55. (s) See M'Culloch's Comm. Dict. art. "Wool," for further information on the subject. (t) Lever v. Fletcher, Park on Ins. 505. 8th ed. See also Planché v. Fletcher, Dougl. 238. 1 In this country, the English rule as declared by Lord Mansfield, has been followed to its fullest extent. 3 Kent, (5th ed.) 266; Cook v. Essex Ins. Co. 6 Mass. 122; Richardson v. Maine F. & M. Ins. Co. 6 Mass. 102; Parker v. Jones, 13 Mass. 173; Gardiner v. Smith, 1 John. Cas. 141; Andrews v. Essex F. & M. Ins. Co. 3 Mason, 6, 18, 20; Lansing, C. J. in Gardiner v. Smith, 1 John. Cas. 141. |