administration; and it should thus have proved foolproof. It is often suggested as remarkable that the Act approves, though it does not compel, the use of the antiquated and much abused document known as Lloyd's S.G. Form. It is almost platitudinous to remark that all concerned find it advisable to retain a method of expression by which the precise meaning of each word and phrase has been so rigorously defined. In spite of its anomalies, anachronisms and ambiguous phraseology, very little departure from the S.G. Form is made by Lloyd's underwriters, or by the English Companies.

The position is now that all points specifically dealt with in the Act have a clear legal position, but for all questions not so dealt with, recourse, in case of dispute, will have to be made to judicial process. The large number of cases fought since its passage prove that the Act is not as exhaustive as was thought. Especially has this been demonstrated in the light of conditions extant during, and since, the war. It is essential to keep au fait with decisions as they are made, and to modify one's view of the law in accordance with them. It must also be remembered that the Act does not place marine insurance outside the common law of the country, such as, for example, that of contracts or of agency.

CHAPTER II.

STATUTORY ENACTMENTS RELATING TO MARINE INSURANCE.

ALTHOUGH marine insurance has been in existence in England for "time out of mind" legislation known to deal with it did not make its appearance until the commencement of the seventeenth century.

It is known that a statute was passed in Scotland in the reign of James I. dated A.D. 1427, entitled "The leave to merchants to sure their gudes," but it is not definitely established that this statute made any reference to marine insurance, although such is probable. For this reason it is usual to describe the Act of 1601 to which reference was made in the last chapter as the first British statute relating to marine insurance.

43 Elizabeth, Cap. 12.

As previously indicated, the intention of the Act was to eliminate controversy on the meaning of policies of sea insurance, and thus to expedite settlement of claims arising out of such contracts. The Act established a Court of Arbitration for the "hearing and determining of causes arising from policies of assurance.'

It is to be noted that the Bill was introduced into the Commons by Francis Bacon, later Earl Verulam, on Monday, 7th December, 1601, and was intended to avoid delays attendant upon suits in the Court of Chancery. It is strange that in practice the Act had a precisely opposite eflect. It is generally thought that Bacon actually drafted the measure and this would be in keeping with the statesmanlike exposition of the objects of assurance enumerated in the preamble. Legislation was apparently conducted at some speed in those days as the Bill was read in the House of Lords for the first time on the 16th December and became law before the end of the year. Amended by 13/14 Carolus II., cap. 23, it was not repealed until 1863. (Statute Law Revision Act, 25 Victoria, c. 125.) It may be mentioned that the Act became dormant

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largely as a result of the opposition evinced towards it during the latter half of the seventeenth century by the judges in the King's Bench Court.

6 George I., Cap. 18.

The business of underwriting marine policies in this country remained in the hands of private individuals for many years before it was undertaken by composite companies. Private underwriters had congregated together in association at " Lloyd's," which was a result of their resorting to the premises of the coffeehouse keeper, Edward Lloyd. This influential body of men strenuously resisted all attempts to found companies to conduct insurance business, contending that companies were without conscience. Although this opposition undoubtedly delayed the formation of companies, the end was inevitable, and a statute was passed in 1720 by which two companies received charters of incorporation, and, as far as companies were concerned, these corporations were granted a monopoly.

As the formation of the companies coincided with the South Sea Bubble, a very precarious existence was the lot of the companies for some years, but both managed to survive these difficult times. The Act conferring the monopoly is often referred to as the "Bubble Act." As indicated in the previous chapter the "heavenly twins" had proved extremely active in the foetus stage. The Royal Exchange Corporation had its origin in the Public Assurance Office, which operated under authority" of a mining charter granted in 1568, under the style of "Court of Assistants of the Mines Royal, Mineral and Battery Works." After the Charter was granted to the Royal Exchange Assurance Corporation, the "mining" company abandoned the conduct of sea insurance, converting its capital into stock of the corporation.

19 George II., Cap. 37.

Marine insurance is a legitimate business, and, correctly conducted, is of infinite service to commerce, but unscrupulous persons have often endeavoured to prostitute its practice for base ends. During the early days of Lloyd's, wager policies were quite common, and, even at that time, straightforward underwriters

unhesitatingly condemned such malpractices. Wagering contracts on the insurance of sea adventures became so rife that in 1746 an Act was passed which voided all policies to be made on such terms as "policy proof of interest," but exceptions were made in the cases of Spanish and Portuguese ships and private ships of war. The practice of bottomry was also fully treated. The enactment also forbade re-insurances except in the case of insolvency, or death, of the original underwriter. Lord Mansfield ruled that this statute did not forbid "valued" policies as was generally considered. The embargo on re-insurance policies was repealed in 1864, and the whole statute by the Marine Insurance Act, 1906.

28 George III., Cap. 56.

This Act was passed in 1788 and prescribed that all policies made out in blank were to be void. The Act repealed a previous statute (25 George III., Cap. 44, 1785, "An Act for regulating Insurances on Ships, and on goods, merchandises or effects") and was itself as far as it related to marine insurance repealed by the Marine Insurance Act, 1906.

35 George III., Cap. 63, 1795.

This required policies to be in writing and to be stamped.

11 George I., Cap. 29, 1725.

43 George III., Cap. 113, 1803.

The conduct of marine insurance has always allowed some latitude for claims on underwriters to be fraudulently made, and losses have often been engineered with the intention of making dishonest claims. The statutes cited above were made law in order to repress such misdemeanours, and penalised individuals directing or prosecuting frauds on insurers. Fortunately most assured act up to the principle of observing the utmost good faith, which is the essence of every insur

ance contract.

The latter statute arose out of the notorious case of Captain Codling. This enterprising mariner caused to be cast away off Brighton the vessel Adventure. Very heavy insurances, largely of a fictitious character, had

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been effected on the vessel and her cargo. An element of humour attended the actual loss of the vessel, as before it became submerged, it was towed by a manof-war into very shallow water. The cause of the loss was thus patent. Codling himself was hanged at Plymouth, but the trial of the real instigators of the fraud, whilst indicating the prevalence of organised swindles on marine insurance underwriters, also demonstrated the impotence of the law adequately to deal with the offenders. It may, however, be pointed out that insurers are not policemen, and that although Lloyd's has statutory authority to take proceedings against fraudulent claimants, the average underwriter is well content if he can obtain sufficient evidence to repudiate unlawful claims made upon him. This attitude possibly is often a deciding factor in encouraging such epidemics of dishonest scuttlings as were so common during 1920.

The Repeal of the Monopoly.

At the beginning of the nineteenth century attempts to repeal the monopoly of the two existing marine insurance corporations were many. A commission was appointed to inquire into its working, and reported against the continuation of the restriction, the amount of business written by the companies being quite limited.

Angerstein in giving evidence before the Committee stated that during 1807 whereas on one vessel (the Diana frigate, from Vera Cruz to Great Britain) one company had underwritten but £25,000, private insurers had absorbed £631,000! The Committee resolved:

(a) "That property requiring to be insured against sea and enemies risk, should have all the security which can be found for it, whether that security exists in chartered companies or through individuals;" and

(b) "That the exclusive privilege for marine insurance of the two chartered companies should be repealed, saving their charters, and their powers and privileges in all other respects, and that leave should be given to bring in a Bill for this purpose."

This was in 1810, but the repeal was not enacted until 4th June, 1824. The repeal resulted in the immediate establishment by Nathan Rothschild of the