Insurance Co. of Pennsylvania v. The Waubaushene

• Citation: 24 F. 559
• Parties: INSURANCE CO. OF PENNSYLVANIA v. PROCEEDS OF THE SALE OF THE BARGE WAUBAUSHENE.
• Decision Date: 21 July 1885
• Court: U.S. District Court — Northern District of New York

24 F. 559

INSURANCE CO. OF PENNSYLVANIA v. PROCEEDS OF THE SALE OF THE BARGE WAUBAUSHENE.

United States Circuit Court, N.D. New York.

July 21, 1885

Williams & Potter, for appellant.

Marshall Clinton & Wilson, for appellee.

WALLACE J.

In deciding against the application of the insurance company to be paid the premium due upon the marine policy issued by it upon the barge out of the proceeds arising from her sale in the registry of the court, the learned judge of the district court held that the contract for insurance was made in Canada, and the rights of the parties to a lien were controlled by the lex loci contractus. He also held that such a lien is not recognized by our jurisprudence, and that the statutes of this state creating a lien for premiums in favor of underwriters do not apply to foreign vessels. He therefore held that as the company had no lien by the law of Canada, it could assert none here. These conclusions are fully approved and it seems superfluous to attempt to re-enforce the reasoning of the very able and careful opinion of the district judge further than briefly to indicate the reasons which have led this court to deny the existence of the maritime lien for insurance premiums. As early as 1815 Mr Justice STORY decided, in De Lovio v. Boit, 2 Gall. 398, that a policy of insurance upon a vessel was a maritime contract, in an opinion which has been characterized as 'a learned and elaborate essay on admiralty jurisdiction, and one of the most luminous views of the subject extant.' 2 Hoff.Leg.Stud. (2d Ed.) 465. Although the doctrine of that case was not uniformly accepted, (Ramsay v. Allegre, JOHNSON, J., 12 Wheat. 638; Jackson v. The Magnolia, CAMPBELL, J., 20 How. 335,) the jurisdiction over such contracts was always maintained subsequently in the First circuit, and was generally approved by commentators of authority. Gloucester Ins. Co. v. Younger, 2 Curt. 322; Hale v. Washington Ins. Co. 2 Story, 176; Dunl. Adm. Pr. 43; 1 Kent, Comm. 370, note; Ben. Adm. Sec. 294; Conkl. Pr. 13. Yet until the decision in The Dolphin, 1 Flippin, 580, as is conceded in the opinion of the court in that case, the general understanding of the profession was adverse to the existence of a lien for the premium secured by such a contract. In that case, reasoning from analogies, and influenced by the views recently declared by the learned judge of the Sixth circuit, that every maritime agreement, upon principle, should bind the ship as well as the owner, (The Williams, Brown, Adm. 208,) the court held that the lien should be recognized as extending to the premiums for insurance. It was said by Mr. Justice CURTIS, (The Kiersage, 2 Curt.C.C. 424,)-- 'To be a settled rule that privileged liens, constituting a jus in re accompanying the property into the hands of bona fide purchasers and operating to the prejudice of general creditors, are matters stricti juris, which cannot be extended from one case to another argumentatively, or by analogy or by inference.'

And he cites Pardessus, (3 Droit, Comm. 597, 598,) when reasoning on the policy of allowing a privilege for premiums of...