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| | HORII TT TT ET EE TR eT ipa ap RTS he Marine Record. MARITIME LAW. [Continued from last week.) INSURANCE—S8UBROGATION—BILL OF LADING —STIPULATION THAT CARRIER MAY HAVE BENEFIT OF INSURANCE EFFECTBD UPON GOOD&S—CONSTRUCTION.—PH@NIX INSUR- ANCE CO. VS. ERIE & WESTERN TRANSPOR- TATION Co. Supreme Court of the United States. Appeal from the U. S. Circuit Court, Kastern Dis- trict of Wisconsin. The policy of insurance contains no ex- press stipulation for the assignment to the insurer of the assured’s right of action against third persons. In the bills of lading it is expressly stipulated that the carriers, whose railroad or vessels form part of the line of transportation, shall not be liable for loss or damage by fire, collision or dangers of navigation, and that each carrier shall be liable only for a loss of the goods while in its custody, ‘‘and that the carrier so liable shall have the full bénefit of any insurance that may have been effected upon or on ac- count of said goods.” The question is, whether under these cir cumstances the insurer, upon payment of a loss, became subrogated to the right to re- cover damages from the carrier. When goods insured are totally lost, actually or constructively, by perils insured against, the insurer, upon payment of the loss doubtless becomes subrogated to all the assured’s rights of action against third per- sons who have caused or are responsible for the loss. No express stipulations in the policy of insurance, or abandonment by the assured, is necessary to perfect the title of the insurer. From the very nature of the contract of insurance asa contract of in- demnity, the insurer, when he has paid to the assured the amount of the indemnity agreed on between them, is entitled, by way of salvage, to the benefit of anything that may be received, ejther from the remnants of the goods, or from damages paid by third persons for the same loss. His title arises out of the contract of insurance, and is de- rived from the assured, alone, and can only be enforced in tlhe right of the latter. Ina court of common law, it can only be asserted in hig name and, even in acourt of equity or of admiralty, it can only be asserted in his right. In any form of remedy, the insurer can take nothing by subrogation, but'the rights of the assured. (Comegys vs. Vasse, 1 Pet, 193, 214; Fretz ve. Bull, 12 How. 466, 468; the Monticelle, 17 How. 152, 155; Garrison vs. Memphis Ins. Co. 19 How. 312, 317; Hall vs. Railroad Co’s, 13 ‘Wall. 367, 370, 371; the Potomac, 105, U.S. €30, 634, 635; Mobile & Montgomery Rail- ~ vs Irving, 111 U.S. 584, 594; Clarke . Wilson, 108, Mass., 219; Simpson ys, eee. 8 App. Cas. 279, 286, 292, 298.) That the right of the assured to recover damages against a third person is not inci- dent tothe property in the thing assured, but only a personal right of the assured, is clearly shown by the fact that the insurer aequires a beneficial interest in that right of action, in proportion to the sum pald by him, and not only in the care of a total loss, but likewise in a case of a partial loss, and where no interest in the property is aban- doned or accrues to him. (Hall vs. Railroad Cos., the Potomac, and Simpson vs. Thomp- son, above cited.) The right of action against another per- son, the equitable interest in which passes to the insurer, being only that which the insured has, it follows thatif the assured has no such right of action none passes to the insurer: and that if the assured’s right of action is limited or restricted by Jawful contract between him and the per- son sought to be made responsible for the loss a suit by the insurer, in the right of the assured, is subject to like limitations or re- strictions. For instance, if two ships, owned by the same person, came into collision by the fault of the master and crew of one ship and to the injury of the other, an underwriter who has insured the injured ship, and re- ceived an abandonment from the owner, and paid him: the amount of the insurance as and fora total loss, acquires thereby no right to recover against the other ship, be- ‘cause the assured, the owner of both ships, could not sue himself. (Simpson vs. Thomp- son above cited; Globe Ins. Co. ys Sherbuck, 25 Ohio statute, 50, 68.) Upon the same principle, any lawful stipulation between the owner and the car- rier of the goods, limiting the .risks for ' which the carrier is answerable, or the time of making the claim, or the value to be re- covered, applies to any suit brought in the right of the owner, for the benefit of his in- surer, against the carrier; as, for instance, ifthe contract of carriage. expressly ex- empts the carrier from lisbility for losses by fire; (York Co, vs. Central Railroad 3 Wall 107;) or requires claims against the carrier to be made within three months; | (Express Co. vs Caldwell, 21 Wall. 254;) or fixes the value for which the carrier shall be responsible; (Hart vs. Pennsylvania Rauil- road 112 U.S. 381.) So the stipulation, not now in controversy, in the bills of lading in the present case, making the valueof the goods at the place and time of shipment the measure of the carriet’s liability would con- trol, although in the absence of such a stip- ; ulation the carrier would be liable for the value at the place of destination, as held in Mobile & Montgomery Railway vs. Jurey, (111 U. 8. 584.) The stipulation in these bills of lading, that the carriers ‘‘shall not be liable for loss or damage by fire, collision, or the dangers ot navigation,’’? clearly does not protect them from liability for any loss occasioned by their own negligence. By the settled doctrine of this court, even an express stip- ulation in the contract of carriage, thata common carrier shall be exempt from liability for losses caused bv the negligence of himself and his servants, is unreasonable and contrary to public policy, and therefore void. (Railroad Co. vs. Lockwood, 17 Wall. 857; Railroad Co. ve. Pratt, 22 Wall 123, Bank of Kentucky vs. Adams Express Co., 93 U.S. 174; Railway Co. vs. Stevens, 95 U. 8. 655.) Andit may be that, as held by Judge Wallace in a case in the circuit court, a stipulation that ‘tno damage that. can be insured against will be paid tor,” would not protect the carrier from liability for his own negligence, because that would be to com- pel the owners of the goods to insure against the negligence of the carrier. (The Hadji, 22 Blatchford, 235.) But the stipulation upon the subject of insurance, in the bills of lading before us, is governed by other considerations. It does not compel the owner of the goods to -other persons employed by himself. stand his own insurer, or to obtain in- stirance on the gooda; nor does it exempt the carrier, in cage of loss by negligence of himself or his servants, from liability. to the owner to the same extent as if the goods were uninsured. It simply provides that the carrier, when liable for the loss, shall have the benefit of any insurance effected upon the goods. It is conelusively settled, in this country, and ia Englanjl, that a policy of insurance, taken out by the owner.of a ship or goods, covers.a lo-s by perils of the sea or other perils, insured against although occasioned by the negligence of the master or crew or (Wat- ersvs. Merchants’ Louisville Ins. Oo., 11 Pet 213; Copland vs. New England Ins. Co., 2 Met. 432; General Ins. Co. vs. Sherwood, 14 How. 351, 366; Davidson vs. Basoand, le R.4CB.117, 121.) Auy one who has wade himself responsible for the, satety: of goods has a snfticient in- terest in them to enable him to insure them,, Contracts of re-insurance, by which one insurer causes the sum which he has insured to be re-assured to him by a distinct con- tract with another insurer, with the object ot indemnitying himself against his own re- sponsibility, (though prohibited.for a time in England by statute,) are valid by the common law, and have always been 1n this country ; and in a suit upon such a contract, the subject at risk.and the loss thereof must be proved in the same manner as if the original assured were the plaintiff, 3 Kent Com. 278, 279: Sun Ins. Co. vs. Ocean Ins. Qo., 107 U.S. 485; Mackenzie vs. Whit- worth, L. R, 10 Ex, 142, and 1 Ex. D. 36.) So « common carrier, a warehouseman, or a whartinger, whether liable by law or cus- tom to the same extent as an insurer, or only for his own negligence, may in order to protect himself against his own responsi- bility, as well as to secure his lien, cause the goods in his custody to be insired to their full value, and the policy need not specify the nature of his interest. (Crewley vs. Cohen, 3 B. & Ad. 478; De Forest vs. Fulton Ins. Co., 1 Hall 84, 110; ‘Waters vs. Monarch Assurance Oo., 5 El. & Bl. 870; London & Northwestern Railway vs. Glyn, E}. & Bl, 652; Savage vs. Colin Exchange Ins. Co., 36 N. Y. 655; Joyce vs. Kennard, L. 8S. 7 Q. B. 78; commonwealth vs. Shoe & Leather Ins. Co., 112 Mass. 131; Home Ins, Co. vs. Baltimore Warehouse Co. 93 U.S 627; North British Ins, Co. vs. London, Liverpool & Globe Ins, Vo., 5 Ch. D. 569.) No rule of law or of public policy is violated by allowing a common carrier, like any other person having" either the general property or a peculiar interest in goods, to have them insured against the usual perils, and to recover for any loss from such perils, though occasioned by the negligence of his own servants, By obtaining insurance, he does not diminish his own responsibility to the owners of the goods, but rather increases his means of meeting that responsibility. If it were true thata ship owner, obtaining insurance by general description upon his ship and the goods earned by her, could, in case of the loss of both ship and goods, by perils insured against, and through the negli- ence of the master and crew, recover of the insurers for the loss of the ship only, and not for the los3 of the goods, some trace of the distinction would be found in the books. But the Jearning and research of counsel have failed to furnish any such precedent. On the contrary, in one of the earliest cases in which the rule that a policy of in- surance covers losses by perils insured against, though occasioned by the negli- gence of the servants of the assured, was judicially affirmed, the assured, being the owner of the ship, had chartered her fora West India voyage and by the usages of trade bore the risk of bringing the cargo trom the shore to the ship; the policy was upon the boats of the ship, and upon goods in them; and the amount recovered of the insurer was for goods being carried from the shore to the ship in her boats, and lost by the wreck ing of the boats in consequence or the mis- conduct and negligence of some of the ship’s crew. Such was the state of tacts to which Lord Chief Justice Abbott applied the language, cited and approved by Mr. Justice Story in Waters vs. Merchants’ Louisville Ins. Co, (11 Pet. 222,) and by Chiet Justice Shaw in Copeland vs. New England Ins. Co., (2 Met. 442:) ‘In this case, the im- mediate cause of the loss was the violence of the winds and waves. No decision can be cited, where, in sucha case, the under- writers have-been held to be excused in con- sequence of their having been remotely oc- casioned by the negligence of the crew. I am afraid of laying down any such rule; it willintroduce an infinite number of ques- tions as to the quantum of care, which, if used, might have prevented the loss. Sup- pose, for Instance, the master were to send a men to the mast head to look out, and he falls asleep, in consequence of which the ‘vessel runs upon a rock, or is taken by the, enemy, in that case it might be argued, as here, that the loss was imputable to the negligence of one of the crew, and that the underwriters were not liable. These, and a variety of other such questions, would be introduced, in case our opinion were in favor of the underwriters.”’ (Welker vs, Maitland, 5 B. & Ald, 171, 174, 175.) So in the recent case of North British Ins. Co, vs. London, Liverpool & Globe Ins. Co., it was assumed, as unquestionable, that in- surance obtained by a wharfinger would cover a loss by his own negligence. (5 Ch. D. 584.) i As the carrier might lawfully himself eb- tain insurance against the loss of the goods by the usual perils, though occasioned by his own negligence, he may lawfully stipulate with the owner to be allowed the benefit of insurance voluntarily obtained by the latter. This stipulation does not, ,in terms or in effect, prevent the owner from being reimbursed the full value of the goods; but being valid as between the own- er and the carrier, it does uot prevent either the owner himself, or the insurer, whe can only sue in his right, from maintaining an action against the carrier upon any terms | inconsistent with this stipulation. | Nor does this conclusion impair any law- ful rights of the insurer, His right of sub- rogation, arising out of the contract of in- surance and payment of the logs, is only to such rights as the assured has, by law or contract, against third persons. ‘The policy, containing no express stipulation upon the subject, and there being no evidence of any fraudulent concealment or misrepresenta- tion by the owner in obtaining the insurance, the existence of the stipulation between the owner and the carrier would have afforded no defence to an action on the policy, ac- cording to two careful judgments rendered in June last, and independently of each other, the one by the English Court of Ap- peal; and the other by the Supreme Judicial Court of Massachusetts. (Tate vs, Hyslop, 15 Q. B. D, 368; Jackson Oo, vs. Boylston Ins. Co. 139 Mass. 508.) In Tate vs. Hyslop, owners ot goods, in- sured against risks in crafts or lighters, had previously agreed with alighterman that he should not be liable for any loss in crafts except loss caused by his own negligence, and did not disclose this agreement to the underwriters at the time of procuring the insurance, The sole ground on which it was held that the owners could not recover on the policy was that this agreement was material to the. risk, because the under- writers, as the assured knew, bad previously established two rates of premium, depend- ing on the question whether they would have recourse over against the lighterman. Lord Justice Brett observed that, but for the two rates of premium established by the | underwriters and known to the assured, the omission of the assured to disclose their agreement with the lighterman could only have affected the amount of salvage which the underwriters might have, and would have been immaterial to the risk, and con- sequently to the insurance. (15 Q. B.D. 375, 376.) In Jackson Co. v3. Boylston Ins. Co. it was adjudged that, in the absence of any traud or intentional concealment, the un- disclosed existence of a stipulation between the assured and the carrier, like that now before us, afforded no defence to an action on the policy. It may be added that our conclusion ac- cords with the decision of Judge Shipman in Rintoul vs. New York Central Railroad, (21 Blatehford, 439), as well as with those of Judge Dyer in the district court, and Judge Drummond in the circuit, in the present case. (10 Bissell, 18, 38. See also, Carstairs vs. Mechanics’ & Traders’ [ns. C».,18 Fed. Rep. 473; The Sydney, 23 Fed. Re. 88; Merecan- tile Ins. Co. ys. Calebs, 20 N. Y. 173.) Decree affirmed. Mr. Justice Bradley dissented. March 1, 1886. CHARACTERISTICS OF MISSISSIPPL RIVER STEAMBOAT MEN. BY THE SECCND ENGINEER. Written for the Marine Record. ‘PART XVI. Engineers upon the Mississippi river often pride themselves as being “‘hot,’’ in not be- ing afraid to carry big steam. ‘There is to- day an engineer, well and favorably known in connection with engineering interests and us-ociations, who wore with pride the distinction of being the ‘hottest man” that ever left the port from whence he hailed. Many stories are told of engineers who were known as hot men, who steamboated before the inspection laws came into force, puiting certain restrictions upon the steam being carried at high pressure. Thereis a-story told of Bill Jones, one of the hot men, brave as a lion, and cool asa soldier in battle. He had charge of a big side wheel boat, with engines that were so small that it took all the steam they could possibly get to drive her up the river. Bill was so warm that he could seldom geta second engineer to stay on the boat more than a week or so until he shipped George King, a young man whose earlier days had been spent in a blacksmith shop, in a coun- try town. George was a young fellow de- sirous of learning the business, and willing to obey orders, so he said. : “Look ’ere,George,’’ said Bill,after backing the boat out from St. Louis, with the steam- gauge indicating a: pretty. big pressure, and the safety valves whistling in the chimneys; ‘“chere’s no. limit to. the game on this boat; do you understand what that means?” ‘Yes, sir,’? responded George, with a meekness that caused Bill to conclude that he_was ’most too scary to carry steam. — “Well, I?ll take the first watch out after 4 o’clock, and you can come on after sup- per, which ll bring ’er up to Illinois. Yes, |you’ll have to ‘spank ’er’ purty lively to make Quincy agin breakfast time.’? “All right, Mr. Jones, I'l1——” E “Don’t call me Mr. Jones,’? inetrupie the ‘‘boss;”’ ‘jest call me plain Bie it fits me, better.”? .. « Thus admonished, Gece: turned in, doubting his ability to carry steam to suit the old man, George came on duty at supper, and step- ping onto the, foot box, cast his eye up at the gauge, remarking as he did so: “That gauge ain’t working, is it?” “Yes, the gauge is working good enough, ” responded Bill, “You’ve got the steam shut off then, e: reckon, tor it doesn’t show any pressure.” “Pressure!” yelled Bill; “man, the hand has gone clean ’round agin the pin! 3 ‘‘Whew!” said George, as he drew a jong breath. “Don’t be skeered. Them ‘smoke “jacks? 711 give you plenty of it, and you just let it go through ’er, and,” observing that. George was still intent on his study of the gauge; ‘‘don’t be afraid of ’er, . just keep two cocks of water and let her spin. You need not be afraid of getting too much.” - i With this admonition Bill left, and eorge entered on his first watch, filled wit misgivings, yet studiously anxious along with the boss engineer, and Y good run on his watch, The water in river was getting low, ard there slo bell pretty often, the result of which “was that the boat would blow off, . Geor not “scape out”? or “open t but, hanging a little more weigh safety valve line, he let he go. kept getting hotter and hotte when the engines were un