and receive a *return of premium due upon the arrival of the vessel, he cannot, without an express stipulation, resort again to the underwriter in any contingency of the adventure. As where a ship, having been seized by the Dutch government, was liberated upon a bond being given by the agent of the insured, and, upon its arrival at the place of destination, the policy was adjusted, and the insured claimed the return due upon arrival, but the ship and cargo were afterwards condemned, and the insured received a return of premium, the loss occasioned by the bond being put in force could not be made a charge upon the insurer. (b) The clause for a return upon arrival means, that if the adventure be safely terminated, and the insurer free from all danger of loss, and discharged from all other claims, he will return to the insured a portion of the premium which he has received. The insured have no right to call upon underwriters for this species of return unless the risk be at an end; whilst they are subject to any danger, they cannot be called upon to return the premium. The return premium is only due when the adventure is wound up. If any thing of risk remain outstanding, it should be communicated to the insurers when a return is claimed, and the return at that period, the risk being still undetermined, is only matter of favour, not of right.

(b) May and Others v Christie, 1 Holt, 67.

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289

*CHAPTER XV.

OF TOTAL LOSSES AND ABANDONMENT.

LOSSES are of two kinds, total and partial. A total loss occurs, either when the property insured is in fact wholly lost to the owner, or when, though not in fact wholly lost, the damage sustained is of such a nature that the owner is entitled to recover to the amount of the insurance on making an abandonment.

An abandonment signifies a giving up to the underwriters of the thing insured, or such part of it as may remain, on a loss taking place. When the property or a part of it is still in existence, and the insured yet claim for a total loss, (as in certain cases they may,) they must abandon what is saved to the underwriters; for, if they could retain what is saved, and yet recover for a total loss, they would receive more than an indemnity. Because, said Lord Mansfield, the insured cannot recover more than they have suffered, they must abandon what is saved. (a) The use of abandonment in such cases is to enable the underwriters to take measures for the preservation of the property, and to exclude any inference that the insured still intend to adhere to it as their own. (b) There is no clause in the policy which regulates abandonment; there is, indeed, a stipulation which directs that, in case of misfortune, the insured may sue, labour, and travail, in and about the defence, safeguard, and recovery of the property, without prejudice to the insurance, and that the insurers will contribute to the charges. In this country it is considered as implied in the nature of the contract; and engrafted by the tacit operation of mercantile usage on the terms of every policy. Its true design seems to be, to enable the insured to recover a full indemnity when the loss is virtually total;-when only a very small part of the property is saved, or, if saved, is burthened with pecuniary charges, for which the underwriters ought to answer, to such an extent, as nearly or quite to exhaust the value. With regard to the history of the practice, it is said to be coeval with the first introduction of insurance; all foreign nations, where insurance prevails, allow of abandonment to some extent; and traces of it are

(a) 2 Burr 696.

(b) Vide 5 M & S 456.

to be found in the laws of Rhodes and Oleron. (c) Whether, said Mr. Justice Buller in one of the cases, (d) it might not have been wiser for the courts, many years ago, to have determined that the insured should not in any case abandon where the property did exist, is not for our consideration. About the year 1745, (e) that question was determined after much deliberation. But whatever may be the history or origin of abandonment, it cannot be denied that the practice has a tendency to encroach upon the true spirit of insurance as a contract of indemnity. The insurer does not agree under any circumstances to become the purchaser of the subject of insurance : he is only to indemnify the insured. In casu quo merces assecuratœ sunt solum deterioratæ vel damnificatæ, tenentur Assecuratores ad solam damni emendationem sive ad reficiendum deteriorationis pretium et non ad totam Assecurationem. (f) On principle, therefore, the doctrine of abandonment does not seem to be necessarily incidental to the nature of a policy and some care should be observed, lest, by an undue extention of the right, the insured should be enabled at his pleasure, to convert a partial loss into a total one, and by this means recover beyond the extent of an indemnity.

We shall proceed to consider, 1st, When a loss is total without abandonment, and when abandonment is necessary to make it total. 2dly, In what cases abandonment may be made. 3dly, In what time. 4thly, In what form and mode it must be made, by *and to whom, and how an irregularity may be waived and, lastly, The effect of an abandonment when made.

The first consideration which presents itself on the subject of abandonment, is in what cases the insured may, and in what they cannot, recover for a total loss, without giving notice of abandon

ment.

It is a common doctrine, that if the thing insured, though much damaged, continue to exist in specie, an abandonment is necessary to create a total loss. (g) But the phrase "exist in specie" must be construed with reference to the design and object of insurance, as a contract of indemnity. To render an abandonment necessary, it seems that the thing insured, or a part of it, must exist in the hands, or at least for the benefit of the insured; (h) and that it must exist in such a state of integrity, as to be fit for some useful and available purpose. (i) The leading principle is the same, whether the loss happen from the perils of the sea, or any other cause; but for the

(g) Per cur. in Mitchell v Edie, 1 TR 613, 615, where the loss was by capture,

but the rule is stated generally. Da Costa v Newnham, 2 TR 407, 408. Anderson v Royal Exchange Assurance Company, 7 East, 38, 42, 43. Tunno v Edwards, 12 East, 491. Martin and Other v Crokatt, 14 East, 466, 467. Davy v Milford, 15 East, 565.

(h) Mullet and Other v Shedden, 13 East, 304. Mellish v Andrews, 15 East, 13. Bondrett v Hentigg, 1 Holt Rep 149. 5 B & A 597.

(i) 2 Barn & Cres 691. 203 S C. 3 Bos & Pul 476. 456.

4

Dowl & Ry

5 MS 455,

In a

sake of perspicuity, we shall consider, first, cases where abandonment is or is not necessary when the loss happens by the perils of the sea. When the insured, on a ship being driven into a foreign port in distress, did not make an abandonment, although he negotiated with the underwriters concerning one, and ultimately caused a sale to be effected for the benefit of all concerned, this loss was held not to be total, although the damage sustained was such, that on the sale taking place, the expences of salvage were found to exceed the proceeds of the ship and cargo. (k) The reason assigned for this loss not being total without abandonment, was, that the ship remained all the time in the character of a ship, when the owners proceeded to the sale; and if this could have been thrown up on the underwriters as a total loss, their liability would have been made to depend upon the event of the auction or market at which the sale *was made, against which the underwriters do not insure. later case, when a ship, being driven by stress of weather into a port where there was no dock to receive her, was found on a survey to be considerably damaged, and incapable of being removed to any port for the purpose of repair, so that it was deemed expedient to break her up, and sell her for old timber, an abandonment was still holden to be necessary, the Court, in this case, saying, that the ship could not, under the circumstances, be deemed a mere wreck. (1) However, when an abandonment is said to be necessary when the ship exists in specie, this must mean when she is available for the purposes of a ship; if the vessel be so damaged that the cost of repair would exceed her value when repaired, she can scarcely be with propriety called a ship, but is rather a congeries of planks, and in such a case the loss is total without abandonment. When a ship was so much injured by the perils of the sea, that the expence of getting her off the place where she then lay, (even if that could have been accomplished) and of repairing her, would have exceeded the value of her when repaired; the loss was held total without abandonment, although the ship was sold by the master with her certificate of registry. (m) The ship here was utterly useless without an enormous expense; the jury under the direction of the judge at the trial, found that the master was justified in selling, and the loss was total without abandonment. The principle now adopted is, that if a ship be so much injured by the perils of the sea as to prevent her from being used as such, and render a sale necessary, the loss is total without abandonment. (n) In the case of damage to goods by the perils of the sea, if the goods be so far injured by the perils of the sea, that they have a tendency to putrefac

(k) Martin and Other v Crokatt, 14 v Bonham. In Robertson v Clarke, 1 East, 465.

(Bell and Others v Nixon, 1 Holt, 423. Cor Dallas, C J, and id 425 in Banco. Sed

quære.

(m) Cambridge v Anderton, 2 Barn & Cres 691. 4 Dowl & Ryl 203 S C. 1 Raym & Moody, 60 S C.

(n) Per Bayley, J, 4 D & R 207. 2B & C 693, S C citing 8 Taunt 755. 3 Bro. & B 151 note (d). 3 Bro & B 147. Reed

Bing 445, the loss was held total, and no notice of abandonment seems to have been given. In Reed v Bonham, 3 B & B 147 a notice was given, though unneces sarily, if upon the facts the loss was total. In Allwood v Henkle, Park, 280 and Hodgson v Blahiston, id 281 n, it is said to have been ruled, that notice was necessa ry, though the property had been sold; and see a dictum 3 Bro & Bing 151.

*

tion, and are obliged to be thrown overboard, this seems to be in itself a total loss. (o) Considering the contract of insurance, said Lord Ellenborough, as a contract of indemnity, it surely cannot be less a total loss, because the commodity subsists in specie, if it subsist only in the form of a nuisance.

In a case of loss by seizure and detention, or barratry, if the insured be afterwards indemnified by a restoration in the whole or in part, they cannot recover for a total loss, unless notice of abandonment was given when the loss happened; but, on the other hand, if the dominion of the seizors continue, and the insured never effectually resume their rights, they may recover for a total loss without abandonment. Thus in a case of capture which occurred in the time of Lord Kenyon, where the ship having been brought into port and sold, was purchased by the master, his Lordship held, that although the insured might have abandoned on the capture taking place, the loss was only partial without abandonment, and the insured could only recover the sum paid for the ransom; that a policy was to be considered a contract of indemnity according to the principle laid down by Roccus, and every other writer, and the case was the same as if a ship were sunk, and afterwards weighed up again. (p) [So, where a cargo insured was captured on the voyage by a French privateer; and thereupon a bond given by the consignees of the cargo at its appraised value to abide the final determination; and the cargo thereupon delivered to them. The appraisal was more than the insurance and 50 per cent. advance upon the prime cost. The cargo was taken to Leghorn and sold at an advance beyond the amount of the appraisal. Gracie v. New York Ins. Co., 8 John. 185. Kent J.-"The insured has nothing to do with the proceeds of the cargo any more than he would, if the vessel had been robbed on the voyage of part of her cargo, or the captain had been obliged to ransom the vessel from pirates. He is bound to save the assured from such intermediate loss. If the plaintiff recovers the amount of the bond he is only indemnified, and is placed in the same situation as if the peril had not intervened."

Whether the amount falls short or goes beyond the prime cost of the subject, does not alter the principle, nor affect the question of abandonment. The assured receives no more than his indemnity, by being reimbursed the sum he has paid. I do not perceive any principle that requires to abandon the property so reclaimed, when the amount of the money paid exceeds the prime cost of the article, and which does not require it when it is less. He is only to abandon when he goes for the whole subject as lost, and part of it remains, or the hope of its recovery

(0) Dyson v Rowcroft, 3 Bos & Pul 474. Cologan v London Assurance Company, 5 M & S 447, 452, but see Cocking v Fraser, Park, 181.

(p) M'Masters v Shoolbred, 1 Esp Rep 237. But semble, that if an abandonment

had been made, a total loss could not have been recovered, as the loss in the result was only partial, and the ransom money being illegal, ought not to have been al lowed to the insured. Parsons v Scott, 2 Taunt 363.