Washburn & Moen Manufacturing Company v. Reliance Marine Insurance Company

by Melvin Fuller

United States Supreme Court

179 U.S. 1

Washburn & Moen Manufacturing Company  v.  Reliance Marine Insurance Company

 Argued: March 15, 16, 1899. --- Decided: October 15, 1900

This was an action at law brought in the superior court of Massachusetts for the county of Suffolk, and thence removed into the circuit court of the United States for the district of Massachusetts, by the Washburn & Moen Manufacturing Company against the Reliance Marine Insurance Company (Limited) of London, England, on a policy of marine insurance taken out, March 15, 1893, in the sum of $48,800, on a cargo of wire shipped from Boston to Velasco, Texas, on the schooner Benjamin Hale, John Hall, master.

The memorandum clause of the policy ran thus: 'Memorandum. It is also agreed that bar, bundle, rod, hoop, and sheet iron, wire of all kinds, tin plates, steel, madder, sumac, wickerware, and willow (manufactured or otherwise), salt, grain of all kinds. tobacco, Indian meal, fruits (whether preserved or otherwise), cheese, dry fish, hay, vegetables and roots, rags, hempen yarn, bags, cotton bagging, and other articles used for bags or bagging, pleasure carriages, household furniture, skins and hides, musical instruments, looking-glasses, and all other articles that are perishable in their own nature, are warranted by the assured free from average, unless general; hemp, tobacco stems, matting, and cassia, except in boxes, free from average under 20 per cent unless general; and sugar, flax, flaxseed, and bread are warranted by the assured free from average under 7 per cent unless general; and coffee in bags or bulk, pepper in bags or bulk, and rice, free from average under 10 per cent unless general.'

And on the margin the following was stamped or written: 'Free of particular average, but liable for absolute total loss of a part if amounting to five (5%) per cent.'

It was also provided: 'And in case of any loss or misfortune, it shall be lawful and necessary to and for the assured, their factors, servants, and assigns, to sue, labor, and travel for, in, and about the defense, safeguard, and recovery of the said goods and merchandise, or any part thereof, without prejudice to this insurance; nor shall the acts of the insured or insurers in recovering, saving, and preserving the property insured, in case of disaster, be considered a waiver or an acceptance of an abandonment; to the charges whereof the said assurers will contribute according to the rate and quantity of the sum herein insured.'

The Benjamin Hale sailed for Velasco, March 31, 1893, and on April 15 ran ashore on Bahama Banks, but, after throwing overboard 200 reels of barbed wire, floated and proceeded. On the night of April 19 the schooner again ran ashore, on Bird Key, near Dry Tortugas, and largely filled with water. Wreckers came on board April 21. The master went to Key West, and from thence telegraphed the Washburn & Moen Company, April 24, that the vessel was ashore, and he thought the loss was total. April 24, 25, or 26 the agent of that company told the agent of the insurance company, in Boston, 'what he knew in regard to the troubles, and said that he wished to abandon the cargo to the underwriters.' April 29 a written notice of abandonment was given, which the insurance company explicitly declined to accept. The master returned at once with further assistance, reaching the wreck the morning of April 25, and the vessel was floated April 29, and finnally taken to Key West, arriving May 4. The captain testified that 'from the time the vessel went ashore until she came off they were taking the cargo out as they could so as to get her off. . . . Think about one half of cargo was discharged on the reef, of which he thinks about 1,300 reels were dry.' This was substantially all carried to Key West, where the unloading was completed May 10.

Captain Hall made a memorandum at Key West as to the condition of the cargo when landed there. From this it appeared that out of 13,051 reels of barbed wire, shipped from Boston, 12,277 (or 12,625) were landed at Key West, of which 989 were perfectly dry, and 10,448 had received 'hardly perceptible' damage. Of plain wire, 1,102 bundles were shipped, and all landed at Key West, and 464 were stated to be nearly dry. Five reels of salamander wire and a wire rope were all landed and transshipped dry and unimpaired; also 243 kegs of staples out of 249; and 478 bundles of hay bands out of 1,050.

Libels for salvage were filed against vessel and cargo at Key West, and the schooner condemned and sold, but the cargo was released and the amount decreed in respect thereof paid by the insurance company.

The goods were forwarded from Key West to Velasco on the schooner Cactus, where they were tendered to the Washburn & Moen Company, which refused to receive them. That company again abandoned, and the insurance company again declined to accept abandonment.

At this time a very large part of the goods existed in specie, and a considerable part was practically uninjured. There were no facilities for handling, and no market for, barbed wire at Key West, but there were at Velasco, which was also but 60 miles by rail from Houston, the headquarters of the general agent of the manufacturing company in Texas.

The goods were afterwards sold by order of court on the libel of the master of the Cactus for freight, demurrage, and expenses, and realized $10,000. Plaintiff was not present and made no bid at the sale.

As the cost of saving the cargo and bringing it to Key West, and expenses there, exceeded the sum realized at forced sale, and the freight to Velasco added some hundreds of dollars to that, plaintiff contended that the cost was more than the value at Key West and at Velasco.

In respect of the forwarding of the cargo from Key West to Velasco, the charter party was signed by Captain Hall as master of the Benjamin Hale. This was in Boston several days after Hall had left Key West, but there was evidence that he had previously authorized the agents of the vessel at Key West, and who paid for the discharge of the cargo there, to charter the Cactus, and the second bill of lading was signed by one of them as attorney in fact for Captain Hall, and stated that the goods were shipped by him.

The agent for the board of underwriters testified that he instructed the agent at Key West to see that a vessel was secured and the cargo properly shipped to Velasco according to the original bill of lading; that Hall authorized the Cactus to be chartered; and that he always insisted that Hall should forward the cargo; while Hall said that he received a request from defendant's agent to so forward.

The circuit court ruled that the defendant was not liable for a constructive total loss; that the transshipment of the cargo at Key West, though made by the underwriters as he thought it was, did not, under the circumstances, make them liable for the property as underwriters; and that 'inasmuch as a portion of this cargo-a considerable portion, including the staples and a very large percentage of the fencing wire-was at Key West in a condition to be transshipped, and did in fact arrive at Velasco in specie, and suitable for the purposes for which it was intended, although not so suitable as it would have been if it had not been submerged in the sea,' there was no absolute total loss of the whole.

It was agreed that there was an actual total loss of parts of the cargo to the amount of $2,500 and that, under the views expressed by the court, plaintiff was entitled to a finding that there was a constructive total loss.

Accordingly a verdict was directed for $2,500, and a special verdict 'that there was a constructive total loss.'

Judgment was rendered in favor of plaintiff, and each party prosecuted a writ of error from the circuit court of appeals.

That court concurred in the rulings of the circuit court, but was of opinion that the cargo was forwarded from Key West to Velasco under authority of the captain of the Benjamin Hale. 50 U.S. App. 231, 82 Fed. Rep. 296, 27 C. C. A. 134.

Judgment having been affirmed, the Washburn & Moen Manufacturing Company applied for and obtained a writ of certiorari from this court.

Errors were relied on by petitioner, in substance, that the circuit court erred in not ruling that plaintiff was entitled to recover for a constructive total loss under the policy; and in not allowing the question whether there was an absolute total loss to go to the jury; or the question whether defendant had accepted plaintiff's abandonment of the cargo.

Messrs. Eugene P. Carver and Edward E. Blodgett for petitioner.

[Argument of Counsel from pages 6-8 intentionally omitted]

Mr. F. J. Stimson for respondent.

Mr. Chief Justice Fuller delivered the opinion of the court:

Notes