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literally complied with. Pawson v. Watson, Cowp. 785. See as to life policies, and the distinction between marine and life policies, Wheelton v. Hardisty, 8 E. & B. 232; 26 L. J., Q. B. 265; cited post, p. 438. In the case of insurance of chartered freight, the non-disclosure of a power in the charterer to cancel the charter-party is fatal. Mercantile SS. Co. v. Tyser, 7 Q. B. D. 73.
The slip, though not admissible in evidence as a contract, by reason of the 30 & 31 Vict. c. 23, s. 7, is, by mercantile usage, treated as the contract for insurance, vide ante, p. 263. Hence, facts coming to the knowledge of the assured after the slip is signed, but before the policy is delivered out, need not be disclosed to the underwriter. Lishman v. N. Maritime Insur. Co., L. R., 8 C. P. 216; L. R., 10 C. P. 179, Ex. Ch. See also Cory v. Patton, L. R., 7 Q. B. 304; and L. R., 9 Q. B. 577. So, where the assured conceals from the underwriter a material fact, when the slip is signed, and the underwriter delivers out the policy in conformity with the slip after the fact has come to his knowledge, it is a question for the jury whether the underwriter elected to go on with the policy; if not, the policy does not bind him; Morrison v. Universal Marine Insur, Co., L. R., 8 Ex. 197, Ex. Ch.; and where the underwriter stated, when he issued the policy, that he should rely on the concealment, it was held that he might do so; Nicholson v. Power, 20 L. T., N. S. 580, Ex. Ch., E. T. 1869.
In an action against a second or subsequent underwriter, it has been the practice to admit evidence of representations to the first underwriter, on a presumption that the subsequent underwriter gave credit to them. Pawson v. Watson, Barber v. Fletcher, supra; Marsden v. Reid, 3 East, 572. This rule is confined to representations made to the first underwriter, that is, the first on the policy. S. C.; Bell v. Carstairs, 2 Camp. 543. The principle of the rule was questioned by Ld. Ellenborough, C. J., in the last case, and in Forrester v. Pigou, 1 M. & S. 13.
If goods insured are over-valued with intent to defraud the underwriters, the contract is void, and the assured cannot recover, even for the value actually on board; Haigh v. De la Cour, 3 Camp. 319; and, eren without fraud, an excessive over-insurance may be a material fact, and, if concealed from the underwriter, the policy be void; Ionides v. Pender, L. R., 9 Q. B. 531. So where there were successive open policies, on goods to be declared, and the assured fraudulently declared the goods at risk at an under-value on the earlier policies, the policies effected subsequently to such false declarations were held void, and were ordered to be cancelled. Rivaz v. Gerussi, 6 Q. B. D. 222, C. A.
Illegality.] A contravention of law by the assured, having direct relation to the subject of the risk, will vitiate the policy. Thus, where a ship was loaded in contravention of the 16 & 17 Vict. c. 107, forbidding a ship to sail from certain ports at certain times in the
any of the cargo on deck, and the plaintiff insured the cargo with the express knowledge of the mode of loading, it was held that the plaintiff could not recover for any part of the cargo; Cunard v. Hyde, 2 E. & E. 1; 29 L. J., Q. B. 6; aliter, if the assured had no knowledge of the mode of loading; S. C., E. B. & E. 670; 27 L. J., Q. B. 408. If the master so loaded, without the knowledge of his owner, the owner may recover on an insurance of freight. Wilson v. Rankin, 6 B. & S. 208; 34 L. J., Q. B. 62; L. R., 1 Q. B. 162, Ex. Ch. So the owner may recover where the master has, without his knowledge, in contravention of the Merchant Shipping Act, 1854, s. 318, taken passengers on board without a certificate. Dudgeon v. Pembroke, L. R., 9 Q. B. 581.
Payment.] It is a good defence to show a custom that credit taken between the insurance broker and underwriter should be taken as payment to the assured by the underwriter, after the amount has been adjusted between him and such broker. Stewart v. Aberdein, 4 M. & W. 211. But the assured is not bound by such a custom, if he had no knowledge of it. Sweeting v. Pearce, 9 C. B., N. S. 534; 30 L. J., C. P. 109, Ex. Ch. An adjustment indorsed on the policy produced by the assured, with the defendant's name struck out of it, is not evidence for the defendant that the amount so adjusted has been paid. Adams v. Sanders, M. & M. 373.
Return of Premium. A claim for a return of premium is often added to a claim on a policy; and the question of the right to recover arises on the failure of the plaintiff to establish his case on the policy.
When plaintiff entitled to a return.] If the policy is void ab initio, or where there is no insurable interest, and this proceeds through misinformation or other innocent cause; or where an interest is less than that insured; the premium or part of it may be recovered. 3 Kent, Com. 341. Where there are two insurances at different times, together exceeding the interest insured, the excess of premium is to be recovered from the last insurers, and not the first. Fisk v. Masterman, 8 M. & W. 165. When several insurances are effected at the same time, and before the risk commenced, they are to be taken as one policy, and the return must be pro ratâ; semb. S. C.
If the risk has never commenced there must be a return; as if the ship never sailed, or, the policy is avoided by failure of warranty without fraud. 3 Kent, Com. 341. But if the risk has once commenced, or the policy be void for illegality, or for any fraud of the assured, there is no return. Ib.; Allkins v. Jupe, 2 C. P. D. 375, ante, p. 431; and see Stone v. Marine Assur. Co., &c., 1 Ex. D. 81. The defendant having insured a cargo for a certain voyage, effected a re-insurance with the plaintiff on the same cargo and risk after the ship had, unknown to either party, arrived safely at her destination; it was held that the premium was payable on the reinsurance. Bradford v. Symondson, 7 Q. B. D. 456, C. A. Where the policy is avoided by material misrepresentation or concealment, without fraud, the premium may be recovered, and the policy is conclusive evidence of payment of the premium. Anderson 7. Thornton, 8 Exch. 425. Where the voyage and the risk are divisible, and part is not run, there may be a return of a proportionate part of the premium. As, where the voyage was from London to Halifax, Nova Scotia, to depart with convoy from Portsmouth, and when the ship arrived at that place the convoy had sailed. Stevenson v. Snow, 3 Burr. 1237; 1 W. Bl. 318.
The defendant having paid the amount of premium into Court, the plaintiff afterwards obtained a verdict on the policy for a sum less than the sum assured : the Court directed that judgment should be entered only for the amount of the verdict, less the sum taken out of Court. Carr v. Montefiore, 5 B. & S. 941 ; 34 L. J., Q. B. 21.
Life Insurance. Many of the cases and authorities on marine policies apply equally to policies on lives and against fire; but the contract of life assurance is, in consideration of a lump sum or of periodical payments, to pay a sum certain upon the death of a given life,
and is not a contract of indemnity, like that of marine and fire policies. The pleadings sufficiently point out the nature of the required evidence.
Form of policy.] It does not appear ever to have been decided that an agreement for life insurance need be expressed in a policy or reduced to writing. The statute 14 Geo. 3, c. 48, s. 2, enacts that it shall not be lawful to make any policy on the life of any person or other event, without inserting in such policy the person's name interested therein, or for whose use, benefit, or on whose account such policy is so made or underwrote. The Stamp Act, 1870, s. 118 (which replaced the earlier statute, 16 & 17 Vict. c. 59, s. 6), requires every person receiving or taking credit for any premium or consideration for any contract of insurance, to make out and execute a stamped policy of such insurance, within one calendar month from the receipt of the premium, under a penalty of 501. This section was passed for the better securing the payment of the stamp duty, and rather negatives the idea that 14 Geo. 3, c. 48, s. 2, supra, was intended to avoid agreements for life insurance not in writing.
By the Married Women's Property Act, 1882 (45 & 46 Vict. c. 75), s. 11, “A married woman may, by virtue of the power of making contracts herein before contained, effect a policy upon her own life, or the life of her husband for her separate use, and the same and all benefit thereof shall enure accordingly. A policy of insurance effected by any man on his own life, and expressed to be for the benefit of his wife or of his children, or of his wife and children or any of them, or by any woman on her own life, and expressed to be for the benefit of her husband, or of her children, or of her husband and children, or any of them, shall create a trust in favour of the objects therein named, and the moneys payable under any such policy shall not, so long as any object of the trust remains unperformed, form part of the estate of the insured, or be subject to his or her debts." The section enables the insured to appoint a trustee or new trustees of the policy by a memorandum in writing and the receipt of a trustee duly appointed, or, in default of notice to the office, the receipt of the legal personal representative of the insured, shall be a discharge to the office. See Holt v. Everall, 2 Ch. D. 266, C. A.; In re Adam's Policy Trusts, 23 Ch. D. 525; Seyton v. Salterthwaite, 34 Ch. D. 511, decided on 33 & 34 Vict. c. 93, s. 10.
Where, after the proposal for insurance has been accepted by the insurance office, on the terms that no insurance shall take effect until the premium is paid, and before it is tendered there has been a material alteration in the health of the proposer, the office is not bound to issue a policy. Canning v. Farquhar, 16 Q. B. D. 727.
As to stamp duties, vide ante, p. 260.
Assignment of policy.] The Policies of Assurance Act, 1867 (30 & 31 Vict. c. 144), s. 1, enacts that "any person or corporation now being or hereafter,” vide infra, “becoming entitled by assignment or other derivative title to a policy of life assurance, and possessing, at the time of action brought, the right in equity to receive and the right to give an effectual discharge to the assurance company liable under such policy for moneys thereby assured or secured, shall be at liberty to sue at law in the name of such person or corporation to recover such moneys.?
By sect. 3, “ no assignment made after the passing of this Act” (20th August, 1867) “ of a policy of life assurance shall confer on the assignee therein named, his executors, administrators, or assigns, any right to sue for the amount of such policy, or the moneys assured or secured thereby, until a written notice of the date and purport of such assignment shall have been given to the assurance company liable under such policy at their principal place of business for the time being, or, in case they have two or more principal places of business, then at some one of such principal places of business, either in England or Scotland or Ireland, and the date on which such notice shall be received shall regulate the priority of all claims under any assignment; and a payment bonâ fide made in respect of any policy by any assurance company, before the date on which such notice shall have been received, shall be as valid against the assignee giving such notice as if this Act had not been passed.
By sect. 4, assurance companies are, in policies issued after 30th of September, 1867, to specify the principal place or places of business at which notices of assignment may be given.
By sect. 6, every assurance company to whom notice of the assignment of any policy shall have been duly given shall deliver an acknowledgment in writing, under the hand of the manager, secretary, treasurer, or other principal officer of the assurance company, of their receipt of such notice; and every such written acknowledgment, if signed by a person being de jure or de facto the manager, &c., of the assurance company whose acknowledgment it purports to be, shall be conclusive evidence, as against such assurance company, of their having duly received the notice to which such acknowledgment relates.
An agreement for assignment is not an assignment within this Act. Spencer v. Clarke, 9 Ch. D. 137.
Sect. 3 regulates the priority of claims as between the company and persons interested in the policy, and does not affect the rights of those persons inter se. Newman v. Newman, 28 Ch. D. 674.
Where there is a condition against assignment in the policy, it is still assignable in equity as before the statute. In re Turcan, 40 Ch. D. 5, C. A.
The J. Act, 1873, s. 25 (6), ante, p. 300, contains a general provision with reference to the assignment of choses in action.
Interest.] By stat. 14 Geo. 3, c. 48, ss. 1, 2, a policy on lives or other events is unlawful and void, unless the person on whose account the insurance is made has an interest, and the name of the person interested, or for whose use or benefit, or on whose account, it is made, be inserted therein. If A., having no interest in B.'s life, cause him to effect an insurance in his own name, but at A.'s expense, and for A.'s benefit, this is a fraudulent evasion, and the policy is void under sect. 1. Wainewright v. Bland, 1 M. & Rob. 481 ; Shilling v. Accidental Death Insur. Co., 2 H. & N. 42; 26 L. J., Ex. 266. See also S. C., 27 L. J., Ex. 16. Everyone is presumed to have an insurable interest in his own life, and if he insures, whether for life or a limited time, his executor is not bound to show any interest beyond this. Wainewright v. Bland, supra. So, it is said, where a wife insures her husband's life. Reed v. R. Exch. Assur. Co., Peake, Add. Ca. 70; and now see 45 & 46 Vict. c. 75, s. 11, ante, p. 436. But where a wife was entitled to a legacy on attaining twenty-one, and her husband insured her life in her name, to secure the amount of the legacy, which was then advanced to him, it was held that the policy was void, as it did not state that the husband was the person having the present interest therein, alt ough the ultimate benefit might be for the wife.
Evans v. Bignold, L. R., 4 Q. B. 622. A creditor has an insurable interest in his debtor's life. Anderson v. Edie, Park, Ins., 8th ed. 914-15. And, in general, the interest which the insurer is required to have in the life of the assured, under 14 Geo. 3, c. 48, s. 1, must be a pecuniary interest; and, therefore, the insurance by a father in his own name on the life of his son, without any pecuniary interest in it, is void. Halford v. Kymer, 10 B. & C. 724. As to what is sufficient pecuniary interest, see Hebden v. West, infra. If a father, being engaged in a hazardous employment, agree with his son that the father will insure his own life and the son pay the premiums, and that the father shall leave the sum insured to his son by will, semble, per Martin and Bramwell, BB., that the insurance would be the father's and valid. Shilling v. Accidental Death Insur. Co., 2 H. & N. 42; 26 L. J., Ex. 266.
By sect. 3, a person who insures the life of another, or any other event, can recover from the insurer or insurers no greater sum than the amount or value of his interest in such life or event. The interest referred to is the interest at the time of making the policy, and this amount is recoverable whether the interest ceased or not before the death, or, has been satisfied aliunde. Dalby v. India and L. Assur. Co., 15 C. B. 365; 24 L. J., C. P. 2; in the Ex. Ch., overruling Godsall v. Boldero, 9 East, 72. Law v. L. Indisputable Policy Co., 1 K. & J. 223; 24 L. J., Ch. 196, is to the same effect. But, by this section, the assured can in no case recover more than this insurable interest, whether upon one policy or many; and if he has already received that amount on other policies, this is an answer to an action. Hebden v. West, 3 B. & S. 579; 32 L. J., Q. B. 85.
The assignee of a life policy is not within the Act, and need not show any interest other than the original one on which the policy is founded. Ashley v. Ashley, 3 Sim. 149.
Damages.] As to damages in the nature of interest under 3 & 4 Will. 4, c. 42, s. 29, vide ante, p. 432.
Defence. The general observations made, ante, p. 432, with respect to defences to actions on Policies of Marine Insurance, will apply here.
Misrepresentation.] The assured usually subscribes a declaration answering facts inquired of by the insurers, and it is made a condition that if any be untruly answered the policy is to be void; in such case the policy is avoided though there be no intentional untruth; Duckett v. Williams, 2 Cr. & M. 348; Macdonald v. Law, &c. Insur. Co., L. R., 9 Q. B. 228; Thomson v. Weems, 9 Ap. Ca. 671, D. P.; and though the mis-statement be found by the jury to be immaterial: for as the basis of the contract is the truth of the representation, its materiality is not in question, and ought not to be left to the jury. Anderson v. Fitzgerald, 4 H. L. C. 484; Cazenove v. British Equitable Assur. Co., 6 C. B., N. S. 437; 28 L. J., P. 259. See British Equitable Assur, Co. v. Gt. W. Ry. Co., 17 W. R. 43, M. T. 1868, Malins, V.-O. If there be such express condition on the policy, yet material and fraudulent concealment or misrepresentation, though the inquiry and statement be oral, will also avoid it. Waineuright v. Bland, 1 M. & W. 32; 1 M. & Rob. 481. But mere representations or statements, which turn out untrue, will not avoid a life policy (as in some cases they do a marine policy), unless the policy purports to be based upon their truth, or there be fraud. Wheelton v. Hardisty, 8 E. & B. 232, 26 L. J., Q. B. 265; 8 E. & B. 285; 27 L. J., Q. B. 241, Ex. Ch. See Fowkes v. Manchester and London Assur. Association, 3 B. & S. 917; 32 L. J., Q. B. 153. If there be an untrue statement without fraud, and the policies of a company are expressed to be “indisputable except in case of fraud,"