[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 255
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 256 The plaintiffs recovered upwards of $3,000 beyond the amount insured by their policy of insurance, and the exceptions taken by the defendant at the trial present the question whether any portion of that excess was properly chargeable to and recoverable against it. It now concedes its liability on account thereof to the amount of four-fifths of $581.18, the vessel's proportion of general average expenses shown to have been properly incurred and admitted to be chargeable to it under what is called the "suing and laboring" clause in the policy. The plaintiffs claim that the same clause makes it liable for the residue of such excess, which was allowed for repairs to the vessel after she returned to Balize. It therefore becomes material to refer to its terms. It provided that in case of any loss or misfortune it should be lawful and necessary to and for the insured, their factors, servants and assigns, to sue, labor and travel in and about the defence, safeguard and recovery of the said vessel or any part thereof, without prejudice to the insurance made by said policy; and that the said company would contribute to the charges thereof, according to the rate and quantity of the sum insured by said policy.
That provision has reference to charges not covered by the insurance, and does not embrace losses caused by damage to the property insured. Its object was to secure diligence in its preservation and protection, and thereby prevent a loss or reduce its amount, and to provide compensation for the labor done and expenses incurred in accomplishing that end. *Page 258 It has application in the present case only to the general average expenses that had been incurred. The subsequent expenditures were made to repair damages caused by the risks insured against, and were clearly payable under the insuring clause. They, consequently, do not come within the terms or meaning of the agreement "to sue, labor and travel" for the benefit of the property insured. The two provisions, as I have stated, relate to different subjects, and the right to compensation and payment under one of them necessarily excludes a right to a claim or demand under the other.
The views above expressed lead me to the conclusion that no portion of the cost of repairs above the sum insured was recoverable under the suing and laboring clause, and also show that the claim, on behalf of the plaintiffs, that they could, independent of that clause, recover such excess of repairs, on the ground that the underwriter was liable upon the general principles of the contract of insurance to pay for expenditures incurred to prevent or diminish the extent of loss, is unfounded. No such expense was in fact incurred, or, at least, beyond that of a general average character, admitted by the defendant to be chargeable as before stated. It then remains to be considered whether the recovery of such excess can be sustained on any other ground. It is claimed by the plaintiffs that the defendant is bound by a special agreement to pay it, and that was the ground on which the General Term placed their decision in ordering judgment on the verdict.
I cannot concur in that conclusion. When the vessel returned to Balize it was ascertained that she required extensive repairs, and the master thereupon wrote and sent a letter to the plaintiffs informing them of the nature and extent of the damages, the heavy expense that would be necessary to be incurred in making such repairs and the inefficiency with which the work would be performed; and after making the suggestion that she might, after making certain repairs, proceed *Page 259 to New York with safety for full repairs, he asks for their instruction.
On the receipt of this letter by the plaintiffs they took it to the defendant and consulted it as to what should be done, and it was determined that the vessel should be temporarily repaired at Balize and sent to New York for permanent repairs. The defendant requested the plaintiffs to write to the master and instruct him in the premises. They thereupon wrote him a letter on the fourth day of November, 1864, which (so far as it is material to ascertain the instructions given) contains the following directions:
"We have consulted with the underwriters and they leave the matter in our own hands. We, therefore, request you to consult with our friend Anto. Mathe in all matters concerning the brig. We wish to put only such repairs as will be considered perfectly safe to bring the brig to this port. * * * In a word, whatever you and Mr. Mathe decide about the brig is approved beforehand."
This letter, before being forwarded, was exhibited to the defendant, and it wrote at the foot thereof as follows:
"OFFICE SUN MUTUAL INS. Co., | November 4, 1864. |
"We, as the underwriters on the hull of brig Anto. Mathe, concur in the above.
"E.R. ANTHONY, "Vice-President."
This is a mere assent to such action as the assured might deem it advisable to take in reference to the matter. At that time the expense of the necessary temporary repairs at Balize had been estimated by a master shipwright at $1,500, and it was the opinion of another that $2,500 would be nearer the amount, and the general tenor of the master's letter indicates his opinion that they would not much, if at all, exceed that sum, and that it would be for the interest of all parties to have those made and postpone the making of full repairs till the arrival of the vessel at New York; but he does not suggest *Page 260 that it could not be fully repaired at Balize, or that the damage was so great as to justify an abandonment. Under such circumstances the plaintiffs, as owners, and the underwriter had mutual rights and interests to be protected, and it was very proper, if not in fact necessary, that the latter should be consulted in reference to the repairs to be made, and particularly whether the entire or only a partial expenditure therefor should be made at Balize. There was nothing said by the plaintiffs to the defendant giving color to the idea or suggestion that the latter was to assume the responsibility of the entire cost, or that it was to be held liable beyond the amount of the sum insured by it, and it in expressing its concurrence in the instructions given by the plaintiffs to the master declared it to be given "as underwriters," clearly intending to limit or qualify its assent by the nature of its liability as such "underwriters," and to that extent only, and not to change its relation to the vessel or owners.
Nothing was said by it to warrant the inference that it made or intended to make the master its agent in procuring the repairs to be made.
Its liability under the terms of its policy to contribute to the loss to the extent of the amount of its subscription or sum insured by it made it its interest to have the repairs made on as reasonable terms as possible, and it was important to the plaintiffs, who had to bear the residue of such loss, not only that the expenses incurred therefor should be reasonable, but that there should be no question made after they had been incurred in reference to the amount thereof. It was, therefore, well and provident that there should be a consultation and an agreement on the subject before any expenditures were made.
It may also be added that although it is said in the statement of facts read on the trial, and which had been previously agreed upon as correct by the counsel of both parties, that the repairs which on the survey of the vessel were found to be necessary, "could not be done where she lay at Balize," *Page 261 it is evident from the letter of the master that such was not his understanding nor the result of his information at the time he wrote it, but that his advice or opinion in regard to the propriety of only making temporary repairs there was based on the extravagant charges that would be made, and that the work would not be as well or efficiently performed as at New York, and it may have been doubted whether in that case they would have been justified in making temporary or partial repairs only at that port, and the consultation by them with the defendant in reference thereto, and its concurrence in the directions that might be given by them to the master, may have been deemed necessary. Such action was prudent and in the exercise of a proper precaution against subsequent difficulties, but it did not change or in any way affect the relative rights or liabilities of the parties.
It follows that the defendant cannot be charged or held liable on the ground that it had entered into a special agreement to pay those expenditures, and the court below erred in holding that such a liability existed.
There must, therefore, be a reversal of the judgment appealed from, unless the plaintiffs consent within twenty days after notice of filing the remittitur in the Supreme Court to the reduction of their verdict and judgment to four-fifths of $581.18, the vessel's proportion of the general average expenses, with interest thereon from 20th June, 1865.
If such consent is given, then the judgment is affirmed for that sum, with such interest thereon. If such consent is not given, then the judgment must be reversed and a new trial ordered. No costs in either case are given to either party on the appeal to this court.