Wilson v Jones
| Jurisdiction | England & Wales |
| Date | 1865 |
| Year | 1865 |
| Court | Exchequer |
Policy of Insurance - Policy on Adventure - Atlantic Cable - Insurable Interest - Wages.
The plaintiff, being a shareholder in the Atlantic Telegraph Company, caused himself to be insured with the defendant in a policy, which was a common printed form of a marine policy, filled up with interlineations and marginal additions, and which contained the following words: “At and from Ireland to Newfoundland, the risk to commence at the lading of the cable on board the Great Eastern, and to continue until it be laid in one continuous length between Ireland and Newfoundland, and until 100 words shall have been transmitted each way …. the ship, &c., goods, &c., are and shall be valued at 200l. on the Atlantic cable, value, say on 20 shares, at 10l. per share:” and also, written opposite to the clause, “touching the adventures, &c.,” the words, “it is hereby understood and agreed that this policy, in addition to all perils and casualties herein specified, shall cover every risk and contingency attending the conveyance and successful laying of the cable, from and including its loading on board the Great Eastern, until one hundred words be transmitted from Ireland to Newfoundland, and vice versâ, and it is distinctly declared and agreed that the transmission of the said one hundred words from Ireland to Newfoundland, and vice versâ, shall be an essential condition of the policy.” The attempt to lay the cable failed, through the cable breaking whilst it was being hauled in to remedy a defect in the insulation; but one half of the cable was saved:—
Held, first, that the policy was not on the cable, but on the plaintiff's interest in “the adventure,” that is, on the profits to be derived by him from the success of the adventure; and semble, that the adventure was the attempt to lay the cable on that voyage.
Secondly, that such an interest was an insurable interest.
Thirdly, that the loss was a loss by the perils insured against.
Fourthly, that, whether the adventure insured was the adventure of laying the cable on that voyage, or of laying it generally, the loss was total, inasmuch as by the breaking of the cable the probability of laying it was reduced to a mere chance, and the case was therefore within the rule making the loss of a ship total at the time of capture, although there may exist a spes recuperandi.
APPEAL from the decision of the Court of ExchequerF1, discharging a rule to set aside the verdict for the plaintiff, and to enter a verdict for the defendant.
The plaintiff, being a shareholder in the Atlantic Telegraph Company, caused himself to be insured with the defendant, in the policy now sued upon, which was the ordinary printed form of a marine policy, with interlineations and marginal additions. The material words of the policy were as follows: “Lost or not lost, at and from Ireland to Newfoundland, the risk to commence at the lading of the cable on board the Great Eastern, and to continue until the cable be laid down in one continuous length between Ireland and Newfoundland, and until 100 words shall have been transmitted from Ireland to Newfoundland, and vice versa, the risk on the policy then to cease and determine, upon any kinds of goods and merchandizes, &c.” (in the ordinary words of a marine policy, the Great Eastern being the ship named); “the said ship, &c., goods and merchandizes, &c., for so much as concerns the assured, by agreement between the assured and assurers, in the policy are and shall be valued at 200l. on the Atlantic cable, value, say on twenty shares, valued at 10l. per share.”
In the margin, opposite the usual clause, “touching the adventures and perils which we, the assurers, are contented to bear, and do take upon us in the voyage, they are of the seas, &c., and all other perils, losses, and misfortunes that have or shall come to the hurt, detriment, or damage of the said goods and merchandizes, and ship, &c, or to any part thereof,” were written the words, “it is hereby understood and agreed that the policy, in addition ta all perils and casualties herein specified, shall cover every risk and contingency attending the conveyance and successful laying of the cable, from and including its loading on board the Great Eastern, until 100 words be transmitted from Ireland to Newfoundland, and vice versâ; and it is distinctly declared and agreed that the transmission of the said 100 words from Ireland to Newfoundland, and vice versâ, shall be an essential condition of the policy.” There was the usual warranty against average under 3l., unless general.
The adventure having failed by the breaking of the cable whilst it was being hauled in to remedy a defect in the insulationF2, one half of the cable being saved, the plaintiff brought the present action, and obtained a verdict, subject to leave reserved to the defendant to enter a verdict for him, on the ground that the loss was not a loss by the perils insured against, or, if any, only an average loss, and that there was no evidence that it was higher than 3l. per cent., or to reduce the damages, on the ground that, if any loss, it was an average loss.F3
The rule having been granted, and afterwards discharged by the Court below, the defendant appealed.
Brett, Q.C. (Cohen with him), for the appellant, the defendant. The first inquiry is, what ii the subject matter of the policy? It is laid down in the judgment of the Court below that this is an insurance on the adventure; but to insure the success of a maritime adventure is a wager, and to make the policy good some other construction must be given to it.
[WILLES, J. The distinction between a wagering contract and one which is not wagering, depends upon whether the person making it has or has not an interest in the subject matter of the contract.
BLACKBURN, J. Does not this resemble an insurance on profits? Is it not an insurance of the profits to arise from the success of the adventure?]
In Arnould Ins. vol. i. p. 288 (2nd ed.) it is said of freight, that in order to make it an insurable interest, the assured “must be so situated with respect to it, as that he would certainly have earned freight but for the intervention of the loss;” and the same is laid down with respect to insurance on profits (p. 290). Now, there is no such certainty here. But further, in an ordinary insurance on profits the goods from which the profits are to arise are on board, and are subject to the risks insured against; but the profits here must arise from the shares, which were never on board or at risk, and which, according to the decision in Paterson v. HarrisF4, could not be insured. If then the shares could not be insured, how can the profits, which are an excrescence of them, be the subject of insurance?
[WILLES, J., referred to McSwiney v. Royal Exchange Assurance Company.F5]
The construction of the policy itself, which must be construed as a marine policy, shews that not the adventure but the cable was the subject matter of insurance. The words are, “on the Atlantic cable;” these words standing alone would plainly make the cable the subject matter, and their effect is not altered by those which follow, “value, say on twenty shares, at 10l. per share,” for these words only indicate the mode in which the plaintiff's interest in the cable is arrived at. Again, in the words inserted in the margin the cable is still the subject referred to; the perils are perils “attending the conveyance and successful laying of the cable.” The rest of these special words relate only to the duration of the risk, which might as well, had it been possible to calculate it, have been expressed as a specified time...
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