Hartshorne v. The Union Mutual Insurance Co. SAMUEL H. HARTSHORNE, Plaintiff and Appellant, V. THE UNION MUTUAL INSURANCE COMPANY, Defendants and Respondents. * * The defendants, an Insurance Company located in New York, executed and delivered to J. Day & Co., of Apalachicola, Florida, a Marine Policy, being in form a Cargo Policy, numbered 784,) by which they in terms, "on account of whom it may concern, to cover only property which may be indorsed hereon, by said J. Day & Co., loss, if any, payable to the parties named in the certificate granted by said J. Day & Co., and subject to conditions contained therein, and not inconsistent with the terms of this Policy, do make insurance, lost or not lost, at and from ports and places to ports and places, on cotton," &c. $250,000 was written on the margin of the Policy as the sum insured. With this Policy the defendants delivered to J. Day & Co. blank certificates, to be issued to persons who might contract for insurance under the Policy; which certificates state that the person named in them, respectively, is insured by the defendants; and they also delivered to J. Day & Co. a letter of instructions, which states, inter alia, that said certificates are each of them considered by the defendants as representing a Policy issued by the Company itself." November 14, 1853, the defendants, by a written certificate of that date, extended the sum insured by Policy No. 784, an additional $250,000. On the 28th of October, 1853, the defendants issued a further policy, (numbered 993,) for $250,000 to J. Day & Co., in form like that numbered 784. J. Day & Co. pasted the Policy No. 784 in a large book, (called their Policy Book,) entered in it the substance of each certificate issued by them, and the fact and date of issuing it, and also the aforesaid certificate of renewal of Policy No. 784, and the further Policy No. 993. The risks attaching during each month under the certificates, as these amounts were ascertained, were entered in said Policy Book, and numbered consecutively as entered, in a column in which specific risks were also entered and numbered as entered. On the 15th of November, 1852, J. Day & Co. issued to the plaintiff one of said certificates, indefinite as to amount, thereby insuring, under Policy No. 784, cotton to be shipped by persons, and at and from places named therein, consigned to the plaintiff. This certificate was renewed November 15, 1853, by an indorsement made thereon by J. Day & Co., (and entered in said Policy Book,) continuing the insurance until July 1, 1854. The cotton in question, which was covered by the terms and embraced within the insurance stipulated by the certificate issued to the plaintiff, was shipped on the 1st and 2d of February, 1854, and on the 3d was totally lost by the perils insured against. Early in February, 1854, it was ascertained that all risks taken from the commencement of the business, including specific risks, Hartshorne v. The Union Mutual Insurance Co. exceeded $750,000 in the aggregate prior to the time the cotton in question was shipped. This suit was brought to recover the value of the cotton shipped February 1 and 2, 1854, and the complaint was dismissed, on the grounds that J. Day & Co. could not make valid contracts exceeding $750,000 in the aggregate, and that when the risks actually taken had reached that sum, all certificates of insurance previously issued became inoperative and void. On appeal it was held: 1. That the certificate so issued to the plaintiff was the contract of the defendants, and obligatory from the time of its delivery. 2. That such certificate covered the cotton in question. 3. That, as between the plaintiff and third persons subsequently insured, whether insured under similar certificates issued, or upon specific risks taken subsequent to the issuing of the plaintiff's certificate, the plaintiff's contract, being first in point of time, gives him priority of right, and that he is to be protected in preference to them, even if it be held that J. Day & Co. could not bind the defendants for sums exceeding $750,000 in the aggregate. That J. Day & Co. having, by the certificate issued to the plaintiff, insured all cotton described therein to be thereafter shipped to him, could not deprive him of the benefit of that insurance by subsequently insuring others. 4. That, without deciding the question whether J. Day & Co. could make valid contracts of insurance for sums exceeding $750,000 in the aggregate, the judgment should be reversed and a new trial granted. (Before BOSWORTH, Ch. J., and WOODRUFF and MONCRIEF, J. J.) THIS is an appeal by the plaintiff from a judgment dismissing his complaint. The action was tried before Mr. Justice HoFFMAN without a jury, in October, 1855. It is brought to recover for a total loss upon a contract of insurance alleged to have been made between the plaintiff and the defendants on the 15th of November, 1853, and which, by its terms, was to continue in force until July, 1854. The loss in question occurred early in February, 1854, and there is no question as to the fact of a loss or of its amount. The main question is, whether the property so lost was in fact insured by the defendants. The contract of insurance was made in Apalachicola, Florida, by J. Day & Co., as agents of the defendants. The powers of J. Day & Co., a firm doing business at Apalachicola, arose in this wise: The defendants executed and delivered to J. Day & Co., a Cargo Policy, (No. 784,) dated October 27, 1852, in favor of J. Day & Co. for $250,000, in terms, "on account of whom it may Hartshorne v. The Union Mutual Insurance Co. concern, to cover only property which may be indorsed hereon by J. Day & Co., loss, if any, payable to the persons named in the certificates granted by said J. Day & Co., and subject to conditions contained therein, and not inconsistent with the terms of this Policy." * * By the terms of this Policy, the defendants make insurance "at and from ports and places to ports and places, on cotton," and "upon all kinds of lawful goods and merchandises laden or to be laden on board any good vessel or vessels, steamer or steamers," &c. The premiums to be at the same rates as charged by other good companies or agencies, to be governed as near as may be by the tariff of premiums furnished with such Policy to J. Day & Co., "the premiums on risks to be fixed at the time of indorsement, and such clauses to apply, as the Company may insert, as the risks are successively reported." An indorsement on the Policy declares that "this Policy is to be deemed continuous unless otherwise directed by either party, thirty days' notice being given to the assured, to enable risks which had already attached previous to the receipt of notice by J. Day & Co. to terminate." The defendants delivered with this Policy, to J. Day & Co., a letter of instructions and blank certificates, to be filled up by J. Day & Co., and to be delivered by them to persons whom they might agree to insure under the Policy. The Policy itself J. Day & Co. pasted in a book, in which book they entered, under correct dates, the fact of their having granted insurance and certificates to the several persons with whom they subsequently made contracts of insurance. On the 15th of November, 1852, the plaintiff applied to J. Day & Co., as such agents, for insurance, and J. Day & Co. signed and delivered to him one of the certificates, and at the same time indorsed on Policy (No. 784) by entering in the book in which it was pasted, the following, viz. : "Certificate granted to S. H. Hartshorne to cover all cotton shipped per good steamboats, from points on the Chattahoochee river, by or for account of the following parties, and consigned to S. H. Hartshorne, valuation per bale annexed to each name. Fire risk at Apalachicola three days after landing." Hartshorne v. The Union Mutual Insurance Co. Then follow the names of ten persons or firms who were to so ship cotton, and against the name of each of said persons was the name of the place from which he was to ship and the agreed valuation of each bale he might ship. Having made this indorsement on the Policy, J. Day & Co. filled up and signed one of the blank certificates furnished to them by the defendants, and delivered it to the plaintiff. It is in these words: "UNION MUTUAL INSURANCE COMPANY OF N. Y. "F. S. LATHROP, President. "JNO. S. TAPPAN, Vice-President. "FERDINAND STAGG, Secretary. แ Certificate No. 1. "APALACHICOLA, Nov. 15, 1852. "Entered this day on Policy No. 784, issued by the Union. Mutual Insurance Company, of the city of New York, sundry amounts, per endorsements made in books accompanying this certificate, by J. Day & Co., on account of sundry persons whose names appear on book, payable in case of loss to S. H. Hartshorne, on cotton shipped per good steamboats from points on the Chattahoochee river to Apalachicola, and consigned to S. H. Hartshorne, valued at, per indorsements made in book by J. Day & Co., on board the ..... ... master, at and from .... to... time of sailing....; bills of lading dated The said S. H. Hartshorne, therefore, is insured by the said Union Mutual Insurance Company, lost or not lost, for the said sum of, per indorsement, dollars as above. "Binding. J. DAY & Co." In the letter of instructions accompanying the Policy and certificates, when delivered to J. Day & Co., the defendants say: "These Policies are granted in the form presented, for the purpose of enabling you to take risks for other parties under the same, and the certificates are to be used as evidence for the assured that the risks described by them are covered by the Policy in your hands, and are considered by us, in fact, as representing a Policy issued by the Company itself, subject to all the conditions of the same, and in case of loss, payable in like manner." Hartshorne v. The Union Mutual Insurance Co. According to the course of business, the plaintiff's consignors of cotton shipped it on steamers at the points on the Chattahoochee river named in the certificate, consigned to him; and as a general thing information of the fact of shipment could not be received by the plaintiff before the arrival of the cotton, as the same steamer which carried the cotton, also carried the mail containing advices of the shipment. The certificate granted to the plaintiff was pasted in a small book which he kept, and as each cargo arrived, he entered in this book the date of such arrival, the quantity, and by whom shipped; and at the end of each month presented this book to J. Day & Co., whereupon the amount payable for premiums was ascertained and then or soon thereafter paid. The amount of property thus ascertained to have been at risk during the month, was then entered by J. Day & Co., as of that date in their Policy Book, that is, in the book in which Policy (No. 784) was pasted. This course was pursued with respect to every person to whom J. Day & Co. issued one of these certificates. And these certificates were treated as open and continuing Policies, covering all goods shipped thereafter, from time to time, answering the description contained in the certificates. J. Day & Co. also took specific risks, and these were entered in their said Policy Book under the dates when they were respectively taken. By the 14th of February, 1853, it was ascertained that $250,000, in the aggregate, had been at risk under Policy (No. 784,) and the defendants sent to J. Day & Co. a paper reading thus: "MARINE. "OFFICE OF THE UNION MUTUAL INSURANCE COMPANY. "NEW YORK, February 14, 1853. "An additional sum of $250,000 is hereby granted upon Policy No. 784, issued to J. Day & Co., of Apalachicola, subject to the same terms and conditions as the original insurance under our letter of instructions. "FERDINAND STAGG, Sec'y." "JNO. S. TAPPAN, Vice-Pres't. J. Day & Co. pasted this renewal in their said Policy Book, and continued the business of insuring as before. |