CHAPTER V.

OF THE FORM AND REQUISITES OF A POLICY OF INSURANCE.

The policy of insurance, is a written contract, signed by the insurer, or an agent on his behalf; or, in the case of an insurance by a corporation, by the authorised agent of the company, who is usually the president. The instrument is not authenticated by the signature of the insured, or the party by whom the protection of the policy is sought.

The Massachusetts Revised Statutes, p. 321, s. 13, makes it necessary that “all policies shall be subscribed by the President, or in case of his death, inability, or absence, by any two of the directors, and countersigned by the secretary of the company; and they shall be binding upon the company in like manner as if executed under the corporate seal thereof.”

The premium paid on the insurance, the sum insured and the name of the insurer must by the law and practice, be inserted in the policy. (See Form in Appendix.)

In Levy v. Merrill, 4 Greenl. R. 180, where a marine policy contained the words "Touching the risks I am willing to bear, the same as contained in the regular policies of insurance, and should any difficulty arise in adjusting this policy, I am willing that the same should be adjusted according to the rules established at Loyd's or at the regular insurance offices in the United States." Defendant insisted that the policy did not extend to a capture, and offered to prove by parol that such was the understanding of the parties. Weston, J. "The form of the policy now used in London and which it seems has varied very little for 200 years, embraces losses arising from “men of war, pirates, enemies, rovers, takings at sea, arrests, restraints, detainments of all kings, princes and people of what nation, condition or quality soever." These risks among others are to be found also in the common printed forms in this country. Loss by capture, then being one of the usual risks contained in regular policies, is clearly included in the one in question. And we are not at liberty to vary a contract, the terms of which are thus explicit, from any considerations drawn from the amount of the premium, or from the letter of the assured to the correspondent, adduced to shew the sense of the contract, written with a view to obtain indemnity from another quarter.

1. Contract when consummated. An assured can recover on a policy executed after the loss has accrued, and become known to both parties. Thus, in Mead v. Davison, 3 Adol. & Ell. 303, a policy of insurance on a ship, lost or not lost, is good, the ship having been accepted for insurance, and the pre

mium paid, before loss, although the policy was not actually executed and stamped till loss had happened, and both insurer and insured know it. The insured bought and paid for the underwriter's promise to indemnify. If his ship had arrived, the underwriter could have kept the whole premium: though she has perished, he cannot be relieved from his agreement. Equity would have compelled him to execute the formal policy, whenever tendered to him: in voluntarily executing, he has only performed a manifest duty, and cannot now retract the obligation.

There must be a complete contract of insurance between the parties; a negotiation which has not resulted in a contract, is not sufficient. 10 Pick, 326. Where the premium has been paid at the proper office of the company, and the authorised agent or officer has acknowledged the receipt thereof, it is not to be doubted that the insurance would be as binding as if a policy had been executed. Such receipts are in common use, and are intended to give immediate effect to the insurance, and supply the place of a formal policy, until one can be prepared. It is settled that these receipts are as binding as a policy could be. In truth, the receipt answers all the use of a policy, except that the latter authorizes the assured, in case of loss, to sue in a court of law, instead of being obliged to resort to a court of Chancery. Per Woodworth, J. in 4 Cowen, 661.

Where the plaintiff wrote by mail inquiring the terms of insurance, and the defendants wrote in reply stating the premium; but on the next day wrote again and retracted their offer. In the mean time the plaintiff had accepted the offer made by letter, which had been put into the post office, notifying defendants of such acceptance before the receipt of the second letter: Held that the contract was not consummated. M'Cullock v. The Eagle Ins. Co., 1 Pick. 278. However, the case of Mactier v. Frith, 6 Wend. 116, is different.

The policy in general is supposed to contain the whole of the contract, The insurers having a description of the property in their possession, are presumed to insert in the policy itself, as much of that description as they deem material, and by omitting any part of it, they show that they are content to take such part as a representation merely, and to look to it only, for the purpose of estimating the risk. 1 Cond. Marsh. 451. Every paper referred to in the policy, is not to be considered as incorporated in it. By Oakley J. 2 Hall, 628. A reference in the policy in general terms to a description of the buildings filed in the office, is not to be considered as incorporated into the policy, so as to amount to a warranty that the buildings shall conform exactly to the description. Delonguemare v. The Tradesman's Ins. Co. 2 Hall, 589.

A description of the subject of insurance may, when embodied in the policy, amount to a warranty that the subject is such as the policy describes it to be. To have that effect, however, it seems that such description must appear on the face of the policy: it is not sufficient that the descriptions or expressions are contained in other documents to which the policy may refer. Consequently a description in a report or survey, not incorporated in a policy, nor attached to it, as part of the accompanying instrument, is held not to be a

warranty, simply because the policy refers to it, as containing a further specification of the property insured. By Jones C. J. ib.

The "printed forms, calculated as they are for ordinary risks, and containing the provisions and conditions usually attached to insurances upon them, must necessarily be general and comprehensive in their terms, and cannot be adapted to insurances upon other and special hazards. It is the ordinary course of effecting insurances, that upon each application, a special agreement is made between the applicant and the underwriter, designating and describing the premises required to be insured, and settling the terms of that particular insurance, and the policy is then completed by filling up the blank spaces, left for that purpose in the printed form, with suitable words and clauses to express the contract thus agreed upon. This is the usual mode of consummating the contract, and it is the general practice to leave the printed form of the policy unaltered, without expunging or modifying the parts of it which conflict with the written clause. ib.

"But these written clauses nevertheless contain the elements of the contract, and being framed under the immediate eye of the parties, and without a reference to the terms of the previous arrangement between them, they not unfrequently present a contract to which some of the printed parts of the policy are inapplicable, and as effect must be given to the acknowledged intention of the parties, they must necessarily supersede or control such of the printed clauses as would if enforced and literally applied, be inconsistent with them. In this policy a written description is given of the premises insured, which designates and describes the buildings and their contents in general terms as a manufactory of china ware. The agreement is to insure the plaintiff upon a factory of that description in actual operation, and upon the machinery and stock finished and unfinished contained therein. This is a vital part of the contract and must have its full and entire effect and operation, uncontrolled and untrammelled by the printed parts of the policy. It was the purpose and design of the memorandum of special rates, to which the policy refers, to enumerate and specify the several trades, business and vocations which were supposed to endanger the safety of the buildings insured, and to entitle the underwriter to a higher rate of premium, and it was the object of the prohibitory clause, to provide that the exercise of those extra hazardous trades should not be permitted, unless with the assent of the insurers. But that general provision was not adapted, and could not be intended to apply to a trade or vocation, which the policy in terms insures, or by necessary implication permits.

"The written and the printed parts of the policy, when they harmonize, are equally operative and binding upon the parties; but whenever they come into conflict, the written clauses, as expressing the special agreement and declared intention of the parties at the time of the contract, must prevail, and the printed parts of the policy be held subordinate, and be taken and construed in the qualified and restricted sense, so as to confine them to the declared purpose and intention of the parties as expressed in the written clauses. On that principle, the express written agreement of the company to insure a manufac

tory of china ware in full operation, inserted in this policy, necessarily authorised the exercising of those trades and avocations, in the buildings insured which appertained to the establishment, and were required for the judicious management and transaction of its accustomed operations and business. It follows, that the general printed clause against the clause of extra-hazardous trades, must be restricted in its operation, to trades which the conductors of a china factory do not require for the transaction of the ordinary business of the establishment, and cannot be applied to any trade or vocation necessarily or usually attached to such manufactories.

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The case also of Stebbins v. The Globe Insurance Co. 2 Hall, 632, decides that a general reference in a policy to a description of the insured property, on file in the office of the assurers is not to be considered a warranty, except it appear on the face of the policy. The action is on a fire policy, dated January the 5th, A. D. 1327. The property insured is described in the policy, as a framed building in three tenements, situate on the "corner of New York wharf and Commerce street, in the city of "Mobile, privileged to contain hazardous goods, per report no. " 36, 748, filed in the Washington Office." The application for insurance, bears date at Mobile, on the 23d of Nov. 1826, and gives a description of the premises to be insured; and, with a view to point out their situation with respect to contiguous buildings, there is subjoined to, or inserted in the application, a map or diagram, on which the store of the plaintiff is marked out, and also two stores adjoining thereto; and in the rear of the whole, the word "vacant" is written. The New York wharf and Commerce street, mentioned in the policy, are laid down on the diagram, and also two other streets, called Alabama street and Water street, forming in the whole a square, or parallelogram. The plan or map contains no building except the three stores above-mentioned, all of which front on Commerce

street.

At the trial, the defendants offered to prove, that subsequently to the insurance, the plaintiff had erected other buildings, immediately contiguous to the store insured, and on the ground represented as vacant, and that the risk of loss was thereby increased. The judge rejected the evidence, unless the defendants meant to show that the intention of the plaintiff, at the time of ef fecting the insurance, was to erect these buildings, and that he had concealed that intention, or that the fire was occasioned by, or originated in the adjacent buildings so erected.

2. Description of the Parties.

Previous to the stat. 25 Geo. C. 44, which required the name of the insured or that of his agent to be inserted in the policy, it was the practice of the English underwriters to sign their policies in blank, which authorised his agent to fill it up in such manner as he thought proper. If such a custom prevails in this country, the blank may be filled with the names of any persons who are legally entitled to the benefit thereof, and if the words, for whom it may concern, were inserted in the blank they could not have extended its legal effect

any further.

By Chancellor, 8 Wend. 150. See the case of Nelson v. Dubois,

13 J. R. 175: Joselyn v. Ames, 13 Mass. 274.

The maxim expressio uniues est exclusio alterius applies emphatically in the naming of the party assured in the policy of insurance; especially when the contract is guarded against over-insurance, or a single subscription, exceeding the property at risk. Each policy and underwriter, where there are several upon one risk, is distinguished as engaged in a separate concern; and the liability of the insurer depends upon the order of time, in which the policies or subscription are effected. Per Sewall, J. in 6 Mass. 81.

In a marine policy, the general term owner is used often, not in its strict legal sense, but as equivalent to whomsoever it may concern, leaving the party who may claim the benefit of the policy, to establish by evidence, that he caused it to be effected for his own security. This principle was settled in Lawrence v. Van Horn and Clarkson, 1 Caines, 276. There it was a joint adventure by three parties, having distinct interests. The plaintiffs being one of the parties, effected an insurance to a certain amount, on the cargo generally, whether in their own names or as owners does not appear, and it was held by the court that the assured is not required to state the particular interest or proportion of interest which he intends to have insured; that it is sufficient if he have an insurable interest to the amount insured, and it is immaterial whether it be a distinct or undivided interest. In Catlett v. Pacific Ins. Co., 1 Wend. 561, (affirmed 4 Wend. 75,) it appeared that the insurance was in fact intended for the several interest of one of the parties, and a witness who was one of the partners, testified that the plaintiffs had no authority to insure except on their own account: Held, that the party causing insurance to be made for his separate benefit may maintain an action on the policy, although the only designation which it contained of the assured was, where it states "that Le Roy, Bayard, & Co. on account of the owners, did make insurance”—it appearing in evidence that the two plaintiffs Catlett and Keith, Jr. wrote to Le Roy, & Co. to effect the insurance on the joint account of Mr. James Keith, Jr. and himself. The marine policy is most commonly general in its terms, comprehending in its indemnity all who are interested in the subject of insurance, while the fire policy limits its protection to those who are specially named in it. 13 Mass. 67; ib. 269.

A marine policy "on account of the owners" without naming the persons, and two of three owners claimed the right to recover: and the court held that the term owners was equivalent to whomsoever it may concern; and it was for the party who claims the benefit of the policy to establish by evidence that he caused it to be effected for his own security. Catlett v. The Pacific Ins. Co. 1 Wend. 561. So, the words for whom it may concern, enable any one having a special interest in the property insured, to recover provided he was intended to be insured. 4 id. 75. S. C.; Turner v. Burrows, 5 id. 531; 8 id. 144, S. C. The words in a marine policy, owners of the brig Sampson," are merely words of description of the persons interested. And where the insurance was in these words "cause Foster and Thompson to be assured, lost or not lost, one thousand dollars, on property on board the brig Sampson," the court held,