U.S. Supreme Court Caze & Richaud v. Baltimore Insurance Company, 11 U.S. 7 Cranch 358 358 (1813)
Caze & Richaud v. Baltimore Insurance Company
11 U.S. (7 Cranch) 358
ERROR TO THE CIRCUIT COURT
FOR THE DISTRICT OF MARYLAND
The underwriters upon a cargo are not liable for freight, pro rata itineris to the owner of the vessel who is also owner of the cargo insured in a case where the vessel and cargo were captured, the cargo abandoned to the underwriters as a total loss and by them accepted, the loss paid, the cargo condemned, restored upon appeal, and the proceeds of the cargo paid over to the underwriters.
Freight pro rata itineris is not due unless the owner of the cargo voluntarily agrees to receive it at a place short of its ultimate destination.
The existence of a lien on a cargo for freight does not vary the legal responsibility of the underwriter on the cargo after abandonment.
Error to the Circuit Court for the District of Maryland in an action of indebitatus assumpsit for freight
of goods by the ship Hamilton from Bordeaux to Halifax.
In the court below, a case was agreed by the parties which was in substance as follows.
On 28 July, 1805, Mr. John Ducorneau, of Bordeaux, the agent of the plaintiffs, shipped for them there, on their account on board the ship Hamilton, of which they were owners, a cargo of the value of $22,986 on a voyage from Bordeaux to New York, where the plaintiffs resided. On the voyage she was captured by a British vessel of war and carried into Halifax, where the ship and cargo were condemned. Within due time after the plaintiffs heard of the capture, they abandoned as for a total loss to the defendants who accepted the abandonment and paid the amount insured.
From the sentence of condemnation in the vice-admiralty court as to the vessel and cargo, but not as to freight, there was an appeal, upon which the sentence was reversed and the proceeds of the vessel and cargo were restored. The proceeds of the cargo were paid over to the underwriters, but the sum they received was less than the sum they had paid upon the policy.
The question, upon this case was whether the plaintiffs, who were owners of both vessel and cargo, were entitled to recover from the underwriters upon the cargo freight from Bordeaux to Halifax.
STORY, J. delivered the opinion of the Court as follows:
The present action is brought to recover freight pro rata itineris under the following circumstances:
The plaintiffs were the owners of the ship Hamilton and cargo, and effected insurance of her cargo on a voyage from Bordeaux to New York. The sum of $11,000 was underwritten by the defendants -- the sum of $10,000 at Philadelphia and the residue of the value of the cargo ($1,986) was left uninsured. During the voyage, the ship and cargo were captured, carried into Halifax, and there condemned. The plaintiffs abandoned to the underwriters and received payment for a total loss. An appeal from the sentence of condemnation was interposed and the sentence finally reversed, and the proceeds of the cargo, which had been previously sold by order of court, were paid over to the underwriters in proportion to the sums underwritten by them respectively.
We are all of opinion that the plaintiffs are not entitled to recover in the present action.
In the first place, the Court is satisfied that as between the insured and the underwriter on the cargo of a ship, the latter is in no case responsible for the payment of freight, whether there be an abandonment or not. It is a charge on the cargo against which he does not undertake to indemnify the owner, and if authority be necessary to support the position, it is fully borne out by the doctrine of Lord Mansfield in Baillie v. Modigliani, Marshall 728.
In the next place, we are all of opinion that no freight whatsoever was, under the circumstances of this case, due. Freight in general is not due unless the voyage be performed. Here the ship and cargo never arrived at their port of destination, and of course the whole freight could not be due. Was a pro rata freight due? We think not. The whole class of cases resting on the authority of Luke v. Lyde, 2 Burr. 882, proceed on the ground that there is a voluntary acceptance of the goods themselves at an intermediate port, and not, as in the present case, a compulsive receipt from the hands of the admiralty after capture and condemnation and ultimate restoration upon the appeal. There is, in our judgment, no equity to support such a claim, and although
it receive countenance from some remarks incidentally thrown out in Baillie v. Modigliani, the current of more recent authority, as well as of principle, clearly points the other way.
It may be further added that as between the insured and the underwriter, the existence of a lien on the cargo for freight does not vary the legal responsibility of the underwriter on such cargo after an abandonment.
The judgment of the circuit court is affirmed with costs.