v.
John Yelton, Merchant in Kincardine. James Ogilvie, Shipmaster there, and Robert Stein, Farmer in Loanside, Owners of the Ship Diana of Kincardine, Respondents
Subject_Insurance — Insurable Interest. —
A policy of insurance was effected on the salvage arising to a ship and owners, from the recapture of a vessel. She was, in a short time, captured back again by the enemy; and the questions were, 1. Whether the salvage due, on recapture of a vessel, was a valid insurable interest? and, 2. Whether the terms of the written policy, without any specification of the commencement and termination of the risk, and proper description of the subject insured, was valid? The Judge Admiral and the Court of Session, held that there was an insurable interest. In the House of Lords, the policy was held to be void and null, as not containing a sufficient description.
June 1797.
John Yelton, merchant in Kincardine, and part owner of the ship Diana of that port, and one of the pursuers in this action, employed Mr. Robert Allan, insurance broker in Edinburgh, to effect an insurance for £800, on the ship Diana, on a voyage from the Firth of Forth to the Baltic, which was accordingly effected.
July 5, 1797.
A few weeks thereafter, Mr. Yelton wrote Mr. Allan, informing him that “the Diana has got safe over, and has retaken the Lady Bruce of Newcastle, said worth, with cargo, £2600; and, although I have no particular advice from Captain Ogilvie, yet as I am pretty certain that one-third will at least come to the recaptors, I judge proper to request you to cover £800 on said ship and cargo, for interest of owners of Diana; for premium of such, debit my account, advice of which you may send per bearer, who is to be in Edinburgh till four o’clock evening.”
July 6, 1797.
To this letter Mr. Allan returned the following answer:—
| “I wrote you last post, and have since your favour of the same date, ordering me to insure £800 on the supposed salvage of the Lady Bruce of Newcastle, retaken and carried into Norway, due to the Diana. I have only been
Page: 140↓ able to get £400 clone, at £8. 8s. per cent. |
£33 | 12 | 0 |
| Policy 2s. 6d.—Duty 10s. | 0 | 12 | 6 |
| At debit of the owners of the Diana, | £34 | 4 | 6 |
I annex the underwriters’ names; and, from what I can learn, that it is as much as you can cover on the chance of salvage.
£100 J. Smith.
£100 J. Tod.
£100 H. Smith.
£50 A. Wood.
£50 A. Ross.
In all, £400.”
The policy was in the common form, but without any of the accustomed blanks being filled up, except, 1st. The name of the assured, viz. “John Yelton of Kincardine, for the owners of the Diana, Ogilvie.” 2d. “The premium eight guineas per cent.”; and, 3d. “The date and place where the policy was executed, viz. 5th July 1797, Edinburgh.” At the foot of the policy was the following memorandum:
“The insurance is declared to be upon the supposed salvage due to the Diana, Captain Ogilvie, on the Lady Bruce of Newcastle, retaken and carried into Norway.”
Within three days thereafter, Mr. Yelton wrote Mr. Allan, informing him that the Lady Bruce had again been captured; and soon thereafter raised action before the Admiralty Court upon the policy.
In defence, it was stated that the pursuers had here no insurable interest. If they had, then they were bound to show the letters of marque, authorizing the Diana to make capture or reprisals on the enemy. The policy is an open policy—the subject or interest insured is “the supposed salvage due to the Diana.” There is neither the name of the place from whence the ship is to proceed, nor the port to which she is bound, and for which she is to sail, nor the time at which the risk begins and the same is to end, expressed therein.
May 24, 1798.
The Judge Admiral ordered the pursuers (respondents) to produce evidence of the facts, and also the policy. Thereafter he pronounced this interlocutor:—
Aug. 16,1799.
“Finds the pursuers, by the recapture of the ship called the Lady Bruce, have qualified a legal insurable interest for the salvage
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due upon the recapture of the said ship; and, before farther answer, allows the defenders ( i. e. the now appellants) to see the object as they shall be advised to the evidence adduced of the recapture, and also of the said ship the Lady Bruce being again captured by a Dutch privateer, and allows the pursuers (i. e. the now respondents) to see and answer the objection when lodged.”
He afterwards held the defenders as confessed upon the fact of recapture by the Diana, and allowed a condescendence of the salvage that might be equitably due to her. He afterwards held them as confessed as to the value of the Lady Bruce, and decerned.
Nov. 1, 1799.
Nov. 19, 1801.
A bill of suspension being brought to the Court of Session, the Lords, on full argument, found the letters orderly proceeded on, and decerned. *
Against these interlocutors the present appeal was brought to the House of Lords.
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Pleaded by the Appellants.—The respondents had not such an interest in the subject matter of the insurance as is insurable by law; but the said insurance is null and void by 19 Geo. II. c. 37, which declares, that if “any person or persons, bodies corporate or politic, on any ship or ships belonging to his Majesty, or any of his subjects, or any goods, merchandizes, or effects, laden or to be laden on board of any such ship or ships, interest or no interest, or without farther proof of interest than the policy; or by way of gaming or wagering, or without benefit of salvage to the assurer, and that every such insurance shall be null and void to all intents and purposes.” The policy is, besides, imperfect and inept, as it contains no description of the voyage, nor of the commencement or termination of the risk insured against. And the warranty that the ship was then in Norway at the time of the insurance appears not to have been true. Further, even supposing the policy attached, yet no more could be demanded than the proportion,
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or actual interest that the owners of the Diana had in the salvage, bore to the sums assured, and not to the whole sum of £400 subscribed in the policy.
Pleaded for the Respondents.—That the recapture made by the vessel Diana was an act, not contrary to the law, and that, in consequence thereof, they did acquire a certain interest in the ship and cargo so recaptured, and which created, in a certain event, a contingent ‘claim against the owners for a just and equitable remuneration. That the interest acquired by the respondents was of such a nature as entitled them to insure the same, against those risks which might occur to prevent them from obtaining the just remuneration for their risk and trouble; and that in no respect can the policy here entered into be considered as a gaming policy, struck at by the statute Geo. II.
After hearing counsel, it was
Ordered and adjudged as follows: The Lords find, That the terms in which the salvage is described in the policy of insurance, as the subject upon which the insurance is declared to have been made, are such in their construction, that the policy must be considered as inept and void; and find, that it is unnecessary to determine upon any question which it might have been necessary to decide, if the subject upon which the insurance is declared in the policy to have been made, had been described in other terms; and it is therefore ordered and adjudged that the cause be remitted to the Court of Session to review their interlocutors complained of, and to proceed consistent with this finding.
Counsel: For Appellants, M. Nolan, James Reddie.
For Respondents, William Adam, David Williamson.
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