Swan v. The Union Insurance Company of Maryland

ERROR to the circuit court for the district of Maryland. This was an action on a policy of Insurance upon the schooner Humming Bird, at and from New-York to Port au Prince, and at and from thence back to New-York. The policy was dated on the 21st of July, 1810, and the vessel sailed on the voyage insured on the 5th of that month. About the 5th of August following, she arrived at Port au Prince, and was there stripped of her sails and a considerable part of her rigging by one James Gillespie, to whom she had been chartered for the voyage. This was done with the knowledge and acquiescence of the master, either for the purpose of procuring the loss of the vessel, or of fiting up another vessel, which Gillespie wished to despatch to the United States. On her return voyage she was sunk by Gillespie, but whether with or without the knowledge of the master, did not appear. The plaintiff insisted at the trial, that as barratry had been committed at Port au Prince, the subsequent loss, however occasioned, was to be ascribed to that cause, and he was entitled to recover. But the Court directed the jury that, admitting the act at Port au Prince to be barratry, the plaintiff could not recover on account of it, unless the jury should be of opinion that it produced the loss. Under this direction, to which the plaintiff excepted, the jury found a verdict for the defendants. Feb. 12th. Mr. Harper, for the plaintiff, argued that the loss, though not immediately consequent upon the act of barratry, was a ground of recovery; the insured ought to be protected against the incidental consequences of that act; and could not else have the benefit of his contract of indemnity. In the case of Vallejo v. Wheeler, the smuggling which was the barratrous act, was not the immediate and direct cause of the loss: yet the insured recovered, because the loss was sustained in consequence of the alteration of the voyage. Sergeant Marshall deduces from the case this corrolary, that if barratry be once committed, every subsequent loss or damage may be ascribed to that cause; and the underwriters are liable for it as for a loss by a barratry. Mr. Winder, contra, contended that it did not appear that the act of the master at Port au Prince was barratrous, or any thing more than gross neglect, or that he had any interest in the consequences of his supposed misconduct. The case of Vallejo v. Wheeler does not support the inference of Marshall, and his opinion is not authority any further than it is borne by the case. I has been doubted by the most enlightened jurists, whether barratry ought to be the subject, of insurance, and certainly it ought not to be extended beyond its direct and immediate consequences. Feb. 18th. Mr. Chief Justice MARSHALL delivered the opinion of the court, and after stating the facts, proceeded as follows: