258 F.2d 718 | 5th Cir. | 1958
Lead Opinion
This appeal is from that portion of a decree in admiralty dismissing the third-party petition filed by the appellants, hereinafter called Nardelli, against the appellee, hereinafter called Stuyvesant. The libel was filed by another maritime insurance company which had become subrogated to the rights of the owner of the M/V Lolita to recover from those responsible for her sinking. It was filed against Robert A. Wilson, Nardelli, and the M/V Narco.
The district court found the Narco solely at fault in causing the collision and entered judgment against her in rem and against Nardelli in personam for $29,075.00, but dismissed the in per-sonam claim against Wilson on the ground that Nardelli was operating the Narco under a bareboat charter at the time of the collision. The court further dismissed as to Stuyvesant on the ground that the coverage of Stuyvesant’s policy did not extend to Nardelli as bare-boat charterer. La Interamericana, S. A. v. The Narco (The Narco-The Lolita), D.C.S.D.Fla.1956, 146 F.Supp. 270. This appeal is taken from that part of the decree holding Stuyvesant not liable.
The lease-purchase agreement from Wilson to Nardelli was executed on July 15, 1952,
“for the term of thirty-six (36) months, from the 15 day of July, A.D., 1952, expiring on the 15 day of July, A.D., 1955, now next ensuing, for the sum of Seven Hundred, Sixty-two Dollars and thirty-three ($762.33) cents per month, payable in advance each and every month, except that the amount for the first month shall be Ten Thousand ($10,-000.00) Dollars, payable on the signing of this Agreement, plus insurance prorated on a monthly basis which is now Eighty-three Dollars and thirty-four ($83.34) cents per month.”
Nardelli was granted the option, on or before the expiration of the lease, to buy the vessel for $37,440.00, the approximate sum of the cash payment and the installments, and when Nardelli should
The insuring agreement, a copy of which was attached to the petition of Nardelli, was entitled “Special Marine Certificate,” bore “No. PB 31,” and was dated August 14, 1952, one month after the date of the lease. Its opening provisions were:
“This Certifies that Gibbs Corporation and C.I.T. Corporation has effected insurance under and subject to the conditions of Open Policy No. OHL 1050 of The Stuyvesant Insurance Company of New York issued in the name of the Gibbs Corporation. Covering the respective interests of the said (Named Assured and/or Purchaser, hereinafter called ‘Assured’) Robert A. Wilson, Gibbs Corporation and C.I.T. Corporation in the sum of $25,000.00 — Dollars upon the (description of property to be insured) oil screw, Miss Thelma. Valued at $25,000.00 — Dollars at and from (12:01 A.M., Standard Time at place of issuance) August 14, 1952 and ending August 14, 1953 unless sooner terminated as hereinafter provided. The Company to be paid in consideration of this insurance One Thousand and No/100— Dollars being at the rate of four per cent. Loss, if any, to be adjusted in accordance with the terms of the policy and payable to Assured — or order, in funds current in the United States of America.”
Attached to the certificate were the “Insuring Agreements,” which include the collision or full running-down clause quoted in the margin.
1. Does Nardelli have standing as an assured because he provided the monies for the payment of the premium?
The payment of premiums on a policy of insurance is persuasive that the party paying them intended himself to be covered.
Further, even as between Wilson and Nardelli, Nardelli’s simple agreement to pay the amount of the premium did not shift the responsibility for the loss. The Barnstable, 1901, 181 U.S. 464, 468, 470, 473, 21 S.Ct. 684, 45 L.Ed. 954. A for-tiori is that true where, as in this case, the policy covered many risks.
2. Is Nardelli an assured encompassed by the category “for the account of whom it may concern”?
Unless that category is limited by other terms of the policy, it covers all parties having an insurable interest at
The policy does, however, in several of its terms, definitely limit Stuyvesant’s liability for the account of others than Gibbs Corporation, and specifically retain Stuyvesant’s right to select its own assureds.
In accordance with such limiting terms of the policy, the “Special Marine Certificate” was issued “covering the respective interests of Robert A. Wilson, Gibbs Corporation and C.I.T. Corporation.” As to Nardelii, however, Gibbs Corporation never requested coverage; Nardelli’s lease-purchase agreement was never reported to Stuyvesant, nor did Stuyvesant ever issue any individual policy or certificate naming Nardelii as an assured. In the absence of other provisions of the policy, therefore, Nardelii was not included in the category “for the account of whom it may concern.”
3. Does Nardelii have status as an assured because he was an installment sales purchaser covered by the policy?
We think that paragraph III of the policy, quoted in footnote 5, supra, has reference only to purchasers financed or refinanced by the Named Assured Gibbs Corporation. In any event, under paragraph VI, quoted in the same footnote, no liability attached when Nardelli’s lease-purchase was not reported to Stuyvesant or its authorized agent within thirty days after its execution. Further, the acceptance of that risk was not evidenced by any individual policy or certificate. It follows that Nardelii was not a “purchaser” within the coverage of the policy.
4. Is Nardelii covered as a “charterer” under the collision or running-down clause quoted in footnote 3, supra? Is he excluded by the concluding provision of that clause?
The collision or running-down clause, quoted in footnote 3, supra, is identical with the standard clause adopted by the American Institute of Marine Underwriters, except for the insertion of the words “and/or property” throughout that clause. An earlier edition of that clause is set forth in footnote 1 in Harbor Towing Corp. v. Atlantic Mutual Insurance Co., 4 Cir., 1951, 189 F.2d 409, 410, 411; see also 4 Richards on Law of Insurance, 5th ed., pages 2057, 2064. One of the purposes of the revision was to provide expressly that the collision must be “in consequence of the insured vessel being at fault,” so as to meet the holding of this Court in The Fanny D, 5 Cir., 1940, 112 F.2d 347, 350, with which the Fourth Circuit differed in Harbor Towing Corp. v. Atlantic Mutual Insurance Co., supra.
A comparison of the collision or running-down clause in footnote 3, supra, with both the standard clause and its earlier edition shows that in the present policy the words “and/or property” have been inserted in several places. The obvious reason for that insertion was that the property insured included more than the vessel itself.
Without that phrase, the concluding provision reads:
“And provided also that in the event of any claim being made by anyone other than the owners of the Vessel hereby insured under this clause he shall not be entitled to recover in respect of any liability to which the Owners of the Vessel insured as such would not be subject, nor to a greater extent than the Owners of the Vessel insured would be entitled in such event to recover.”
The expression “anyone other than the owners of the Vessel hereby insured” admittedly would include a mere bare-boat charterer, which the district court held that Nardelli was at the time of the collision.
The first sentence of the collision .clause, however, makes plain that the underwriter will pay for a liability of •the charterer and will even pay the charterer directly. That sentence, eliminating the added phrase “and/or property” for the sake of clarity, reads:
“And it is further agreed that if the Vessel insured shall come into collision with any other Ship or Vessel and the Assured or the Charter■ers or the Surety in consequence of the insured vessel being at fault .shall become liable to pay and shall pay by way of damages to any other •person or persons any sum or sums in respect of such collision, we, the Underwriters, will pay the Assured ■or Charterers or the Surety, whichever shall have paid, such proportion of such sum or sums so paid as •our respective subscriptions hereto bear to the value of the Vessel injured, provided always that our liability in respect of any one such collision shall not exceed our proportionate part of the value of the Vessel insured.”
The two sentences, and indeed the entire policy, must, of course, be construed together as one harmonious whole. In its inception the policy was meant to cover Gibbs Corporation, the shipbuilder and seller of the vessel under the lease-purchaser agreement, and C.I.T. Corporation, the finance company which purchased the installment notes. The endorsement (footnote 4, supra) added Wilson, the lease-purchaser of the vessel, as one of the assureds. The contention of the underwriter, successfully pressed below, assumed that Wilson was the sole owner, and argued that, since Wilson was exonerated from in per-sonam liability, the collision came within the last sentence, the exclusion clause.
We disagree with that contention on several grounds. First, we do not think that Wilson was the sole owner within the meaning of the phrase “the owners of the Vessel hereby insured.” That phrase, we think, includes all of the persons having any interest in the vessel and who were insured by name under the policy, that is, Wilson, Gibbs Corporation and C.I.T. Corporation, according to their respective interests. That construction seems to us necessary in order that the collision clause may fulfill its general purpose, which, since its revision, must be conceded to be in accordance with the Fourth Circuit’s view of the earlier edition: “And it becomes clear, when all the terms of the collision clause are borne in mind, that the parties intended to safeguard the owner against the consequences of a collision in which his vessel was at fault.” Harbor Towing Corp. v. Atlantic Mutual Insurance Co. supra, at 189 F.2d 411, 412. See also, Peters v. Warren Insurance Co., 1840, 14 Pet. 98, 10 L.Ed. 371; General Mutual Ins. Co. v. Sherwood, 1852, 14 How. 351, 14 L.Ed. 452; Western Transit Co. v. Brown, 2 Cir., 1908, 161 F. 869.
Further, even though Wilson was expressly exonerated from in personam liability, and Gibbs Corporation, and C.I. T. Corporation were also not personally
Charterers were covered in the first ■sentence of the collision clause not from any desire to protect them as such, but in order adequately to safeguard the owners of the vessel against the application of the fiction that the vessel may be .a wrongdoer, though the owners are not personally responsible.
Stuyvesant argues, however that such a construction of the collision clause deprives it of its subrogation rights as ■against Nardelli.
We hold, therefore, that Nardelli can recover from Stuyvesant to the extent of the interest in the vessel which, at the time of the collision, the named assureds could have lost on an in rem libel. The judgment is reversed and the cause remanded for further proceedings not inconsistent with this opinion.
Reversed and remanded.
CAMERON, Circuit Judge.
I concur in the result.
. Her former name, M/V Thelma, in the insurance certificate, but we refer appears to her as the M/V Narco.
. At the time of the collision on July 24, 1953, it would appear that Nardelli had paid a total of $19,147.96; by the time of final decree on December 17, 1956, Nar-delli had paid the full purchase price. Hence, Wilson suffered no loss from the in rem judgment against the vessel.
. “And it is further agreed that if the vessel and/or property insured shall come into collision with any other Ship or Vessel and the Assured or the Charterers or the Surety in consequence of the insured vessel being at fault shall become liable to pay and shall pay by way of damages to any other person or persons any sum or sums in respect of such collision, we, the Underwriters, will pay the Assured or Charterers or the Surety, whichever shall have paid, such proportion of such sum or sums so paid as our respective subscriptions hereto bear to the value of the Vessel and/or property insured, provided always that our liability in respect of any one such collision shall not exceed our proportionate part of the value of the Vessel and/or property insured. And, in cases where the liability of the Vessel has been contested, or proceedings have been taken to limit liability, with the consent in writing of a majority (in amount) of Hull Underwriters, we will also pay a like proportion of the costs which the Assured or Charterers shall thereby incur, or be compelled to pay; but when both Ves-seis are to blame, then, unless the liability of the Owners or Charterers of one or both of such Vessels becomes limited by law, claims under the Collision Clause shall be settled on the principle of Cross-Liabilities as if the Owners or Charterers of each Vessel had been compelled to pay to the Owners or Charterers of the other of such Vessels such one-half or other proportion of the latter’s damages as may have been properly allowed in ascertaining the balance or sum payable by or to the Assured or Charterers in consequence of such collision; and it is further agreed that the principles involved in this clause shall apply to the case where both Vessels are the property, in part or in whole, of the same Owners or Charterers, all questions of responsibility and amount of liability as between the two Vessels being left to the decision of a single Arbitrator, if the parties can agree upon a single Arbitrator, or failing such agreement, to the decision of Arbitrators, one to be appointed by the Managing Owners or Charterers of both Vessels, and one to be appointed by the majority (in amount) of Hull Underwriters interested; the two Arbitrators chosen to choose a third Arbitrator before entering upon the reference, and the decision of such single, or of any two of such three Arbitrators, appointed as above, to be final and binding. Provided always that this clause
. “Endorsement
“Attached to and forming part of Policy No. PB 31 of the Stuyvesant Insurance Company of New York Insurance Company Name of Assured Robert A. Wilson, Gibbs Corporation and C.I.T. Corporation. It is hereby understood and agreed the policy insuring agreements as written are amended to include :
“Protection and Indemnity Clauses which was excluded in the original certificate issued on August 14, 1952.
“All other terms and conditions of the policy remain unchanged.
“Date January 2, 1953 Harry R. James Agent.”
“I.
. “Assured.
“This Policy of Insurance witnesseth, that the Stuyvesant Insurance Company of New York by these presents, does make instirance and cause to be insured, lost or not lost: Gibbs Corporation as hereinafter provided or for account of whom it may concern.
“II.
“Loss Payable.
“Assured or order.
“HI.
“Interests Insured.
“(A) Double Interest. The interest of Gibbs Corporation or any assignee thereof, herein called the ‘Named Assured’, and of any retail purchasers financing or refinancing the purchase of property insured, herein called ‘Purchasers’ and
“(B) Single Interest. The interest of the Named Assured in property insured, financed or refinanced by the Assured for retail purchasers as described in individual policies or certificates issued in connection with this Open Policy is insured hereunder as provided in this Open Policy and in such individual policies or certificates, as their respective interests may appear.
“ (C) Eor Account of Others. It is further agreed that this policy is extended to cover property insured as hereinafter provided for the account of others and not provided for in paragraphs III (A) and (B) but only at the request of the Gibbs Corporation and upon acceptance by this Company or its Agent.
“IV.
“Property Insured.
“This policy covers Hulls and/or Marine Engines, Machinery, Electric Light Apparatus and similar equipment, Appurtenances, Parts and Supplies for same which the Named Assured has sold for installation in vessels under partial payment contracts as hereinafter provided.
“V.
“Territorial Limits.
“This policy covers property insured hereunder while located or operated within the Continental United States, Canada, Mexico, Central America, Puerto Rico or the Inland or Coastal Waters of the aforementioned countries.
“VI.
“Attachment and Evidence of Insurance.
“Open Policy. At and from 12:01 A.M. (Eastern Standard Time), the Third day of May, 1952, until cancelled. The insurance hereunder upon each property insured attaches as of the time of execution of the bailment lease, conditional sale, mortgage or other encumbrance, but only if reported to the Company or its authorized Agent within thirty (30) days thereafter. The insurance hereunder upon property insured under Paragraph III (C) shall attach as of the date and time of such request. The acceptance of each risk and the particulars of insurance thereon shall bo evidenced by an individual policy or certificate of insurance issued hereunder.
* * * * *
“Protection and Indemnity Clauses.
* * * * *
“This Company shall be subrogated to all the rights which the Assured may have against any other person or entity, in respect of any claim or payment made under this policy, to the extent of such payment and the Assured shall, upon the request of this Company, execute all documents necessary to secure to this Company such rights.
“This Company shall be entitled to take credit for any profit accruing to the Assured by reason of any negligence or wrongful act of the Assured’s servants or agents, up to the measure of their loss, or to recover for their own account from third parties any damage that may be provable by reason of such negligence or wrongful act.
“Special Conditions.
“XIX.
“Conditions Precedent to Liability to the Named Assured.
“The Named Assured agrees, and it is a condition precedent to the Company’s liability to the Named Assured for loss or damage hereinafter called ‘Loss’:
“1. Double Interest.
“(h) That the Named Assured shall notify the Company promptly of any change in ownership or increase in hazard in respect of any property insured hereunder which shall come to its knowledge and shall account to the Company for the premium for such increased hazard.”
. The John Russell, 2 Cir., 1934, 68 F.2d 901, 902.
. Hagan v. Scottish Union & National Ins. Co., 1902, 186 U.S. 423, 427, 22 S. Ct. 862, 46 L.Ed. 1229; The John Russell, 2 Cir., 1934, 68 F.2d 901, 902; Miami Jockey Club v. Union Assurance Society, 5 Cir., 1936, 82 F.2d 588, 589.
. Phoenix Insurance Co. v. Erie & Western Transportation Co., 1886, 117 U.S. 312, 323, 6 S.Ct. 750, 29 L.Ed. 873; Munich Assur. Co. v. Dodwell & Co., 9 Cir., 1904, 128 E. 410, 413; The John Russell, 2 Cir., 1934, 68 F.2d 901, 902.
. See for example, paragraphs III (B) and (C) and VI quoted in footnote 5, supra.
. See footnote 5, supra, under “IV Property Insured.”
. The City of Norwich, 1886, 118 U.S. 468, 494, 6 S.Ct. 1150, 30 L.Ed. 134; Carpenter v. Providence Washington Ins. Co., 1842, 16 Pet. 495, 41 U.S. 495, 10 L.Ed. 1044.
. The Eugene F. Moran, 1909, 212 U.S. 466, 474, 29 S.Ct. 339, 53 L.Ed. 600; The Barnstable, 1901, 381 U.S. 464, 467, 21 S.Ct. 684, 45 L.Ed. 954.
. The provisions of the policy for Stuyvesanl’s subrogation are quoted in footnote 5, supra, under “XIII Protection and Indemnity Clauses.”
. Wager v. Providence Insurance Co., 1893, 150 U.S. 99, 108, 109, 14 S.Ct. 55, 37 L.Ed. 3013; The John Russell, 2 Cir., 1934, 68 F.2d 901, 902.
. Nicholson Transit Co. v. Nicholson Universal S.S. Co., 6 Cir., 1932, 60 F.2d 90, 92.
Dissenting Opinion
(dissenting), ing).
With deference to the views of my colleagues I respectfully dissent. I think the holding of the majority opinion does violence to the provision appearing as the last sentence in footnote 3:
“And provided also that in the event of any claim being made by anyone other than the owners of The Vessel [and/or property] hereby insured under this clause he shall not be entitled to recover in respect of any liability to which the Owners of the Vessel [and/or property] insured as such would not be subject * * *_>>
All agree that Nardelli is not an owner of this vessel; all agree that the owners are not personally liable for the dam
I think the judgment of the trial court was correct and that it should be affirmed.
