text:
Merchants' Insurance Company v. Huchbergers/Opinion of the Court

ERROR to the Northern District of Illinois.

L. & M. Huchberger brought suit against the Merchants' Insurance Company of Providence, R. I., declaring upon a contract to insure them for one year from September 14th, 1866, against loss by fire on their goods 'contained in the brick building No. 173 Lake Street, Chicago.' The narr also set out that it was provided in the policy that if the situation of the property should during the existence of the policy be changed by the assured, the policy should be void; and also it should be void, unless countersigned by the agents of said Merchants' Insurance Company.

After the averment of interest in the property insured, the narr continued:

'And the said plaintiffs aver that afterwards, to wit, on the 2d of March, A. D. 1867, the said property in the said policy of insurance mentioned was burnt, and destroyed by fire. And that the situation of the property has not been, during the existence of the said policy, altered or changed by the said plaintiffs.'

The company pleaded the general issue; and a trial having been had on the evidence a verdict was given for the plaintiffs. The defendants then moved an arrest of judgment on the grounds:

1. That the narr did not aver that the goods were burned at the particular place mentioned in the contract, to wit, 'the brick building, No. 173 Lake Street, Chicago.'

2. That the countersigning of the policy by the agents of the insurance company, was a condition precedent, and ought to have been averred in the narr.

This motion being overruled and judgment given for the plaintiff, the company brought the case here on the sufficiency of the narr.

No counsel appeared personally for the insurance company, the plaintiff in error. A brief was, however, filed by Mr. O. B. Sansum in its behalf, arguing that the contract was to insure goods in a particular place only, while for aught that appeared they had been burned elsewhere. Neither, as the brief argued, was the policy to be of effect unless countersigned, yet there was no averment that it had been. Accordingly no title to sue had been shown, and for this want of title shown, judgment should have been arrested.

1st. The inference from the allegations which are made is clearly enough that the goods were burned in the building where they were insured; but if it were not so, the declaration in this respect is as specific as the policy. If the one does not allege where the goods were burned, neither does the other limit the liability to a burning at any particular place.

2d. As to the objection of a want of averment of a countersigning, the declaration alleges that the insurance company 'made and executed to the plaintiffs a certain policy of insurance in writing, whereby, &c.' This was sufficient. If not executed so as to bind the company, the policy was not the instrument declared on, and the plaintiffs must have failed in their proof. After verdict, the court will presume that every material fact inferable from what is alleged was proved on the trial.

The writs of error have obviously been prosecuted for delay. We ask damages, as provided by the 23d Rule of court, which declares that:

'In all cases where a writ of error shall delay the proceedings on the judgment of the inferior court, and shall appear to have been sued out merely for delay, damages at the rate of ten per cent., in addition to interest, shall be awarded on the amount of the judgment.'

The court is of opinion that this writ of error can have been taken out only for delay. We affirm the judgment below with ten per cent.

DAMAGES IN ADDITION TO INTEREST.

NOTE.-Two other judgments, given under like circumstances, were affirmed with the same penalty.


text: Talk:Merchants' Insurance Company v. Huchbergers/Opinion of the Court

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The Steamer Syracuse

APPEAL from the Circuit Court for the Southern District of New York.

This appeal originated in a libel in the Admiralty by the owner of the canal-boat Eldridge, against the steamer Syracuse, to recover the damages occasioned to her by her running into a vessel at anchor in the harbor of New York, the canal-boat being at the time in tow of the Syracuse.

The canal-boat was taken in tow at Albany, to be towed to New York; the Syracuse having at the time a tow of forty boats; a tow, however, testified to have been 'an ordinary tow for the Syracuse, which on one occasion had taken fifty-two boats.' The Eldridge, which had applied for towage after the tow was pretty much made up, was toward the rear end of it, and liable of course to be well swung round in any sweep of the steamer.

Approaching New York, and getting within a mile or so of the Battery, that part of the harbor was seen to be somewhat unusually full of vessels, but to the view of the captain there seemed to be one passage or 'gangway,' through which the tow could be taken. Another steamer, the Cayuga, with a similar tow had, as he supposed, though, perhaps, incorrectly, passed through it safely not long before. The Syracuse accordingly went on. The tide at the time was ebb, setting south in the North River, but above Governor's Island setting sharply to the west and southwest, as it came out of the East River.

The peculiarity of the position lay of course in this, that the tow coming down the North River, had the tide with her, but as she turned into the East River had to meet an ebb tide coming from the East River nearly at right angles, while many vessels were lying at anchor all around. Of necessity the rear end of a long tow would be swept well round.

As soon as the Syracuse passed the last vessel on her port side, she turned up into the East River. It was desirable to head up the East River as speedily as possible in order to check the effects of the East River tide upon the boats. She had previously taken on two small steamtugs as helpers, and in addition to the starboarding of her own wheel the helper on the port side was stopped, while the other one was kept in motion, to assist the turn. But notwithstanding all efforts, the boats at the end of the hawser were swept over by the East River tide, which struck them on their sides, and were carried towards a brig which lay at anchor on the starboard side, and which also took a sheer towards them. The canal-boat struck the brig's stem and shortly after sunk.

The libel charged that the collision was occasioned by the carelessness and negligence of those in charge of the steamboat in not giving the brig lying at anchor a wide berth, which, as the libel alleged, she might have done, there being plenty of room between the Battery and the brig for the Syracuse to have passed with her tow.

The libel also charged that the collision was caused by the negligence, want of skill and of prudent management generally on the part of the steamboat. But it did not charge negligence in not stopping before reaching the Battery, and dividing the tow.

The answer did not in any respect deny the allegations of the libel above set forth as to the steamboats having abundance of room to make the passage round the Battery. The grounds upon which it sought to exculpate the steamer were:

1st. That by special agreement between the canal-boat and the steamboat, the former was being towed at her own risk.

2d. By the negligence of those in charge of the canal-boat to cast off lines, or use their helm, or do anything to prevent the collision.

3d. That the collision was inevitable, having been caused by an unusually strong ebb tide, which swept the canal-boat against the bows of the brig lying at anchor as the towboat was rounding the Battery with her tow.

The canal-boat was shown to have committed no fault. This was admitted in the argument here. The receipt for the towage-a printed form-was for towing her 'at the risk of her master and owner;' but it seemed that the canal-boat had been made fast, the tow put in motion, and the towage charge paid before this receipt was delivered. What the contract was, was therefore a matter disputed.

As to the tide setting in from the East River, although the captain of the steamer testified that it was unusually strong, nothing unusual about it was otherwise well proved. Nothing out of the usual and regular order of nature was attempted to be shown, nor any preceding violence of the winds, which sometimes forces the waters from the sea into the inlets when they retire with greater force on the ebb. Neither had it occurred, apparently, to those in charge of the steamer, until the place of the disaster was nearly reached, that the tide was stronger than the usually strong tide at that place. The almanac, for December 1st, 1861, showed that it was a low course of tides at that time, the moon not becoming full until December 17th.

It appeared, by cross-examination of the master of the steamer, that there was always considerable danger in taking a tow so large as the one which he had on this occasion round the Battery, when there was a strong ebb tide from the East River, if the place was crowded by numerous vessels at anchor, as it commonly was. That on this occasion, however, he thought he saw a clear gangway, and felt no alarm until he had got too far into it to stop with so large a tow, though he could have stopped with a small tow; that he could have stopped with the tow he had, above Thirteenth Street, about two miles above, where there is room and the tide has a different set; and could have there held or divided his tow; that in the night-time he had for caution stopped there and left his tow until morning; that such stoppage was made not unfrequently in the night-time, and could be made as well in the daytime as the night; that he had seen persons stop there, and, when the tow was large, divide their tow; though he had never divided his own tow.

The pilot on cross-examination testified that above Thirteenth Street they could have stopped the tow, but not lower down; that he did not see that the water about the Battery was crowded with vessels until he got lower down, say within a mile or so of the Battery; that at Thirteenth Street it did not appear to be more crowded than usual, nor, at that point, but what they might go through the same as usual; that there are generally a good many vessels off the Battery, and that he never went through a gangway there but that he saw 'more or less danger.'

The District Court condemned the steamer, and the Circuit Court having affirmed the decree, her owners brought the case here.

Mr. R. D. Benedict, for the appellant:

I. The boat was towed, 'at the risk of her master and owners,' that is to say, under a contract on the part of the libellant that he would bear the risks of the navigation, provided the steamboat which furnished the propulsive power was navigated with ordinary care and skill. Any other construction of the rights of the parties would deprive that clause of the contract of meaning and make it a snare.

II. The libellant's case is made in this court to rest chiefly on the fact that the tow was not divided on arriving at Thirteenth Street and sent round piecemeal.

The answer is brief:

1st. The libel makes no charge of negligence antecedent to the coming to the Battery. It is variance to let in proof of an allegation not made, and a surprise on us to bring forward such an allegation now.

2d. There was no call for such extraordinary proceeding. No human being could tell on arriving at Thirteenth Street, full two miles above, that there was not room to pass through the vessels at anchor below in safety; and unless that could be told, the steamer was in no wise called upon to do so extraordinary a thing as to divide the tow. It needed but a few feet more width of channel to have saved all danger. To hold that the human eye is called upon to estimate, within a few feet, the width of such a passage at the distance of two miles, and to hold that a failure in the correctness of such an estimate is a failure to use ordinary care, would be unreasonable. If the officers of the Syracuse formed the best judgment which was possible to be attained, there was no negligence on their part in acting upon that judgment.

Mr. J. C. Carter, contra.

Mr. Justice DAVIS delivered the opinion of the court.

title: The Steamer Syracuse


text: Talk:The Steamer Syracuse

title: Talk:The Steamer Syracuse


text:
The Steamer Syracuse/Opinion of the Court

It is unnecessary to consider the evidence relating to the alleged contract of towage, because, if it be true, as the appellant says, that, by special agreement, the canal-boat was being towed at her own risk, nevertheless, the steamer is liable, if, through the negligence of those in charge of her, the canal-boat has suffered loss. Although the policy of the law has not imposed on the towing boat the obligation resting on a common carrier, it does require on the part of the persons engaged in her management, the exercise of reasonable care, caution, and maritime skill, and if these are neglected, and disaster occurs, the towing boat must be visited with the consequences. It is admitted in the argument, and proved by the evidence, that the canal-boat was not to blame, and the inquiry, therefore, is, was the steamer equally without fault? It frequently happens in cases of collision that the master of the vessel could not have prevented the accident at the moment it occurred, but this will not excuse him, if, by timely measures of precaution, the danger could have been avoided. Testing the present case by this rule there is no difficulty in determining by whose fault this collision occurred. It may be true, that the master of the Syracuse, after he got his boat off the Battery with her two, in making the turn to go up the East River, was unable to keep the canal-boat from striking against the brig, but the question arises, ought he to have encountered this peril?

Manifestly not, under the proof furnished by the officers of the Syracuse themselves. In the state of case disclosed by the master and pilot, is it not plain that ordinary prudence required the master to stop where he was able to hold his tow, long enough to ascertain the state of things at the Battery? The master tells us that in the night-time, as a measure of precaution, he had stopped some distance above that place, and left his tow there until morning. If this precaution was necessary at night, why not in daylight; as the ebb tide was very strong, and the danger, therefore, imminent? It is no valid excuse for proceeding down the river, that, when off Thirteenth Street, it was impossible to know the width of the gangway through which the vessels must pass to get into the East River, because it was easy to tell, even at that distance, that the river at the Battery was full of vessels, and, therefore, in the state of the tide, dangerous to navigate with such a fleet of boats. In view of the magnitude of the tow, the admitted danger of handling it in a strong ebb tide where there is a large amount of shipping, and the ability to stop where the tow could be managed, it was, to use the mildest term, negligence to make the attempt to pass the Battery into the East River. As the master could have stopped anywhere above Thirteenth Street, it was his duty, under the circumstances, to have done so, and either to have divided his tow, or remain there until the tide had slacked. If companies engaged in the business of towing, will, through greed of gain, undertake to transport from Albany to New York, more canal-boats in one tow than can be safely handled in the waters of New York, they must see that the large amount of property intrusted to their care is not placed in jeopardy, through the want of preliminary caution and foresight on the part of the officers of their steamers.

It is objected that the libel does not specifically charge this antecedent negligence as a fault. This is true, and the libel is defective on that account, but in admiralty an omission to state some facts which prove to be material, but which cannot have occasioned any surprise to the opposite party, will not be allowed to work any injury to the libellant, if the court can see there was no design on his part in omitting to state them. There is no doctrine of mere technical variance in the admiralty, and subject to the rule above stated, it is the duty of the court to extract the real case from the whole record, and decide accordingly. It is very clear that the libellant had no design in view in omitting to state the failure to stop as a fault, and equally clear, that the proof on that subject, coming, as it did, from the opposite party, could not have operated to surprise them.

JUDGMENT AFFIRMED.


text: Talk:The Steamer Syracuse/Opinion of the Court


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Handlin v. Wickliffe

ERROR to the Supreme Court of Louisiana; the case being thus:

During the late civil war, when the State of Louisiana was occupied by the troops of the United States, Brigadier-General G. F. Shepley, who had been appointed military governor of the State, commissioned W. W. Handlin as judge of the Third District Court of New Orleans. Handlin took the prescribed oath and entered upon the duties of his office. Subsequently, while the war was yet flagrant, a constitution was adopted for the State, under military orders, by a portion of its citizens, and Michael Hahn was elected governor, and was also appointed military governor in place of Shepley by the President. Handlin, who remained judge after the election and appointment of Hahn, was removed from office by him on account, as it appeared, of a decision to the effect that slavery still existed in the parish of New Orleans, which had been exempted by President Lincoln from the operation of the Proclamation of Emancipation. Asserting that, notwithstanding this removal, he remained of right in office and was entitled to its salary, Handlin, after the final suppression of the rebellion and reconstruction of the State, sued out a writ of mandamus in one of the inferior State courts of Louisiana against Wickliffe, the auditor of public accounts of the State, to compel payment. The judgment of the court was against him and the mandamus was dismissed. An appeal having been taken to the Supreme Court of the State and the judgment affirmed, Handlin now brought the case here by writ of error.

Messrs. W. W. Handlin, C. Cushing, and J. T. Drew, for the plaintiff in error; Mr. T. J. Durant, contra.

The CHIEF JUSTICE delivered the opinion of the court.

title: Handlin v. Wickliffe


text: Talk:Handlin v. Wickliffe

title: Talk:Handlin v. Wickliffe


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Handlin v. Wickliffe/Opinion of the Court

It is too clear for argument that the appointment of the relator as judge was purely military, authorized only by the necessities of military occupation, and was subject to revocation whenever, in the judgment of the military governor, revocation should become necessary or expedient. The adoption of the constitution during the war, under military orders, and the election of Hahn as governor, did not affect the military occupation, in the judgment of the national authorities, for Hahn was appointed military governor by the President. If the situation was not changed, Hahn, as military governor, had the same right as his predecessor to revoke the appointment of judge. If it was changed and the civil constitution of the State was in full operation, independent of military control, the authority derived from the appointment by the military governor designated by the President ceased of necessity. The office became vacant, and Hahn had whatever authority the State constitution conferred to enforce the vacancy by removal, and to fill it by a new appointment. We are unable to approve the reasons assigned for removal, but we cannot doubt the power. The judgment of the Supreme Court of Louisiana is therefore

AFFIRMED.


text: Talk:Handlin v. Wickliffe/Opinion of the Court


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United States v. Crusell (79 U.S. 175)

THIS was an application by Mr. Bristow, the Solicitor-General, and Mr. Hill, the Assistant Attorney-General, in behalf of the government, for the continuance of an appeal from the Court of Claims, founded upon the fact that evidence had been newly discovered on which a motion in behalf of the United States had been made for a new trial, under the act of June 25, 1868. By that act the Court of Claims is authorized 'at any time, while any suit or claim is pending before, or on appeal from, said court, or within two years next after the final disposition of any such suit or claim,' to grant a new trial on motion of the United States.

The motion was opposed by Mr. J. Hughes, for the appellee,

1st. On account of the fact which he stated, that the record and minutes of the Court of Claims showed, to wit, that more than two years had elapsed after judgment in the Court of Claims was given before a new trial was asked for.

2d. Because if a party, by the mere filing of a motion for a new trial in the court below, after appeal taken here, could get a continuance, an appellee might be delayed in this court indefinitely. The case would be different, he admitted, if a new trial had been actually granted; for then indeed a dismissal of the appeal might be asked.

The CHIEF JUSTICE delivered the opinion of the court.

title: United States v. Crusell (79 U.S. 175)


text: Talk:United States v. Crusell (79 U.S. 175)


text:
United States v. Crusell (79 U.S. 175)/Opinion of the Court

In the case of the United States v. Ayres this court denied a motion to dismiss an appeal from a judgment of the Court of Claims when the motion was made upon the sole ground that a motion for a new trial had been made by the United States, and was pending in that court, but afterwards dismissed the same appeal when a new trial had been granted. We are satisfied with the rulings then announced, and think that the spirit of them requires us to allow the continuance now asked for. We must not be understood, however, as giving any sanction to the idea that indefinite postponement of final hearing and determination can be obtained by repeated motions for continuance here.

The objection that more than two years had elapsed after judgment in the Court of Claims before the motion for new trial was made should be addressed to that court in opposition to the motion. Its decision, whatever it may be, can be reviewed here.

CONTINUANCE GRANTED.


text: Talk:United States v. Crusell (79 U.S. 175)/Opinion of the Court


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United States v. Alexander (79 U.S. 177)

APPEAL from the Court of Claims, the case being thus:

On the 29th July, 1848, Congress enacted:

'That the widows of all officers, non-commissioned officers, musicians, soldiers, mariners, or marines, and Indian spies, who shall have served in the Continental line, State troops, volunteers, militia, or in the naval service, in the Revolutionary War with Great Britain, shall be entitled to a pension, during such widowhood, of an equal amount per annum that their husbands would be entitled to, if living, under existing pension laws, to commence on the 4th day of March, 1848, and to be paid in the same manner that other pensions are paid to widows.'. ..

The act proceeded, however, further to declare that 'no widow married after the 1st day of January, 1800, should be entitled to receive a pension under the act.'

A subsequent section enacted that the same rules of evidence, regulations, and prescriptions should apply and govern the Commissioner of Pensions and pension agents as then prevailed under existing pension laws which related to widows of Revolutionary officers and soldiers.

On the 23d of February, 1853, Congress passed another act, thus:

'And be it further enacted, that the widows of all officers, non-commissioned officers, musicians, and privates of the Revolutionary army, who were married subsequently to January, A. D. 1800, shall be entitled to a pension in the same manner as those who were married before that date.'

In this state of the statutes, Mrs. Alexander, widow of a soldier in the Revolutionary War, who was married to him subsequently to the year 1800, and who had received a pension from the date of this act of February 3d, 1853, filed a petition in the Court of Claims to recover what her counsel called 'the arrears of her pension;' that is to say, to have it declared that her pension took effect from the passage of the act of 1848. The argument of the claimant's counsel was that the act of 1853 was substantially an amendment of the act of 1848, and intended to repeal the provision it contains, that widows married after January 1st, 1800, should not be entitled to its benefits; that hence the two acts must be read together, and all widows be entitled to a pension commencing on the 4th of March, 1848. This was inferred from the assumption that the act of 1848 must be referred to in order to fix the rate, or amount of the pension granted by the act of 1853, as well as its duration, and that if there be an implied reference for those purposes there must be for the purpose of fixing the commencement of the pension.

Of this view was the Court of Claims, and it accordingly gave a decree for the amount claimed as arrears. The United States appealed, Mr. B. H. Bristow, Solicitor-General, and Mr. C. H. Hill, Assistant Attorney-General, insisting in her behalf--

1. This the Court of Claims had no jurisdiction of a claim for a pension.

2. That under a proper construction of the act of 1853, persons who under it were entitled to a pension, were entitled to one but from the date of that act.

Mr. J. A. Wills, contra, enforced the argument above presented, as made below.

Mr. Justice STRONG delivered the opinion of the court.


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United States v. Alexander (79 U.S. 177)/Opinion of the Court

Whether or not the Court of Claims has jurisdiction in a case such as the present, is a question which we do not propose now to determine, for we are of opinion that if that court had jurisdiction, it erred in giving judgment for the plaintiff. Passing, then, to the merits of the case, it is clear that if the act of 1853 stood alone no widow could be entitled to a pension under it, commencing auterior to its passage. All statutes are to be construed as operating prospectively, unless a contrary intent appears beyond doubt. But it is said the act is to be construed with reference to the prior act of 1848. The argument in support of this view is not without weight, but we think it insufficient to overbalance the reasons there are for holding that the act of 1853 is intended to grant pensions only from the time of its enactment. It does not profess to be an amendment of any former, act, and there is no necessary reference to the act of 1848, even for the purpose of fixing the rate or duration of the pensions granted by it. Laws prior to the act of 1848 had determined the rate of pensions granted to widows of Revoluntionary soldiers as equal to the pay of the husband, and the pension was of course during widowhood, unless restricted by the statute. Nor was reference to any former act necessary to ascertain when the pension was to commence, for it commenced, of course, with the passage of the act, unless a different intention was either expressed or plainly implied. True, the act of 1853 declared that widows married after January, 1800, shall be entitled to a pension in the same manner as those who were married before that date, but the manner may well refer to the mode in which the pension must be obtained by the adjudication of the Commissioner of Pensions and to the rules, regulations, and prescriptions provided by law long before 1848 for the government of the commissioner and pension agents, and for the payment of pensions. Certainly such a direction is not inconsistent with our holding that the act of 1853 was not intended to have a retroactive effect, or to confer a right to a pension commencing prior to its passage.

But, without pursuing this line of remark farther, whatever might be our opinions respecting the construction of the statute, were the matter res nova, we cannot regard the question as an open one. Immediately after the passage of the act, it was construed by the Commissioner of Pensions as granting pensions commencing only from and after its passage, and such construction has ever since been given to it by that bureau. That such was its meaning seems also to have been the understanding of the next succeeding Congress after it was enacted. The act of 1848 gave pensions to widows of solidiers and mariners when they had been married before the first day of January, 1800. The act of 1853 gave pensions to widows of soldiers, but not to widows of mariners. This was follows by an act passed February 28th, 1855, giving pensions to widows of mariners and marines who served in the navy during the Revolutionary War, 'in the same manner, and to the same extent,' as the widows of soldiers of the army, 'under the second section of the act of February 3d, 1853.' Here not only the manner, but the extent of the pension was directed, and widows of mariners were put upon the same footing with widows of soldiers married after January, 1800. Had it been understood that soldiers' widows, married after January, 1800, were entitled to pensions commencing March 4th, 1848, it would have been unnecessary to declare that mariners' widows should have pensions 'to the same extent' as under the act of 1853. But measuring the extent by the grant made in 1853, and not by that of 1848, tends to show that Congress regarded the extent, or commencement, of the pension under the act of 1853, as different from that of those granted by the act of 1848. And this is made quite certain by the history of the legislation. The act of 1855, when first proposed, contained the following provision: 'And the pensions granted by this act, and those under the said section of the act of February 3d, 1853, shall commence on the fourth day of March, 1848.' This provision was intended to change the construction which the Commissioner of Pensions had given to the act of 1853, but it was stricken out, and the statute was enacted as it now stands. The intention of Congress was thus clearly manifested to adopt the construction of the act of 1853, which had been given to it by the Pension Bureau, and we are hardly at liberty now to interpret it differently.

In view of this action of Congress, and the long-standing construction of the act given by the department whose duty it was to act under it, we are of opinion that the plaintiff's intestate was not entitled to a pension commencing anterior to February 3d, 1853. The judgment of the Court of Claims was, therefore, erroneous.

JUDGMENT REVERSED, and the record remanded with instructions to

DISMISS THE PLAINTIFF'S SUIT.


text: Talk:United States v. Alexander (79 U.S. 177)/Opinion of the Court


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Hoffman Company v. Bank of Milwaukee

ERROR to the Circuit Court for the District of Wisconsin; the case being thus:

Chapin & Miles, a forwarding and commission firm in Milwaukee, were engaged in moving produce to Hoffman & Co., of Philadelphia, for sale there. The course of their business was thus: They first shipped the produce, obtaining a bill of lading therefor, to which they attached a draft drawn by them on their consignee for about the value of the grain, and then negotiated the draft with bill of lading attached, to some bank in Milwaukee, and obtained the money. It was understood that the draft was drawn upon the credit of the property called for by the bill of lading, and would be paid by the consignee upon receipt of the bill of lading; and-with perhaps a single exception where the bills of lading, not being obtained during bank hours, was sent otherwise than with the draft-the drafts were accompanied by such bills. The Philadelphia firm, however, rarely knew what flour belonged to any particular bill of lading; not being obliged by the railroad clerks at Philadelphia, where they were known, to exhibit any bill of lading in order to get the flour, and their custom being, on getting notice from the railroad office that flour had arrived for them, to pay the charges, give receipts, and send their drayman for it, and bring it away. It was the practice of the Milwaukee firm to advise their Philadelphia correspondents by letter of shipments made and drafts drawn, which advisements were acknowledged with a promise 'to honor the drafts.' When flour was 'slow' in going forward they correspondent with the Milwaukee house about it, but did not on that account refuse acceptance or payment of any bill.

Having been thus dealing for about sixteen months, Chapin & Miles drew three drafts on Hoffman & Co., in the ordinary way, and attaching to them bills of lading which they had forged, negotiated, in the ordinary course of business, the drafts, with the forged bills of lading attached, to the City Bank of Milwaukee, getting the money for them. The bank knew nothing of the forgery of the bills of lading. The ordinary correspondence between the two houses took place. That in regard to one draft will exhibit its character.

'MILWAUKEE, February 26th, 1869.

'MESSRS. HOFFMAN & CO., PHILADELPHIA.

'DEAR SIRS: We ship to you to-day 200 bbls. 'Prairie Flour,' and draw at s't for $1100, which please honor. Will draw for $5 only when we can, but must crowd $5 1/2 part of the time.

'Yours, truly,

'CHAPIN & MILES."PHILADELPHIA, March 2d, 1869.

'MESSRS.C.HAPIN & MILES.

'GENTLEMEN: Yours 26th ult. here. Your draft $1100, will be paid, but we think you should try to keep them down to $5 per barrel. We advise sale of 100 Prairie, at $7, and 54, at $7.25.

'Yours, respectfully,

'HOFFMAN & Co.'

No flour was forwarded. The Milwaukee bank forwarded the drafts, however, with the forged bills of lading attached, to their correspondent, the Park Bank in New York, for collection. The Park Bank forwarded the same to its correspondent, the Commonwealth Bank of Philadelphia, for the same purpose, and the latter bank presented the draft and bill of lading to the drawees, Hoffman & Co., who, knowing the drafts to be genuine, and not supposing that the bills of lading were otherwise, paid the drafts to the Philadelphia bank, which remitted the money back to the Park Bank to the credit of the Bank of Milwaukee.

No flour coming forward, Hoffman & Co. discovered that the bills of lading were forged, and Miles & Chapin being insolvent, they sued the Bank of Milwaukee to recover the amount paid, as above stated.

The declaration in the case contained the common counts in assumpsit, with a notice attached to the defendant, 'that the action was brought to recover $3100, money paid by the plaintiff, under mistake of fact, upon drafts and bills of lading (of which copies were annexed), the mistake being that the plaintiffs paid the money upon the belief that the said bills of lading were genuine instruments; whereas, in fact, they were forged; the amount of money paid being the amount called for by the drafts, which was paid upon the credit and inducement of the bills of lading.'

Neither the name of the defendant, the Milwaukee bank, nor of any of its officers or agents, appeared in or upon the bills of lading in question, and had it not been for extrinsic evidence, it could not have been told from those bills that the bank had had anything to do with them. Nor had the bank had any dealings or correspondence of any kind with the Philadelphia house, relative to the shipments of flour by Chapin & Miles, or relative to the drafts drawn by them.

On this case the court below directed the jury to find for the bank, defendant in the case, and the plaintiffs brought the case here.

Mr. M. H. Carpenter, for the plaintiff in error:

The case is this: The defendants are owners of certain drafts drawn upon the plaintiffs, which the defendants know the plaintiffs will not pay unless accompanied with bills of lading, which will authorize the plaintiffs to receive the flour, upon the faith and security of which the drafts are drawn. And knowing this, the defendant presents said drafts to the plaintiffs, accompanied by forged bills of lading; and the plaintiffs, believing the bills of lading to be genuine, pay the money to the defendant. Had the plaintiffs known the real facts of the case they would not have accepted and paid the drafts, and could not have been compelled to do so, and the loss would have fallen on the defendants. The plaintiffs paid the drafts to the defendant because they did not know the facts; in other words, under a mistake. The money of the plaintiffs has therefore got into the pocket of the defendant without consideration; both the plaintiffs in paying and the defendant in receiving the money being mutually mistaken about the fact which was the inducement for the plaintiffs to pay the money. Money so paid can be recovered.

We fully concede the rule that the acceptor of a draft is bound to know the signature of the person drawing or indorsing it. But the rule is confined to the signature of mercantile paper; and this payment was made not on the credit of the draft, but on the credit of the bills of lading. It was part of the agreement between the forwarders and the consignees, that bills of lading should always accompany the drafts; genuine bills, of course, not forged ones. The Milwaukee bank being an indorser of the draft which carried the bill of lading with it, should be held to have guaranteed the genuineness of the bill.

In Bank of Commerce v. Union Bank, it was held that the acceptor of a draft which was forged, not as to the signature of the drawer, but by an alteration in the body of the draft, might recover back the money, as money paid under a mistake. The court distinguishing the case from that of the forgery of the drawer's signature, which the acceptor is presumed to know, say: 'The greater negligence in a case of this kind is chargeable on the party who received the bill from the perpetrator of the forgery. So far as respects the genuineness of the bill each indorser receives it on the credit of the previous indorsers,' &c.

This language is particularly applicable to the facts of this case; for these forged bills of lading purported to be executed in Milwaukee, where the defendant had its banking office, and where its officers could have informed themselves as to the genuineness of the instruments by a few minutes' walk. The plaintiffs resided and did business in Philadelphia, and received the instruments on the faith of approbation by the defendant.

Mr. J. W. Cary, contra:

We concede that money paid by mistake may, in many cases, be recovered back, but it is settled that money paid by the drawee of a forged bill of exchange to an innocent holder for value, cannot be so recovered, because the drawee is presumed to know his drawer's signature. This exception is 'fully conceded' by the other side. Their argument is obliged, therefore, to proceed on an assumption of facts not true; to assume that this payment was not a payment of drafts, but a payment on flour shipped. This is a radical defect of the argument, and pervades it throughout. The assumption is in the face of the facts. These show that Hoffman & Co. paid drafts, relying on their general business arrangement with Chapin & Miles rather than on a receipt of the very flour mentioned in any specific bill of lading. In this particular case it is specifically 'the draft' which they promise to pay.

The bill of lading is not in any way indorsed by the Milwaukee bank. No representation of any sort was made by that bank about anything to Hoffman & Co. The transaction was wholly between Miles & Chapin and Hoffman & Co., and in pursuance of their general agreement. The bills, which were not forgeries, though the case would not be changed if they had been-were discounted in ordinary course, forwarded for collection, and paid on demand. That concludes the thing. That the 'collateral' was worthless don't change the case. The bank's title to the drafts being unquestioned, no defence was available to the acceptor after payment of them.

There positions do not rest on argument merely. The case of Craig v. Sibbett & Jones, where the judgment of the Supreme Court of Pennsylvania is given, in a luminous opinion by Gibson, C. J., is in point. So too the English case of Robinson v. Reynolds covers this. After such precedents there would be an end of the question if the case were not plainly within old rules, which it is.

Mr. Justice CLIFFORD delivered the opinion of the court.

title: Hoffman Company v. Bank of Milwaukee


text: Talk:Hoffman Company v. Bank of Milwaukee


text:
Hoffman Company v. Bank of Milwaukee/Opinion of the Court

Acceptors of a bill of exchange, by the act of acceptance, admit the genuineness of the signatures of the drawers, and the competency of the drawers to assume that responsibility. Such an act imports an engagement, on the part of the acceptor, to the payee or other lawful holder of the bill, to pay the same, if duly presented, when it becomes due, according to the tenor of the acceptance. He engages to pay the holder, whether payee or indorsee, the full amount of the bill at maturity, and if he does not, the holder has a right of action against him, and he may also have one against the drawer. Drawers of bills of exchange, however, are not liable to the holder, under such circumstances, until it appears that the bill was duly presented, and that the acceptor refused or neglected to pay the same according to the tenor of the instrument, as their liability is contingent and subject to those conditions precedent.

There bills of exchange, as exhibited in the record, were drawn by Chapin, Miles & Co., payable to the order of the defendants, and the record shows that they, the defendants, received and discounted the three bills at the request of the drawers. Attached to each bill of exchange was a bill of lading for two hundred barrels of flour, shipped, as therein represented, by the drawers of the bills of exchange, and consigned to the plaintiffs; and the record also shows that the drawers, in each case, sent a letter of advice to the consignees apprising them of the shipment, and that they would draw on them as such consignees for the respective amounts specified in the several bills of exchange. Prompt reply in each case was communicated by the plaintiffs, acknowledging the receipt of the letter of advice sent by the shippers, and promising to honor the bills of exchange, as therein requested. Evidence was also introduced by the plaintiffs showing that the defendants indorsed the bills of exchange and forwarded the same, with the bills of lading attached, to the National Park Bank of the city of New York, their regular correspondent; that the same were subsequently indorsed by the latter bank, and forwarded to the Commonwealth Bank of Philadelphia for collection; that the Commonwealth Bank presented the bills of exchange, with the bills of lading attached, to the plaintiffs, as the acceptors, and that they paid the respective amounts as they had previously promised to do, and that the Commonwealth Bank remitted the proceeds in each case to the National Park Bank, where the respective amounts were credited to the defendants. Proof was also introduced by the plaintiffs showing that each of the bills of lading was a forgery, and that the plaintiffs, before the commencement of the suit, tendered the same and the bills of exchange to the defendants, and that they demanded of the defendants, at the same time, the respective amounts so paid by them to the Commonwealth Bank. Payment as demanded being refused, the plaintiffs brought an action of assumpsit against the defendants for money had and received, claiming to recover back the several amounts so paid as money paid by mistake, but the verdict and judgment were for the defendants, and the plaintiffs sued out a writ of error, and removed the cause into this court. Testimony was also introduced by the defendants tending to show that the shippers were millers; that they made an arrangement with the plaintiffs to ship flour to them at Philadelphia for sale in that market, the plaintiffs agreeing that they, the shippers, might draw on them for advances on the flour, to be reimbursed out of the proceeds of the sales; that for more than a year they had been in the habit of shipping flour to the plaintiffs under that arrangement and of negotiating drafts on the plaintiffs to the banks in that city, accompanied by bills of lading in form like those given in evidence in this case; that the drafts, with the bills of lading attached, were sent forward by the banks, where the same were discounted, and that the same were paid by the plaintiffs; that the drawers of the drafts in every case notified the plaintiffs of the same, and that the plaintiffs, as in this case, answered the letter of advice and promised to pay the amount. They also proved that the drawers of the drafts in this case informed their cashier that the same would always be drawn upon property, and that the bills of lading would accompany the drafts, and that they had no knowledge or intimation that the bills of lading were not genuine. Instructions were requested by the plaintiffs, that if the jury found that the respective bills of lading were not genuine, that they were entitled to recover the several amounts paid to the Commonwealth Bank, with interest; but the court refused to give the instruction as prayed, and instructed the jury that if they found the facts as shown by the defendants, the plaintiffs could not recover in the case, even though they should find that the several bills of lading were a forgery.

Money paid under a mistake of facts, it is said, may be recovered back as having been paid without consideration, but the decisive answer to that suggestion, as applied to the case before the court, is that money paid, as in this case, by the acceptor of a bill of exchange to the payee of the same, or to a subsequent indorsee, in discharge of his legal obligation as such, is not a payment by mistake nor without consideration, unless it be shown that the instrument was fraudulent in its inception, or that the consideration was illegal, or that the facts and circumstances which impeach the transaction, as between the acceptor and the drawer, were known to the payee or subsequent indorsee at the time he became the holder of the instrument.

Such an instrument, as between the payee and the acceptor, imports a sufficient consideration, and in a suit by the former against the latter the defence of prior equities, as between the acceptor and the drawer, is not open unless it be shown that the payee, at the time he became the holder of the instrument, had knowledge of those facts and circumstances.

Attempt is made in argument to show that the plaintiffs accepted the bills of exchange upon the faith and security of the bills of lading attached to the same at the time the bills of exchange were discounted by the defendants. Suppose it was so, which is not satisfactorily proved, still it is not perceived that the concession, if made, would benefit the plaintiffs, as the bills of exchange are in the usual form and contain no reference whatever to the bills of lading, and it is not pretended that the defendants had any knowledge or intimation that the bills of lading were not genuine, nor is it pretended that they made any representation upon the subject to induce the plaintiffs to contract any such liability. They received the bills of exchange in the usual course of their business as a bank of discount and paid the full amount of the net proceeds of the same to the drawers, and it is not even suggested that any act of the defendants, except the indorsement of the bills of exchange in the usual course of their business, operated to the prejudice of the plaintiffs or prevented them from making an earlier discovery of the true character of the transaction. On the contrary, it distinctly appears that the drawers of the bills of exchange were the regular correspondents of the plaintiffs, and that they became the acceptors of the bills of exchange at the request of the drawers of the same and upon their representations that the flour mentioned in the bills of lading had been shipped to their firm for sale under the arrangement before described.

Beyond doubt the bills of lading gave some credit to the bills of exchange beyond what was created by the pecuniary standing of the parties to the same, but it is clear that they are not a part of those instruments nor are they referred to either in the body of the bills or in the acceptance, and they cannot be regarded in any more favorable light for the plaintiffs than as collateral security accompanying the bills of exchange.

Sent forward, as the bills of lading were, with the bills of exchange, it is beyond question that the property in the same passed to the acceptors when they paid the several amounts therein specified, as the lien, if any, in favor of the defendants was then displaced and the plaintiffs became entitled to the instruments as the muniments of title to the flour shipped to them for sale and as security for the money which they had advanced under the arrangement between them and the drawers of the bills of exchange. Proof, therefore, that the bills of lading were forgeries could not operate to discharge the liability of the plaintiffs, as acceptors, to pay the amounts to the payees or their indorsees, as the payees were innocent holders, having paid value for the same in the usual course of business.

Different rules apply between the immediate parties to a bill of exchange-as between the drawer and the acceptor, or between the payee and the drawer-as the only consideration as between those parties is that which moves from the plaintiff to the defendant; and the rule is, if that consideration fails, proof of that fact is a good defence to the action. But the rule is otherwise between the remote parties to the bill, as, for example, between the payee and the acceptor, or between the indorsee and the acceptor, as two distinct considerations come in question in every such case where the payee or indorsee became the holder of the bill before it was overdue and without any knowledge of the facts and circumstances which impeach the title as between the immediate parties to the instrument. Those two considerations are as follows: First, that which the defendant received for his liability, and, secondly, that which the plaintiff gave for his title, and the rule is well settled that the action between the remote parties to the bill will not be defeated unless there be an absence or failure of both these considerations.

Unless both considerations fail in a suit by the payee against the acceptor, it is clear that the action may be maintained, and many decided cases affirm the rule, where the suit is in the name of a remote indorsee against the acceptor, that if any intermediate holder between the defendant and the plaintiff gave value for the bill, such an intervening consideration will sustain the title of the plaintiff.

Where it was arranged between a drawer and his correspondent that the latter would accept his bills in consideration of produce to be shipped or transported to the acceptor for sale, the Supreme Court of Pennsylvania held, that the acceptor was bound to the payee by his general acceptance of a bill, although it turned out that the bill of lading forwarded at the same time with the bill of exchange was fraudulent, it not being shown that the payee of the bill was privy to the fraud. Evidence was introduced in that case showing that the payee knew what the terms of the arrangement between the drawer and the payee were, but the court held that mere knowledge of that fact was not sufficient to constitute a defence, as the payee was not a party to the arrangement and was not in any respect a surety for the good faith and fair dealing of the shipper.

Failure of consideration, as between the drawer and acceptor of a bill of exchange, is no defence to an action brought by the payee against the acceptor, if the acceptance was unconditional in its terms, and it appears that the plaintiff paid value for the bill, even though the acceptor was defrauded by the drawer, unless it be shown that the payee had knowledge of the fraudulent acts of the drawer before he paid such value and became the holder of the instrument.

Testimony to show that the payees were not bona fide holders of the bills would be admissible in a suit by them against the acceptors, and would constitute, if believed, a good defence, but the evidence in this case does not show that they did anything that is not entirely sanctioned by commercial usage. They discounted these bills and they had a right to present them for acceptance, and having obtained the acceptance they have an undoubted right to apply the proceeds collected from the acceptors to their own indemnity.

Forgery of the bills of lading would be a good defence to an action on the bills if the defendants in this case had been the drawers, but they were payees and holders for value in the regular course of business, and the case last referred to, which was decided in the Exchequer Chamber, shows that such an acceptance binds the acceptor conclusively as between them and every bon a fide holder for value.

Very many cases decide that the drawee of a bill of exchange is bound to know the handwriting of his correspondent, the drawer, and that if he accepts or pays a bill in the hands of a bon a fide holder for value, he is concluded by the act, although the bill turns out to be a forgery. If he has accepted he must pay, and if he has paid he cannot recover the money back, as the money, in such a case, is paid in pursuance of a legal obligation as understood in the commercial law.

Difficulty sometimes arises in determining whether the plaintiff, in an action on a bill of exchange, is the immediate promisee of the defendant, or whether he is to be regarded as a remote party, but it is settled law that the payee, where he discounts the bill at the request of the drawer, is regarded as a stranger to the acceptor in respect to the consideration for the acceptance; consequently, if the acceptance is absolute in its terms and the bill is received in good faith and for value, it is no answer to an action by him that the defendant received no consideration for his acceptance or that the consideration therefor has failed; and it is immaterial in that behalf whether the bill was accepted while in the hands of the drawer and at his request, or whether it had passed into the hands of the payee before acceptance and was accepted at his request.

Certain other defences, such as that the payments were voluntarily made, and that the title to the bills at the time the payments were made was in the National Park Bank, were also set up by the defendants, but the court does not find it necessary to examine those matters, as they are of the opinion that the payments, if made to the payees of the bills, as contended by the plaintiffs, were made in pursuance of a legal obligation and that the money cannot be recovered back.

JUDGMENT AFFIRMED.


text: Talk:Hoffman Company v. Bank of Milwaukee/Opinion of the Court


text:
Howard Fire Insurance Company v. Transportation Company

ERROR to the Circuit Court for the District of Connecticut; the case being thus:

The Howard Fire Insurance Company insured the steamer Norwich, owned by the Norwich and New York Transportation Company, for $5000 against fire. The policy covered the steamer, her hull boilers, machinery, tackle, furniture, apparel, & c., whether stationary or movable, whether the boat should be running or not running, and insured against all such loss or damage, not exceeding the sum insured, as should happen to the property by fire, other than fire happening by means of any invasion, insurrection, riot, or civil commotion, or of any military or usurped power.

While on one of her regular trips from Norwich to New York, on Long Island Sound, the steamer collided with a schooner, the latter striking her on her port side, and cutting into her hull below the water-line, in consequence of which she immediately and rapidly began to fill with water. Within ten or fifteen minutes after the collision, the water reached the floor of the furnace, and the steam thereby generated blew out the fire, which communicated with the wood-work of the boat. Her upper works and her combustible freight were soon enveloped in flames, and they continued to burn half or three-quarters of an hour, when she gradually sunk in twenty fathoms of water, reeling over. The steamer was so constructed that her main deck was completely housed in from stem to stern, up to her promenade, or hurricane deck above. Her freight was stowed on the main deck, and her cabin and staterooms were on the hurricane deck. From the effects of the collision alone she would not have sunk below her promenade deck, but would have remained there suspended in the water, and would have been towed to a place of safety, when she, her engines, tackle, and furniture, could have been repaired and restored to their condition prior to the collision for the sum of $15,000, the expense of towage included. The sinking of the steamer below her promenade deck was the result of the action of the fire in burning off her light upper works and housing, thus liberating her freight, allowing much of it to drift away, whereby her floating capacity was greatly reduced, so that she sunk to the bottom, and all the damage which she suffered beyond the $15,000 above named as chargeable to the collision, (amounting to $7300), including the cost of raising the boat, was the natural and necessary result of the fire, and of the fire only.

The Transportation Company having set up a claim for indemnity against the Insurance Company, for a loss by fire within the policy, and the company declining to pay, suit was brought in the court below against it; and on the facts as already stated, and specially found as facts by the Circuit Court, judgment was given for the plaintiff. The Insurance Company brought the case here to reverse the judgment.

Messrs. J. C. Carter and G. Pratt, for the plaintiff in error, citing Mills on Causation, Brown's Inquiry into the Relation of Cause and Effect, Sir William Hamilton's Lectures, as well as numerous adjudged cases, in England and the United States, went into an ingenious and interesting though, as it struck the reporter, possibly somewhat metaphysical argument, on the subject of what was to be regarded as 'the cause of any event;' how far the antecedents of a given event are connected together as the successive links in one chain; and how far there are several concurrent trains leading to the effect; concluding that in no case will the inquiry whether a given event would have happened but for another which preceded it, disclose the cause of the given event, or what is called its proximate cause, or its principal cause, or anything save this alone, that such preceding event was, or was not, a necessary contributing cause. The true meaning of the cause causans, the predominating cause, the series of successive causes, and of Lord Bacon's apothegm, causa proxima non remota spectatur, were considered at length; and the effort made to show that here-the sinking of the steamer, being the result of two concurrent causes, of which the collision was the predominating, and therefore the proximate cause-by a right application of the just rule of law, as established by the two well-known rules of Mr. Phillips, an authoritative text-writer on Insurance, the loss was attributable to the collision, and to that alone; a matter in which the Transportation Company was its own insurers; the policy having been but against fire.

Messrs. J. A. Hovey and I. Halsey, contra.

Mr. Justice STRONG delivered the opinion of the court.


text: Talk:Howard Fire Insurance Company v. Transportation Company


text:
Howard Fire Insurance Company v. Transportation Company/Opinion of the Court

Mr. Phillips, in his Treatise on the Law of Insurance, lays down two rules respecting the concurrence of different causes of loss, which the plaintiffs in error contend should be applied to this case, and which, if applied, they insist must lead to a reversal of the judgment in the court below. The first of these is:

'In case of the concurrence of two causes of loss, one at the risk of the assured, and the other insured against, or one insured against by A., and the other by B., if the damage by the perils respectively can be discriminated, each party must bear his proportion.' The second is:

'Where different parties, whether the assured and the underwriter, or different underwriters, are responsible for different causes of loss, and the damage by each cannot be distinguished, the party responsible for the predominating efficient cause, or that by which the operation of the other is directly occasioned, as being merely incidental to it, is liable to bear the loss.'

These propositions may be accepted as correct statements of the law, and the question before us is, whether the Circuit Court, in giving judgment for the assured, failed to apply them rightly to the facts of the case.

The insurance in this case was against all such loss or damage, not exceeding the sum insured, as should happen to the property by fire, other than fire happening by means of any invasion, insurrection, riot, or civil commotion, or of any military or usurped power. Thus loss from fire happening in consequence of every other cause than those excepted was covered by the policy. The insurers took the risk of fires caused by lightning, explosions, and collisions. Such was the contract.

It is urged on behalf of the plaintiffs in error the findings in the case establish that the sinking of the steamer, wherein consisted principally the loss, or that part of it in excess of $15,000 chargeable to the collision, was the result of two concurrent causes, one the fire, and the other the water in the steamer's hold, let in by the breach made by the collision. As the influx of the water was the direct and necessary consequence of the collision, it is argued that the collision was the predominating, and, therefore, the proximate cause of the loss. The argument overlooks the fact, distinctly found, that the damage resulting from the sinking of the vessel was the natural and necessary result of the fire only. If it be said that this was but an inference from facts previously found, it was not for that reason necessarily a mere legal conclusion. But we need not rely upon this. Apart from that finding, the other findings, unquestionably of facts, show that neither the collision, nor the presence of water in the steamer's hold was the predominating efficient cause of her going to the bottom. That result required the agency of the fire. It is found that the water would not have caused the vessel to sink below her promenade deck, had not some other cause of sinking supervened. It would have expended its force at that point. The effects of the fire were necessary to give it additional efficiency. The fire was, therefore, the efficient predominating cause, as well as nearest in time to the catastrophe, which not only directly contributed to all the damage done, after the steamer had sunk to her promenade deck, but enlarged the destructive power of the water, and rendered certain the submergence of the vessel. This plainly appears, if we suppose that the fire had occurred on the day after the collision, and had originated from some other cause than the collision itself. The effects of the prior disaster would then have been complete. The steamer would have been full of water, sunk to her promenade deck, and, remaining thus suspended, would have been towed to a place of safety and saved, in that condition, to her owners, except for the new injury. But the fire occurring on the next day, destroying the upper works and the housing, thus liberating the light freight and greatly reducing the floating capacity of the steamer, would have caused her to sink to the bottom as she did. In the case supposed the water would have been as truly a concurrent and efficient cause of the steamer's sinking, as it was in the case now in hand. It would have operated in precisely the same manner, remaining dormant until given new activity. But could there have been any hesitation in that case, in determining which was the proximate, the efficient, predominating cause of the sinking of the vessel? And can it be doubted that the underwriters against loss by fire would be held responsible for such a loss? Wherein does the case supposed differ in principle from the present, when the facts found are considered? True, the fire in this case was caused by the collision, but the policy insured against fire caused by collision. True, the fire immediately followed the filling of the steamer with water, or commenced while she was filling, but the effects of the fire are conclusively distinguished from the breach in the steamer's hull, and the filling of her hold with water. The damages caused by the several agencies have been discriminated, and its proper share assigned to each. It is an established fact that the damaging effect of the water, independent of the fire, would not have reached beyond sinking of the steamer to its upper deck, when she would have been saved from further injury.

There is, undoubtedly, difficulty, in many cases, attending the application of the maxim, 'proxima causa, non remota spectatur,' but none when the causes succeed each other in order of time. In such cases the rule is plain. When one of several successive causes is sufficient to produce the effect (for example, to cause a loss), the law will never regard an antecedent cause of that cause, or the 'causa causans.' In such a case there is no doubt which cause is the proximate one within the meaning of the maxim. But, when there is no order of succession in time, when there are two concurrent causes of a loss, the predominating efficient one must be regarded as the proximate, when the damage done by each cannot be distinguished. Such is, in effect, Mr. Phillips's rule. And certainly that cause which set the other in motion and gave to it its efficiency for harm at the time of the disaster must rank as predominant. In the present case, however, the rule hardly seems applicable, because the damage resulting from the fire and that caused by the filling of the steamer are clearly distinguished.

It is true, as argued, that as the insurance in this case was only against fire, the assured must be regarded as having taken the risk of collision, and it is also true that the collision caused the fire, but it is well settled that when an efficient cause nearest the loss is a peril expressly insured against, the insurer is not to be relieved from responsibility by his showing that the property was brought within that peril by a cause not mentioned in the contract. The case quoted- St. John v. The American Mutual Insurance Company-is instructive, and is, in one particular at least, responsive to the argument of the plaintiffs in error. It exhibits the difference, in effect, between an express exception from a risk undertaken, and silence in regard to a peril not insured against. The policy, as here, was against fire, but it contained a provision that the company would not be liable 'for any loss occasioned by the explosion of a steam boiler.' While it was in force there was an explosion of a steam boiler which caused the destruction of the property insured by fire. It was held the insurers were not liable. The proviso, or exception, was construed as extending to fire caused by such explosions, for, as the parties were contracting about the peril of fire alone, an express exception of all loss from explosions must have been meant to cover fire when a consequence of explosions, otherwise the exception would have been unmeaning. But the court said, if nothing had been said in the policy respecting a steam boiler, the loss, having been occasioned by fire, as its proximate cause, would have rested on the insurers, though it had been shown, as it might have been, that the fire was kindled by means of the explosion. The judgment thus turned on the effect of an express exception. Had there been none, the court would not have inquired how the fire happened, whether by an explosion or not. In the case before us there is no exception of collisions, or fires caused by collisions. It must therefore be understood that the insurers took the risk of all fires not expressly excepted.

It has been argued that because the policy was against fire only, the assured are to be considered their own insurers against perils of the sea, including collisions, and as insurers against marine risks are liable for collisions, with all their consequences, including fires, the assured in this case must be held to have undertaken that risk. This would be so if they had taken out no policy against fire. But that works a material difference. Suppose these underwriters had insured the steamer against collisions and fire, and had then reinsured in another company against fire alone, as they might have done, would it have been a sufficient answer to a suit brought by them against their insurers, that the fire which caused the steamer to sink was itself caused by a collision? No one will affirme that. Yet upon the theory of the plaintiffs in error, this is substantially what is now attempted. Before any policy was issued, the Transportation Company were their own insurers against collisions and fire, no matter how caused. They sought protection against some of the possible consequences of these risks, and they obtained a policy insuring them against all loss by fire, except fire caused by certain things, of which collision was not one. Against every other consequence of a collision than a fire, they remained their own insurers, but the risk of fire was no longer theirs.

We have already sufficiently said that the amount of the loss caused by the collision, apart from the fire, was distinctly ascertained, and the insurers were not charged with it. So was the amount of loss caused by the fire itself ascertained. If therefore it was a case of the concurrence of two causes of loss, one at the risk of the assured, and the other of the insurers, the damage resulting from each has been discriminated, and the insurers have been held liable only for that caused by the peril against which they contracted.

Judgment has therefore been given in conformity with the rules as above stated, in Phillips on Insurance. It is

AFFIRMED.

At the same time with the preceding case was adjudged another, in error, from the same circuit, to wit, that of

WESTERN MASSACHUSETTS INSURANCE COMPANY v. SAME DEFENDANTS,

In which the controlling question was the same as in the case just reported-a question which the court said that they did not propose to reconsider. This second case had been adjudged below, before the other one, and not on a finding of facts by the court, but on a verdict by a jury; the issues of fact being submitted to it under instructions from the court.

In this second case the policy provided that the loss or damage should be estimated according to the true and actual cash value of the said property 'at the time the fire should happen;' and evidence of the value of the steamer before the collision took place having been offered by the owners of the steamer, the insurance company objected to it, and on their objection it was excluded.

Evidence was allowed to be given against the defendants' objection, to show how much it cost to raise the steamer, and $22,500 were allowed; the value of the wreck when recovered.

The plaintiff based his estimate of damages upon the cost of repairing and restoring the vessel to her former condition, exclusive of the amount properly chargeable to the collision.

The judge charged, that the main question for the jury to determine was whether the loss sustained by the plaintiffs was the natural, necessary, and inevitable consequence of the fire. Then, after referring to the facts as proved, he added:

'The question is, would the steamer have gone to the bottom but for the fire? This is a vital question, and must be decided by the jury before the plaintiff can recover. You will say, in view of the evidence, whether she would have gone to the bottom or only settled down to her promenade deck and remained suspended in the water but for the effect produced by the fire. If she would not have sunk but only settled in the water to the promenade deck, except for the effect of the fire in reducing her floating capacity, then the plaintiffs are entitled to recover.'

As to the damages, after stating the plaintiffs' base of estimate, he said:

'You will determine upon the evidence whether in your judgment the repairs that were put upon her enhanced her value beyond her cash value before the commencement of the fire. If they did, you will deduct from the damage you find proved a sum equal to such increase of value.'

The jury found for the plaintiffs, and judgment went accordingly.

The case was argued by the same counsel as the preceding one; the objection by the counsel of the insurance company, plaintiffs in error, being to the charge on the main question, to the instruction as to damages and on the admission of the evidence to show how much it cost to raise the steamer, which the learned counsel contended that the defendants could not in any event be liable for, the rule of damages being fixed in the policy.

Mr. Justice STRONG delivered the opinion of the court.

As the issues of fact in this case were submitted to a jury, it is to be considered whether they were submitted with proper instructions.

It is complained that the Circuit Court instructed the jury that the way to determine the question whether the insurers were liable was to consider and determine whether the steamer would have sunk except for the effect of the fire. This is hardly a fair statement of the manner in which the case was submitted. The charge must be taken, not in detached portions, but according to its general tenor and effect. That what the judge did charge, was, in our opinion, proper instruction, is sufficiently shown by what we have said in the case just decided. We have also shown that the policy contained no implied exception against the consequences of any marine peril.

The only other thing which need be noticed is the allegation of the plaintiffs in error that the jury were instructed to ascertain the amount of the damage, not by reference to the actual cash value of the subject, but by the cost of restoration. If this complaint were founded in fact, it would call for a reversal of the judgment, for the policy stipulated that loss or damage should be estimated according to the true and actual cash value of the property at the time the same should happen. But when the insured offered evidence to prove what was the actual cash value of the steamer before the collision, from which the damage caused by the collision might have been deducted, and thus the cash value of the property at the time when the fire attacked it might have been ascertained, the plaintiffs in error objected and the evidence was excluded. There remained, then, no way of establishing the cash value except by ascertaining the cost of restoration to the condition in which the steamer was before the fire. This was allowed, but the jury were instructed that if the cost of repairs exceeded the damage done by the fire they should deduct the excess. It is plain, therefore, that under such instructions the loss of the assured must have been measured by the standard provided in the policy.

It is sufficient to say of the admission of evidence to prove how much it cost to raise the steamer, that if it was erroneous it did no harm. The value of the boat when raised was proved to have been exactly equal to the cost of raising her, and the insurers had the benefit of it.

Nothing need be said of the other exceptions. They were not pressed in the oral argument, or in the printed briefs, and they exhibit no error.


text: Talk:Howard Fire Insurance Company v. Transportation Company/Opinion of the Court


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Western Massachusetts Inusrance Company v. Same

In which the controlling question was the same as in the case just reported-a question which the court said that they did not propose to reconsider. This second case had been adjudged below, before the other one, and not on a finding of facts by the court, but on a verdict by a jury; the issues of fact being submitted to it under instructions from the court.

In this second case the policy provided that the loss or damage should be estimated according to the true and actual cash value of the said property 'at the time the fire should happen;' and evidence of the value of the steamer before the collision took place having been offered by the owners of the steamer, the insurance company objected to it, and on their objection it was excluded.

Evidence was allowed to be given against the defendants' objection, to show how much it cost to raise the steamer, and $22,500 were allowed; the value of the wreck when recovered.

The plaintiff based his estimate of damages upon the cost of repairing and restoring the vessel to her former condition, exclusive of the amount properly chargeable to the collision.

The judge charged, that the main question for the jury to determine was whether the loss sustained by the plaintiffs was the natural, necessary, and inevitable consequence of the fire. Then, after referring to the facts as proved, he added:

'The question is, would the steamer have gone to the bottom but for the fire? This is a vital question, and must be decided by the jury before the plaintiff can recover. You will say, in view of the evidence, whether she would have gone to the bottom or only settled down to her promenade deck and remained suspended in the water but for the effect produced by the fire. If she would not have sunk but only settled in the water to the promenade deck, except for the effect of the fire in reducing her floating capacity, then the plaintiffs are entitled to recover.'

As to the damages, after stating the plaintiffs' base of estimate, he said:

'You will determine upon the evidence whether in your judgment the repairs that were put upon her enhanced her value beyond her cash value before the commencement of the fire. If they did, you will deduct from the damage you find proved a sum equal to such increase of value.'

The jury found for the plaintiffs, and judgment went accordingly.

The case was argued by the same counsel as the preceding one; the objection by the counsel of the insurance company, plaintiffs in error, being to the charge on the main question, to the instruction as to damages and on the admission of the evidence to show how much it cost to raise the steamer, which the learned counsel contended that the defendants could not in any event be liable for, the rule of damages being fixed in the policy.

Mr. Justice STRONG delivered the opinion of the court.


text: Talk:Western Massachusetts Inusrance Company v. Same


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Western Massachusetts Inusrance Company v. Same/Opinion of the Court

As the issues of fact in this case were submitted to a jury, it is to be considered whether they were submitted with proper instructions.

It is complained that the Circuit Court instructed the jury that the way to determine the question whether the insurers were liable was to consider and determine whether the steamer would have sunk except for the effect of the fire. This is hardly a fair statement of the manner in which the case was submitted. The charge must be taken, not in detached portions, but according to its general tenor and effect. That what the judge did charge, was, in our opinion, proper instruction, is sufficiently shown by what we have said in the case just decided. We have also shown that the policy contained no implied exception against the consequences of any marine peril.

The only other thing which need be noticed is the allegation of the plaintiffs in error that the jury were instructed to ascertain the amount of the damage, not by reference to the actual cash value of the subject, but by the cost of restoration. If this complaint were founded in fact, it would call for a reversal of the judgment, for the policy stipulated that loss or damage should be estimated according to the true and actual cash value of the property at the time the same should happen. But when the insured offered evidence to prove what was the actual cash value of the steamer before the collision, from which the damage caused by the collision might have been deducted, and thus the cash value of the property at the time when the fire attacked it might have been ascertained, the plaintiffs in error objected and the evidence was excluded. There remained, then, no way of establishing the cash value except by ascertaining the cost of restoration to the condition in which the steamer was before the fire. This was allowed, but the jury were instructed that if the cost of repairs exceeded the damage done by the fire they should deduct the excess. It is plain, therefore, that under such instructions the loss of the assured must have been measured by the standard provided in the policy.

It is sufficient to say of the admission of evidence to prove how much it cost to raise the steamer, that if it was erroneous it did no harm. The value of the boat when raised was proved to have been exactly equal to the cost of raising her, and the insurers had the benefit of it.

Nothing need be said of the other exceptions. They were not pressed in the oral argument, or in the printed briefs, and they exhibit no error.


text: Talk:Western Massachusetts Inusrance Company v. Same/Opinion of the Court


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State Tonnage Tax Cases Cox v. Collector Trade Company

ERROR to the Supreme Court of Alabama.

These were two cases, which, though coming in different forms, involved one and the same point only; and at the bar-where the counsel directed attention to the principle involved, separated from the accidents of the case-were discussed together as presenting 'precisely the same question.' The matter was thus:

The Constitution ordains that 'no State shall without the consent of Congress lay any duty of tonnage.' With this provision in force as superior law, the State of Alabama passed on the 22d of February, 1866, a revenue law. By this law, the rate of taxation for property generally was the one-half of one per cent; but 'on all steamboats, vessels, and other water crafts plying in the navigable waters of the State,' the act levied a tax at 'the rate of $1 per ton of the registered tonnage thereof,' which it declared should 'be assessed and collected at the port where such vessels are registered, if practicable; otherwise at any other port or landing within the State where such vessel may be.'

The tax collector was directed by the act to demand, in each year, of the person in charge of the vessel, if the taxes had been paid. If a receipt for the same was not produced, he was to immediately assess the same according to tonnage, and if such tax was not paid on demand he was to seize the boat, &c., and, after notice, proceed and sell the same for payment of the tax, &c., and pay the surplus into the county treasury for the use of the owner. If the vessel could not be seized, the collector was to make the amount of the tax out of the real and personal estate of the owner, &c.

Under this act, one Lott, tax collector of the State of Alabama, demanded of Cox, the owner of the Dorrance, a steamer of 321 tons, and valued at $5000, and of several other steamers, certain sums as taxes; and under an act of 1867, identical in language with the one of 1866, just quoted, demanded from the Trade Company of Mobile certain sums on like vessels owned by them; the tax in all the cases being proportioned to the registered tonnage of the vessel.

The steamboats, the subject of the tax, were owned exclusively by citizens of the State of Alabama, and were engaged in the navigation of the Alabama, Bigbee, and Mobile Rivers, carrying freight and passengers between Mobile and other points of said rivers, altogether within the limits of that State. These waters were navigable from the sea for vessels of 'ten and more tons burden;' and it was not denied that there were ports of delivery on them above the highest points to which these boats plied. The owners of the boats were not assessed for any other tax on them than the one here claimed. The boats were enrolled and licensed for the coasting trade. Though running, therefore, between points altogether within the limits of the State of Alabama, the boats were, as it seemed, of that sort on which Congress lays a tonnage duty.

Cox, under compulsion and protest, paid the tax demanded of him, and then brought assumpsit in one of the inferior State courts of Alabama, to get back the money. The Trade Company refused to pay, and filed a bill in a like court, to enjoin the collector from proceeding to collect. The ground of resistance to the tax in each case was this, that being laid in proportion to the tonnage of the vessel, the tax was laid in a form and manner which the State was prohibited by the already quoted section of the Constitution from adopting. The right of the State to lay a tax on vessels according to their value and as property was not denied, but on the contrary conceded. Judgment being given in each case against the validity of the tax, the matter was taken to the Supreme Court of Alabama, which decided that it was lawful. To review that judgment the case was now here.

Messrs. J. A. Campbell and P. Hamilton, for the plaintiffs in error:

The right of the State to tax the property of the citizen is admitted by us; but we assert that the tax should be upon property as property, and not because it is in the shape of vessels or boats having a greater or less capacity.

'Tonnage duties,' as defined by the learned Bouvier, are 'duties on vessels in proportion to their capacity.' Now Congress has imposed such duties from the 20th July, 1790 till the present time. The duties are imposed upon vessels plying on the navigable waters of the United States for the purpose of traffic, according to the tonnage measurement of the vessel. The manner in which the vessel shall be admeasured is prescribed, and the time and place at which the duties shall be collected are determined by law. The same officer collects these duties who collects other duties. The tax is collected yearly at the port where the vessel enters or clears for the first time.

The argument of Mr. Langdon in the Convention of 1787, 'that the regulation of tonnage was an essential part of the regulation of trade, and that the States ought to have nothing to do with it,' has been practically applied in this legislation of Congress. But the Alabama statute is similar in what it does to the enactments of the General Government. The duty is assessed in the same manner, is a yearly tax, and is made for the same cause. We insist, therefore, that it is void.

The injustice of the tax in this instance, it may be added, is striking. The value of one of these boats, the Dorrance, is $5000; her tonnage, 321 tons. At the rate of taxation established by the Alabama revenue acts for property (the half of one per cent.), the tax on this vessel would be $25; but assessed on tonnage, it is $643.25; more than twelve per cent. on the value of the property.

Mr. P. Phillips, contra:

The vessels being owned by citizens of the State, and employed exclusively in commerce within the State, are like all other property within its jurisdiction, subject to taxation. This being admitted, of what consequence can it be to the citizens of any other State, what form the State may adopt in which to impose the tax? Why should the consent of Congress be asked, to the imposition of a tonnage tax in a case, when it is admitted that the State has full power to tax. It is evident that this provision is of the category of prohibitions, in which we find that 'no preference shall be given in any regulation of commerce to the ports of one State over those of another;' and that 'vessels bound to or from one State, shall not be obliged to enter, clear, or pay duties in another.' These, like all other constitutional provisions, extend to cases where there is a general interest or concern. They do not deal with cases where the citizens of the State are alone interested. The Constitution does not deal with words, but with substance, and is to be construed accordingly. A tax which in reality operates as a 'tonnage' duty, though not in the form of such a duty, would, when the prohibition was intended to apply, be held invalid. On the other hand, when the case is not within the intent of the prohibition, the form of the tax will be disregarded. Pilot fees in one case were levied at so much per ton, and yet this court held, that to consider this as a tonnage duty, 'would be to confound things essentially different. It is the thing, and not the name which is to be considered.' The Constitution provides that 'no State shall levy any duty on imports or exports,' yet when the question was presented to this court, as to the power of the State to levy a tax on goods imported from another State, the court did not confine itself to the mere word 'import,' but proceeded to inquire into the true meaning and design of the prohibition, and held, that the word did not include imports from another State, but was applicable alone to goods brought from a foreign country.

That the tax may operate very unequally upon different sorts of property owned by the people of Alabama, is no argument against the constitutionality of the tax, though it may be so against its policy. But the policy of any State tax is a matter for the legislature of the State alone to decide on. It will be admitted by the other side, that the same inequality might be lawfully brought about if it were done in another form.

Nor, we may reply in passing, is the inequality produced by the Alabama statute, greater than that which Congress produces by its statutes laying a tonnage tax; for an old and decayed vessel, though it may be worth but quarter as much as a well-built, new, and sound one, must pay, under the act of Congress, if the tonnage capacity of the two vessels be the same, exactly the same amount of tax.

Reply: Though the vessels in this particular case are all owned by citizens of Alabama, the statute taxing them, applies to 'all' vessels plying in the navigable waters of the State by whomsoever owned. We say that the statute is void, and not simply that this particular tax is unlawful.

Mr. Justice CLIFFORD delivered the judgment of the court, giving an opinion in each of the cases.


text: Talk:State Tonnage Tax Cases Cox v. Collector Trade Company