Scottish Court of Session Decisions

Subject_1 PART I.

INSURANCE.

Bogle
v.
Smith, and Others

Date: 22 May 1804
Case No. No. 7.

What concealment vacates the policy?

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The ship Concordia was Freighted from the owners Adam and Mathie, merchants in Greenock, by Robert Bogle jun. merchant in Glasgow, to carry out a cargo to Jamaica, and to return from thence to the Clyde.

The voyage out was performed without any accident, but in going into Port Morant she run upon a reef of rocks, and sustained damage, of which Bogle was informed by a letter dated 17th April, received on 28th May 1799, from his consignees, mentioning, that although the damage was said by the Captain to be immaterial, that she must be surveyed before they could ship any goods on board.

The vessel was accordingly examined and repaired, and an affidavit made by two ship-carpenters (July 13, 1799), “That she is now a staunch vessel, and fit to carry a cargo to any port in Great Britain.”

After ordering insurance, (July 13,) the consignees write:

“We hope the Concordia will be ready to sail from Old Harbour on the 16th, with the other vessels, to join convoy at Port Antonio; yet we should not be surprised if this is not the case. We must advise you to take care how you engage again with such a captain and vessel.”

The following letter was, in consequence of this, written by Bogle to the brokers, (September 6, 1799):

“You formerly mentioned that your under-writers were shy of the Concordia. I have got further orders for insurances on her, and as she has got a thorough repair, they may now be induced to take her, particularly as I now want dyewood insured. If so, you may go the length of £1140, valuing at £20 per ton, at and from Jamaica to Clyde, with liberty to join convoy at the place of rendezvous; premium fifteen guineas per cent. tp return 6 per cent. for convoy, and 3 per cent. if sails by 1st of August. At these terms I have considerable sums done; but as they charge in London sixteen guineas, with a return of four for sailing by the 1st of August, rather than not get it done, would give that premium; say, sixteen guineas, to return six and four. P. S. Letters of the 14th July say, that Captain Simpson was expected to clear out his ship the next day.”

The insurance was accordingly effected. Instead of clearing out the 15th, she did not sail from Old Harbour till the 22d, so that she missed the convoy which sailed from Port Antonio; and owing to various accidents, the vessel was detained there for several months, when it was found (20th January 1800) “that she was unfit to proceed to sea, without undergoing repairs.”

The estimate of repairs seamed so much beyond her value, that the insured abandoned, and claimed for a total loss. Bogle's correspondents immediately sold the cargo, by which means the price fell greatly short of the sum insured. For the difference, an action was brought in the Court of Admiralty by Bogle against James Smith, and other underwriters on the cargo. The defences were repelled, (4th March 1803) and expenses awarded.

Of this judgment, a bill of advocation was presented.

The Lord Ordinary ordered memorials, which he reported.

The Court chiefly confined themselves to the defence of concealment; on which it was urged by the underwriters, that the insured is bound to disclose every circumstance, consistent with his knowledge, which is material, of Which there are none more so than the time of the vessel's sailing. Thus, in the present case if the Concordia had sailed on the 15th, having ten days to reach the place of rendezvous, there could be little doubt of her arriving there in time to sail with the July fleet. If she was so far from being ready as not to be able to join the convoy till the 22d, then there was a great probability of her being disappointed of that fleet, and her voyage would necessarily be delayed till a time of the year the very worst for shipping. Though an express assurance is given of the time expected for her clearing out, the doubt as to this being the case is concealed; and it is even directly asserted, that the letter contained an expectation, which from the whole context, is not warranted by it.

But, on the other hand, it was answered, and the Court held satisfactorily, that by virtue of the established law in such cases, it is not the concealment of any fact, which is material in the estimation of the risk, or which should be known to the underwriters themselves, which will vary the risk so as to vacate the policy; that no undue expectation was here held out as to the time of the vessel's, sailing, as the terms of the policy expressly declare, that it was uncertain whether she would sail with without convoy, and whether before or after 1 st August. The intention of clearing out by a certain day might be conceived, but many things might render if abortive; and the order to insure was in such terms as to meet every event.

The bill was (26th January 1804) refused.

The Court adhered, (22d May), on advising a petition, with answers.

Lord Ordinary, Glenlee. Act. Irving. Agent, Alex. Kidd. Alt. Campbell. Agent, Jo. Dillon. Clerk, Ferrier. Fac. Coll. No. 161. p. 363.