No. 78. Bush v. Royal Exchange Assurance Co. Notes. maintains the doctrine of the plaintiff, and adds, that negligence itself, when gross, is evidence of barratry. And certainly a master of a vessel who sees another in the act of scuttling or firing his ship, and will not rise from his berth to prevent it, is primâ facie chargeable with barratry. Although a mere misfeasance, it is a breach of trust, a fault, an act of infidelity to his owners. So if, in the height of a storm, the captain and crew turn in without resorting to the nautical precautions of laying the vessel to and otherwise preparing her to overcome the peril, it may well be left to a jury to determine if such conduct be not barratrous. "The truth is, that in the incidents to this kind of contract, misfeasance and nonfeasance often approach so near to each other in character and consequences, that it is not surprising if Courts of justice should incline to the adoption of rules which would relieve them from the difficulty of discriminating, or the inconsistencies that might result from their efforts to discriminate. “The case of Grim v. The Phænix Ins. Co., decided in New York, was certainly a very strong case to establish the doctrine that a loss by fire, proceeding from negligence of the master and mariners, was not a loss within the policy, although barratry be one of the risks. It will, however, be found, by looking into the reasons which governed the Court in that case, that its conclusions were drawn partly from the too general expressions of an elementary writer, and partly from analogy with other decisions in which the expressions of the Court, unless restricted to the cases before them, were justly deemed authority for the decision there rendered. The question was one of the first impression, and one on which the best constituted minds may well have been led to contrary conclusions. It was however no unreasonable claim upon the profession made by LAWRENCE, Justice, in the case of Phyn v. The Royal Ex. Ass. Co., with regard to his own doctrines in Moss v. Byrom, 'that what fell from him there must be taken in reference to the case then in judgment before the Court.' Thus restricted doctrines will often be found correct, which in a more general sense might well be questioned. And in the case of Voss and Graves v. The Union Ins. Co., and also in that of Cleveland v. The Union Ins. Co., relied upon in the New York decision, the act of the master, for which the underwriters were held to be discharged, was in the first instance sailing towards a blockaded port with intent to violate the blockade, and in the second, leaving his register behind him. The first of these cases did not call for the opinion of KENT, Justice, on the subject of negligence; the second is exactly one of those cases in which a nonfeasance becomes a misfeasance, and both relate to the discharge of a duty unquestionably belonging to the insured, and the master as his agent. Attempting a breach of blockade was an unwarrantable increase of risk, which might or might not be barratrous according to circumstances. And for a vessel to leave her register behind in time of war affected her seaworthiness as much as leaving her compass or quadrant or anchors at home at any time. So neglecting to take a pilot, neglecting to pay port duties, neglecting to obtain a clearance, neglecting to comply with the laws of any port which the vessel has leave to enter; all these, although nonfeasances, involve misfeasances, which dis No. 78. — Busk v. Royal Exchange Assurance Co. - Notes. charge the underwriters, because they violate implied duties incident to navigating the vessel, and produce a positive and definite increase of risk. "It was not until the year 1818, that the question was settled in the British Courts, on the liability of the underwriters for a loss like the present. In the case of Busk v. The Royal Exhange Ass. Co., the question is finally and fully decided there, in direct hostility with the decision in New York; and this Court is now for the first time called upon to establish a rule for its own government in similar cases. "Losses by fire must happen either from the act of God, from design, or from accident. If from design, and by the captain and crew, it is barratry; if by any other person, or by pure accident, it is clearly a risk by fire, but, from the peculiar character of this risk, it is no easy matter to point out an accident that may not be resolved into negligence. If by the falling of a candle, it may have been because due care was not bestowed upon securing it; and if from a spark from the camboose, it may have been from neglect in not closing or constructing it; and if from a flue or a stove, the same reason may be assigned. It has already been shown that gross negligence may be evidence of barratry, and when it is considered how difficult it is to decide where gross negligence ends and ordinary negligence begins, and to distinguish between pure accident and accident from negligence, we cannot but think that the British Courts have adopted the safe and legal rule, in deciding that where the policy covers the risk of barratry, and fire be the proximate cause, they will not sustain the defence that negligence was the remote cause. "We think this rule also the most consistent with analogy and mercantile understanding. It is very justly observed in the case of Busk v. The Royal Exchange Ass. Co., that it is a strong argument against the objection there raised for the first time, that in the great variety of cases that have occurred upon marine policies, no such point had ever been made. And now I will add, it is not improbable from comparison of dates, that the defence maintained in the New York decision suggested that made in the British Courts." In Waters v. Merchants' Louisville Ins. Co. (A. D. 1837), 11 Peters (U. S. Supr. Ct.), 213, STORY, J., observed: "It is certainly somewhat remarkable that the question now before us should never have been directly presented in the American or English Courts; viz. whether in a marine policy (as this may well enough be called), where the risk of fire is taken, and the risk of barratry is not (as is the predicament of the present case), a loss by fire, remotely caused by negligence, is a loss within the policy. But it is scarcely a matter of less surprise, considering the great length of time during which policies against both risks have been in constant use among merchants, that the question of a loss by negligence in a policy against both risks should not have arisen in either country until a comparatively recent period. "If we look to the question upon mere principle, without reference to authority, it is difficult to escape from the conclusion that a loss by a peril insured against and occasioned by negligence is a loss within a marine policy; unless there be some other language in it which repels that conclusion. Such No. 78. Busk v. Royal Exchange Assurance Co. - Notes. a loss is within the words, and it is incumbent upon those who seek to make any exception from the words to show that it is not within the intent of the policy. There is nothing unreasonable, unjust, or inconsistent with public policy in allowing the insured to insure himself against all losses from any perils not occasioned by his own personal frauds. It was well observed by Mr. Justice BAYLEY, in delivering the opinion of the Court in Busk v. Royal Exchange Assurance Company" (quoting from the opinion): "There is great force in this reasoning, and the practical inconvenience of carrying out such an implied exception from the general peril in the policy furnishes a strong ground against it; and it is to be remembered that the exception is to be created by construction of the Court, and is not found in the terms of the policy. The reasons of public policy, and the presumption of intention in the parties to make such an exception, ought to be very clear and unequivocal to justify the Court in such a course. So far from any such policy being clear and unequivocal, it may be affirmed that they lean the other way. The practical inconvenience of creating such an exception would be very great. Lord TENTERDEN alluded to it in Walker v. Maitland, 5 Barn. & Ald. 174." (Quoting his words.) "His Lordship might have stated the argument from inconvenience, even in a more general form. If negligence of the master or crew were under such circumstances a good defence, it would be perfectly competent and proper to examine on the trial any single transaction of the whole voyage, and every incident of the navigation of the whole voyage, whether there was due diligence in all respects, in hoisting or taking in sail, in steering the course, in trimming the ship, in selecting the route, in stopping in port, in hastening or retarding the operations of the voyage; for all these might be remotely connected with the loss. If there had been more diligence, or less negligence, the peril might have been avoided or escaped, or never encountered at all. Under such circumstances, the chance of a recovery upon a policy for any loss, from any peril insured against, would of itself be a risk of no inconsiderable hazard. "This is not all: we must interpret this instrument according to the known principles of the common law. It is a well established principle of that law, that in all cases of loss we are to attribute it to the proximate cause, and not to any remote cause: causa proxima non remota spectatur: and this has become a maxim, not only to govern other cases, but (as will presently be shown) to govern cases arising under policies of insurance. If this maxim is to be applied, it disposes of the whole argument in the present case; and why it should not be so applied we are unable to see any reason." "Then came the case of The Patapsco Insurance Company v. Coulter, 3 Peters, 222, where the loss was by fire, and barratry also was insured against. The Court on that occasion held that, in such a policy, a loss which was remotely caused by the master or the crew was a risk taken in the policy; and the doctrine in the English cases already cited was approved. It is true that the Court lay great stress on the fact that barratry was insured against; but it may also be stated that this ground was not exclusively relied on, for the Court expressly refer to and adopt the doctrine of the English cases, that the proximate and not the remote cause of a loss is to be looked to. It is No. 78. - Bush v. Royal Exchange Assurance Co. - Notes. known to those of us who constituted a part of the Court at that time, that a majority of the Judges were then of opinion for the plaintiff, upon this last general ground, independently of the other. "It was under these circumstances that the case of The Columbia Insurance Company of Alexandria v. Lawrence, 10 Peters, 507, came on for argument; and the Court then thought, that in marine policies, whether containing the risk of barratry or not, a loss whose proximate cause was a peril insured against is within the protection of the policy, notwithstanding it might have been occasioned remotely by the negligence of the master and mariners. We see no reason to change that opinion; and, on the contrary, upon the present argument, we are confirmed in it." In Matthews v. Howard Ins. Co., 11 New York, 9, the Court said: "It was held in this State, in Grim v. Phoenix Ins. Co. (13 Johns. 451), where the ves sel, among other risks, was insured against fire, which was occasioned by the carelessness of one of the crew, not amounting to barratry. And such were the earlier decisions in Massachusetts and Ohio. (8 Mass. 308; 5 Ohio, 436; 7 Id. 2.) But in those States, and in others, that doctrine has been expressly overruled. (Copeland v. New England Ins. Co., 2 Metc. 432; Perrin v. Protection Ins. Co., 11 Ohio, 147; 10 Robinson, 164; 2 Gill, 365; 7 Penn. St. 223; Patapsco Ins. Co. v. Coulter, 3 Pet. 222; Columbia Ins. Co. v. Lawrence, 10 Id. 507; Waters v. Merchants' Ins. Co., 11 Id. 213; 14 Id. 99; 2 Story, 176.) And the cases last cited are in accordance with the English decisions. (2 B. & Ald. 73; 5 Id. 74; 5 Mees. & Wels. 14; Id. 476, 495; 8 Id. 895; 7 B. & C. 219; Id. 794, note a.) It is apparent that the weight of authority is against the holding in Grim v. Phænix Ins. Co., and such is the opinion expressed by Chancellor KENT (3 Kent's Com. 300, 306, 307); and though that case has never been expressly overruled in this State, it seems to have been virtually abandoned (3 Hill, 253; 5 N. Y. 469, 478); and I think we are bound to hold the rule to be as it was stated by Verplanck, Senator, in the American Ins. Co. v. Bryan (26 Wend. 583), that underwriters are not discharged from risks expressly assumed, because the losses were incurred, remotely or consequentially, by the defanlt of the master or mariners." "We understand it is the settled rule in this country and in England, if a loss is incurred by a peril insured against, the insurers are liable, although the remote cause be the negligence of the officers and crew. The proximate cause was the storm, a peril of the sea and of navigation, and that was the risk taken by the company. Waters v. Merchants' Life Ins. Co., 1 McLean, 275; 11 Peters, 213; Firemen's Insurance Co. v. Powell, 13 B. Monroe, 311; Nelson v. Suffolk, Ins. Co., 8 Cushing, 447; Walker v. Maitland, 5 Barn. & Ald. 175; Dixon v. Sadler, 5 Mees. & Wels. 405; 2 Arnould on Insurance, 770": National Insurance Co. v. Webster, 83 Illinois, 470. AN unlawful act intentionally committed by the master or mariners, if unauthorized by the owners, is barratry; although the person so acting had no motive of benefit to himself, but supposed himself to be promoting the interest of the owners. Insurance. Earle and others v. Rowcroft. 8 East, 126-140 (9 R. R. 385). Barratry. Wilful, Unlawful, and Unauthorized Acts. - Barratry is any fraudulent or criminal conduct against the owners of [126] the ship or goods by the master or mariners, in breach of the trust reposed in them, and to the injury of the owners; although it may not be done with intent to injure them, or to benefit at their expense the master or mariners. And therefore, where a master had general instructions to make the best purchases with despatch, this would not warrant him in going into an enemy's settlement to trade (which was permitted by the enemy) though his cargo could be more speedily and cheaply completed there; but such act, in consequence of which the ship was seized and confiscated, is barratrous. This was an action on a policy of insurance, dated 28th January, 1804, on the ship Annabella, at and from Liverpool to the coast of Africa, during her stay and trade there, and to the port of sale in the West Indies, with liberty to exchange goods, &c.; and the plaintiff averred a loss by barratry of the master. It appeared at the trial at Guildhall, that the master, who was also supercargo, on his arrival off Cape Coast Castle, a British settlement on the coast of Africa, let go an anchor, and began to trade there for two days; but receiving intelligence that he could barter his goods for slaves more expeditiously and advantageously at D'Elmina, a Dutch fort about 7 miles to windward, he weighed anchor and proceeded to this latter place, which had the Dutch flag flying and guns mounted, where he exchanged his goods, consisting, amongst other things, of muskets and gunpowder, with the Dutch governor and another resident there, for slaves: Holland being at that time at war with Great Britain, and he having a letter of marque on board against |