The Patapsco Insurance Company, Plaintiffs In Error v. John Southgate and Wright Southgate, Defendants In Error

• Decision Date: 01 January 1831
• Citation: 5 Pet. 604,30 U.S. 604,8 L.Ed. 243
• Parties: THE PATAPSCO INSURANCE COMPANY, PLAINTIFFS IN ERROR v. JOHN SOUTHGATE AND WRIGHT SOUTHGATE, DEFENDANTS IN ERROR
• Court: U.S. Supreme Court

30 U.S. 604

5 Pet. 604

8 L.Ed. 243

THE PATAPSCO INSURANCE COMPANY, PLAINTIFFS IN ERROR v. JOHN SOUTHGATE AND WRIGHT SOUTHGATE, DEFENDANTS IN ERROR.

January Term, 1831

ERROR from the circuit court of the district of Maryland.

The defendants in error instituted an action against the Patapsco Insurance Company, in the circuit court of Maryland, on a policy of insurance on the schooner Frances, Seaward, master, from Curacoa, or a port of departure in the West Indies, or on the Maine, to a port in the United States. On her voyage from Carthagena to Norfolk the Frances encountered a severe gale, and sustained such injuries as made it necessary for her, after two days, to put back to Carthagena: on entering that port she struck several times on a sand bar; and on examination it was found that she required considerable repairs in her hull and rigging. She was placed, by the captain under the care of the American consul at Carthagena; and was sold by him at private sale to Evans for one hundred and forty dollars, with the consent of the captain. Evans afterwards sold the Frances to Palmer for two hundred dollars. She was repaired by Palmer, and returned to the United States. The plaintiffs claimed a total loss from the underwriters.

On the trial in the circuit court, the defendants took exceptions to the opinions of the court, on points submitted by the plaintiffs and by the defendants, for instructions to the jury; which, with the facts of the case, are fully stated in the opinion of the court.

The deposition of Thomas Evans was offered in evidence, by the plaintiffs below; and after exceptions to its legality by the defendants, was admitted by this court. The deposition was taken, ex parte, at Norfolk, before the mayor of that place. In the caption, the mayor states the witness to be a resident in Norfolk; and in his certificate declares the reason for taking it to be, that the witness 'lives at a greater distance than one hundred miles from the place of trial, to wit: at the borough Norfolk.' No subpoena was issued for Evans, and no other evidence was offered of the place of his residence, than the caption of the deposition in the handwriting of the mayor of Norfolk.

The jury having found a verdict for the plaintiff in the circuit court, the defendants prosecuted this writ of error.

The case was argued by Mr Mayer and Mr Wirt for the plaintiffs in error; and by Mr Stewart and Mr Taney for the defendants.

For the plaintiffs in error it was contended:

The deposition, ex parte, of Evans, ought not to have been admitted in evidence; because the act of congress allowing depositions of this kind is not to be construed to extend to depositions taken at a place, to which a subpoena from the court of trial will not reach. Only depositions, de bene esse, may be taken under the act; and de bene esse, ex vi termini, imports a power, by ordinary common law process, to obtain the evidence; and a subpoena is that ordinary means. 3 Wash. C. C. R. 415, 529. At least no such deposition can be read, unless due diligence be first used to obtain the attendance of the witness at the trial, or his evidence under commission, according to the rules of the court. 2 Wash. C. C. R. 487. 4 Wash. C. C. R. 215. 1 Peters's C. C. R. 291. Nothing to this effect was in proof at the trial.

No evidence was offered to show that the vessel was injured by any of the accidents insured against injury, beyond one half of her value. The underwriters do not insure the goodness of the ship; and the deficiencies, which form the ground of the claim, must be traced to the disaster which has befallen the vessel within the perils of the policy, and must be proved and measured by regular details and estimates. Cazalet vs. St Barbe, 1 T. R. 190. 1 Johns. Rep. 336. Fontaine vs. Phenix Insurance Company, 11 Johns. Rep. 295.

It may also be questioned, whether, in the estimating of the injury to be beyond one half, the customary rule must not be observed, of deducting from the repairs one third on account of the new work. 3 Mas. 75. 2 Caines' Ca. Er. 157. It is true, the insurer, if the abandonment be valid, will have the vessel, and consequently the benefit of the new work; but the very inquiry here is, whether the abandonment be well grounded; and that is to be learnt only by seeing what injury is really sustained. That necessarily refers us to the value of the old work, in its competent condition, at the commencement of the risk; nothing more being incumbent on the insurer by his contract, than to replace the insured property in its original state, either specifically or by a pecuniary equivalent.

It is not settled to what place the estimate of the vessel's worth, when supposed to be repaired, is to be referred; when the ascertainment is making whether she will be worth repairing. It is to be presumed her value, in her improved condition at her home port, is most just; because, there the vessel is to be available to the owners for sale or enterprise; and the natural occupation of a vessel, to carry merchandize, will be supposed to be the object of the owners in having her at a foreign port, and not the sale of the vessel. 11 Johns. Rep. 295. 2 Caines' Ca. Er. 157. 2 Mason, 71. All analogy from the settlement of the contribution, in general averages, authorizes the present construction. Marshall, 621, 628.

But an abandonment was necessary for sustaining a claim of total loss, admitting the vessel to have been deteriorated by the disasters, beyond one half of her value. Phill. 383. 1 T. R. 611.

There was neither an actual nor constructive abandonment here. An abandonment must be explicit and absolute, and must use terms of cession, that, by clear intent, transfer the property in the thing insured. A mere claim for total loss will not avail as an abandonment. Parmeter vs. Toddhunter, 1 Camp. 451. Turner vs. Edwards, 12 East, 488. Phill. Ins. 447. Marsh. Ins. 600.

The protest does not amount to an abandonment in this case, though transmitted by the insured, and containing words of abandonment in the close of it; because not made by the persons having the property in thing insured, and because the insured transmitted it to the underwriters only as a protest, or detail of the circumstances of the loss.

If there be evidence of abandonment, it is, nevertheless, necessary under the policy in this cause, to show notice of an intention to abandon. The abandonment and the notice, it has been decided in Catlett vs. Columbian Insurance Company, 12 Wheat. 393, may operate by one instrument. But the instrument should contain words of a prospective import. That is not the case in any of the written acts of the parties here.

If there was an abandonment, yet the state of the vessel must be regarded as the vessel was at the time of the abandonment. She had then been repaired, at a trivial expense; and, the sale being a nullity, she was in the hands of the insurers in point of law. Though supposed once to be irretrievably injured, she was not so then; and her repairs having proved to be practicable, at so small a sum, demonstrated that she never was actually thus injured. In reference to this point, on the time of abandoning, the case must be treated in analogy to that of a capture and re-capture.

Only extreme necessity will justify a sale by the master; and that necessity must be found by the jury to have existed: and the jury, and not the master, is the arbiter on that issue of necessity, upon a view of all the circumstances of the case. The honest discretion of the captain is not the sanction here; however that discretion may be conclusive as to all proceedings within the sphere of his ordinary business as master. A sale is, however, without those limits; and must be justified by a superadded agency, which only the force of circumstances can confer upon him. It is not enough, therefore, that the master shall appear to the jury to have had an honest view to his owner's interest in a sale of the ship; but the jury must find that, according to the aspect and state of things, the sale was in fact for the owner's interest, because of the necessity to resort to that measure. It must be an interest created by the exigency, and not produced by any collateral circumstances beyond those connected with the restoration of the vessel. All the authorities may in this view be easily explained and reconciled, where on this head they use the terms, 'for the best of all concerned;' 'for the benefit of the concerned;' 'as a prudent man uninsured would do;' as applied to the master's discretional sale of the vessel. All these rules come round to the principle of the necessity, within which strictly the question of the owner's interest on the emergency lies. What is a case of necessity depends on the circumstances and many varieties of accident; but a necessity, in reference to a sale, may be said to be the state of things which, from actual ascertainment where practicable, or from appearances, where they can alone be consulted, requires instant action; and where there is a choice only between the certain or probable loss of the vessel, and the saving of so much of her as the proceeds of a sale may yield.

Every case of necessity must exhibit a perspective destruction, or an injury already sustained, to a degree irreparable, or demonstrating, in connexion with the expense, that repairs would be an idle waste of money. The first instance is an example of mere jeopardy; the latter is the case that should now be before the court to entitle the insured to succeed. The case of jeopardy is to be found by the jury, from the threatening perils of the ship; the case of sustained injury, from the fact of her actual condition, and the well ascertained expense of repairs, and the value of the vessel after repairs, determined upon some sure data. Hayman vs. Molton, 5 Esp. R. P. C. 67. Reid vs. Darby, 10 East, 343. Miller vs. Fletcher, 1 Doug. 231. Read vs. Bonham, 7 Serg. and Lowb. 386. Scull vs...