Two points determining the nature of the assured's communications. Seaman v. Lynch v. 1 may be recovered back. Moreover, when he underwrites by means of an agent, he does so subject to the law of principal and agent already considered. It is the duty of the assured to communicate to the underwriter all the intelligence he has that may affect the mind of the underwriter as to either of the two following points: 1st, whether he will take the risk at all; 2nd, at what premium he will take it. This is a duty attaching at the time of effecting the insurance, and not at all dependent on subsequent events, 2 for the effect of a concealment on the policy is determined not by its eventual relation to the nature of the risk, but with reference to its immediate influence on the judgment of the underwriter. For so is the law, that were the intelligence concealed to turn out to be wholly unfounded, or the loss to arise from a cause totally unconnected with the fact concealed, the policy is nevertheless void. The agent of the assured, before effecting the policy, held a letter from the captain of another ship stating that he had been in company with the ship insured, and lost sight of her all at once at twelve o'clock at night,—that she had been reported leaky by her captain the day before,—and that a hard gale had ensued the day after. It was held that this intelligence ought to have been communicated to the underwriter, and that the policy was void by reason of its suppression; yet in point of fact the inference suggested by the intelligence turned out to be unfounded, and the ship was lost, not by perils of the sea, but by capture, and that not till a week after the period to which the letter referred.3 A policy was effected on goods on board "ship or ships" 1 Per Lord Mansfield, in Carter v. Boehm, 1 W. Bl. 594; 3 Burr. 1909. See also 3 Benecke, System des Assecuranz, c. x. pp. 90, 91. 2 See the dicta of Mansfield, C. J., Lynch v. Hamilton, 3 Taunt. 37, 44, and of Lord Ellenborough, Lynch v. Dunsford, S. C. in error; 14 East, 494, 497; and of the Court in Stribley v. Imperial Mar. Ins. Co., 1 Q. B. D. 507. 3 Seaman v. Fonnereau, 2 Str. 1183. from the Canary Islands to London, by an agent of the assured, who at the time knew that a portion of the goods to be insured were on board The President, and also that The President had been reported at Lloyd's, as at sea, deep and leaky. He did not inform the underwriter that The President was one of the ships connected with the proposed risks, so that the underwriter had no means of applying the intelligence existing at Lloyd's. Under these circumstances the Court of Common Pleas held, and the Court of King's Bench affirmed their decision, that the suppression of this fact by the assured vitiated the policy, notwithstanding it turned out that the intelligence at Lloyd's was unfounded, The President never having been deep or leaky on any part of the voyage insured, and that she was lost, not by perils of the seas at all, but by capture, which occurred three weeks after the period referred to in Lloyd's intelligence.1 authorities. The result, therefore, is, that every concealment by the Result of the assured of a material fact, whether by design or mistake, avoids the policy; and that it has this effect, although the intelligence suppressed should ultimately turn out to be untrue, or the loss to have arisen from a cause quite different from that which the intelligence, if communicated, might have given reason to apprehend. for brokers. The practical rule for policy brokers and other agents, Practical rule consequently, is to disclose to the underwriter all they know respecting the proposed adventure, and not to exercise their own judgment as to the materiality of any part of the information they possess; for if they do not disclose the whole, and what is kept back appears to the Court to be material, the policy will be avoided, though the concealment was without any intention of fraud, and arose merely from an error of judgment.2 If fraud enter into the contract it vitiates the policy, Fraud. whether the thing concealed be material or otherwise. 1 Lynch v. Hamilton, 3 Taunt. 37; Lynch v. Dunsford, 14 East, 494, S. C. in error. 2 See per curiam, in Shirley v. Wilkinson, 1 Doug. 306, note. Time of sail last heard of. A series of four open policies on fruit and produce from Greece and the Ionian Islands to Liverpool or London "by ship or ships" was effected at several successive dates in the year 1875, the one to follow and succeed the other of them seriatim. At the time of effecting the later two of these policies respectively, declarations of shipments had been made on the earlier two of the four policies, but they remained unexhausted to a large amount in consequence of the shipments having been declared very much under their real value. It was after the safe arrival of the respective cargoes, and to enable the assured to place other cargoes under protection of the premiums already exhausted by previous shipments, that these declarations under value were made. In this state of facts there was a total loss of a large shipment of produce sunk in the Thames, which was declared on the apparently unexhausted policies, and on the policies which had been effected to follow. The jury, having regard to the effect of what seemed to be the unexhausted state of the earlier policies in inducing the underwriters to subscribe the later policies, found that the declarations under value were a material fact which had been fraudulently concealed at the time of negotiating the two later policies, and the Court of Appeal sustained their finding.' The time of the ship sailing, or the time of her being last ing, or being heard of, are facts which, one or other, must enter into and form part of every conceivable case. But whether in any particular case, this or that, as it happens to be, is a material fact to be disclosed on occasion of proposing to insure, is often a question of critical and perplexing difficulty. The criterion of the materiality of any fact has been already stated. Beyond this, it seems that nothing more definite can be laid down. What seemed to be a more definite rule, laid down by so high authority as Tindal, C. J., must now be considered as set aside. 1 Rivaz v. Gerussi, 6 Q. B. D. 222. That learned Judge, in Elton v. Larkins,' said :-"The law clearly is, that a party is not bound to communicate the time of sailing of a ship, unless at the time of effecting the policy the ship is what is called a missing ship. If the underwriter inquires and a false answer is given, that will vitiate the policy; but it is not generally necessary à priori that the assured should communicate the time of sailing." Except what relates to the false answer, every part of this statement may now be considered to be effectually impugned by the following cases: A policy on ship "at and from Mazagan" was effected by Stribley v. Imperial Mar. the plaintiff on the 24th of February, who, at the time of Ins. Co. effecting it, made no mention of a letter received by him on the 24th of January, from the master of the ship, dated the 9th of January, and stating that he had had a fine passage out, that he had commenced loading, but had very bad weather and did not know when he would finish; he would write again. The master never did write again; and the ship after sailing from Mazagan was never again heard of. The main question put to the jury by Grove, J., following the above authority of Tindal, C. J., was, whether the ship was, at the time of effecting the policy, an overdue ship? The jury found in the negative, and gave a verdict for the plaintiff. But the defendant moved for a new trial on the ground of misdirection. The Court, Blackburn, J., presiding, held that the proper question had not been put to the jury, and said that the proper question was, whether the contents of the master's letter, the dates at which it had been written and received, and the time that had elapsed since anything had been heard of the vessel, were not facts which might properly have influenced the underwriter as to the accepting of the risks. "I think," said Blackburn, J., "the test is whether a fair and reasonable underwriter, looking at this letter and the circumstances under which it was received, 1 Elton v. Larkins, 6 C. & P. 392. Ratcliffe v. M'Andrew v. Webster v. would say, 'I think this is a speculative risk, which I will either decline to take, or, if I do take it, it shall be at a greater premium than is usual.' A shipowner, on the 22nd of February, having information that his ship had sailed from the coast of Africa on the 2nd of October, directed his broker, "as the ship had been rather long, and he did not think it prudent to run so large a risk at so critical a time," to effect an insurance on her "at and from the coast of Africa to the West Indies;" adding, "We expect to hear from her soon;" and ordering the broker to communicate to the underwriters "that the ship was on the coast on the 2nd of October," but saying nothing of her having sailed on that day. There was here an implied misrepresentation, and an express concealment, which the Court held to be fatal to the policy.2 So, where the owner, on the 24th of November, received a letter from Lisbon, written on the 8th of November, informing him that the ship was then ready to sail from that port, but did not effect an insurance on her until the 2nd of December, after the arrival from Lisbon of another vessel which had sailed at the same time as the ship insured, and even then did so without communicating to the underwriters the letter he had previously received; Lord Kenyon held that the keeping back this letter avoided the policy.3 All ships sailing to the Baltic before the abolition of the Sound dues, used to touch at Elsinore to pay these dues, and were entered in a list called the Sound List: the voyage from Liverpool to Elsinore could then be performed in from fourteen to eighteen days, and the list be brought to England in ten or twelve; so that, in thirty days, at the most, it could be known here whether a ship sailing from Liverpool had or had not touched at Elsinore. Hence, where an insurance was effected on the 23rd of October, on a ship from Liverpool to 1 Stribley . Imperial Mar. Ins. Co., 1 Q. B. Div. 507. 2 Ratcliffe v. Shoolbred, 1 Mar shall on Ins. 466. 3 M'Andrew v. Bell, 1 Esp. 373. |