Merchants Insurance Co. v. Edmond

17 Va. 138
CourtSupreme Court of Virginia
DecidedOctober 15, 1866
StatusPublished

This text of 17 Va. 138 (Merchants Insurance Co. v. Edmond) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Merchants Insurance Co. v. Edmond, 17 Va. 138 (Va. 1866).

Opinion

RIVES, J.

This action was brought upon a policy of marine insurance, whereby the appellees procured of the appellants an insurance of fifteen thousand dollars upon a certain cargo of the Sally Magee, at a premium of one and a quarter per cent. The policy bears date on the 24th of December, 1860, when the underwriters and insured were alike citizens of Virginia and of the United States. The barque Sally Magee was owned by citizens of Virginia, and as such also citizens of the United States, and was duly registered in the United States custom house for the port of Richmond. On the 10th day of May, 1861, she cleared from Rio de Janeiro, having on board, for the insured, coffee to the amount of six thousand nine hundred and nine dollars and forty-two cents, with United States papers and under the United States flag, for Richmond, *Virginia, or some other Atlantic port of the United States, and while proceeding on her voyage was captured by the United States on the 27th of June, 1861, on the high seas, outside of the capes of Virginia, and was subsequently condemned and confiscated by a prize court of the United States. The loss of the ap-pellees was .total, and due notice of condemnation and abandonment was given to the underwriters.

In the agreed case upon which the judgment of the court below was rendered, reference was specially made and allowed to the constitution, laws and public acts of the government of the United States; to any facts or circumstances of a general and historical character touching the United States, of which the court would take judicial cognizance if Virginia had not dissolved its political connection with the United States ; to the public acts of the Confederate States, and the several states composing the Confederate States; and to the historical facts touching the formation and establishment of the Confederacy and government of the Confederate States. The case was submitted as “set out in this agreement, and in the declaration, to which a plea of the general issue was pleaded, and issue thereupon joined.” The case was heard and decided by the court below on the 4th day of Eeb-ruary, 1863, and judgment given for the $6,909.42, the value of the coffee condemned and lost.

The review of this judgment presents for consideration several questions of interest and importance. The distinguishing feature of the cause is new, and it is not surprising that it invited the counsel on both sides to a latitude of discussion beyond the actual necessities of the occasion. But I shall cautiously abstain from following counsel into inquiries, however interesting not strictly pertinent and necessary; nor shall I be tempted to intimate any opinion whatsoever upon certain questions that have *been made in this cause, and which I deem out of its legitimate pale. The examination I propose shall be confined to the distinct issues of the cause, and shall preclude, as beyond the proprieties of my place, the intimation or expression of opinion upon irrelevant matters. The great and controlling controversy in this cause is whether any, and, if any, what effect the great change in the political relations and governments of these parties, supervening upon their contract of insurance of 24th December, 1860, should have upon the construction or validity of that contract. When they contracted, they were citizens of the United States; when the cause of action arose, they found themselves in fact, whatever they may have been in theory, the subjects of another government, and, as such, enemies of the United States, and in arms against them. How far the terms of their contract and the intendment of law shall bind or discharge the underwriters under the actual circumstances of this loss, depends in a great degree upon the legal character and incidents of this policy. For this reason it is fit that certain general principles of law upon this subject should be advanced, before attempting to solve the main question which I have just stated.

Marine insurances are of vast benefit to commerce. . By distributing losses, they fortify the merchants of small capital, and encourage in a variety of ways commercial enterprise and adventure. They are therefore entitled to the favor of courts, and should be so construed as to sustain the fair intent of the parties, neither enhancing on the one hand the risks of the insurer, nor on the other impairing the indemnities of the insured. It is well observed by Parsons, in his treatise on Maritime haw, vol. 2, p. 49, that if by construction ‘ ‘the insured are always favored, either the practice of insurance must cease, or the premiums must be enlarged to cover the risks of the *law as well as the perils of the sea, until insurance becomes so costly that the best men will give it up, because it will be more profitable for prudent and honest merchants to stand their own insurers.” In Pelly v. Royal Exchange Assurance Company, 1 Burr. 344-349, it was said by Eee, C. J., that “in the construction of policies the strictum jus or apex juris is not to be laid hold on, but they are to be construed largely for the benefit of trade and for the insured;” and in Wolff v. Horncastle, 1 Bos. & Pull. 316, Buller, J., speaks [307]*307of a policy of insurance as “a contract ubérrimas fidei, in which we must avoid bearing' harder upon the plaintiffs than is absolutely necessary.”

Where words of doubtful or ambiguous import are used in the policy, it has been decided in the case of Dole & another v. New England Mutual Marine Insurance Company, 6 Allen 373, that “that interpretation is to be adopted which is most favorable to the claims of the assured under the policy. This is the ordinary and familiar rule applicable to the construction of all policies of insurance. It is founded on the consideration that the contract being one of indemnity to the assured, it is most consonant to the intent of the parties to construe it so that the extent of the indemnity shall be as great as a just interpretation of its terms will fairly admit; but that this salutary and well-established rule of interpretation can have no application to a case where the terms of the policy are clear and unambiguous.” Alluding to this principle of favor to the insured, Parker; J., in Hood v. Manhattan Fire Insurance Company, 1 Kern. R. 532, says: ‘ ‘ Where the words are not ambiguous, and the expression of the intent of the parties is full, I know of no reason why they should be excepted from the general rules of law applicable to the „ construction of all contracts.” Dord *Ellenborough in Robertson v. French, 4 East’s R. 130, 135, uses the following explicit language: “In the course of the argument it seems to have been assumed that some peculiar rules of construction apply to the terms of a policy of assurance, which are not equally applicable to the terms of other instruments, and in all other cases; it is therefore proper to state that the same rule of construction which applies to all other instruments applies equally to this instrument of a policy of insurance, namely, that it to be construed according to its sense and meaning as collected in the first place from the terms used in it; which terms are themselves to be understood in their plain, ordinary and popular sense, unless they have generally, in respect to the subject matter, as by the known usage of trade or the like, acquired a peculiar sense distinct from the popular sense of the same words; or unless the context evidently points out that they must, in the particular instance, and in order to effectuate the immediate intentions of the parties to that contract, be understood in some other special and peculiar sense.”

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Bluebook (online)
17 Va. 138, Counsel Stack Legal Research, https://law.counselstack.com/opinion/merchants-insurance-co-v-edmond-va-1866.