Hubbard v. Coolidge

STORY, Circuit Justice

(after summing up the facts, and advising the jury to find a verdict for the plaintiffs on the facts, if they were satisfied that there had been no concealment or misrepresentation), proceeded: If, on the point of concealment, the jury are satisfied, that the substance of the letter of the 14th of July was not communicated to the underwriters, and that it would have materially enhanced the premium, it becomes my duty to declare the law applicable to this point. It is incumbent on *780the assured to disclose all facts in his possession material to the risk, which are not contained or implied in the policy itself. But he may be innocently silent as to facts, which the policy necessarily imports; If the policy authorized the ship to stop at a particular port,.it is not necessary for the assured to disclose, that the ship will call there, although he has information of the fact. The underwriter, in such a case, takes upon himself the chance of her stopping; and he cannot but know, that the permission to stop implies a chance or probability of its being •done, and he estimates his risk accordingly. If he want further information, he is bound to ask for it: and if he waive any inquiry, he cannot reasonably complain, that the calling at such port was not estimated in his risk. Suppose, at the present time, a policy from Boston to any port in France; the assured need not disclose to what port he intends sending his ship, although in consequence of the Algerine war, the risk to a port in the Mediterranean might materially enhance the premium, beyond that to a port in the Atlantic Ocean. If the underwriter sign the policy without inquiry, he agrees that the ship may go to any port, which the .assured may elect. It would be a different thing, if the assured fraudulently misrepresented the port of destination. Seton v. Low, 1 Johns. Cas. 1.

The present case, however, does not require so strong a principle. The concealment is stated to consist in the non-disclosure of the contents of the letter of the 14th of July. That letter does not disclose a. decided intention to call at the Cape or at St. Helena. It merely requires, that the insurance should include a permission to stop at these ports without any absolute determination. one way or the other. It seems to have been a measure of extreme caution, to guard against possible events. As the defendants allowed the permission to stop at these ports, I am entirely satisfied, that the non-disclosure of the letter of the 14th of July was not such a concealment, as could, in point of law, avoid the policy. If, therefore, the concealment be made out, the plaintiffs are, notwithstanding, by law entitled to a verdict on this point.

But it is argued, that the underwriters did call for information, and it was not truly given. The call was very general; and when the answer was given, it was not complained of, as not sufficiently precise and special. If dissatisfied, the underwriters were bound to make further inquiries, and to point out the deficiencies, and not lie by until after a loss, when the assured is no longer able to save himself. General answers are sufficient to general inquiries; and if the underwriters do not insist upon more exact information, they waive the benefit of it; and this applies more strongly in cases, where the questions are not so explicit, asto point to any definite facts. "Where theunder-writers call for information on a particular point, the assured is bound to answer truly. If he misrepresent a material fact, or give it a false coloring, by design or by accident, it is fatal to the policy. Representations as to the destination of the ship, however, have been thought susceptible of a distinction. It has been held, that such a representation, if not fraudulently made, does not avoid the policy. If true at the time, it is sufficient, although another destination should ultimately' be given; for the assured in effect says, this is my present intention or expectation, but I reserve a right by the policy to go to other ports. Bize v. Fletcher, Doug. 271, Park, Ins. 270; Marsh. Ins. bk. 1, p. 459, c. 10, § 2; Vandervoort v. Smith, 2 Caines, 155.

In the present case, there is not the slightest pretence, that the plaintiffs fraudulently misrepresented the destination of the ship. The supposed misrepresentation consists in the plaintiffs’ having affirmed, that they had no knowledge, that the ship would call at the Cape, and knew of no motive for calling there, and thought, as rumors of war existed at Calcutta, it would be madness in the captain to call at the Cape; whereas the defendants contend, that the letter of the 14th of July clearly showed an intention to call there. I have already stated what is my construction of that letter. The jury will consider, whether it is possible to give it any other reasonable construction. If that letter was disclosed, there is an end to the defence. If it was not, it seems to me very difficult to maintain, that the plaintiffs have falsely interpreted it.

The jury gave a verdict for the plaintiffs, and found specially, that the letter of the 13th of January, 1813, (which substantially stated the contents of the letter of the 14th of July! was shown to the underwriters.