Gulf Transp. Co. v. Firemans Fund Ins. Co

• Decision Date: 08 March 1920
• Docket Number: 20934
• Citation: 83 So. 730,121 Miss. 655
• Court: Mississippi Supreme Court
• Parties: GULF TRANSP. CO. v. FIREMANS FUND INS. CO

83 So. 730

121 Miss. 655

GULF TRANSP. CO. v. FIREMANS FUND INS. CO

No. 20934

Supreme Court of Mississippi

March 8, 1920

March 1920

1 INSURANCE. Loss of oil large not covered by marine policy against "perils of the sea."

Where an oil barge while being towed in smooth waters within thirty minutes after starting on the voyage broke under the weight of her own cargo, necessitating stranding, on account of initial defective construction, though it had been repaired by the insurer after a previous storm, was not covered by a policy against perils of the sea, barratry, etc., the loss in such case not being proximately caused by a "peril of the sea."

2. APPEAL AND ERROR. Court will not reverse chancellor unless findings are clearly wrong.

The supreme court on appeal should not reverse the findings of a chancellor on facts unless he is clearly wrong.

Hon WM. M. DENNY, JR., Chancellor.

APPEAL from the chancery court of Harrison county, HON. WM. M DENNY, JR., Chancellor.

Suit by the Fireman's Fund Insurance Company against the Gulf Transportation Company. From a decree for the defendant for less than it claims against plaintiff, it appeals.

The facts are fully stated in the opinion of the court.

Decree affirmed.

J. A. Leathers and Mize & Mize, for appellant.

White & Ford and Dart, Kernan & Dart, for appellee.

IN BANC

OPINION

STEVENS, J.

Appellant, a Mississippi corporation had constructed and is the owner of a certain wooden barge "Bert." This barge was constructed at Gulfport, Miss., in 1916, and on August 2, 1916, appellee, the Fireman's Fund Insurance Company, a foreign corporation of San Franciso, Cal., executed a time policy of marine insurance whereby it undertook to insure the said Gulf Transportation Company for a period of one year, and in the sum of thirty-five thousand dollars, against any loss or damage to said barge caused by the perils of the sea as named and set forth in the written contract. The perils, accidents or contingencies insured against are set forth in the following clause:

"Touching the adventures and perils which the said insurance company is contented to bear and take upon itself in this voyage, they are of the seas, fire, barratry of the master (unless the insured be an owner of the vessel), and of the mariners and all other losses and misfortunes which have or shall come to the damage of the said property or any part thereof, to which insurers are liable by the rules and customs of insurance in Boston, subject to the provisions or conditions referred to by clauses in this policy."

The barge was constructed for the transportation of oil, and soon after it was constructed and the policy of insurance written, it was towed from Gulfport to Tampico, Mex., where it was used in carrying oil from Tampico to Lobos Island, making several trips. In February, 1917, it started upon a voyage from Tampico to New Orleans, La., in tow of a tug. On this voyage it encountered a storm which badly water-logged and otherwise damaged the barge to such an extent that it was compelled to put into the port of Galveston for repairs. Thereupon appellee company appointed one T. J. Anderson, a ship surveyor, to make a survey and report to the insurance company. Mr. A. E. Fant appears to be the principal owner, the active agent, and dominant influence in appellant company. Mr. Fant went to Galveston to look after the interest of his company and there received from Anderson, the surveyor, recommendations as to what should be done to repair the damage to the barge. Without referring to immaterial conflicts in the testimony, it may be said generally that these negotiations between Fant and Anderson led to the preparation by Mr. Anderson of plans and specifications for the necessary repairs, and that, based upon these specifications, Fant, acting for the Gulf Transportation Company, contracted with one Weaver to repair or rebuild the barge in accordance with Anderson's specifications. In the course of the work, Fant made payment to Weaver on the contract in accordance with the O. K. or recommendation of Mr. Anderson. The total expense of these repairs appears to have been twenty thousand, five hundred four dollars, and fifty-four cents, and under the terms of the policy appellant claimed and recovered sixteen thousand, nine hundred, sixty-four dollars and twenty-one cents as the amount for which the Insurance Company was chargeable. Weaver completed his contract, and thereupon Anderson, at Mr. Fant's request, gave a certificate of seaworthiness, upon which Frank B. Hall & Company, the New York agents of appellee company, reinstated the policy for the full amount of thirty-five thousand dollars; the additional premium to be paid when appellee settled for the loss incurred as above stated Mr. Fant thereupon leased the barge, as repaired, to Charles Clark & Co., which company had the barge towed up Houston Ship Channel to Lynchburg, Tex., where she was loaded with oil and proceeded on a voyage down Houston Ship Channel to Port Arthur, Tex. After going a short distance, about thirty minutes after she started, and while in smooth and placid waters, she gradually began to settle, the oil began to seep out of the barge and make its appearance in the wake of the barge, and to prevent further sinking the captain "shoved her out of the channel in shallow water and anchored the barge and then proceeded to Galveston light to report." The captain left the barge anchored over night and, returning the next morning, states: "She was resting on the bottom in about twelve feet of water." That he thereupon "pumped water out of her and she floated, and we got back in the channel and carried her back to Lynchburg."

The parties failed to adjust or agree upon the loss or amount properly chargeable under the terms of the policy, whereupon the Gulf Transportation Company instituted a suit on the policy in the circuit court of Harrison county for the recovery, first, of the sum of sixteen thousand, nine hundred, sixty-four dollars, and twenty-one cents under the first loss; and for the sum of thirty-five thousand dollars, alleged total loss for accident in Houston Ship Channel. It was the contention of the plaintiff that the barge opened up, became hogged, and so badly went to pieces in Houston Ship Channel that she is no longer fit for the purpose for which she was constructed, and that inasmuch as, under certain estimates obtained by appellant, it would require at least forty thousand dollars to make the barge seaworthy, she is now a total loss. The barge at the time this suit was instituted, and at the time it was tried in the lower court, was anchored at Galveston, and a photograph of the barge as she lies at anchor is made a part of the record. Because the case was tried in the circuit court, appellee filed its bill in the chancery court of Harrison county to enjoin the prosecution of the suit at law, and seeking to transfer the issues to a court of equity for reasons unnecessary here to set out. To this bill appellant, as plaintiff in the action at law, filed an answer and cross-bill and consented to equity jurisdiction. The pleadings were thereupon drawn in accordance with the practice in chancery, and the cause submitted to the chancellor upon the pleadings and proof, and a decree rendered awarding to appellant the full amount of sixteen thousand, nine hundred, sixty-four dollars, and twenty-one cents, together with interest thereon, as the appropriate amount of loss incurred as a result of the storm and as a consequence of the repairs made by Weaver, but denied any recovery on account of the alleged second disaster in the Houston Ship Channel. Appellant company was satisfied with the recovery awarded for the first loss and elects to accept the amount found to be due for the first disaster, but prosecutes its appeal from that portion of the decree denying the claim of thirty-five thousand dollars, on the policy as restored for the loss alleged to have been sustained in the Houston Ship Channel. The only issue presented by this appeal, therefore, is the question whether or not appellant is entitled to recover damages claimed to have been sustained on the last voyage.

On the question of liability, two main contentions are made by counsel for appellant: First, that the repairs at Galveston were under the direct supervision of T. J. Anderson a surveyor for the insurance company; that Anderson as a surveyor for appellee company issued a certificate of seaworthiness; that acting upon this certificate of seaworthiness, the insurance company restored the policy for the full amount, and the barge started upon the journey which resulted in disaster; and that the insurance company is accordingly estopped from pleading or successfully maintaining that the...