Horace Lloyd, for the defendant:

The plaintiffs insured only their own risk as carriers by this policy, and did not insure, as trustees, the interest of any other parties. * * The policy binds the Insurance Company to make good "to the assured ""all damage and loss which the " "assured" "shall suffer." There are two questions, therefore, to consider in determining the extent of the defendant's liability: first, who are the assured? Secondly, what damage and loss have they suffered? The assured are the Railway Company, the plaintiffs: and, if the defendant's contention, that they insured only as carriers, is well founded, they have suffered no loss whatever, not being, as carriers, responsible for the loss of the goods in question.

(CROMPTON, J.: You have to contend against the strong words "goods held in trust," in the second condition, and the fact that these goods were insured, by the policy, as such.)

* *

The words of the

That raises a question of intention.
policy, in the present case, show that the plaintiffs intended.
to insure their own interest only. The words of the policy in
Waters v. The Monarch Insurance Company (1) were different;
and the judgment proceeds on the construction to be given to
the words there used.

(HILL, J.: What meaning do you give here to the words "in trust," which are used in compliance with the second condition indorsed on the policy ?)

They are used to show the plaintiffs' intention to insure as carriers; had those words been omitted, it might have been said that the plaintiffs could recover, on the policy, only in case of the loss of goods which were their own property.

(CROMPTON, J.: If it is to be considered that this insurance. does not cover the owners' interest in the goods, the result will be that, in all cases like the present, two or three insurances must be effected in respect of the same goods, in order to the protection of every one interested in them.)

WIGHTMAN, J.:

The question in this case is, Whether the plaintiffs are entitled, under this policy, to recover more than their own particular interest in the goods which they, as carriers, had in the warehouse when it was burnt? I think that they are: and that they ought to recover the full value of the goods. They must, in my opinion, be considered as having insured the (1) 103 R. R. 786 (5 El. & Bl. 870).

LONDON AND

NORTH WESTERN

RAILWAY

COMPANY

v.

GLYN.

[ 659 ]

[660]

NORTH

LONDON AND goods, *which they held in trust as carriers, for the benefit of the owners, for whom they will hold the amount recovered, what is due in respect of their

WESTERN
RAILWAY
COMPANY

v.

GLYN.

[ *661 ]

[ *662 ]

as trustees, after deducting
own charges upon the goods. It is not contended that there is
anything illegal in this policy. The plaintiffs are clearly entitled
to recover something: the only question is, how much. Now,
when the terms of the policy are looked at, it appears that the
plaintiffs thereby insure "goods their own and in trust as
carriers" in the warehouse. Thus a distinction is drawn between
their own goods and goods which, as carriers, they hold for other
people; and it appears to me that both classes of goods were
meant to be fully covered by the insurance, and that the descrip-
tion of some of the goods as "goods in trust as carriers
was inserted, in compliance with the second condition indorsed
on the policy, for the express purpose of protecting the interest
of the owners of such goods, as well as the more limited
interest of the plaintiffs. It is true that this insurance is in
the nature of a voluntary trust undertaken by the plaintiffs,
without the knowledge of the cestuis que trust, the owners of
the goods but it is a trust clearly binding on the plaintiffs
in equity, who will hold the amount which they now recover,
in the first place for the satisfaction of their own claims, and in
the next, as to the residue, in trust for the owners.
If a
different construction was put on such a policy as this, it
would be necessary, as my brother CROMPTON has observed,
that several policies should be effected on the same goods, and
thus Insurance Companies would obtain several premiums
instead of one in respect of what, to them, is the same risk.
The question is, certainly, one of intention: but I have no
doubt that the intention was as I have stated. The circum-
stance that the plaintiffs, in consequence of the non-compliance
with the Carriers Act, are not liable, as carriers, to the owners
for the loss of the goods, is not, as it seems to me, very
material to the present question. In Waters v. The Monarch
Insurance Company (1) the plaintiffs, being warehousemen, and
therefore not insurers, were not liable to the owners of the
goods which were burnt: but the COURT held that that fact
did not prevent the Insurance Company from being liable to
the plaintiffs to the amount of the full value of the goods,
although the utmost interest that the plaintiffs themselves had
in the goods was to the extent of their warehouse charges,
for which they had a lien upon them. That case is, in prin-
ciple, undistinguishable from the present: and is conclusive
in favour of the plaintiffs.

(1) 103 R. R. 786 (5 El, & Bl, 870).

ERLE, J.:

I do not disagree with the rest of the CoURT as to the construction to be put upon the policy in this particular case. I should have been inclined to think that the intention of the assured was to insure only their own interest: but then, as a carrier is responsible to the owner for the full value of goods destroyed by fire, his insurance of his own interest is an insurance of the full value of the goods. And, in this particular case, I do not think that it can be said that, in making this insurance, the plaintiffs made an implied stipulation with the Insurance Company that, although they insured the full value of all goods in their hands as carriers, they would, if the Carriers Act, 11 Geo. IV. & 1 Will. IV. c. 68, gave them a defence against the claim of the owners of any such goods, if lost, avail themselves of it. And here *we have it found, as a fact, that the plaintiffs have made a payment to the owners of the goods in question in respect of the loss. In future, if Insurance Companies wish, in granting such policies as the present, to limit their responsibility to the responsibility of the carrier, upon proceedings taken against him in invitum, they must employ precise words to that effect.

CROMPTON, J.:

I am of the same opinion. The plaintiffs intended to insure, first, their own interest, if any, in the goods; and, secondly, the interest of their cestuis que trust, the owners of the goods. Mr. Lloyd said that the questions were, Who are the assured ? and What is their loss? I answer, first, the assured are the plaintiffs, both as trustees and as carriers; secondly, the loss is the loss of the property as trust property, that is to say as property in which the plaintiffs are beneficially interested to the extent of their lien, and as to the residue of which they are trustees for the true owners. I should come to no other conclusion if the question was res integra: but it is not, having already been decided in Waters v. The Monarch Insurance Company (1). That case established that persons who, like the plaintiffs here, are the bailees of goods, have an insurable interest in them, as against the assurers, to their full value, although the assured may be trustees for third persons of part of the amount recovered on the policy. Then we have to consider whether the plaintiffs here have sufficiently complied with the second condition on the policy, which says that "goods held in trust or on commission are to be insured as such." I read that as meaning "If you intend to *insure as trustees, (1) 103 R. R. 786 (5 El. & Bl, 870).

LONDON AND and not as absolute owners, you must give us notice of that NORTH fact." The condition proceeds: otherwise the policy will

WESTERN

RAILWAY COMPANY

not extend to cover such property." Mr. Lloyd says that that
means "will not extend to cover your particular interest in such
property." But I think that it means the value of such
property shall not be recoverable unless you specify it as trust
property but, if you do, its entire value shall be recoverable."
I think, too, that, notwithstanding this condition, an insurance
simply upon "goods " would have covered the plaintiffs' interest
as carriers in the goods. Then, the policy itself is expressed
to be made upon "goods their "
goods their" (the plaintiffs') "own, and
in trust as carriers;" so that the condition is complied with.
There can be no objection to the plaintiffs recovering the full
value of the goods: for an equity will arise, in favour of the
owners, from the mere circumstance that the plaintiffs will
have received more than enough to cover their own interest:
as to the excess above the sum which will cover that interest,
the plaintiffs will be compellable, in equity, to pay it over to
the owners. The fact that the plaintiffs, in consequence of
non-compliance with the provisions, as to notice, of the Carriers
Act, were not liable to the owners for the loss of the goods,
does not, in my judgment, at all affect the case. The owners
may fairly have chosen, knowing that an insurance had been
effected by the plaintiffs, to look to the insurance office for
compensation instead of to the plaintiffs. I do not see that
there is any obligation, under that Act, upon the owners of
goods above the value of 10l., to declare their value to the
carrier if they are willing to run the risk of the loss of the
goods, without having any redress against the carrier, they may
do so.
But there is no hardship *in holding the insurance
office liable to the full value of the goods, for they have received
the premium upon the full value.

HILL, J.:

I am of the same opinion. The question is one of construction of the policy. Does it protect the interest and legal responsibility of the plaintiffs, as carriers only, or does it also protect the interest of the owners in the case of goods in their possession as carriers? The latter appears to me to be the proper construction. The policy contains plain words, describing the property insured, "Goods their own and in trust as carriers." If it had been intended that only the plaintiffs' own goods should be insured, why should the further words have been added? Mr. Lloyd relied on the second condition as making it necessary for the plaintiffs to add these words in order

NORTH WESTERN RAILWAY COMPANY

2.

GLYN.

to insure merely their interest as carriers. But that condition LONDON AND is: Goods held in trust or on commission are to be insured as such, otherwise the policy will not extend to cover such property." I agree with my brother CROMPTON that this condition. would not have prevented the plaintiffs from recovering on the policy to the extent of their interest as carriers, had they intended to insure only that interest, and, with that intention, had made the insurance simply upon "goods," without adding the words "in trust." The effect to be given to these words, which have been added, is, that the owners' interest was insured, as well as that of the plaintiffs. My brother ERLE has most truly said that Insurance Companies must insert in policies express words to that effect, if they wish to limit their liability in the manner here contended for. To hold that they have done so would be to put a most strained construction on *the language which has been used. Moreover, I consider that Waters v. The Monarch Insurance Company (1) really governs the present case. The ratio decidendi was the same.

Judgment for the plaintiffs.

LEONARD v. SHEARD.

(1 El. & El. 667-680; S. C. 28 L. J. Q. B. 183; 5 Jur. N. S. 1050; 33 L. T. O. S. 9.)

[Obsolete bankruptcy.]

[ *666 ]

1859. Feb. 3.

GRIFFITHS v. PERRY (2).

(1 El. & El. 680–691; S. C. 28 L. J. Q. B. 204; 5 Jur. N. S. 1076.)
On 30th October, 1857, plaintiff agreed with defendant to buy of
him 100 parcels of iron of a named quality, and 300 parcels of iron
of another named quality, to be delivered immediately, and paid for
by a bill of exchange at four months' date, down. No specific iron
was appropriated for the purposes of the contract.
Plaintiff gave
the bill, which, on 31st October, 1857, defendant indorsed to his
bankers, the W. and S. S. Banking Company, who continued the holders
till the bill fell due. Defendant duly delivered the 100 parcels of
iron, and gave plaintiff a delivery order for the 300 parcels; which
plaintiff, on 19th November, 1857, indorsed to his bankers, H. & Co.,
and a few days afterwards gave defendant notice of the indorsement.
H. & Co. presented the order at the works where the iron was lying,
on 19th November, 1857, when delivery of it was refused.
November, 1857, defendant suspended payment and,
February, 1858, plaintiff was adjudicated a bankrupt. On 4th March,
1858, the bill given by plaintiff fell due, and was dishonoured. The
W. and S. S. Banking Company, though they claimed to be creditors
of plaintiff for the amount of the bill, did not prove against his
estate, nor had plaintiff paid any part of the amount. Defendant,
however, had paid them a composition of 8s. in the pound upon the
amount of the bill; which composition amounted to 5777. 10s. Held,

(1) 103 R. R. 786 (5 El. & Bl. 870).
(2) Approved, In re Edwards, Ex

On 17th

on 10th

parte Chalmers (1872) L. R. 8 Ch. 289,
292, 42 L. J. Bk. 5, 28 L. T. 325.

1859. Feb. 4.

[ 680 ]