De Wolf v. New-York Firemen Insurance

Spencer, Ch. J. delivered the opinion of the Court. This case gives rise to three questions; 1st. Was the delivery of the cargo at one of the three ports, Havanna, Laguira, or Porto Cabello, at the election of Levy, a condition precedent to the plaintiff’s right to demand payment of the stipulated price, according to the contract; or was the sale consummated here ? 2d. Was the transaction a cover, and did the plaintiff know that the cargo was for the Spanish government? 3d. Was it necessary for the plaintiff to disclose to the defendants the circumstances under which the property was shipped, even if the risk was enhanced ? The contract on the part of the plaintiff is to deliver the cargo at one of the designated places; and it 'is perfectly clear that the election at which of the ports Levy would receive it, was in him. This right of election, to receive the cargo at Laguira or Porto Cabello, might be made and signified to the plaintiff at Havanna, and so it was understood by the parties to the contract. The policy speaks the same language. The cargo is insured from JVew- York to Havanna, and at and from thence to Laguira and Porto Cabello, or either of them, at a premium of seven per cent., to return five and a quarter per cent.., if the risk ended at [226] Havanna without loss; thus making Havanna a port to which the vessel was to go, at all events, and leaving it op- ' tional with the assured to proceed to one or both of the other ports. The contract is to purchase and sell, deliver-' able in Havanna, Laguira or Porto Cabello. The risk of delivery rests on the vendor, and the purchase is incomplete, unless the cargo be delivered at one of the appointed places, to be elected by the vendee. As an indemnity for the risk to be incurred by the vendor, he wasat liberty to procure . insurance, which, in the event of the delivery, was to constitute part of the price of the cargo, and in the event of a loss, by the perils insured against, the vendor would find his indemnity in the insurance. Until, then, the plaintiff had performed his part of the contract, by delivering the-cargo at one of the designated ports to be elected by Levy, the property never became vested in Levy, and the plaintiff never could recover the price, and consequently it remained the plaintiff’s property. Such a contract, Sir William Scott, in the case of the Packet de Bilboa, (2 Robinson, 111.) considered lawful in time of peace, but as illegal in time of war, and as a fraud on the belligerent, because it went to protect property in transitu to the enemy, and as it deprived the belligerent of his right of capture. It was urged, on the argument, that the cargo was received by the consignees at the Havanna, and that thenceforth the property ceased to be the plaintiff’s. The vessel merely reported herself there to Hernandez and Chauviteau, to whom she was addressed; she remained there but two days, and never broke bulk; and then, by their directions, as agents to Levy, proceeded to Laguira. Nothing like an acceptance of the cargo at Havanna is perceived in these acts; but, on the contrary, an election not to receive the cargo there. It has also been insisted, that as the cargo was consigned to Hernandez and Chauviteau, and was not to be sold, what they did, and particularly the alteration in the bill of lading, was equivalent to an acceptance. It was shown, most satisfactorily, by the late Ch. J. Thompson, in the case of Ludlow v. Bowne and Eddy, (1 Johns. Rep. 1.) that the consignment was open to explanation, whether made to the consignees, on the account and risk of the consignor, or on [227] their account and risk. Hernandez and Chauviteau were also the agents of the plaintiff, in the event that they did not, as the agents of Levy, accept the cargo at Havanna; and, as such agents, they had a right, after electing not to accept the cargo there, with the assent of the captain, to alter the bill of lading in the manner they did, without compromitting the rights of either party. It was a necessary and an innocent act. We come back to the question, whether the contract between the plaintiff, an American citizen, and Levy, a resident merchant at St. Thomas, was so far unlawful, as to subject the cargo to capture as Spanish property. The case of Ludlow v. Bowne and Eddy decides this case; and it is impossible to distinguish the two cases. In both, the property insured was warranted to be American property. There, the cargo was shipped by the plaintiffs under an agreement with merchants in France, whereby' the plaintiffs were to deliver the goods at St. Vallery, for which they were to be allowed eight per cent, commissions, taking upon themselves all risk, expressly including a premium for sea risks as well as war risks; the consignees to pay freight on the delivei’y, and also for the amount of cargo, in bills on London, guarantied by a commercial house in London. The goods were captured in transitu, by the British, and condemned as French property. This Court decided, that the goods remained the property of the consignors, and that the warranty was complied with. A majority of the Court were of opinion, that the goods remained the property of the plaintiffs, until their delivery at St. Fallery. In that case, we held, that there was a right to withhold the delivery of the goods, until payment had been made according to the contract; and here, by the express stipulation of the parties, the plaintiff can have no right to demand payment, until he has performed the condition precedent,- the delivery of the goods according to the contract; so that, in both cases, there was no change of property. The decisions of Sir William Scott, in the Admiralty Court, were then pressed upon our attention; but we regarded them as the result of political expediency, and as evincing a determination in the British councils, to destroy [228] all commerce with their enemy, rather than as rules of international law. We adopted the broad and just principle, that a neutral had a right, and was justified by the law of nations, in supplying belligerents, with the sole exception of contraband goods, and going to a blockaded port. How can the existence of a state of war between Spain and her colonies, not then recognised by the rest of the world as independent states, or how can the existence of war between Spain and Venezuela, under any circumstances, affect such a contract, or render it unlawful ? The warranty in the policy, that the property was American, means that it was so by the law of nations. If the contract would be a legal one in time of peace, which Sir William Scott expressly admits, and if the property would be deemed the plaintiff’s, until actual delivery at one of the elected ports, what would vitiate this contract, or make the property the vendee’s before the performance of the condition precedent, according to the law of nations ? Certainly not because there was a war between Spain and Venezuela; for I trust that this country never will permit the great principle, that a neutral may carry on commerce with a belligerent during war, as well as in peace, with the exceptions already mentioned, to be infringed or abandoned. In the case referred to, we meant to dissent from the principles advanced by Sir William Scott, which go to consider all property bound to an enemy’s country as belonging to the enemy, and as exposed rightfully to capture and condemnation. We meant to consider that rule as an arbitrary one, forming no part of the international code, and as entirely destructive of neutral rights. Subsequent reflection has served to strengthen the opinion 1 held in that case ; and it has led to a conviction that the doctrines advanced by that eminent Judge, in the British Admiralty, were the result of power forgetting right, and the offspring of state policy, created for the occasion. As to the alleged concealment, or non-disclosure by the plaintiff, that the cargo was intended by Levy for the Spanish government, the case definitively settles the point; for it is admitted by the defendants, that the plaintiff did not know that Levy had contracted with the Intend ant at, [229] Havanna to supply the Spanish government with flour ana provisions; and that he did not know that the cargo, on its arrival at its port of final destination, would have been applied by Levy to the performance of his contract. But it is urged, that the facts and circumstances of the contract should have been disclosed, as the risk was materially enhanced. If it be conceded, that those circumstances did enhance the risk, the answer is decisive, that a party need not communicate any thing with respect to a fact, in regard to which there is an express or implied warranty. As to the conclusiveness of the sentence of condemnation, we are not at liberty to question the doctrine on that point, which has been definitively settled in the Court for the Correction of Errors, and has been so long acquiesced in. There must be judgment for the plaintiff, according to the stipulation in the case. Judgment for the plaintiff.