source: Caselaw Access Project

author: Jones C. J.

license: Public Domain

text:
    Edward N. Rogers, George S. Rogers and Samuel Rogers versus The Niagara Insurance Company of New-York.
    To an action, for a total loss of freight, upon a policy of insurance, containing the usual special agreement, “ that if the vessel upon a regular survey should be “ thereby declared unseaworthy, or incapable of prosecuting her voyage by rea- “ son of her being unsound or rotten, the insurers should not be bound to pay “their subscription,”—the defendants pleaded, that the vessel upon her outward voyage sought a port of necessity ;■—“ that a regular survey was held up, on her there ;—that upon such survey, it was thereby found and declared that certain parts of the vessel (in the survey and plea particularly specified) were rotten ;—that other parts (also specified) were so defective, “ that they would necessarily require to be shifted —that the probable cost of the repairs would amount to $3,000 dollars,—and that, in the opinion of the surveyors, the vessel was “ unworthy of repairs, and would not sell for the amount of her bills;”— whereupon they recommended that she should be sold at public auction for the benefit of all concerned.
    Upon demurrer to this plea, principally upon the ground that the survey did not expressly declare the vessel to be unseaworthy or incapable of proceeding on her voyage, and that the plea sought to draw matters of fact from the jury and put the finding as to the seaworthiness or unseaworthiness of the vessel, upon the Court, by inference to be drawn from particulars stated in the survey,—the plea was held to be sufficient.
    The conclusion of the surveyors, that the vessel was unworthy of repairs; that she would not sell for the amount of her bills, and their recommendation that she should be sold for the benefit of all concerned, were held to be tantamount to a declaration in the survey, that the vessel was unseaworthy and incapable of prosecuting her voyage, by reason of unsoundness. And such conclusive upon the question of seaworthiness, and may be pleaded as a bar to an action upon the policy. a declaration upon a regular survey, is, by the terms of the agreement, made
    This cause was transferred from the Supreme Court into this Court by an arrangement between the parties. It was an action upon a policy of insurance on the freight of goods laden on board the brig Champion at and from New-York to Omoa, and from thence back to New-York.

      The policy contained the usual clause against unsoundness, and stated “ that if the vessel, upon a regular survey, should be declared “ unseaworthy by reason of her being unsound or rotten, or inca- “ pable of prosecuting her voyage, on account of her being unsound or rotten, then the assurers should not be bound to pay their sub scription on that policy.”
    The declaration was for a total loss upon the outward voyage, alleging that the vessel departed from New-York on the 25th day of August, 1827, with the goods on board; and that while prosecuting her voyage, and before her arrival at the port of discharge, “ by the perils and dangers of the seas, and by the force and vio- “ lence of the winds and waves, she became leaky, and was greatly “ injured, broken and damaged ; insomuch, that it became expedient and necessary, for the purposes of refitting and repairing said vessel to sail to and put into the nearest and most convenient port; and the said vessel did accordingly sail to the nearest and “ most convenient port, to wit, the port of Norfolk in the State of Virginia “ and then and there it became and was wholly im possible to repair and refit the said vessel; by means whereof she was unable to pursue her said voyage, and the freight of the goods on board was wholly perished or lost, and became of no use or “ value, &c. The declaration also further alleged that the interest of the plaintiffs in the freight of the goods was abandoned to the “ defendants, on the sixth day of December, 1827.”
    The defendants pleaded the general issue, together with three special pleas in bar. The third special plea alleged, that upon the arrival of the vessel at Norfolk, “ a regular survey was held upon said « brig,” upon which “ it was found and declared” “ that all the “ ends of the beams from the break of the quarter-deck of the said “ brig, to the end of the windlass, being seven in number, with the « knees by which they were secured, were rotten: that the lari' board wing of the transom-fashion-piece, the next timber below " and all the ends of the bottom plank which butt on the transom " of the said brig, were rotten, and that four top timbers from the " transom to the after part of her main channels were rotten. That «in the space of nine of her timbers amid-ships, five were rotten. « That in the space of eight of her timbers forward of her fore-
      “ channels, five were rotten. That the inner edge of the two of her “ bottom planks which are cut and the lower wale were rotten. That <6 on per gtarboard side pn the bow, one timber and the lower wale «were rotten ; and that sixteen of her top timbers in the waist , “ were rotten. That on the larboard side of said brig, four of her “ foothooks were rotten.' That on her starboard side, seven futtocks “ were rotten, and that the whole of her bending streaks on both “ sides of the quarter, main and lower deck, the waist and wales, “ were so defective by rot, that they would, necessarily, require to be “ shifted. And the persons making the last mentioned survey, did “ therein and thereby estimate that the probable costs of the repair's “ of the hull of the said brig so declared to be rotten as aforesaid “ would amount to three thousand dollars, or thereabouts; and did “ also therein and thereby find and declare, that in their opinion, “ the said brig was unworthy of repairs, and that she would not sell “for the amount of her bills ; and they did, therefore, thereby re- “ commend that the said brig Champion, with all her tackle, ap- “ parel and furniture be sold at public auction for the benefit of all “ concerned.”
    Upon the two first special pleas the plaintiffs joined issue, but demurred to the third. For cause of demurrer, they alleged, first, that the plea neither admits nor denies that the master and mariners of the brig were compelled by necessity arising from sea damage, to put into the port of Norfolk, as in the declaration alleged.
    II. That the plea does not set forth, in hcec verba, the survey mentioned and referred to, so that the Court can judge thereof in all respects, and especially if the same be regular.
    III. That the plea attempts to draw the finding of matters of fact from the jury and put the seaworthiness or unseaworthiness of the vessel upon the Court by inferences from the facts: whereas such inference can properly be made only by a jury aided by the evidence of men skilled in the art of ship building.
    IV. The survey and its contents are not legal evidence to prove the unseaworthiness of said brig.

      V. The plea does not aver that the said brig was rotten in any part, but only, that by the survey it was found and declared certain parts of her were rotten.
    VI. The matters contained in the plea respect exclusively the state of the vessel at the time of the survey on her arrival at Norfolk, and do not relate, in any respect, to her condition at the time of her departure from New-York.

      Mr. Sullivan.

    The cause was argued by Mr. George Sullivan for the plaintiffs, in support of the demurrer, and by Mr. George Griffin for the defendants.
    The pleadings in this cause admit an insurance by the defendants to the extent of 3000 dollars, on the brig Champion from New-York to Omoa, and from thence back to New-York. They also admit that the vessel while prosecuting her voyage was compelled by stress of weather to put into the port of Norfolk, and that she was totally lost in consequence of the perils insured against. Thus far the plaintiffs show a clear case for a recovery. But the defendants seek to avoid the effect of these admissions, by setting forth that the vessel has been brought within that proviso of the policy, which stipulates that the defendants shall not be bound to pay their subscription, if the vessel upon a regular survey shall be declared unseaworthy.
    Upon the sufficiency of this plea we have taken issue, and the special causes of demurrer point out several objections to which it is liable; but we rely principally upon the third cause.
    The defendants in this case, plead the special matters on which they rely by way of defeasance, and they must, therefore, bring themselves strictly within the terms of the defeasance. The plaintiffs having agreed, that the sentence of a regular survey, if against them, should be conclusive upon their rights, the defendants are bound to show that they are clearly within the proviso of the policy on which they rely. They must produce such a survey as is contemplated by the agreement: and from its actual finding it must appear, that the vessel was pronounced unseaworthy by reason of her being unsound or rotten. Nothing must be left to conjecture or implication, but the decree which concludes the rights of the plaintiffs under the policy must be clear, direct and explicit. [Laws on assumpsit, tit. defeasance. 8. John. R. 163. 20th J. R. 328.]
    The survey by the common rules of evidence, would be no proof _ _ _ . t e , of the facts asserted m it; and the defendants’ plea would of course be bad, were it not for the proviso in the policy. As the defendants rely upon a special agreement, which by its strictness is to cut off the plaintiff’s claims entirely, the Court will not give any latitude to the proof adduced under the agreement, not warranted by the plain terms of the survey. The proof being of a special nature, and conclusive in its effect, when against the plaintiff, is not entitled to particular favor, but must be confined within its own limits. If the survey by its express terms,—by its very sentence, has not pronounced the vessel unseaworthy, the Court will not infer that such was her condition from the particular facts stated. The conclusion to be drawn from the facts is not an inference of law, but amounts merely to a statement of another fact. The survey does not state that the vessel was unseaworthy, or that she could not prosecute her voyage: but sets forth certain facts from which the Court may infer, if they were at liberty to do so, that the vessel was unseaworthy.
    But can the Court, on a special plea and demurrer draw any inferences from the facts 1 If this were a case made, the Court would then be at liberty to make every inference from the facts found which a jury could make : but they can only take the facts as they are set forth in the survey. The plea itself, states no conclusion from the facts found, but merely alleges as a result therefrom, that by the survey, the vessel was ordered to be sold.
    The question here, is not as to the sufficiency of the survey, but upon the sufficiency of the plea. If the survey states facts which amount to unseaworthiness, then the plea should have alleged that in explicit terms as a conclusion from the facts. The pleader seems to have supposed that it was enough for him to set forth the facts contained in the survey, and that the Court would deduce their own inferences from those facts. But it will be found that in all the cases cited from the books, the pleas expressly aver that the vessel was unseaworthy. Nothing is left to inference or conjecture, but the very fact required by the proviso in the policy, to defeat the plaintiffs’ right of recovery, is distinctly stated. But in this plea, no conclusion is stated, no result is set forth; but facts are detailed, from which the Court, if they are skilled in matters of ship building, may infer, that the vessel was unseaworthv. This is not, however, the necessary consequence of the facts found by the survey, and the Court will not pronounce the sentence against the plaintiffs, which it is the duty of another tribunal to declare. For these reasons the plea is insufficient and the demurrer must prevail.

      Mr. George Griffin for the defendants presented the following points.
    I. The plea discloses rottenness as the sole cause of the condemnation of the vessel, within the meaning of the clause in the policy in that behalf set forth in the declaration.
    II. The special causes assigned for the demurrer, do not show the plea to be bad either in substance or form. [Brandegee v. The National Insurance Co. 20. John. Rep. 328. Dorr v. The Pacific Insurance Co. 7. Wheat. 581. Garriques v. Coxe. 1. Bin. Rep. 595. Armroyd v. The Union Insurance Co. 2. Binney 394. Griswold v. The National Insurance Co. 3. Cowen's. Rep. 96. Steinmets v. The U. S. Insurance Co. 2. Serg. & Rawle. 293.]
    The counsel for the plaintiffs is mistaken in his criticism upon this special plea. The question is altogether as to the sufficiency of the survey, and not as to the sufficiency of the plea, for the plea sets out the survey as it was actuaEy made, and nearly in its very words. The plea then is according to the truth of the case, and if the survey be insufficient in its terms, the plea must be good as a matter of course.
    The language of the surveyors as set forth in the plea, is tantamount to a declaration of unseaworthiness from inherent defects in the vessel,—from rottenness. The survey expressly declares, that the condition of the vessel was such, that she “ xoas unworthy of repairs, and would not sell for the amount of her bills.” It farther recommends that the “ brig Champion, with all her tackle, apparel and furniture, be sold at public auction for the benefit of all concerned.” What more explicit declaration of unseaworthiness can any Court desire than this 1 The particular defects in the vessel are in the first place all specially stated, and then as the result of those defects, the vessel is pronounced unworthy of repairs. If she was unworthy of repairs, she could not be seaworthy by any possibility, and the very conclusion demanded by the plaintiff, is thus obtained. The proviso in the policy does not require that the vessel should be pronounced unseaworthy at the time of her departure upon the voyage described; but merely declares, that if the vessel on a regular survey be declared unseaworthy, then the underwriters shall not be bound to pay their subscription.
    The whole question then is, whether by this survey the vessel is found to be unseaworthy : for if she is, the plea is a conclusive bar to the action.
    The Court will, as a matter of law, put the proper construction upon the language of the survey; because if this plea be overruled, the defendants will be cut off from all the benefits of their legal bar. The survey cannot be given in evidence, to defeat the plaintiffs recovery ; it must be pleaded, that the Court may say whether it is sufficient or not. The Court, then, is the proper tribunal to pronounce upon the language of. the survey, and it is a question for their exclusive consideration.
    In the case of Brandegee v. The National Insurance Company, the fifth plea of the defendants, set out the survey in the same manner in which it is set out here. No doubts were then entertained as to the correctness of this mode of pleading, because it was according to the truth of the case. Judging the plea by the rules of common sense and common interpretation, it will be found to contain every fact required by the proviso of the policy, and it must as a necessary consequence be a perfect bar to the action.
   Jones C. J.

This case comes before us on a demurrer to the defendants’ fourth plea. The action is upon a policy of insurance which contains a special agreement, that if the vessel upon a regular survey, should be thereby declared unseaworthy, by reason of her being unsound or rotten, then the assurors should not be bound to pay the subscription upon that policy.

The declaration which is for a total loss by the perils of the sea, sets forth that the vessel was compelled, during the progress of her outward voyage, to put into the nearest port for the purpose of refitting and repairing, and that Norfolk in the state of Virginia, was the place where she sought refuge.

The defendants by their fourth plea aver that a regular survey of the tenor set forth in the plea, was held upon the brig at the port of necesity ; and upon this they rely for their defence under the special agreement. To this plea the plaintiff demurs, and for cause of demurrer, exhibits six special grounds of exception. The first objection is, that the plea does not admit or deny that the vessel was compelled by necesity arising from sea-damage, to put into Norfolk to refit.

The only material ingredients of the defence under the agreement are, 1st. The fact of a regular surrey. 2d. The finding or declaration of the surveyors that the brig was so rotten or unsound as to render her unseaworthy, or incapable to proceed on the voyage. Both these facts are intended to be averred by this plea in the language of the survey, and this was all that the rules of pleading could require of the pleader. The construction or legal effect of the survey, and how far it does find and declare the vessel to be unseaworthy or incapable of prosecuting her voyage by means of her being rotten or unsound, within the meaning of the clause in the policy, is a question of law, and upon which we are to adjudicate. But it is a question which goes to the competency of the survey, as a defence, and not to the sufficiency of the plea, within the forms and rules of pleading.

Seeing that the fact of a regular survey having been had upon the vessel, is distinctly averred, and that the contents of the survey and the adjudication of the surveyors are given in the plea, no valid objection can be taken to it by demurrer, unless the objection goes to the sufficiency of the matters of the survey, or the adjudication of the surveyors, to satisfy the terms of the agreement and sustain the defence. The causes which induced or compelled the master to put into the port of necessity cannot be material. Whether the defects or decay of the brig became so palpable and obvious as to jeopardize the safety of the cargo and crew, or the apparent cause of the leaks was the damage arising from the action of the winds and waves upon her, matters not. She was for some justifiable and sufficient cause obliged to seek a port: there she underwent a survey. It is that survey which is to determine the condition of the vessel and the cause of her distress. The first ground of demurrer is consequently untenable.

The fourth and fifth special causes must, for similar reasons, be disregarded. The survey is not offered as evidence to prove the unseaworthiness of the brig, it is pleaded as the adjudication or declaration of the surveyors, which the parties by their own compact have made conclusive on the question of seaworthiness. It has the same force and effect upon the rights of the plaintiffs, under the contract as an award of arbitrators has upon the parties to the submission, in regard to the matters embraced in the submission. If the surveyors substantiably declare the vessel to be so rotten as to be unseaworthy, or incapable of prosecuting the voyage, it will be sufficient for the insurers to produce and prove the survey to establish their defence. The objection, therefore, that the survey is not legal evidence to prove unseaworthiness, and cannot for that reason be pleaded in bar to the action, but is matter of evidence merely for the jury, which is the substance of the fourth cause of demurrer, is wholly irrelevant. And the fifth ground of demurrer, which is, that the plea, which does not aver the brig to be rotton, but avers only that the survey declares her to be rotten, so far from showing any fault in the pleading, affirms its validity : for it is to the survey that the defendant was by the contract to refer for the fact of rottenness. The parties have substituted the opinion and declaration of the surveyors for proof. And if that document pronounces the vessel unsound or rotten and condemns her as unfit from that cause for sea, the decision is decisive. No other evidence is necessary to prove the fact, and none can be received to contradict or disprove the truth of the document.

The sixth cause of demurrer objects to the plea, because it respects the state of the brig at the time of the survey, and does not relate, in any respect, to her condition at the time of her departure from New-York. The answer is, that the plea conforms to the survey, and the objection of course, if it has any force, must be to the declaration of the surveyors, as relating to the time of the examination and survey of the vessel, instead of referring to the antecedent period of her sailing upon the voyage, for which the insurance was made. It is only necessary to state the objection in this form to show its weakness and utter irrelevancy. The agreement of the parties necessarily refers to a survey of the vessel after her departure upon her voyage; and the surveyors can only judge of the causes of her distress from the condition in which they find her upon the survey and at the time of her examination. It is not possible for them to determine or declare her condition at any antecedent period of her existence. When the survey takes place shortly after her departure, or in an early stage of her voyage, and she is then found to be in a state of decay, the probability of her unsoundness at the commencement of her voyage, approaches Very nearly, if it does not actually' amount to certainty. For it may be safely predicated of such a vessel, that her defects could not be of recent origin, and that no inherent cause of decay could operate so rapidly as to reduce her to such a disabled state of unsoundness in so short a period of time. But in long voyages, it is possible that a vessel not materially unsound at the time of her departure, but infected with the seeds of disease, or in any incipient state of decay, may, by constant exposure at seasons and in climates which favor and hasten the progress of the disease, become disabled and be rendered incapable of pursuing her voyage without reparation. But such a state of decay comes equally within the special provision of the policy, whether it arises upon the voyage, or existed before it began, and equally entitles the insurer to the benefits of its protection.

The best safeguard for the insurer against the mischief, was seen to consist in referring the cause of the disability exclusively to the opinion of those who are called to examine her at the time of the disaster; and when she is in her disabled condition, they alone can judge correctly of her soundness or decay, and determine whether her inability is owing to her inherent defects, or to the injuries she received from the perils of the seas. Their judgment of her actual state and condition, if they examine with fixity» and act impartially, cannot err-and as the master who is the agent of the assured, and acts for him, generally nominates the surveyors, and superintends their operations, there can be no room for any improper influence or undue practice on the part of the underwriters, and the opinion they express in the report they make, will generally be as favorable to the assured, as the truth of the fact will warrant. It is proper, therefore, that it should be held conclusive upon them; but to make it available, it must be held conclusive, not only of the fact of unsoundness and decay at the time of the survey, but that she was incapable when she sailed, of performing the voyage, or became so afterwards by rottenness solely. And if the agreement of the parties is to have any efficacy, such a survey must bring the case within its provisions^

It would be impossible to trace the decay to its source, or to ascertain its origin, or when it first became the cause of the ship’s disability. The surveyors enter into no such speculations or conjectural opinion, for such it must always be, but they confine themselves to the actual injuries or defects they discover upon the survey, and the causes, whether decay or accident and recent disaster to which those injuries or defects are to be ascribed. The agreement does not require that the survey should declare the vessel to have been unsound or rotten at the commencement of the voyage, to exempt the insurer from the pajunent of his subscription. It is sufficient that she be upon a regular survey thereby declared unseaworthy or incapable of prosecuting her voyage by reason, or on account of her being unsound or rotten, to protect the insurer from the loss. The surveyors are to report her actual condition as they find it; and if her disability is found by the survey to be owing to the unsound and rotten state of her hull, and to that cause solely, the insurers, if there is any efficacy in the contract, must be discharged from the liability, however recent or remote the origin of the disease may be.

The objection, therefore, that the survey, or the plea refers to the time of the survey, and not to the commencement of the voyage, has no solidity. It probably was suggested by some of the early decisions on the clause in question, when its true character was not justly appreciated, and its legal construction had not yet been judicially settled. If this plea, then, be vicious, it must be because it is obnoxious to the exception taken to it by the third special cause of demurrer—upon the general ground that the survey it recites, does not sufficiently adjudge or declare the vessel to be unseaworthy or incapable of prosecuting her voyage, by reason of her being unsound or rotten, to satisfy the terms of the agreement.

The objection raised by the third cause of demurrer is two fold ; first, that the plea attempts to draw the finding of matters of fact from the jury; and second, that it refers to the Court, to find the fact of seaworthiness or unseaworthiuess by inference from the facts stated in the plea, which inference the jury ought to draw.

The first branch of this exception, is the repetition, in a different form of the objection, that the survey and its contents are not legal evidence of the unseaworthiness of the vessel: and the answer to it is, that the parties have by the agreement, withdrawn the finding upon the fact of seaworthiness from the jury, and substituted the survey and the declaration of the surveyors in the place of such finding, and made it conclusive upon their rights. If, therefore, it be a grievance, that the finding of that matter of fact is drawn from the jury, they owe it to their own act and voluntary compact with the insurers, and they have no right to complain. But the other branch of the exception objects further, that the plea in its present form requires the Court to find the fact of seaworthiness or unseaworthiness, by inference from the facts, or evidence stated in the plea. The plea states the substance of the survey, and reposes upon it as a conclusive bar. The point of the objection, then, must be, that the report of the surveyors details the defects and unsound condition of the vessel with the cause of them, without declaring her unseaworthy, or incapable of prosecuting her voyage, in consequence of those defects. That these details constitute the evidence from which the unseaworthiness or inability may be inferred, but which inference the surveyors have forborne to draw. That they were required by the terms and spirit of the agreement to declare the fact,, as the result of their own judgment upon the condition of the vessel, or the report could not conclude the parties; and that when this question is left open, it is the province of the jury and not of the Court to decide it;' This involves the merits of the general ohjectioa, that the survey does not satisfy the terms of the special clause in the policy; and if it was well founded, it would be fatal.

It was doubtless the intention of the parties, that the surveyors, to whom they referred the question, should exercise their judgment upon the ability of the vessel in the condition they found her, to prosecute her voyage ; and how far her disability was the consequence of defect from decay, or her unsound and rotten condition, and that such judgment or opinion should be manifested by the report they should make : but they did not intend to prescribe the form which such adjudication should take, or the terms in which the opinion of the surveyors should be declared. The substance of the declaration required by the agreement is, that the vessel is found so unsound or rotten as to be incapable, from those causes, to continue her voyage. The two facts of actual disability to proceed, and decay from rottenness as the cause of it, must concur to bring her within the meaning of the provision ; but the terms in which the opinions of the surveyors upon those two points are expressed, are immaterial. It is sufficient if they, in any form of expression, declare an opinion upon them so intelligibly as to satisfy the understanding of the meaning they intend to convey.

The clause in question is of modern origin. It is peculiar to us and our sister States. We are to look therefore to the decisions of our own Courts for a judicial exposition of its import. In the early discussions to which it gave rise, the leading questions seem to have been, whether the survey was a conclusive bar to the action, or only prima facie evidence of the unseaworthiness of the vessel which might be repelled by other proof,—and whether the survey at an intermediate port is conclusive evidence of original unsoundness or relates to the time it is made, and admits of proof of seaworthiness at the commencement of the risk, so as to neutralize its effect upon the contract. But without entering into the history of those discussions it is sufficient to observe that those questions were settled by the Supreme Court of the United States in the case of Dorr v. The Pacific Insurance Co. [7 Wheaton 582,] where the points came distinctly before the Court and received its decision. The case arose upon a special verdict on a policy of insurance on the ship Ilolofem, which contained the clause now under consideration. The jury found that the ship was seaworthy at the time of the commencement of the risk: but that in the course of the voyage she met with violent gales, in consequence of which she sprung a leak and was compelled to bear away for New Providence, where, upon a survey held upon her, she was found to be in a leaky state, and the surveyors, having caused a part of her ceiling to be stripped off, discovered her to be in a very decayed condition ; and they certified that they were of opinion that she was altogether unworthy of being repaired, and ought to be condemned as being unsafe and unfit ever to go to sea again. She was condemned accordingly and sold.

It was contended that the survey was not conclusive evidence of the unsoundness of the vessel at the time of her sailing upon the voyage, but left that point open to further inquiry; and that the special verdict had negatived the presumption of unsoundness arising from the survey, and neutralized its effect as a bar. But the Court held that the words of the contract expressly look forward to a future event, and contemplate two objects;—first, that a state of rottenness ascertained at any stage of the voyage should be conclusive evidence of original unsoundness: and secondly, that the determination of that fact by means of a regular survey should be received as conclusive evidence between the parties. It was further objected to the survey in that case, that it certifies the existence of other causes of loss besides the decayed state of the vessel; and it was .admitted by the Court that if the vessel be declared unseaworthy for any additional cause besides her being unsound and rotten, the survey would not avail the defendant as a bar. But they held that in the case before them, decay was exhibited as the mortal disease, and every thing else was either inducement or consequence. That the springing a leak was the consequence of that state of decay which weakened her whole fabric, and her being unworthy of repairs or unfit to go to sea, was no additional cause of condemnation, but the mode in which the disease produced her destruction. The views of the Court upon the latter point, show the case then before them in that aspect of it, to bear a strong resemblance to this, and we may deduce from the reasoning applied to that cause, principles peculiarly applicable to this. The conclusion drawn by the surveyors from the decayed state of that vessel was, that she was unworthy of being repaired, and as a consequence of that opinion they advised her condemnation, as unsafe and unfit ever to go to sea again. Their own sentence, however, was, that she was unworthy of being repaired. The same sentence, in nearly the same words, is contained in the survey now under our consideration.

Two cases have recently occurred, in which the opinion of our Supreme Court has been expressed upon the construction and legal effect of the clause in question, and the requisites of the survey to which it refers. [Brandegee v. The Nat. Ins. Co. 20 John. R. 328.—Griswold v. The Nat. Ins. Co. 3 Cowen’s R. 96.]

The opinion of the Supreme Court, in the cases to which I have just adverted, as I understand its decisions, is in accordance with that expressed by the Supreme Court of 'the United States. In those cases, the defence was taken by plea, and the form of pleading the. survey, was calculated and intended to test its legal effect: for it was set up and relied upon by the pleader as a decisive bar to the plaintiff’s action. And the plaintiff’s counsel for that cause demurred, insisting that the clause in the policy to which the plea referred, did not make the survey conclusive evidence of the fact of the vessel being rotten, and if it was not conclusive, but prima facie evidence merely, it could not be pleaded in bar. In the case of Brandegee v. The National Insurance Co., where a plea in that form was first interposed, the ground was distinctly taken by the defendant’s connsel, that the survey was conclusive, and by the plaintiff’s, that it was prima facie evidence merely: and upon that point the question turned, whether it was of itself a defence and could be pleaded in bar, or was matter of evidence only, and must be given in evidence. It was admitted in that case, that the survey, to be available as a bar to the action, must be regular, and must declare the inability of the vessel to further prosecute her voyage to be, because she is unsound or rotten, and for that cause solely. But it was contended that if the survey amounts to a declaration by the surveyors that the ship was unseaworthy by reason of her being unsound or rotten, or that she was incapable of pursuing her voyage from that cause, it is decisive upon the right of the parties. No particular form of expression is required, nor is it essential for the surveyors formally to adjudge or declare her to be unseaworthy or incapable of prosecuting her voyage by reason of rottenness : it is sufficient that they substantially pronounce her disability, and show the cause of it to be defects by rot, and not injuries from disaster. The language in which the declaration is made, and mode of expressing the opinions they give, are not material.

Let the efficacy of the survey under consideration be tested by by these rules. The surveyors specify numerous defects, discovered by them in their survey, all which they ascribe solely to rot, and they superadd the declaration that the whole of her bending streaks on both sides of the quarter, main and lower decks, the waist and wales were so defective by rot, that they would necessarily require to be shifted; and they estimate that the probable cost of the repairs of the hull of the brig, so declared to be rotten, would amount to $3000, or thereabouts; and declare their opinion to be, that she was unworthy of repairs and would not sell for the amount of her bills, and they recommended that she should be sold. How could language more clearly and forcibly express the disabled condition of the vessel, or the cause of her distress 1 She is described as being so rotten, that the probable expense of the repairs of her hull so declared to be rotten would be about $3000; and an opinion is expressed that she was unworthy of repairs, and ought to be sold. Where is the escape from the conclusion that she was unseaworthy, and wholly incapable of pro-on her voyage, and that rottenness was the sole cause of her disability?

It is said the surveyors have not expressly declared her unseaworthy or incapable of proceeding on her voyage. They have not used those precise terms, but the expressions they have employed are tantamount to that declaration. A vessel whose hull is so rotten that she is unworthy of repair, cannot be seaworthy, nor capable in her crippled and disabled condition of proceeding on her voyage ; and when the surveyors after examining h er, instead of advising the repair, recommend a sale of her, they emphatically pronounce her unfit to proceed on her voyage, and in ascribing her inability to rottenness solely, they bring her fully within the provision of the clause in question.

It was said, that if the cause of the condemnation be the great expense of repairs as well as the unsound state of the ship, the survey for the same reason will not be a bar. But the mixed causes of condemnation must be disclosed by the survey itself, and cannot be shown by extrinsic evidence. The survey is its own test of the ground of the declaration it contains. If it appears that unsoundness proceeding from decay was the sole cause of inability, the survey is a bar, otherwise not. Tiglman J. held, in the case of Garagues v. Cox, that if the survey upon the vessel should say that she was unsound, and for that cause was condemned and should say no more, the plaintiff would be barred. It is usual, however, to state the particular parts which are found to be rotten or decayed, and it is always advisable to do so, because it is more satisfactory to exhibit, on the face of the record the reason for the conclusion of the surveyors. And for that reason the same enlightened Judge in the subsequent case of Steinmets v The U. S. Ins. Co. [2 S. and R. 297,] observes that “it would not be proper to “ say in general terms that the vessel was rotten, but that the “ defects ought to be stated.” But whether the surveyors content themselves with the general statement of rottenness as they may do,- or use the more correct form of specifying the particulars of the decay, it is perfectly clear from all the cases, that if they ascribe the inability of the ship to her unsound and rotten condition solely, or if they specify her defects and attribute each to decay, and then pronounce her irreparable or unworthy of repair, or unfit to proceed on her voyage, without stating any other reason for their opinion, the survey will be conclusive upon the right of the parties; and the plaintiff will not be at liberty to repel it, by proof of the soundness or sufficiency of the ship for the voyage, or, by showing that she in truth became innavigable or unworthy of repair from other causes ; for it is well settled that the effect of the agreement in the policy is to render the survey conclusive upon the parties.

When, therefore, the surveyors in the case at bar, enumeate the long list of defects in the hull of the brig specified in the survey, and attribute all of them to rottenness and decay, and give the probable estimate of the cost of the repairs of the hull so declared to be rotten, at a sum equal to the whole value of the brig as estimated, without mentioning or suggesting any other reason for the expe> of her reparation than the extensive repairs required ky her unsound condition; and when they follow up this description of defect, and estimate if the expense of repairs, with the opinion that the brig is unworthy of repair, and recommend the sale of her; we are not at liberty to refer the opinion or recommendation of the surveyors to any other cause than the rottenness of .the vessel to which the report is confined ; nor can we suppose or intend the estimate of the cost of the requisite repairs, to proceed upon any unusual or peculiar difficulty or expense incident to the reparation of vessels in that particular port, the survey taking no notice of any such special circumstance, but placing the estimate upon the general ground of an ordinary repair of the decayed and rotten hull of the brig.

Nor indeed could it avail the plaintiff to show the fact, supposing it to exist, that the difficulty of repairs at Norfolk, the port of necessity, and the great expense attending them, were amongst the reasons why the brig was unworthy of repair, and would not when repaired, sell for the "amount of her bills- For conceding such to be the actual state of the ease, still the sole cause of her being irreparable or unworthy of repair was the unsound and rotten condition of her hull, and not the disaster which she had encountered on her voyage. She was at Norfolk and in want of repair of to enable her to proceed on her voyage. These repairs roust be done, to her whatever the cost may be, or she cannot go on. And if rottenness was the cause which induced the ne- . „ , , . .. .. of that repair, the vessel was literally unable to prosecute her voyage by reason of her rottenness. It may, perhaps, beat the option of the assured, in such cases, to incur the expense of the repairs, if the vessel was in fact reparable, and proceed with her on her voyage, or to break up the voyage and abandon the vessel as not worth repairing. But the capability of the vessel of repair is not in such cases the criterion ; for a vessel unseaworthy from decay, may, nevertheless, be reparable. The expense of her repair will vary with the extent of her defects, and the facilities or difficulty of obtaining workmen and materials at the port of necessity. The true test is her inability to proceed by reason of her defects. And if she is in that condition, sx> that the voyage be rightfully broken up for that cause, and the survey upon her so declare the facts to be, the casus fcederis has occurred, =nd the underwriter is absolved from his obligation to pay his subscription.

If, then, it be conceded that the survey now before us, either expressly or by necessary implication admits the vessel to be reparable, and declares her unworthy of repair by reason of her unsoundness or decay, and from the difficulty and expense of procuring workmen and materials for her repairs at the port of Norfolk, still, as her repairs were indispensable, to enable her to proceed on her voyage, and the rottenness of her hull is the sole cause to which the necessity for them is ascribed-by the survey, she was in her actual condition unseaworthy, and incapable of prosecuting her voyage by reason of rottenness ; and the Insurers cannot be chargeable with the loss which ensued from the abandonment and sale of her.

It was strenuously urged that the plea admits the facts set forth in the declaration, and consequently admits that the disability of the brig to pursue her voyage was partly owing to recent injuries by the perils of the sea: But it is not true that the plea admits the causes of loss to be such as the plaintiff in his declaration alleges them to be. It admits the fact that the vessel did put into the port of necessity for the purpose of refitting and repairing and that it was wholly impossible to repair and refit her, as red in the declaration, but it refers to the survey as conclusive proof of the causes of her disability, and as a bar to the plaintiff’s recovery. And the utmost extent of the implied admission"of the causes which induced or compelled her to put into port for repairs, is, that the apparrent causes of that necessity were those which the declaration states ; but that implied admission is to be taken with this qualification, that the pleader refers to the survey as unfolding the true state of the facts and showing the real cause of the disaster. The plea has reference to the declaration^ and admits the substantial facts which it would be incumbent on the plaintiff to prove, to entitle him in the first instance to recover, and then sets up the survey under the special agreement in the policy as a bar to that recovery ; but no.allegation or averment is admitted which is repugnant to the bar created by the survey. The plaintiff cannot control or evade the force and effect which his own agreement gives to the survey, by his averments in his declaration, any more than he can by evidence at the trial. When therefore the survey declares the vessel unseaworthy or incapable of proceeding by reason of rottenness, the plaintiff is precluded by his own contract from ascribing her Inability to any other cause ; and a plea which sets up the survey as a bar, will not be an admission of any averment in the declaration, of any cause of disability, inconsistent with the report of the surveyors.

If the case be stated from the allegations of the plaintiff, which the plea admits, and the additional facts appearing in the survey which the plea sets up and asserts, it will stand thus.—The brig having, by means apparently, (and, as was supposed at the time) of the perils and dangers of the seas, and the force and violence of the winds and waves, become leaky and greatly injured, broken, and damaged, it became, and was expedient, and necessary, to put into the nearest and most convenient port for the purpose of refitting and repairing her; and she did accordingly, from that necessity, put into the port of Norfolk, which was the nearest and most convenient port for that purpose; but that it became and was wholly impossible to repair and refit the said brig, because, upon her arrival at the port of Norfolk, and in reference to the voyage, and the state and condition of the brig at the time of the said arrival there, a regular survey was held upon her at Norfolk; and upon such survey, it was thereby found and declared, that the numerous defects from rot, specified in the survey, and the extreme decay from the rottenness of her hull, and those causes solely, rendered her unworthy of repairs.

Who can read this statement, which is faithfully abstracted from the pleadings, without the full impression upon his mind, of the opinion and declaration of the surveyors, that the brig was in effect unseaworlhy, and incapable of continuing her voyage, in consequence of the defects in her hull, proceeding from rot 1 I acknowledge that my understanding is so thoroughly convinced of the import of the declaration, that I am unable to attach any other sense to the expressions they have employed. And it seems to be impossible to come to any other conclusion, from the facts they state. To understand the full force of the report, we must view it in connexion with the disabled state of the brig to which it refers, and the causes of the survey upon her. She was not at her port of ■ departure, undergoing a survey to satisfy the insurers of her ability to perform the voyage on which she was about to sail. She was in a port of necessity, to which her disabled condition and avowed inability to proceed on her voyage, had compelled her to come, for the purpose of repairing and refitting, so as to enable her to resume and complete her voyage. It was to ascertain the extent and the causes of her disease, and the practicability and expediency of repairs, that the survey was held upon her.

Let it not be objected that the survey is to explain itself, and can derive no aid from extrinsic facts. We do not go out of the record for the facts which we connect with the report: they appear upon the face of the pleadings.. The plaintiff in his declaration, in effect avers them, and the plea admits them. The survey has an immediate and necessary connection with them, and refers to them. The first and most material fact thus taken from the history of the brig, as it appears upon the record, is the actual inability of the vessel at her arrival at Norfolk, and when the survey was held upon her to prosecute her voyage in her then present state and condition. This fact is distinctly averred by the plaintiff, and its existence is the only cause that could justify the deviation from the track of the voyage to put into an intermediate port, not permitted by the policy. And the surveyors act upon that assumption in making the survey, and must be understood as speaking in reference to it, when they express the opinion in the report, and recommend the sale of the vessel, and consequent termination of the voyage. The survey was called and held upon her as a vessel already reduced to an incapacity to pursue her voyage ; and the chief purpose of the survey was to investigate and report the cause of her inability, and to recommend and prescribe the course to be pursued by the master.

When, therefore, they discovered the extensive defects of her hull from rot, and came to the conclusion, that the expense of the repairs which that rottenness rendered necessary, would exceed her value when repaired; and when they declared their opinion to be, that she was not worthy of repair, and therefore recommend the sale of her, did they not in effect declare her to be unseaworthy, and incapable of proceeding on her voyage, from the rottenness of her hull? When they reported a vessel which was in a disabled condition, and from inability to proceed on the voyage had put into port for repairs, to be unworthy of repairs, was not the report tantamount to a declaration that she was unseaworthy? Did/hot the declaration that she was unworthy of repairs, necessarily assume and include the fact, that she stood in need of repairs to make her seaworthy, or to enable her to prosecute her voyage ? And when they recommend the sale' of her because she was unworthy of repair, did they not virtually declare her incapable of her proceeding on her voyage in the state she then was, without first undergoing reparation ?

If either of these propositions is well founded, the survey amounts to a declaration that the brig was unseaworthy, or inca-' pable of proceeding on the voyage, and it must be conceded that'the rotteness of her hull is the sole cause to which the survey ascribes her disability.

I am satisfied, therefore, that ihc exceptions taken to theplea, in this case, are not well founded; and there must be judgment for the defendants on the demurrer.

Judgment for the defendants on the demurrer.

[A. S. Rogers, Att’y for the plffs. G. W. Strong, Att'y for the defts.]


author: Per curiam.

text:
    The New-York Gas Light Company versus The Mechanics Fire Insurance Co. of the City of NewYork.
    The defendants, by a policy bearing date the 12th of May, 1326, insured the plaintiffs to the amount of $5000, for seven years, on “fixtures," placed or to be placed in buildings of their subscribers. By another policy dated the 2d of December, 1825, the defendants had insured the plaintiffs to the amount of $2000 on “ gas-meters placed or to be placed in the city of New-York for three years.” At the date of the first policy, the plaintiffs had placed gas-meters to the amount of $2000;—but at its expiration, theira mount had been increased to $20,000. When the policy on thc“ fixtures” wasmade, their value was estimated at $5000;—but this amount was afterwards increased to to $100,000 and upwards.
    The gas-meters and fixtures -wore subsequently injured by fire to the amount of $2500, a part of which was upon the “gas-meters and fix^ires” placed at the dale of the policies, and a part upon those which wore established afterwards Held that by the true construction of the policies, they covered all “ fixtures” to the amount of $3000, whether erected before or after the date of the policies. Held also that parol evidence was inadmissible to prove a verbal representation made by an agent, at the time the policies were effected, as to the value of the fixtures intended to be placed by the plaintiffs.
    This action was brought to recover the amount of damage sustained by the plaintiffs from the destruction or injury by fire, of certain “ gas meters” and “ fixtures” belonging to them, which had been insured by the defendants in two separate policies.
    The first policy was dated the 12th of May, 182G, and by it, the defendants insured the plaintiffs “ five thousand dollars,” viz : on “fixtures, belonging t.o and rented by the Company, placed or to be placed in the buildings, stores or dwellings of subscribers, “ for seven years.” In case of loss or damage, the injury to be estimated according “to the true and actual value of “ the property at the time the same should happen.”
    By the second policy (which bore date the 2d of Dec. 1825,) the defendants insured the plaintiffs to the amount of two thous- and dollars, “ on gas-meters placed,” or thereafter to be placed in “ various buildings in the city of New York,” from the date of the policy to the second of December, 1828.” The company however, were not bound to pay when loss or damage should occur from “ fire occasioned by gas.”
    The loss claimed by the plaintiffs was for damage from fire, not occasioned by gas, to gas-meters belonging to the plaintiffs, placed in various buildings by consumers of gas, and to fixtures belonging to and rented byjhe plaintiffs, placed in buildings, stores and dwellings of subscribers,—all of which were situated in the City of New-York. At the trial it appeared that the plaintiffs commenced the business of supplying gas shortly before the first policy was effected. At the time of its date, the value of the gas-meters “ placed” was about $2000, but when the policy expired, it had been increased, by additional gas-meters, to the sum of $20,000 and upwards.
    When the policy on the “ fixtures” was effected, the value of the fixtures, belonging to <he plaintiffs, in buildings, stores and dwellings of their subscribers was upwards of $5000, which amount was subsequently increased, by additional fixtures to upwards of $100,000.
    It was admitted that a part of of the damages claimed by the plaintiffs, was for injuries by fire, not occasioned by gas, to the gas meters and fixtures placed by the plaintiffs at the time the respective policies were effected ; and the residue of the injury was to gas-meters and fixtures subsequently placed,—the whole amount ' of which, for the purposes of this case, was admitted to be $2500.
    The defendants’ counsel offered to prove that at the time the policies were effected, it was verbally represented by the agent of < the plaintiffs, that the value of the meters and fixtures intended : to be placed by the plaintiffs would not exceed $5000, but admitted that such representations were made in good faith, and disclaimed all idea of offering the evidence for the purpose of showing any actual fraud in the transaction. This evidence was overruled by the presiding Judge. Upon this statement of facts it was agreed that a verdict should be taken for the plaintiffs for the nominal sum of $2500, subject to the opinion of the Court, on a case to be made and subject to an adjustment of the amount which the plaintiffs were entitled to recover, to be ascertained according to the principles which the Court should adopt. Either party had leave to turn the case into a bill of exceptions, and it was stipulated, that the Court might, in their discretion, direct a non-suit, or a new trial.
    The cause was now argued by Mr. Slosson for the plaintiffs, and by Mr. Jay and Mr. D. B. Ogden for the defendants.
    Mr. Slosson observed that there were two points to be considered. The first related to the construction of the contract, and the second, to the admissibility of the parol evidence. The first question was, whether the gas-meters placed after the date of the policy were insured at all. Upon that point, the words of the policy (he said) were plain and explicit. The very subjects of insurance were gas-meters and fixtures placed, or to be placed, and it matters not whether they were established before the date of the policy or afterwards. The plaintiffs wished to insure a certain sum for a length of time on their property, and as it was of a changing and shifting kind, the defendants used words broad enough to cover the intention of the parties.
    II. Parol evidence to explain a contract so explicit, was clearly inadmissible. The policies speak their own language and the defendants cannot make them speak another by the mouths of witnesses. [Phil. on In. 117, 118. Thompson v. Ketcham 8. J. R. 189.]
    Mr. Jay and Mr. Ogden contended that the policies were satisfied when gas-meters to the amount of $3000, and fixtures to the amount of $2000 were erected. That the risk attached to the subjects of insurance then established and not to any thing erected afterwards. Suppose fixtures and gas-meters to the amount of $100,000, to be erected subsequently to the date of the policy and then a loss,—what sum must the defendants pay % Not the whole $5000, but such a pr oportion of that sum, as the fixtures and gas-meters actually insured bear to the $100,000. The construction contended for on the other side, is against the grammatical meaning of the words of the policy, and would lead to absurd conclusions. It ought not therefore to be adopted.
    II. As to the parol proof, it ought to have been admitted, because its object was to show an incorrect representation ; and a false representation whether fraudulent or not, avoids the policy.
   Per curiam.

We think that by the true constitution of these policies, they were intended to cover and did cover all the “fixtures” mentioned therein, to the amount of $2000; and this, whether they were “ placed” before or after the date of the policy. There is an exception it is true, as to losses occasioned by fire, proceeding from gas ; but that does not apply to the-case now before the Court.

As to the parol proof offered by the defendants, it was clearly inadmissible. The contract is to be construed by its own terms plainly expressed in the policies, and it cannot be varied by the proof rejected at the trial.

Judgment for the plaintiffs.


author: Oakley J.

text:
    Jonathan Ogden and others versus James Dobbin and Joseph Evans.
    The holder oi a promissory note, who receives and indorses it for the sake of collection only, although amere agent, is to be considered as the real holder, for the purpose of receiving and transmitting notices.
    When a note has been presented for payment and payment is refused, the holder acts with reasonable diligence, if he gives notice by the regular course of mail, to the indorser from whom he received it, that he may transmit notice to his immediate indorser, who may take the same course as the prior indorsers. And if the indorsers, in due season, adopt the regular course of the mail, for transmitting notices from one to the other, and by that means the route to the first indorser is made circuitous, it is no want of diligence on their part; and he cannot set up the manner of the giving of the notice and the delay occasioned by it, as a defence.
    When a note is made payable at a particular place, it must be presented at that place for payment. But when it is made payable at a Bank, and the note is placed in the hands of the cashier of that Bank for collection, there is no necessity for his making a specific or clamorous demand. The legal requirements, as to presentment and demand are complied with, if the note was in the bank at the time it fell due, in the hands of the cashier, who was ready to receive the money.
    This was an action upon a promissory note for $856 81, made by the mercantile firm of Goddard & Burnap, of Eatonton, in the State of Georgia, in favor of the defendants, and payable to their order, at the Branch of the Stale-Bank of Georgia, at Eatonton, six months after its date, and indorsed by the defendants.
    The declaration contained three counts. The first stated that the plaintiffs were the first indorsers of the note ;—the second set forth an indorsement by the defendants to one E. Molyneux, Jr., and by him to the plaintiffs. Both counts averred a presentment of the note at the Branch of the State Bank of Georgia, at Eaton-ton, for payment, on the 17th day of March, 1828, and a neglect and refusal to pay. The third count was for money had and received.
    The cause was tried before Mr. Justice Oakley., At the trial it appeared that the note had been indorsed by Molyneux to the firm of Stiles & Fannier, of Savannah, and by them to one D. B. Halstead, of Milledgeville, who had also put his name upon it:— butt these two last indorsements were stricken out. It also appeared that Stiles & Fannier had forwarded the note to Halstead for collection, and that he immediately transmitted it to the cashier of said Branch Bank at Eatonton.
    On the 17th of March, 1828, (the day when the note became due,) the cashier handed it to a notary, who presented it to Bur-nap, one of the makers, at their place of business in Eatonton, and demanded payment, which was refused. The note was thereupon immediately protested for non-payment, and a notice thereof, addressed to the defendants, was on the same day put into the mail at Eatonton. But as the notary did not know where the defendants resided, he enclosed the notice in an envelope directed to Hal-stead, at Milledgeville, from whom the cashier received the note for collection.
    Milledgeville is twenty-two miles distant from Eatonton; but the arrangement of the mails between the two places is such, that the notice did not leave Eatonton nor reach Milledgeville until the 23d of March, 1828. Halstead on that day received the notice, directed it to the defendants at New-York, and immediately put it into the mail; and thus directed, it left Milledgeville for New-York, on the 24th of March.
    It appeared by the evidence, that if the notice had been transmitted by the notary, direct from Eatonton to New-York, it would have left the former place on the 18th of March, and by due course of mail, would have reached New-York in eleven days thereafter. The mail is also occupied eleven days in passing from Milledgeville to New-York, If the notice, therefore, had taken the most direct course to New-York. it would have reached that city on the 28th of March, whereas by the route adopted, it could not arrive there until the third of April, 1828,

      It appeared also, that the notary had addressed notices of the non-payment of the note to Stiles & Fannier, and to Molyneux, the other indorsers, and that these notices, in like manner, were enclosed to Halstead at Milledgeville.
    There was no evidence of any specific demand of payment of the note at the Branch Bank in Eatonton ; but it was proved that Goddard & Bumap never had any funds in that bank, with which to pay the note.
    Upon this evidence, the counsel for the defendants contended that the plaintiffs had no right to recover ; first, because the plaintiffs had not used due diligence, nor adopted a proper course in giving notice to the defendants of the non-payment of the note: and secondly, because there was no proof to show that the note had been presented at the bank for payment. The presiding Judge, however, charged the jury that the plaintiffs had a right to recover, and the jury returned a verdict in their favor.
    The defendants excepted to the opinion of the judge ; and by consent of parti.es, a case was made for the opinion of the Court, which either party had leave to turn into a bill of exceptions.

      Mr. J. Greenwood, for the defendants, now contended,
    I. That the plaintiffs did not use due diligence in the manner or time of giving notice to the defendants of the non-payment of the note. If Halstead was the agent of the plaintiffs to collect the money, he was bound to use all diligence for his principals. He ought to have informed the cashier of the Bank, when he transmitted the note to him, of the residence of the indorsers. The plaintiffs, however, are bound by the acts of their agent, and they have no right to transmit their note through a circuitous line of agents for collection, to the prejudice of other parties. The holder can claim no right of delay by employing agents, but must act with the same promptitude which the law requires in all cases where an indorser is to be charged. [2. John. Cas. p. 1. 3 Bos. & Pul. 599. 18 John. R. 230.]

      II. The note ought to have been presented at the Bank in Eatonton for payment. The general rule is, that a note must be presented for payment at the place where it is made payable, and want of funds.will not dispense with a neglect of demand. [17. John. R. 248. 19 J. R. 420, 1. 16 East. 113.]
    III. The plaintiffs having averred that the note was presented at the Bank, must show the fact to be so, and cannot cover the defect in their proof, by resorting to the count of money had and received.

      Mr. Thomas L. Ogden, contra, for the plaintiffs.
    As to the first point made by the defendants, it will not be contended that any greater diligence is required of an agent than of a principal. In point of fact, Halstead had no interest in the note, but was a mere agent for Stiles & Fannier, who had sent it to him for collection. But suppose he was the real holder of the note, having received it of Stiles & Fannier by a bona fide indorsement,— what would have been the cashier’s duty in that case, he being the agent of Halstead I Clearly he would have been justified by giving immediate notice to his principal, that he might nqtify his immediate indorser. The rule is well settled that the notice may pass circuitously from one indorser to another in the regular order- of the indorsements, until it shall reach the person who first negotiated the note, by putting his name upon it to give it currency. Any other rule might work the most manifest injustice, for in many instances it is impracticable for the last indorser to state the places where the first and intermediate indorsers reside. Notes are transmitted from agent to agent for the mere convenience of collection, and are indorsed by such agents for that purpose merely. By what channel shall the notice return, except by that in which the note, and with it the names of the various indorsers, came 1 The last indorsee may know no person whose name is on the note except his immediate indorser, and if he uses all diligence to transmit the notice direct to the person from whom he received the note, (the residence of the others being unknown,) he discharges his duty.

      In this case, it is in evidence, that the notary who made the demand and protest, was ignorant of the residence of the defendants. But it is said that Halstead should have informed the cashier as to that, when he transmitted the note to him for collection. Halstead himself was but an agent for Stiles Sc Fannier ; and what proof is there that he knew where the defendants were to be found 1 The same remark is applicable to Stiles & Fannier, for it is to be presumed that they were agents merely, since we find their names stricken from the notes.
    But this matter is fixed and settled by the authority of cases decided in our own Courts, as well as those of other states and countries, and there can be no doubt that the notice was properly given, and that it is sufficient to charge the indorsers. [3 John. Cas. 89. 18 John. R. 230. 5 Mass. R. 167. 3 B. & P. 599. 5 Cowen’s R. 303.]. This last case is quite decisive upon this point.
    II. As to the demand. It is in evidence that the note was at the bank on the day that it fell due, and if the makers had placed funds there, or presented themselves with funds, the money would have been received and the note given up. The cashier, who was the agent of the holders, knowing that there were no funds in the bank for the payment of the note, did not perhaps clamorously demand the money, but he was ready to receive it,' had the makers been prepared to make payment. It was sufficient that the note was at the bank, and the averments in the declaration are fully satisfied by this state of the proof. [6 Mass. R. 524. 2 Hen. Bla. 510. 18 John. R. 230.]

      Mr. Greenwood and Mr. Anthon, in reply.
    This case is not like any of those to be found in the books; it is sui generis, and cannot be supported on any sound principle. The leading authority for all subsequent decisions upon this subject was the case of Haines v. Burkes. [3 B. & Pul. 599.] It is the foundation upon which the others rest, and no principle can be found to uphold the sufficiency of this notice.

      The indorser of a note is entitled to notice' of its non-payment, from the last real holder. The latter has no right to establish a circuitous line of agents, through which the notice is to be passed before it can reach the principal: and if the plaintiffs transmitted the note to Stiles & Funnier for collection, they were bound to inform them where the defendants’ place of residence was. The same information should have been given to Halstead, that he might have communicated it to the cashier, and the latter would then have been bound to transmit his notice directly to New-York. The object of the notice is, to give the indorser an opportunity to secure himself;—but here six days were lost by the laches of the plaintiffs and their agents. If the principle be once established, that the holder of a note may transmit it from agent to agent for collection, and that notice of non-payment may return through the same channel, there is no bound at which we can stop. A note payable at Eatonton, may pass from New-York through a dozen different States, stopping with an agent in each, and notice of nonpayment may then travel the same leisure road on its return. This cannot be permitted, and the cases cited do not support the plaintiffs’ position. The authorities from the first of Johnson’s Cases and that from the third of Bosanquet fy Puller, are not in point for the plaintiffs, and are cited by us, to show the distinction between the true rule and the one sought to be established. There was no line of agents in those cases, and the same delay was not produced. So in the case cited from the 18th of Johnson’s Reports. There the notice went by an immediate and customary route of the mail, although not by the shortest route, and the party was in the habit of receiving his letters by the course adopted.
    But the case on which the defendant seems principally to rely, is that from the 5th of Cowen. In that case a draft on Bristol (R. I.) was put into the Mechanic’s Bank of New-York, for collection, transmitted to Providence and from thence to Bristol. This was the regular course of the mail, and the only route by which it passed. The notice was immediately returned by the same route, and there was none other by which it could be transmitted. There was no delay in that case, no travelling from the ordinary course. How is it here l Eatonton is but 22 miles from Milledgeville, and yet the notice was seven days in passing between these two places. Was that diligence 1 The notary should have inquired after the residence of the indorsers, and in the want of other information, the place of the date of the note would have been a guide. But here, the notary is supposed to have discharged his duty by the most negligent attempt at performing it. The notice cannot be deemed sufficient, and the defendants are discharged by the laches of the holders themselves.
    II. The plaintiffs having averred a presentment at the bank for payment, and a demand there, should have proved the facts laid in their declaration. Such proof was a condition precedent to their recovery, and the want of funds is no answer to the want of demand. In this respect there is a difference between the case of a promissory note and a bill of exchange, and the plaintiffs have neglected their duty. The makers have promised to pay the note at the bank at Eatonton, and there is nothing to show that it would not have been paid at the' time and place, had a demand been made. But at all events the plaintiffs were bound to prove all the material allegations in their declaration, and in-relation to the demand of payment they have totally failed.
   Oakley J.

This was an action on a note drawn by Goddard & Burnap, and payable to the defendants. It bore date at New-York, where the defendants resided, and was made payable at the State Bank of Georgia at Eatonton. It was indorsed by the defendants, and under their name, by E. Molyneux; audit had been indorsed under the name of Molyneux, by Stiles fy Fannier, and by D. B. Halstead. The two last indorsements were stricken out.

The note was sent by Stiles & Fannier, who resided at Savannah, to Halstead at Milledgeville, for collection, who indorsed it, and sent it to the cashier of the Bank at Eatonton, where it was payable. The evidence sufficiently shews that the note remained in the Bank until it fell due, when it was handed by the cashier (there being no funds there to pay it) to a notary, who made a personal demand of payment on the maker, who resided at Eaton-ton. The notary, not knowing the residence of the defendants, or of any of the indorsers, before Halstead, made out notices of demand and of non-payment, directed to them severally, and ed them in a letter to Halstead, which was deposited in the post office at Eatonton without delay. By the order of the mail, that letter did not leave Eatonton for Milledgeville until five or sis days had elapsed. Immediately on the receipt of the notice to the defendants by Halstead, he directed it to thenrat New-York; and it was despatched from Milledgeville, without delay; but by the arrangements of the mails it could not have reached New-York, by several days, as soon as it would have done if it had been sent directly from Eatonton.

On this state of facts, the defendants object, 1st, that the note was not duly presented for payment at the Bank, and 2dly, that there was a want of due diligence in giving notice to the defendants of non-payment.

As to the first objection, it is clear, that a note payable at a particular place, must be presented for payment at that place; but it cannot be doubted that the facts in this case show such a presentment. The note was in the bank at the time it fell due, and in the hands of the cashier, who was authorized to collect it. If the makers had called there to pay it, it would have been delivered up to them. There was no necessity for the cashier to make any other demand. His subsequent delivery of the note to a notary, and his personal demand on the makers, was probably by way of greater caution, and was clearly unnecessary. [2 H. B. 509. 6 Mass. 524.]

I am of opinion, also, that there was no want of diligence in giving notice to the defendants. The objection rests on the ground that Halstead, knowing the residence of the defendants, ought to have informed the cashier of the bank; and in that case, notice would have been received by the defendant several days sooner than it was.

The rule governing this part of the case seems to be clearly laid down in Mead v. Engs, (5 Cow. 303.) The Supreme Court there fully establish the principle that the holder of a note, receiving and indorsing it for the purpose of collection, and being therefore merely an agent, is nevertheless to be considered as the real holder for the purpose of receiving and transmitting notices. And the general rule seems clearly settled, that it is sufficient to give notice of nonpayment with reasonable diligence, to the indorser, from whom the note was received, that he may give notice to Ms immediate indorser, &c.

Applying that principle to the present case, it was enough for the cashier of the bank, or the notary, to give notice by the earliest opportunity in the regular course of the mail, to Halstead, which was done; and it would have been sufficient for him, to have given the like notice to his immediate indorsers at Savannah. It is clear that the defendants in this case received the notice as soon, or sooner, than they would have done if it had been remitted in that circuitous manner. The same doctrine is also recognized in Tunno v. Lague, (2 J. Ca. 1.) and in Haynes v. Birks. (3 Bos. & Pul. 599.) The motion for a new trial must be denied.

Motion for new trial denied.

[Ogden & Huggins, attys. for plffs. J. Greenwood, atty. for deft.]


author: Per Curiam.

text:
    Alexander Birkbeck, versus Fanning C. Tucker, Robert Carter, Richard S. Williams, Henry Packard, John H. Howland and Richard Morell.
    A mortgagee of a vessel, out of possession at the time supplies for her are furnished, but who takes possession subsequently, is not liable for the supplies furnished before his possession commenced.
    Although the bill of sale, or instrument by which the mortgagee exhibits his title, be absolute upon its face, he may show, nevertheless, by parol evidence,- "what the real nature of his interest was: and it is not necessary that the defeasance (or evidence showing the apparently absolute interest,to be a mortgage) should be in writing.

    Where an action was brought'against the defendants jointly, and all of them except one admitted their liability, it was held that the plaintiff was not entitled to recover against those, who admitted their liability without convicting him, also, who made defence.
    Notice was given to the defendant, who contested the plaintiff’s right to recover against him, to produce certain books relative to the vessel, which were kept by the ship’s husband,—the other defendants admitting that they were in his possession. Held that their admissions would not affect the defendant, who made the defence, but that the plaintiff was bound to prove the books to be in his hands, before parol evidence of their contents could be offered.
    This was an action of assumpsit brought against the defendants as owners of the ship De Witt Clinton, to recover the amount of a bill for certain chains furnished for that vessel.—The defendant, Howland, severed from the other defendants, in his defence, appeared by a separate attorney and pleaded the general issue.—Morell was defaulted, but the other defendants appeared by the same attornies and made a joint defence.
    The cause was tried before Mr. Justice Oakley, and at the trial the plaintiff proved the delivery of the articles for which the action was brought, to the master of the vessel.
    The defendants, Tucker, Carter, Williams and Packard, admitted their part ownership, and that the amount claimed was due to the plaintiff; and they were willing that a verdict should pass in his favour, provided Howland were made liable also. The latter in his defence introduced evidence to show that all the articles stated in the plaintiff’s bill of particulars, except the two last, (amounting to the sum of ¿223 29,) were furnished before he had any concern with the vessel, and that his interest in her was that of a mortgagee merely.
    It appeared at the trial, that the vessel was built by S. & F. Fickett, of the city of New-York, for themselves, and the defendants Tucker, Carter, Williams, Packard and Morell, and that originally Howland, had no interest in her. When the vessel w as about to be completed, (viz., on the 24th of March, 1828,) S. & F. Fickett being desirous of borrowing the sum of $8,000 of Howland, gave him an absolute bill of sale, of their interest in the ship, amounting to three eighths thereof, which was intended, however, as a mere collateral security for the loan. Howland never took possession, nor interfered with the vessel, until the month of July, 1828, when the Ficketts failed ; and then, with their consent, he sold out their interest in the ship, and credited them with the proceeds of the sale. The articles, for which this action was brought, were all furnished before Howland took any direct interest in the vessel, and before the failure of the Ficketts. Howland, for the purpose of proving that his interest in the vessel, although apparently absolute by thebill of sale, was in fact and truth but a mortgage, called F. Fickett as a witness : but the counsel for the plaintiff objected to the introduction of any parol proof to contradict or explain the written instrument, or to show that the bill of sale was given as collateral security for the loan. This objection was overruled by the presiding Judge, who was of opinion that if the bill of sale was intended as a mortgage only, that that fact might be shown, by parol, and Fickett was sworn as a witness.
    He testified that the bill of sale was given as a collateral security merely, and that Howland was to reconvey to the borrowers their interest in the vessel, upon being repaid the amount of his demand. The counsel for the plaintiff excepted' to the opinion of the Judge, permitting this evidence to he given. It appeared further, that the vessel, after she was completed, was put into the New-Orleans trade,—that one John W. Russell was appointed by the -other owners, the ship’s husband, and that all the accounts relatiag to the vessel were kept by him. At the trial, the counsel for the plaintiffs called upon the defendant, Howland, to produce the hooks of Russell, pursuant to a notice, which had been given for that purpose. But the counsel for Howland denied that they were in his possession, and contended that as his defence was adverse to that of the other defendants, who admitted their liability, and were interested to cause a joint recovery against all, the course for the plaintiff to pursue, was, to bring Russell into Court with the books, by a subpoena duces tecum.

    The counsel for the other defendants, however, admitted that the books were in Howland’s possession, and that he had not brought them into Court, pursuant to the notice. The plaintiff then offered to give parol evidence as to the contents of the books; but to this the counsel for Howland objected, on the ground that as the books were not proved to be in his possession, and he had denied that they were so, their contents could not be given in evidence against him.
    The Judge 'decided that such evidence could not be given as against Howland, and the counsel for the plaintiff excepted to his opinion on this point.
    The plaintiff then gave in evidence a certificate, produced from the Custom-house, bearing date the 31st of March, 1828, and signed by S. & F. Fickett,—setting forth that the De Witt Clinton was built under their direction, during that year, for Henry Packard, John II. Howland, Fanning C. Tucker, Robert Carter, Richard S. Williams, and Richard Morell. The certificate also set forth the dimensions and measurement of the ship, her bur-then, &c. Upon this point Fickett testified that the certificate was given for the purpose of having the vessel enrolled, in obedience to the act of Congress, and that such certificates often express the names of persons other than those for whom the vessel was built. He also testified that Howland saw and approved of .the certificate before it was filed.- ,

      Upon this state of facts, the Judge charged the jury that the plaintiff was not entitled to recover as against the defendant How-land, for any of the articles furnished prior to the date of his bill of sale; and that as to the balance, it was for the jury to say, whether Howland was a mortgagee in, or out of possession, at the time the articles were furnished. If in possession, he would be liable, but not otherwise. The judge also instructed the jury, as this was a joint action, against all the defendants, that the plaintiff must recover against all, or he could not recover against any.

    The counsel for the plaintiff excepted to this opinion and charge, and then submitted to a nonsuit, with leave to move to set the same aside on a case made.
    A case having afterwards been made pursuant to this permission, the cause was now argued by Mr. Sackett for the plaintiff, and by Mr. G. F. Taiman for all the defendants except Howland. But as their object was to malte Howland contribute, their counsel maintained the same propositions in substance which were relied upon for the plaintiffs.
    They contended—
    I. That parol evidence should not have been admitted to prove that the bill of sale from S. & F. Fickett to Howland was a mere collateral security or mortgage. That the instrument being a deed could not be controlled, explained, or defeated, by a mere verbal understanding between the parties; that upon the happening of a certain contingency, it should become inoperative. It is a general rule, that a deed, absolute in its terms, cannot be shown to be a mortgage by mere parol evidence. [13 Mass. R. 443. Comp. 47. 3 Camp. R. 57. 3 B. and Md. 233. 1 Stark. 361. 2 B. andJlld. 367. 5 Comen’s R. 485. 12 J. R. 488.. Stark, on JEu. 1002 to 1008. 2 Conn. R. 215.]
    There is an exception to this rule, it is true, in chancery, which allows a deed apparently absolute, to be proved a conditional one, merely .* but this exception is only applicable to those cases where a grantee fraudulently attempts to convert a deed which was intended to be conditional into an absolute one. And even this is confined to cases between the immediate parties to the deed; for a third person is not bound by the dealings between the.original parties. [4 J. C. R. 167. 6 lb. 417. 1 lb. 594. 2 B. and Aid. 134.]
    It will be found upon an examination of the leading cases, that a written defeasance of as high a nature as the deed itself, was executed in every instance at the same time with the original deed.
    But suppose the testimony to be admissible,—what is its effect on Howland 1 In judgment of law he was in possession, being part owner; for the possession of one joint tenant is the possession of all. [Jones C. J. Not in this case, where you seek to chrage him, by means of the possession of a co-tenant.]
    But the three-eighths conveyed to Howland must have been in his possession, for the Ficketts had conveyed their interest to him. The possession must have been in them or in Howland. [Jones C. J. As the case stands, that point cannot be discussed. The plaintiff has submitted to a nonsuit, and for the purposes of this argument, Howland is to be deemed a mortgagee out of possession.]
    The plaintiff should have been permitted to give parol proof as to the contents of the books kept by Russell, the ship’s husband. They could not have been reached by a subpana duces tecum, because they were not in Russell’s possesion ; and hence the general rule upon this subject is applicable to this case.
    III. The defendant Howland was liable for the supplies furnished for the ship, even if he was a mere mortgagee. The plaintiff after having trusted the ship, goes to the Custom-house to ascertain who her owners are. He there discovers the names of all those persons who are made defendants; and he brings his action, against them. One of the defendants comes in and says that he is a mortgagee merely, and thus not liable. How was the plaintiff to know this'? If the defence is to prevail, he is taken by surprise; for there was the same proof of ownership in Howland that there was in the other defendants. The defendant has put it upon record that he was a part owner of this ship, and he cannot be permitted to deny the fact, at a moment when it . is his interest to do so. He must abide by his own act, and if he is an owner for one purpose, he is so for all. In the case of McIntyre v. Scott [8 John R. 160] there was a written defeasance given at the time the bill of sale was executed, and Champlin v. Butler (18 John, 169,) was decided upon the ground that there was a special agreement by the master, and that the facts of the case were known to all the parties concerned.
    Again, if Howland is liable at all, then he is liable for the whole amount of the bill of particulars. One part of the charges cannot be separated from the other parts, for the defendants are liable as owners, if liable at all. [1 Cowen's R. 417. 3 lb. 369. 20 John R. 122-3. 1 Sound. 207 n 2.]
    The plaintiff was entitled at all events to a verdict against the defendants, who admitted their liability at the trial, and against the one who was defaulted.—[Upon this last point Mr. Taiman contended, that the plaintiff must fail, unless all the defendants were liable. He cited 1 Chit. Plead. 30. 5 John R. 176. • 11 lb. 101.]
    Mr. Slosson for the defendant,
    Howland contended :
    I. That Howland had no interest in the vessel when that portion of the demand which precedes the 24th of March, 1828, was contracted, and therefore could not be liable for that. The other defendants admit their liability, and are in fact the party adverse to Howland; as a recovery against him would divide the debt for which they are at all events liable in a proper action. The equity of the case is clearly with Howland; for he loaned his money to the Ficketts for the purpose of enabling them to complete their contract with the other defendants. Most of the items for which the action is brought, were furnished before the date of the bill of sale, and that was given merely as a collateral security for the loan. Ought these real defendants, then, to succeed in charging Howland with a part of their debts 1

      ll. The rule is well settled that a mortgagee out of possession is not liable for supplies furnished to the vessel; M'Intyre v. Scott. 8 J. R. 160.] and it was supposed to be too well established to be disturbed. [The Chief Justice here intimated, that the Court did not desire to hear the counsel upon that point, but wished to know whether the defeasance could be by parol.]

      Slosson. That point also I had supposed was settled by the case of Champlin v. Butler. [18 John, 169.] There is no reason why the parol evidence should not be admitted; for it does not in any way conflict with the deed.
    The defendant merely offers to show, that there was a loan; and if there was a loan collaterally secured, then the security may be given in the form of an absolute deed, [Strong v. Stewart, 4 John C. R. 167.] That third persons are concerned incidentally in the transaction, .can make no difference ; for they have been in no way prejudiced by Howland’s title. They have not trusted him, neither has credit been given upon the faith of his being a part owner. This is not pretended either by the plaintiff or the other defendants. But it is said, that by the register, Howland’s ownership appears, and that he is concluded from asserting his real interest, by this documentary evidence. This point, too, has been fully settled by our own Courts, and the register is not evidence of ownership. [14 John R. 201.] It may be that the tribunals of Connecticut have established a different doctrine : if so, their decisions cannot control the law of evidence as it is settled here.
    III. The books of Russell were not in the possession either of Howland or the other defendants, and of course parol evidence of their contents could not be given. The plaintiff should have compelled their production by a subpoena duces tecum, directed either to Russell or the person having charge of the books.
    IV. It seems to be admitted by the counsel for the other defendants, that as this is an action on a joint contract, the recovery must be joint also. The rule upon this subject is also well settled, and if Howland be not considered liable, then the non-

      suit must stand. As the case is presented, all the facts are to be presumed to be in favour of the defendants ; for the plaintiff after offering his evidence, submitted to a nonsuit. We are therefore to have the benefit of all presumptions, and that the defendant, Howland is a mere mortgagee oui of possession, is to be considered as proved before the Court.
   Per Curiam.

The principles upon which this case rests have already been considered and settled in the previous case of Ring and M’Namara v. Franklin. The defendant here, was a mortgagee out of possession, and his ownership had' never been the cause or inducement of the credit which was given by the plaintiff. This being his situation in point of fact, he cannot be made liable for supplies furnished to the ship when he was thus out of possession, provided his real interest in the vessel was established by competent proof.

Upon this point the law .seems to be well settled, that whenever there is a loan and a security furnished for that loan, the fact may be shown by parol proof, even though the instrument forming the security, be absolute in its terms and upon its face. It becomes a question of intention entirely, and if the parties intended that the apparently absolute deed should in truth be but conditional, then that fact may be shown in any form of proof which can establish it. It is not necessary that the defeasance should be in writing; but the real object of the parties in forming the instrument may be proved by parol. The effect of the instrument is not confined to the immediate parties, at all events, if third persons are not prej udiced thereby. In this case there is no pretence that credit was given to this ship, in consequence of the interest, which was vested in Howland. His part ownership in no wise prejudiced the plaintiff, and Howland cannot be made liable from this cause.

As to the evidence which was offered to show the contents of the books kept by the ship’s husband, we think it was rightly rejected at the trial. There was no proof that they were in How-land’s hands, and the admissions of the other defendants, as to that fact, could not prejudice his rights. If the books were jn Russell’s hands he should have been compelled to produce them in the ordinary way, by a supmna duces tecum. At all- events, parol evidence of their contents could not be given as against Hoxvland, until the fact was proved that the books were under his charge. To this point no evidence was produced and the testimony offered was rightfully rejected.

As the plaintiff has brought his action against the defendants jointly, he must show a right of recovery against all, or be non-suited. He has failed to show any liability on the part of How-land, and of course the motion to set aside the nonsuit must be denied.

Motion to set aside the nonsuit denied.

[Sackett, Att'y for the plff. W. Slosson, Att'y for the deft. Howland.] [Hoffman and Tallman, Atty's for the other defts.]