Insurance Company v. Dunham

• Decision Date: 01 December 1870
• Citation: 11 Wall. 1,20 L.Ed. 90,78 U.S. 1
• Parties: INSURANCE COMPANY v. DUNHAM
• Court: U.S. Supreme Court

78 U.S. 1

20 L.Ed. 90

11 Wall. 1

INSURANCE COMPANY v. DUNHAM.

December Term, 1870

ON certificate of division in opinion between the judges of the Circuit Court for the District of Massachusetts.

The act of Congress of April 29th, 1802,¹ provides that

'Whenever any question shall occur before a Circuit Court, upon which the opinions of the judges shall be opposed, the point upon which the disagreement shall happen, shall, during the same term, upon the request of either party or their counsel, be stated under the direction of the judges, and certified under the seal of the court, to the Supreme Court, at their next session to be held thereafter, and shall by the said court be finally decided.'

At the time when this statute was passed the Circuit Court, when consisting of more than a single judge, was composed of a judge of the Supreme Court of the United States and the District judge of the district sitting together, and this organization remained until April 10th, 1869.

By act of that day,² 'to amend the judicial system of the United States,' it was enacted:

'That for each of the nine existing judicial circuits there shall be appointed a Circuit judge, who shall reside in his circuit, and shall possess the same power and jurisdiction therein as the justice of the Supreme Court allotted to the circuit. The Circuit Courts in each circuit shall be held by the justice of the Supreme Court allotted to the circuit; or by the Circuit judge of the circuit; or by the District judge, or by the justice of the Supreme Court and Circuit judge sitting together, . . . or, in the absence of either of them, by the other . . . and the District judge.'

In this state of enactment a libel in personam had been filed in the District Court for the District of Massachusetts, by one Dunham against the New England Mutual Marine Insurance Company, on a policy of insurance, dated at Boston on the 2d day of March, 1863, whereby the insurance company, a corporation of Massachusetts, agreed to insure Dunham, the libellant, a citizen of New York, in the sum of $10,000, for whom it might concern, on a vessel called the Albina, for one year, against the perils of the seas and other perils in the policy mentioned; and the libellant alleged that within the year the said vessel was run into by another vessel on the high seas, through the negligence of those navigating the said other vessel, and sustained much damage, and that the libellant had expended large sums of money in repairing the same, of which he claimed payment of the insurance company.

The question was whether the District Court, sitting in admiralty, had jurisdiction to entertain a libel in personam on a policy of marine insurance to recover for a loss.

The Constitution ordains, it will be remembered, that

'The judicial power shall extend . . . to all cases of admiralty and maritime jurisdiction.'

And the Judiciary Act of 1789, which established the District Courts, declares that they shall have

'exclusive original cognizance of all civil causes of admiralty and maritime jurisdiction . . . saving to suitors in all cases the right of a common law remedy where the common law is competent to give it.'

The District Court decreed in favor of the libellant, and the insurance company appealed to the Circuit Court. The judges of that court were opposed in opinion on the point raised, and it was accordingly certified to this court. Two questions were thus before this court:

1. Whether since the reorganization of the Circuit Courts under the act of 1869, a difference of opinion between a judge of the Supreme Court and 'the Circuit judge,' created by that act, sitting as the Circuit Court, could be certified to this court under the act of 1802.

2. If it could, what was the proper answer to be returned to the question certified? Had the District Court, sitting in admiralty, jurisdiction to entertain the libel in this case, the same being a libel in personam on a policy of marine insurance to recover for a loss?

The latter question was the one to which the briefs of counsel were directed.

Mr. F. C. Loring, for the libellants and in support of the jurisdiction:

By the universal and unanimous foreign practice and authorities, with one exception only, the contract of marine insurance is considered to be maritime, and a proper subject for the cognizance of a court vested with jurisdiction over maritime cases. It might, therefore, have been anticipated, that when the question came before the admiralty courts of the United States, vested with jurisdiction over all maritime cases, the decision would be in favor of the jurisdiction. This does not seem to have happened for more than twenty years after the adoption of the Constitution. As the courts of common law exercise concurrent jurisdiction over contracts of insurance, and as the plaintiffs in suits thereon would naturally prefer not to waive the benefit of a trial by jury, and of a trial in their own courts; and as the lawyers of that day were brought up according to and by the common law, this is not surprising. No case is found, in the reports of any of the courts of the United States, of an action in the admiralty on a policy of insurance until the year 1815, nor on a charter-party, nor for freight, till 1829.³

At the October Term of the Circuit Court for Massachusetts, in 1815, the question was first presented by a libel on a policy of insurance. A plea to the jurisdiction was interposed, and the result was the opinion of Story, J., in De Lovio v. Boit,⁴ deciding in favor of the jurisdiction.

How this decision was received at the time is not now known. As this court was then constituted, it is probable that the jurisdiction would have been maintained on appeal. Marshall, C. J., affirmed, in The Little Charles,⁵ in 1819, that 'The courts of the United States have never doubted their right to proceed under their general powers as courts of admiralty, where they are not restrained from the use of these powers by statute.'

That Washington, J., would have sustained the jurisdiction, cannot be doubted. In The Sencea,⁶ he says:

'I not only admit, but insist, first, that the judicial power of the United States under the Constitution, and the jurisdiction of the District Courts under the ninth section of the Judiciary Act of 1789, embrace all cases of maritime nature, whether they be particularly of admiralty cognizance, or not.

'Second. That this jurisdiction, and the law regulating its exercise, are to be sought for in the general maritime law of nations, and are not confined to that of England, or of any other particular maritime nation.'

He afterwards speaks of the ordinances of Louis XIV, as generally adopted, as evidence of the maritime law of nations.

Difference of opinion as to the extent of the admiralty jurisdiction has occurred only of late date. It first appears eminently in Ramsay v. Allegre, in 1827, in the dissenting opinion of Johnson, J., with whom have concurred, at different times, Baldwin, and Daniel, and Campbell, JJ., and others to a less extent; but the majority of the court have uniformly held that the practical jurisdiction of the English admiralty affords no rule for the jurisdiction vested in the courts of the United States by the Constitution and by Congress, and that that embraces all maritime contracts.

In the reports of this court, and of other courts of the United States, no other reference has been found to the contract of insurance as a matter of admiralty jurisdiction, except in Taylor v. Carryl,⁷ where Taney, C.J., expressed a doubt upon the subject, which had not been presented, or referred to in the argument, and which evidently he had not examined.

Considering the authorities apart from the repeated declarations of this court, that the admiralty jurisdiction of the District Court extends generally over maritime contracts, and the universal admission that marine insurance is a maritime contract, we have in favor of the jurisdiction three decisions of Story, J., in point.⁸ The opinion of Woodbury, J.,⁹ that insurance is clearly a contract within the admiralty jurisdiction. The fact that Curtis, J., sustained the jurisdiction as a settled practice in the first circuit,¹⁰ and, as counsel, took no exception to it.¹¹ The decisions of Sprague, J.,¹² and Ware, J.,¹³ of the District Court, and the opinions of Mr. Dunlap,¹⁴ Mr. Benedict,¹⁵ Conkling, J.,¹⁶ and Chancellor Kent.¹⁷

The weight of authority is in favor of the jurisdiction. Indeed, there is an absence of authority against it, even in England. There is no case on record known, in which the Court of Admiralty has refused to entertain jurisdiction over the subject, or in which the courts of common law have prohibited it. In admiralty commissions, insurance is usually mentioned as a matter over which jurisdiction is to be exercised; and in Scotland, the Court of Admiralty, under similar commissions, constantly entertains such jurisdiction. All that can be said about the exercise of the jurisdiction by the English court is, that, practically, it has not been resorted to. This is no argument against the jurisdiction of the courts of another nation, having jurisdiction over all maritime contracts, which they have exercised for more than fifty years over contracts of insurance. The only question then, is, whether or not marine insurance is a contract concerning matters of navigation, trade, commerce, &c. or in other words, a maritime contract. There can be only one answer; and the jurisdiction follows of course.

An argument in favor of a general jurisdiction of the United States courts in admiralty, over maritime cases, may be drawn from the power vested in Congress to regulate commerce. By virtue of this, Congress may legislate on all commercial matters; it may enact a code of commerce, regulating all affairs of navigation, affreightments, averages, marine insurances, and other maritime matters, and has exercised this power to some...