Mathis v. Hanover Ins. Co.

• Decision Date: 22 September 1972
• Docket Number: No. 47357,No. 2,47357,2
• Citation: 192 S.E.2d 510,127 Ga.App. 89
• Parties: , 75 A.L.R.3d 405 S. C. MATHIS v. HANOVER INSURANCE COMPANY
• Court: Georgia Court of Appeals

Page 510

192 S.E.2d 510

127 Ga.App. 89, 75 A.L.R.3d 405

S. C. MATHIS v. HANOVER INSURANCE COMPANY.

No. 47357.

Court of Appeals of Georgia, Division No. 2.

Sept. 22, 1972.

Syllabus by the Court

In an action to collect on an 'all risks yacht policy' for a pleasure craft which has sunk without obvious explanation, when the insured has shown that the craft was afloat and in good condition just prior to the sinking, the presumption arises that the sinking was caused by some extraordinary occurrence within the type of risk insured against. At this point the insured has made a prima facie case.

In a suit to collect on a marine insurance policy, the plaintiff appeals from the judgment based upon a directed verdict for the defendant and from the denial of his motion for a new trial.

Plaintiff contracted to buy a used, steelhulled houseboat from a marina on Lake Lanier. On September 21st, he arranged financing and telephoned his insurance agent to procure coverage. Regardless of whether there was an enforceable oral binder, the written policy as issued showed an effective date of 4:15 p.m. on September 25th. Sometime in the evening of September 25th, the boat sank at its moorings for unknown reasons. Plaintiff testified that he had looked at the bilges on several occasions, including the night of the 24th and the morning of the 25th, and that they had always been completely dry. The owner of the marina testified that he had inspected the bilges many times while the boat was up for sale and that they had always been dry. Further, he raised the boat after the sinking, tested it for leaks and found none. Finally, the boat had later been docked for some five months without any repair, during which time there had been no leakage or water in the bilges. Neither the plaintiff nor his expert witness knew of any unusual weather conditions, large waves, or other circumstances which would explain the sinking. The court directed a verdict at the close of plaintiff's case.

Westmoreland, Hall & Bryan, James M. Crawford, Atlanta, for appellant.

Kleiner, Herman, DeVille & Simmons, Joel M. Merren, Atlanta, for appellee.

HALL, Presiding Judge.

While there is very little Georgia case law on marine insurance, general maritime law governs the construction of these policies and there are many useful cases from the federal courts and other states. Before discussing the case here, certain basic principles need to be reviewed. First of all, unless otherwise stated, a marine insurance policy does not cover loss resulting from the ordinary action of wind and waves, natural decay or ordinary wear and tear of the vessel or negligence of the owner in keeping the vessel seaworthy. The classic 'perils of the sea' clause has been so interpreted time and time again. See 5A Appleman on Insurance § 3272; Dwyer v. Providence Washington Ins. Co., 95 Ga.App. 672, 98 S.E.2d 592. Even the more modern 'all risks' clause covers only extraordinary and fortuitous events and the onus remains where it would have been under a 'perils of the sea' clause. Mellon v. Federal Ins. Co., 2 Cir., 14 F.2d 997; Anders v. Poland, La.App., 181 So.2d 879. It is also a general rule that the owner warrants the seaworthiness of the vessel at the time the risk attaches; and if it is not seaworthy then, the policy is void ab initio. 4A Appleman § 2654. Seaworthiness means the ability to withstand the ordinary stress of wind, wave and weather which the vessel might normally be expected to enounter-in other words, to stay afloat in the absence of abnormal conditions. 5A Appleman § 3273. The definition is relative, and includes the concepts of 'lakeworthy' and 'portworthy'. 45 C.J.S. Insurance § 652, p. 561.

There is also a body of case law on the presumptions surrounding seaworthiness. The one which is relevant here is best stated as follows: '(W) hen a vessel sinks at a sheltered berth in clam weather without any obvious explanation . . . a presumption arises that the . . . loss, was due to the unseaworthiness of the vessel in some particular. But . . . an insured can rebut the foregoing presumption by establishing that in fact the vessel concerned was seaworthy before the sinking . . . and if he succeeds in doing so the counter presumption arises that the unexplained sinking and consequent loss was caused by some extraordinary, although unknown and unascertainable, peril of the sea.' Boston Insurance Co. v. Dehydrating Process Co., 1 Cir., 204 F.2d 441,...