Providence Washington Insurance Co. v. Adler

Stone, J., delivered the opinion of the Court. The plaintiffs shipped by a line of steamers, running from New York to the south, a quantity of oil cloth clothing to Louisiana and Texas. They insured this clothing before shipment in the office of the defendant company. The clothing was packed in boxes, and on its arrival at its destination, it was found injured and comparatively worth — 166 — less, either by spontaneous combustion or by some chemical action arising from the material in the goods themselves. They all presented the appearance of having been burned or charred within the boxes. The clothing was' not injured by any external force or accident, but whatever the injury was, it was the result of the inherent in-, firmity of the goods themselves. Neither the plaintiffs nor the defendants knew at the time the insurance was effected, that the goods were liable to spontaneous combustion, or to be injured by any inherent defect in the goods. No extra premium to cover such risk was paid. Under these circumstances, the defendants claim that by the general principles of insurance law, they are not liable for a loss by spontaneous combustion, caused by the inherent infirmity of the goods themselves. This was a marine policy, and one of the dangers insured against, by the terms of the policy, was fire. But while this is undoubtedly so, the question remains, and is still undecided in this State, whether the term “ fire ” used in the ordinary marine policy will, upon general principles, cover the case of spontaueous combustion, caused by an inherent infirmity in the article insured, and not the result of accident or peril of the sea. There is no doubt of the liability of the defendant company, under its policy, had the ship taken fire, and the goods been consumed ; or had the fire originated from any of the perils insured against; but the question is a very different one, when, as in this case, the goods are in good faith insured, and believed both by plaintiffs and defendant, not to be liable to spontaneous combustion by reason of their inherent infirmity, but which in fact were so liable, and were so injured. The authorities are few upon this subject, and neither full nor satisfactory. One of the oldest to which we have access is Emerigon, who says, page 290 : “Art. 12 of another title establishes, as a general rule, that everything which happens through the inherent vice — 167 — of the thing, or by tlxe act of the owners, master or merchant shipper, shall not be reputed a peril, if not otherwise borne on the policy.” It is then certain that the insurers never answer for damages and losses which happen directly through the act or fault of the assured himself. It would be in fact intolerable that the assured should be indemnified by others, for a loss of which he is the author. This rule is grounded on first principles. It is a general rule, from which it is not permitted to derogate by a contrary agreement. As Pothier remarks, “it is evident that I cannot validly agree with any one, that he shall charge himself with the faults that I shall commit.” We do not understand this learned author to mean, that an article may not be insured that is inherently liable to spontaneous combustion, or decay, provided it is so expressed in the policy, but not otherwise. But if the loss happens through the fault of the assured, then the insurers are not liable, whatever may be the terms of the policy. For example, if an article is insured, which when dry is not liable to spontaneous combustion, but when he puts it on board, it is wei, in such case no recovery can be had. Such we understand to be the views of this author. The next case to which we are referred, is the case of Boyd vs. Dubois, 3 Campbell. In that case Lord Eelenborougk said, “ If the hemp was put on board in a state liable to effervesce, and it did effervesce, and generate the fire which consumed it, upon the common principles of insurance law, the assured cannot recover for a loss which he himself lias occasioned.” The defendant in that case attempted to prove that the hemp, which was insured, was put aboard ship in a damaged condition; and for that reason, was apt to ferment and take fire. This case is in accord with Emerigon. The next authority, is Parsons on Contracts, 2 vol., page 374, 6th edition. The author therein says: — 168 — “It is another rule, that insurers are not liable for property destroyed by the effect of its own inherent deficiencies or tendencies, unless these tendencies are made active and destructive, by a peril insured against. Thus, if hemp, which was dry when laden, be afterwards wet by a peril of the sea, and by reason of such wet ferments, or rots, or burns, the insurers would be liable.” And that very learned author refers to both Emerigon and the case of Boyd & Dubois as his authorities. Chancellor Kent also takes a similar view, in his Commentaries, 3 Volume, ch. 48. Phillips on Insurance, ch. 13, marginal page, says: “ It is a general rule that insurers are not, under the common form of the policy, liable to any damage or loss arising from the qualities or defects of the subject insured, since these are not among the perils assumed by the underwriter.” Parsons on the Law of Marine Insurance, vol. 2, page 216, holds the same view. He says : “It is also a rule, that the insurers are liable for no subject-matter of insurance, which is destroyed by reason of its own inherent defects or tendencies. But this rule does not apply to tendencies which are called into activity only by a peril insured against. Thus, if hemp insured, burns up, or rots from spontaneous ignition or fermentation, it being known that this may happen, if the ’ hemp be damp, but not if it be dry, the question would be, whether it was damp or dry, when it was put on board. But if the hemp were dry when laden, and was afterwards wet by reason of the straining of the ship in a storm, or by the shipping of a sea, or any like peril, then the insurers, whether on ship or cargo, would be liable.” All these authorities refer to Emerigon and the case in 3 Campbell, and are all upon marine insurance. On the other hand, we have been referred to the case of The British American Insurance Co. vs. Joseph, de — 169 — cided in the Court of Appeals for Lower Canada, which has been supposed to decide that a fire insurance (not marine) covers the risk of spontaneous combustion; and citing that case only, Mr. May, in liis Work on Fire Insurance, comes to the same conclusion. The Lower Ganada case is certainly very imperfectly reported. The report is in French, and the Court gave no opinion; the terms of the policy are not set out, and but a very few of the facts in the case. It is by no means clear, from the few facts that are stated, that the spontaneous combustion did not originate in a heap of uninsured coal, and extend from that to the insured coal. But suppose the case has all the effect claimed for it, by the appellees, and does decide that in a purely fire insurance, the risk of spontaneous combustion is covered, we could not agree that it should overrule the long list of high authorities to the contrary in marine policies. More especially since the reasons to the contrary, we think, are satisfactory. No well managed insurance company would take a marine risk, on an article inherently liable to spontaneous combustion; nor would any prudent shipmaster or owner receive such on his vessel, as not merely the property so insured, but the property of others, and the safety of the ship, and the lives of the crew, would be endangered by so doing. It would, as Fmerigon says, be intolerable that the owner should receive pay for goods, that destroyed themselves. The object of a marine policy is to insure against the perils of the sea, and not against the perils incident to the goods themselves. In this case it is very clear that the goods wore injured by their own inherent infirmity, and that such inherent infirmity was not called into activity by any peril insured against. We think such loss was not within the contemplation of either party to the contract of insurance. That the term, “ fire,” used in the policy, included fire from — 170 — accident, or brought about by a peril of the sea, and not spontaneous combustion. (Decided 11th March, 1886.) Entertaining these views, we think, the Court below was in error, in granting the fourth prayer of the plaintiffs, and in refusing the first prayer of the defendant, and the judgment must be reversed. But inasmuch as the evidence is full and explicit, that the injury was caused0 by the inherent infirmity of the goods, a new trial will not be awarded. > Judgment reversed. Application was made in this case, on the 1st of April, 1886, in behalf of the appellees, for a re-hearing, upon the ground that the Court was in error, in determining that there was full proof in the record, that the injury was caused by the inherent infirmity of the goods insured. Upon a careful re-examination of the case, the Court were of the opinion that their. judgment was justified by the evidence in the record, and disallowed the application; but, assuming that the appellees might be able to furnish other evidence on the point in question, not offered in the former trial, the case was remanded, and a new trial was awarded.