American Insurance v. Dunham

By the Court, Nelson, J. In the case of Seton, Maitland & Co. v. Low, 1 Johns. Cas. 1, determined in 1791, this court decided, in an action upon a policy of insurance, that articles contraband of war were lawful goods, within the meaning of that term in the policy, and that any goods not prohibited by the positive law of the country to which the vessel belongs, are lawful goods. See also Skidmore v. Deldoity, 2 Johns Cas. 77, and Juhel v. Rhinelander, 2 id. 120, affirmed in the court of errors, in same vol. p. 487. The capture and detention in that case were on account of articles contraband of war. In consequence of this decision, the clause in question was introduced into the New-York policies, which protects the insurer “ from any charge, damage or loss, which may arise in consequence of a seizure or detention for, or on account of any illicit or prohibited trade, or any trade on articles contraband of war." 1 Caines, 491, Hamilton, arguendo. • This meets the supposed hardship of the rule established in the cases above referred to, in its broadest extent. Whether the clause of warranty by the assured against illicit trade, &c. included the barratrous acts of the master, was a question presented to the court in Suckley v. Delafield, 2 Caines, 222, some four years (1804) after the decision in the case of Seton v. Low, and when the purpose of the clause must have been well understood by the judges. The construction then given to it, and which is decisive of this case, should be adhered to, even if we were dissatisfied with it, which we are not. So clear were the court on the point, that, as appears from the report of the case, they declined hearing an argument on the part of the plaintiff. We are bound to presume that since that decision, parties have acted with a full knowledge of the construction then given to this clause in policies, and we should regret exceedingly, if [467] we were obliged, after the lapse of thirty years, to draw in question its soundness. If there ever was a case in which the court should feel bound by the maxim stare decisis, this is that case. A different construction now would shake and alarm the confidence of the commercial community. The usual clause against the barratry of the master, I presume was contained in the policies in this case, (though the policies are not set forth in the bill of exceptions,) and which existed before the introduction of the clause now under consideration. The argument for the defendants below is, that barratry, by means of illicit trade, or putting on board contraband goods by the master since the new clause, is not insured against, it being embraced within the terms of the warranty. Now it was for the court to ascertain and determine the true meaning and intent of these two clauses; and having done so the court, as well as parties, are bound by it. They have, decided that this clause of warranty of the assured, does not interfere with or alter the clause of insurance against the barra-try of the master. If any authority was wanted to sustain the decision of Suckley v. Delafield, the case of Havelock v. Hancill, 3 T. R. 277, may be referred to. There the defendant insured the ship Economy in any lawful trade for 12 months. The policy also contained a clause insuring against the barra-try of the master and mariners. The ship was seized and detained for having on board a quantity of brandy, &c., which the master had put there without the knowledge or assent of the plaintiff; and for this act of barratry, the ship became forfeited, &c. All the facts were spread out in the declaration, to which the defendant demurred; and it was contended, on his part, that the seizure happened while the ship was engaged in an unlawful trade, namely, smuggling; and that it was indifferent to the underwriter whether it proceeded from the act of the master or owner. Lord Kenyon decided that the owner was not engaged in an unlawful trade, for the words lawful trade in the policy meant the trade in which the ship was sent by the owner; that the act of the master was barra-try, within the policy against which the underwriter had insured. The principle, of the two cases are alike. [468] The case of Mumford v. Phœnix Ins. Co., 7 Johns. R. 449, was undoubtedly decided under the impression, by the judge who delivered the opinion, that the act of the captain, in entering Cherbourg, after he was compelled to touch at Plymouth, was not barratry ; and that if it could be deemed to fall within the term illicit trade, it would be within the warranty of the assured, and the right to recover defeated.. 2 Johns. Cas. 187, 8, Kent, J. That the act was not barratrous, according to the doctrine of this court, is palpable. 2 Caines, 67. 13 Johns. 451. Phillips on Ins. 230, 1. Here the act of the master is indisputably barratrous, and we consider it too well settled in this court, to admit of question that the policy covers a loss thus arising, without regard to the particular act whether from illicit trade or otherwise, notwithstanding the warranty of the assured. Phillips on Ins. 235, 6. Judgment affirmed.