Tom v. Smith

3 Cai. Cas. 245 | N.Y. Sup. Ct. | 1805

Per Curiam, delivered by

LIVINGSTON-, j.

It is -hot made a question, whether profits are an insurable interest. Whatever objections lie to, the practice, we 'hávc heretofore considered them as such', and the counsel of both parties have reasoned on that supposition. In 'France nothing but ship and cargó are regarded as proper subjects of insurance. In England and ill this country, it is not' unusual to' insure profits, eo nominé, arid •yet no decisions are to be found on the construction or effect of such policies. We are at liberty then to' adopt Such rules, not inconsistent with the written contract, as shall render them as little as possible of the gambling hind.' Under no pretext indeed can they be called wagering policies, which exclude all idea of interest in the assured. It would be hard therefore on the underwriter, to rank them in this class, and thus deprive him of the benefit of salvage. A premium on profits is not greater than on goods, and yet it. certainly ought to. be muds higher, if a total loss may be demanded, without any part of the profits-, however considerable, going to the underwriters. It is more, equitable to consider these-insurances as a species of valued, policies on cargo, which they are- in substance, although not • in form. It is sur--prising, that in a country where merchants- may insure’ their adventures at almost any valúe, this practice should-ever have been introduced. The more the subjects of insurance, on any ene' voyage-are-multiplied, the-more-confusion and embarrassment will, in -cases of disaster, be experienced. - It will-often. perplex the most skillful broker so to adjust a loss,- -as-to-do.justice to -the -different-' classes of underwriters. T am-disposed,, therefore, to re-'-gard these-insurances as another-why.cf valuing the goods, and that ⅛ -total -losses- like -the present, the underwriter has such-an-interest in. - ■ th s ■ prop er ty, as tobe-e».t¡íled to an .-sfer.dc-nmeat'. -Whatwould •■be’v-the 'effect: of abandonments to the respective underwriters of Cargo and profit, I will not undertake to say. Perhaps on tendering an indemnity, the former might be obliged to cede their interest to the others, or to account with them for the profits, but here, being no abandonment of the cargo, this difficulty is not before us. We are only to determine whether as between the owner of cargo, and his insurer of profits, it is reasonable to permit the'former to manage the property, as he pleases, and at a period even so distant, to call on the latter for a.total loss. If an abandonment be necessary, as. I think it is, the one, on which the plaintiff relies, was not in time. So .far. from giving any intimation of such design, he takes back: the premium from several underwriters, and as to them.; cancels the policy. He then proceeds by his agent to sell the cargo, takes bills in payment on which there is a. loss, and- finding, he has not made ,out to his wish, calls ' on the defendant’s for the whole amount of their sub-' scription. This case does not fall within the reason of' those in which it has been settled,: that an abandonment is never too late while the loss continues total. Perhaps-' it would have been better in all cases, to drive the assured to. an early election, whether he will abandon or not,-' and not leave it ih his power, as it now is, to run thé " underwriter to-an immense expense, in attempts to re'co- -- ver the property for his own benefit, and then throw it' upon' him, when he can no longer take any one step that' may be of advantage : but in opposition to the positive1; regulations'or" practice of most maritime countries, and df England among qthers, where abandonments must -be' made 'within ' a reasonable time' after notice of loss, -we; permit' the assured to lay by for years, in case of a cap-"; ture or other technical total loss, provided'the capture or" ether accident continues. In these cases, however, the property is out of the hands of the assured, who is pursuing measures . to recoyer it; but it is.different here, where the loss properly speaking, was never total. The cargo was not, as in case of capture, taken from the owner. On the contrary, he chuses to treat the loss as partial — he directs a sale of it on his own account, and finally abandons, but not until after a lapse of three years, when in fact there is nothing- to surrender, but what he has al-i • , , . ’ TT1 . , , ready received, and means to retain. Whatever might nave been the claim of the defendant on the insurers of the cargo, if an abandonment had been made ,to them (on which my opinion is reserved) I think as between him and the owner, he had a right to pay the first cost of the goods, with all the charges and profits according to valuation, and on those terms to insist on an assignment. To enable him to assert this right, there ought to have been a seasonable abandonment, which, notwithstanding the decision just referred to, should always bé made, as soon as possible, where the disaster, as was the case here,' is of. such nature as not to divest the assured of his pro^ perty. This is a case of some novelty, on which precedents throw little, if any light. It is very probable, therefore, that my view of it may be incorrect, but after, mature reflection, I cannot come to any other result, satisfactory to my own mind. If wrong, the precedent will not work much mischief, for it cannot be long before underwriters, in this State at least, discover the folly of insuring, unless at a very advanced premium, either profits or freight. The latter, it has already been determined, or at least so much as is earned, even during the voyage insured, after abandonment of the ship, goes to her underwriters, and if profits on goods, in like cases, should be adjudged to belong to the assurer of that subject, there would be none, or very little salvage in either case, so that while the underwriters on ship and cargo, would be receiving enough, and perhaps more than enough, to reimburse them, those on profits and freight may pay a total loss on the same voyage, and not receive a farthing from.the|subjects insured. Our opinion is that the de-iendants have judgment.