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CHAPTER THE FIRST.

OF THE POLICY.

POLICY is the name given to the inftrument, by CHA P. which the contract of indemnity is effect

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between the infurer and infured; and it is not, like moft contracts, figned by both parties, but only by the infurer, who on that account, it is fuppofed, is denominated an underwriter. Notwithstanding this, there are certain conditions, of which we fhall hereafter have occafion to speak, to be performed as well by the perfon not fubfcribing, as by the underwriter, otherwise the policy will be void. Of policies there feem to 2 Burr. 1117. be two kinds, valued and open policies; and the only dif ference between them is this, that in the former, goods or property infured are valued at prime coft at the time of effecting the policy; in the latter, the value is not mentioned: that in the cafe of an open policy, the real value must be proved ; in a valued policy it is agreed, and is just as if the parties had admitted it at the trial.

Although policies of affurance are not to be ranked with Skinn. 54. fpecialty contracts, not being under feal, yet they have always been held as facred agreements, and of the firft credit: fo much fo, that when once they are underwritten, they cannot be altered by either party; because it would open a door to an infinite variety of frauds, and introduce uncertainty into a fpecies of contract, of which certainty and precifion are the most effential requifites.

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In a cafe before Lord Chancellor Hardwicke, this doctrine was admitted in its full extent. The plaintiff had infured fhip at and from London to Oftend, from thence to Rotterdam, from thence to the Canaries, warranted an Oftend fhip, which ship was afterwards taken. The bill was brought to have the policy rectified, for that the intention of the parties was miftaken therein, which was, that the warranty was too general, and

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Henkle v. Exch. Affur. The Royal Company,

I Vez. 317.

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CHA P. and that the voyage fhould have been ftated to take place from Oftend only, and not from London. The evidence in this cafe was the depofition of Knox, the agent for the company; who depofed, that the plaintiff applied to him to infure the ship, and that he believed the plaintiff told him, she was, or had been an Englifh fhip, and might fay fomething concerning the mariner or intent of making her an Oftend ship; but that his answer was, that he would not enter into the manner, but that if the plaintiff would warrant her to be an Offend hip, he would insure; and that on those terms, and no other, the agreement was made. There was the evidence of another perfon, who varied from Knox; in addition to which it was faid, there was the evidence arifing from circumstances, for that it was impoffible for the plaintiff to intend to infure her as an Oftend fhip, the being then in London, and could not be an Ofiend hip without going to Oftend; for which proof was read that it was necessary she fhould be registered.

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Lord Chancellor." The firft queflion is, whether it fufficiently appears to the court, that this policy, which is a contract in writing, has been framed contrary to the intent and real agreement. It is certain, that to come at that, there ought to be the frongeft proof poffible, for the agreement is twice reduced into writing in the fame words, and must have the fame conftruction: and yet the plaintiff feeks, contrary to both thefe, to vary them, and that in a cafe, where his witneffes vary from each other. The fingle depofition, upon which it depends, is very uncertain; and imports, that they relied on the plaintiff's warranty, leaving the tranfaction relating to the manner of making her an Offend hip entirely to himself. His Lordship, therefore, as there was no evidence to vary the contract from the written words, ordered the bill to be difmiffed."

At the fame time it must be obferved, that cafes frequently may, and do exist, in which a policy, upon proper evidence, may be altered, without any violation of the principles above laid down, and which has been often done by the courts both of law and equity; for let it be remembered once for all,

that

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that in questions of infurance, which is a contract founded c H A P. upon broad equitable principles, courts of common law are bound by the fame rules of decifion as courts of equity. After figning, policies are likewife frequently altered by confent of the parties, and fuch policies are good, agreeably to the maxim, confenfus tollit errorem.

An inftance of the former kind of alteration of a policy occurs in the chancellorship of Lord Hardwicke, to whofe decifion we laft referred. The infurance was upon the ship five hundred pounds, and the policy ftated, that the adventure was to commence immediately from the departure of the ship from Fort St. George to London. The bill was brought by the plaintiff, fuggesting that the owner had employed a Mr. Halhead to infure the fhip with the defendants, to commence from her arrival at Fort St. George; that a label, agreeable to thofe inftructions, with all the particulars of the agreement, had been entered in a book, and fubfcribed by Halhead, and two of the directors of the company; that by a mistake the policy was made out different from the label; that the fhip being loft in the Bay of Bengal, after her arrival at Fort Saint George, but before her departure for England, the company refuse to pay; upon these suggestions, the plaintiff prayed that the mistake might be rectified, and that the company might be ordered to pay five hundred pounds with intereft.

His Lordship was of opinion, that the label was a memorandum of the agreement, in which the material parts of the policy were inferted; that although the policy was ambiguous, the label made it clear; and as it was only a mistake of the clerk, it ought to be rectified according to the label.

Motteux v. the
Gov. and Comp.
of the London

Affurance,
1 Atkyns 545.

Salk. 444.

In an action upon a policy of infurance, and non affumpfit Bates v. Grabpleaded, the facts were, that Stubbs, a broker, had inftructions ham, to procure an infurance on goods on board the Mary Galley, of Saint Chriftophers, Captain A. Hill, commander: that Stubbs, in writing the policy, by mistake, made the infurance on the Mary, Captain Haflewood, commander, which was fubfcribed by the defendant: that the Mary Galley was loft, and then Stubbs applied to the infurers to confent to alter the policy, to which they agreed. It was urged, that on account of the alteration,

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CHA P. alteration, the defendant fhould have an increase of premium,

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Harding v.

Carter and ano

the fhip Mary being flouter than the Mary Galley. But Holt, chief juftice, ruled, that the action well lay upon the policy, and that the mistake might be fet right.

A policy of infurance, when effected, becomes the property of the infured: and if it be wrongfully withheld, either by the broker employed by him to effect it, or by any other perfon to whofe hands it may happen to come, he may maintain an action of trover for it, as well as for any other fpecies of property.

Thus an action of trover was brought against the defendants for two policies of infurance. The defendants were brokers, who had written to the plaintiff, the master of a ves Efter Vacation, fel, that they had got two policies effected; the one on ac

tler, Sittings at Guildhall,

3781.

count of the plaintiff's cloaths and wages, the other on account of the owners, and that the underwriter was Mr. Newnham. A lofs having happened, the defendants produced a policy, underwritten by one F. S. only infuring the fhip, in which the plaintiff had no interest.

Lord Mansfield." I fhall confider the defendants as the actual insurers, and therefore the plaintiff muft prove his intereft and lofs. The defence fet up was, that the letter above ftated in evidence was written by the defendant's clerk through mistake; and it was faid, that trover could not be maintained for that which never exifted: but his Lordship would not fuffer the defendants now to contradict their own representation; and the plaintiff accordingly had a verdict to the amount of his intereft, the premium being dedufted."

It is material to observe, that policies of infurance, though 1 called written inftruments, are, for the convenience of trade, and the dispatch of business, generally printed, leaving blanks for the infertion of names and all other requifites. This being the cafe, it is frequently neceffary to infert written clauses, in order to express the meaning of the parties to the contract, which, from fome particular circumftances, the printed form may not fufficiently explain. Thefe written claufes and conditions, thus inferted, are to be confidered as

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the

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the real contract; the court will look to them to find out the CHAP intention of the parties, and will confequently fuffer fuch conditions to controul the printed words in policies of insurance.

Having premised thus much of policies in general, it may be proper to confider this fubject in a threefold point of view: Firft, what perfons may be infurers; Secondly, what things may be infured; Thirdly, what the requifites of a policy are.

ift. What perfons may be infurers. It fhould feem, that by the common law and usage of merchants, any person whatever might be an insurer, however unable he might be, from poverty to make up the loffes infured against, provided the merchant was weak enough to truft to fuch a security, In procefs of time, however, there were so many who made a fhew of great wealth, in order to deceive the honeft and unfufpicious trader out of his premiums, and who were in infolvent circumftances, that it became an object of national concern, and parliamentary interference. The mifchiefs then exifting in this branch of trade, and the dangerous consequences thence arising to the intereft of the country, are to be collected from the preamble of the ftatute, which paffed in the reign of George the Firft, to remedy thefe evils, and 6 Geo. I. c. 18. which has in fome, though not in any great degree, restrained the rule of the common law as to the unlimited right any man or body of men had to become infurers. "Whereas "it has been found by experience, that many particular per"fons, after they have received large premiums or confider"ation monies for or towards the infuring of fhips, goods, "and merchandizes at fea, have become bankrupts, or other"wife failed in answering or complying with their policies "of affurance, whereby they were particularly engaged to "make good, or contribute towards the loffes which mer"chants and traders have fuftained, to the ruin and im"poverishment of many merchants and traders, and to the "difcouragement of adventurers at fea, and to the great dimi"nution of the trade, wealth, strength, and publick revenues "of the kingdom: And whereas it is conceived, that if two "feveral and diftinct corporations, with a competent joint "flock

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