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Vol. II.]

GERMANIA INSURANCE COMPANY v. SHERLOCK.

[No. 7.

The contract of insurance being the language of the insurer, must be taken most strongly against the underwriter. Where there is any ground for fair doubt, this rule applies against the underwriter. Blackett v. Assurance Co. 2 Cromp. & J. 251; Snapp & Hanger v. Mer. & Man. Ins. Co. 8 Ohio St. 461, 462; Donnell v. The Col. Ins. Co. 2 Sumn. 381; Bullen v. Denning, 5 B. & C. 847; Earl of Cardigan v. Armitage, 2 B. & C. 207; 1 Duer on Ins. 161, 162, sec. 6; Western Ins. Co. v. Cropper et al. 32 Penn. 355; Knight v. Cambridge, 1 Strange, 581.

The maxim, Causa proxima non remota spectatur, is specially applicable to insurance contracts and to this case.

The maxim above quoted becomes especially necessary in insurance contracts in order that there may be a plain and intelligible rule by which the liability of the underwriters to the assured, and among themselves, can be ascertained. Suppose there had been another set of policies covering these boats against the perils of the river. What would that class of underwriters have said if sued for this loss? Would they not have replied, that the collision did no damage to the boat, but that she was burned up, and that the underwriters against peril by fire were bound for the loss?

But for this maxim, what an interminable confusion and opportunity for litigation! Except for this rule, how could any one adjust the cases, and charge to the assured and to each set of underwriters their appropriate shares of the loss? Cases of the kind are not uncommon. See Stacy v. Frank. Ins. Co. 2 W. & S. 506; Gerodt v. Del. M. Ins. Co. 31 Mo. 596; Madison Ins. Co. v. Fellows, Disney, 228; The Ass. F. Ins. Co. v. Assum, 5 Md. 168; Blake v. Ex. M. Ins. Co. 12 Gray, 273; How. Ins. Co. v. Scribner, 5 Hill, 301.

So complicated has the modern contract of insurance become, that it is now among the most difficult of practical affairs to adjust such losses satisfactorily; and only by strict compliance with this maxim in many of the cases can any adjustment be made.

And this maxim in fact is so applied to avoid such difficulties, and such application is established by the courts. Perrin's Adm'r v. Pro. Ins. Co. 11 Ohio, 171; 2 Arnould on Ins. 766; Dabney v. New Eng. M. M. Ins. Co. 14 Allen, 309; Ionides v. Uni. Mar. Ins. Co. 14 C. B. 284; Dixon v. Sadler, 5 Mees. & Wels. 414; Thompson v. Hopper, 88 E. C. L. 937; Livie v. Janson, 12 East, 653; 11 Johns. 27; Green et al. v. Elmslie, Peake's N. P. Cas. 212; Tatham v. Hodgson, 6 Term, 659; Powell v. Gudgeon, 5 Mau. & Sel. 436; Norwich & N. Y. Trans. Co. v. Western Mass. Ins. Co. 34 Conn. 561; U. F. & M. Ins. Co. v. Foote, 22 Ohio St. 350; Boatman's Ins. Co. v. Parker, 23 Ohio St. 95; Maryland Fire Ins. Co. v. Whiteford.

The collision was not the immediate and proximate cause of the fire. It was two steps behind, and we look not to nearness in time, but to the order of events, though so near one another that we are unable to distinguish between them; and in reference to the rapidity with which one link in the chain follows another. See Dabney v. New Eng. M. M. Ins. Co. 14 Allen, 309; Columbia Ins. Co. v. Lawrence, 10 Pet. 517; Dyer v. Piscataqua F. & M. Ins. Co. 53 Maine, 120.

That the law does not follow back from one cause or sequence to another, in cases of insurance, but rests upon the peril which appears to have

Vol. II.]

GERMANIA INSURANCE COMPANY v. SHERLOCK.

[No. 8.

injured or destroyed the property, is well settled by the following author, ities: Matthews v. The How. Ins. Co. 1 Kern. 16; Gen. M. Ins. Co. v. Sherwood, 14 How. 366; The Ionides v. U. M. Ins. Co. 14 C. B. 295; Gates v. The Mad. Co. Ins. Co. 1 Seld. 478; Columbia Ins. Co. v. Lawrence, 10 Pet. 517, 518; City F. Ins. Co. v. Corlies, 21 Wend. 371; St. John v. The Am. Mu. Ins. Co. 1 Kern. 523; Sadler v. Dixon, 8 Mees. & Wels. 899; Redman v. Wilson, 14 Mees. & Wels. 482; Livie v. Janson, 12 East, 648, 653.

The courts look at the peril assumed, and whenever they find that the property has suffered from such peril, they do not go to the cause that produced the peril. This is well expressed in the above cases.

The proximate cause is the last link, the last sequence or final result, which is the destruction of the vessel. The Ionides v. U. M. Ins. Co. 14 C. B. (Scott) N. S. 284, 286, 295; Dabney v. New Eng. M. M. Ins. Co. 14 Allen, 309; Marble v. The City of Worcester, 4 Gray, 398.

In insurance law the simple fact that the steamer was destroyed by fire not originating in the fraud of the plaintiffs, or their employés, and not coming within any of the exceptions found in the policy, is all we have to look to, all we have to prove. It matters not what caused the fire, or how immediately the fire followed the cause, there being no exception excluding it, the loss is one for which the plaintiffs may recover

The cases cited by plaintiff in error do not sustain their position, but when carefully examined strengthen our view.

The case of Thompson v. Hopper, 88 C. L. 171, cited and greatly relied on by plaintiff in error, is not the law of this country nor of England, as will be seen by the following authorities: Perrin's Adm'r v. The Pro. Ins. Co. 11 Ohio, 147; Johnson v. B. M. F. Ins. Co. 4 Allen, 390; Chandler v. Wor. M. F. Ins. Co. 3 Cush. 328; Huckins v. The Peo. M. F. Ins. Co. 11 Fost. 247; Columbia Ins. Co. v. Lawrence, 10 Pet. 517; Shaw v. Robberds, 6 Ad. & El. 83, 84; Brown v. Kings Co. F. Ins. Co. 31 How. Prac. 512; Gates v. Mad. Co. M. Ins. Co. 1 Seld. 478; Hynds v. The Schen. Co. M. Ins. Co. 16 Barb. 127; St. John v. The Am. M. F. & M. Ins. Co. 1 Duer, 381; Catlin v. The Springfield F. Ins. Co. 1 Sumn. 441; Waters v. The Louis. Mer. Ins. Co. 11 Pet. 220; Thompson v. Hopper, 1 El., Bl.

& El. 1051.

In some of these cases it was held that gross neglect of the assured himself, not amounting to fraud, was no defence.

The following cases St. John v. Amer. M. F. & M. Ins. Co. 1 Kern. 518; Roe et al. v. The Columbus Ins. Co. 17 Mo. 304; Montgomery v. Firemen's Ins. Co. 16 B. Mon. 442; Strong v. The Sun M. Ins. Co. 31 N. Y. 113; Stanley v. The West. Ins. Co. 3 Exch. 71; Insurance Co. v. Tweed, 7 Wal. 44-cited by plaintiff in error, contain excepting clauses, and the decision in each case rests upon the force of the exception, and cannot avail the plaintiff here, who has no exception to go on. 12 Wal. 199.

II. There is no error upon the subject of barratry, to the prejudice of the plaintiff in error.

For a definition of barratry, see Webster; Worcester; 2 Arn. on Ins. 2d ed. 821, 825; Lawton v. Sun M. Ins. Co. 2 Cush. 511; Earle v. Rowcroft, 8 East, 133; 1 Starkie, 191; Parsons on Ins. 550; Marcardier v. 22

VOL. II.

Vol. II.]

GERMANIA INSURANCE COMPANY v. Sherlock.

[No. 8.

Chesapeake Ins. Co. 8 Cranch, 49; Nutt et al. v. Bourdieu, 1 Term, 323; Knight v. Cambridge, 1 Strange, 581; Stamma v. Brown, 2 Strange, 1174; Lockyer v. Offley, 1 Term, 259; Vallejo v. Wheeler, 1 Cowper, 154; Wilcocks et al. v. Union Ins. Co. 2 Binn. 580; Phyn v. Royal Ex. A88. Co. 7 Term, 503, 504; Soares v. Thornton, 7 Taunt. 640; R088 v. Hunter, 4 Term, 38; Chandler v. Wor. M. F. Ins. Co. 3 Cush. 330. The case of The Citizens' Ins. Co. v. Marsh, 41 Penn. St. 394, is referred to by the plaintiff in error. It is difficult to see how the conduct complained of in that case is barratry, as the master was himself the owner, and any conduct of the owner, or with his consent, cannot be barratry. This is universally agreed. 2 Arnould on Ins. 837; 1 Parsons on M. Ins. 571; 1 Phillips on Ins. sec. 1082; Wilson v. Gen. M. Ins. Co. 12 Cush. 365; Marcardier v. Ches. Ins. Co. 8 Cranch, 49; Nutt et al. v. Bourdieu, 1 Term, 323; Ross v. Hunter, 4 Term, 37; Barry v. La. Ins. Co. 11 Martin, 631; Taggard v. Loring, 16 Mass. 340; Pipon v. Cope, 1 Camp. 436; Soares v. Thornton, 7 Taunt. 640.

The officers and crew of The United States could not commit barratry toward The America. Cook v. Com. Ins. Co. 11 John, 43; Kendrick v. Delafield, 2 Caines, 71; 1 Phillips on Ins. sec. 1080.

MCILVAINE, J. The court below charged, "that if the jury were satisfied from the evidence that the steamboat America was destroyed by fire, and that no material injury was done her by the collision, then the plaintiffs are entitled to recover the said loss or damage caused by fire, notwithstanding such fire may have been caused by the collision," and refused to charge as requested by the defendant below, "that loss or damage from. collision being excepted, and the defendant not liable therefor, the defendant is not liable for any loss or damage from fire where a collision was the direct, immediate, and proximate cause of such fire, and without which the loss would never have occurred; in such a case the loss is to be attributed to the collision and not to the peril of fire."

Whether there was error in the charge as given, or in refusing to charge as requested, depends solely upon the proper construction of the policy sued on. The form of the policy, as printed, assumes to insure against the perils of seas, lakes, rivers, &c. ; but the contract of the parties, as evidenced by the terms therein written, which must control in its construction, clearly shows that the only risk assumed by the underwriter was loss by fire; and that the perils of rivers, &c., including collisions, were not insured against at all as proximate causes of loss or damage.

The undertaking of the defendant to insure "against loss by fire only,' must be held to embrace losses by fire generally, without regard to the cause or causes which produced the fire. The qualifying word "only," was not intended to limit the liability of the insurer to losses by a fire caused by any particular agency, or to exclude such liability where the fire was caused by a particular agency, but simply to show that no risk whatever was assumed except loss by fire.

Such is the scope of an insurer's liability arising upon the terms of a contract to insure against loss by fire only. In the policy now under construction, however, the parties, by subsequent clauses, excepted from the scope of the general undertaking of the insurer losses occasioned by certain specified causes that is to say, losses by fire produced by the causes

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Vol. II.]

GERMANIA INSURANCE COMPANY v. SHERLOCK.

[No. 8.

named in the exceptions. See The United L. F. & M. Ins. Co. v. Foote, 22 Ohio St. 350. Among the causes of fire so excepted, however, collisions are not named.

66

The court below, therefore, did not err in refusing to charge as requested by the defendant, for the reason that the request assumed that loss or damage from collision" was excepted from the risks covered by the terms of the contract; which assumption was contrary to the true construction of the policy. Nor was there error in the charge as given.

Among the losses excepted from the risk by the warranties in the policy, was loss or damage caused by barratry.

Testimony had been offered on the trial tending to prove that the pilot of The America had neglected and failed to observe the rules established under the Act of Congress by the supervising inspectors, for his observance in such case, whereby the collision was caused. And other testimony had been offered tending to prove that such neglect or failure to observe the rules by the pilot was neither wilful nor fraudulent on his part; and further, that if the rules were departed from at all, it was in an emergency, in which the pilot honestly believed that it was necessary to do so in order to avoid a collision.

Upon this subject the court charged the jury as follows:

"The second defence is barratry, which may be said to comprehend not only every species of fraud and knavery committed by the master or pilot, with the intention of benefiting himself at the expense of the owners of the boat, but every wilful act on his part of known illegality, whereby the owners are in fact injured. It consists of some fraudulent act intended to injure them, or of a wilful violation of known positive law in the navigation or management of the vessel from which the loss resulted."

[The court here read the rules and the Act of Congress as recited in the statement of this case, and continued:]

"These rules are intended to avoid collisions between boats ascending and descending the river, and they prescribe the course to be pursued by the pilots. They are made to be observed, and are binding as law upon. the pilots, subject, however, to any emergencies by which it may become necessary to depart from them to escape or avoid immediate danger from collision or other perils.

"It is claimed that the pilot wilfully violated these rules of navigation, established under a law of Congress, by failing to give the signals required by the rules, and by omitting to stop when the boats had come within a distance of eight hundred yards. These rules are in evidence, and the pilots are bound to obey them, unless some emergency in the course of navigation occurs justifying a departure from them to avoid a collision or other danger.

"The rules require that when the boats have approached within one mile, the pilot of the ascending boat shall sound the whistle to notify the pilot of the descending boat on which side he will pass; and that if the signals are not answered and understood by the time the boats have approached to the distance of eight hundred yards, he shall stop his boat until the signals are corrected and understood. Now, if the pilot of The America, on approaching The United States, when they had approached within the mile, knew or believed that they had come within the mile,

Vol. II.]

GERMANIA INSURANCE COMPANY v. SHERLOCK.

[No. 8.

and chose to omit to give the signal required by the rule; or, if when he knew or believed that they had approached within the eight hundred yards, without satisfactory signals, he did not stop, although he knew that the rules required that he should stop, but chose to risk the violation of the rule, and the result of such violation of the rule was the loss, that would constitute such misconduct of the pilot as to prevent a recovery, though he did not actually intend an injury to the owners. He is not at liberty to prefer his own judgment to the rule required by law, unless there be some emergency requiring a departure from the rule. But he must deliberately, or voluntarily and knowingly violate the rule in order to constitute such misconduct as to prevent a recovery. The rules are made to be observed by pilots: they are intended for the safety of the public and for the protection of the owners. Whether they are the best that can be made or not, while in force they must be observed, and a wilful disregard of them is misconduct; and if a loss is caused thereby to the owners, it is a loss by barratry, which is excepted from this policy.

"But in establishing this defence, the burden of the proof is on the defendants. They must make it appear by a fair preponderance of evidence that the pilot of The America did violate the rules knowingly, and the loss was the

consequence.

"Mere error of fact or of law is not sufficient to establish a defence on this ground. The pilot must know his duty, and decline to do it. If he supposed that the distance was a mile when he gave the first signal, and intended to comply with the rule by the signal which he gave, the fact that he may have been mistaken in his estimate of the distance is not misconduct, which is a defence. So if when the boats approached to the distance of eight hundred yards, the pilot of The America knew it, or believed it, and knew that the signals had not been answered or properly understood, and yet failed to stop or back his boat according to the law, that would be such misconduct as would be a defence against a suit for a loss caused by it. But if by reason of the darkness of the night, or other causes not under his control, he was mistaken as to the fact of their approach to the distance of eight hundred yards, until they had approached much nearer, such mistake would not be misconduct to defeat a recovery.

"The pilot is not to set up his judgment against the rules, unless there arises an emergency in which he should honestly believe that it was necessary to depart from the rule to avoid a collision or avoid danger. But if he, in good faith, endeavored to comply with the rules of navigation and to avoid a collision, though he may have erred in his estimate of distances, and though he may have been mistaken as to the interpretation of the rules, he cannot be held to be guilty of such misconduct as to constitute a defence.

"You will limit your inquiry on this subject to the conduct of the pilot in charge of The America, as the only barratry which can defeat this suit must be of the officers or crew of the boat, for the loss of which this suit is brought."

We find no error in these instructions of which the defendant had right to complain; nor do we find any error in the record, for which the judgment should be reversed. Judgment affirmed. DAY, C. J., and WELCH, WHITE, and REX, JJ., concurring.

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