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HODGSON The payment of the premium is for ever enjoined, MAR. Yx.Co. and nothing can be more unjust than to compel the
defendants to pay the loss.
The following authorities were cited by the counsel of the defendants. 1 Rob. 11. 13. 1 Burr. 397. Shep. Touch. 58, 59. Chitty on Bills, 8, 9. 3'Bro. Parl: Cas. 525. Smith's Rep. 289. 2 P. Wms. 154. 157. 220. 287. Marsh. 339, 340. 348. Doug. 260. Marsh. 199. 201. 586. 2 Wils. 347. 1 Fonb. 230. 5 Com. Dig. tit. Pleader, 2 W. 18. 3 T. R. 438. Hayne v. Maltby. 2 W. Bl. 115%. 5 Co. 129. Gilb. Ev. 163. 2 Vent. 107. Bull. 173. 1 Mod. 477. 1 Vooddeson, 207. 3 Burr. 1918. Carter v. Boehm. Puk, 182. 1 N. 1. T. Rep. 229. Barnewull v. Church. Doug. 260, 261, 262. M Dowell v. Frazier. 1 W. Bl. 593. Carter V. Boehm. Millar, 57. Park, 209. Marsh. 208, 209. 350. Stewart v. Drinlop. 2 East, 452. Williamson v. Allison. 4 East, 590. Haywood v. Rodgers. Marsh. 540. Le Cras v. Hughes. 3 Crunch, 281. M Ferran v. Taylor & Massie. i Ves. 213. 4 Dall. 250. Doug. 96. 2 Wils. 352. Collins v. Blantern. , 1 Vent. 121. Doug. 30. 2 Wils. 8. Long v. Jackson. Skin. 327.
Jones, in reply, was directed by the court to confine his observations to the 5th and 6th pleas.
No fraud or covin is charged in either of those pleas; the doctrines, therefore, respecting a sealed instrument being vacated by fraud, do not apply. The case depends upon the principles of the common law applicable to contracts under seal.
The 5th and 6th pleas are in substance the same; and if the 5th be bad, as the court below decided, the 6th must be bad for the same reasons.
There is no case in which a sealed instrument has been set aside on the grounds alleged in the plea, If the facts would not maintain an action of deceit, they will not avoid a contract under seal. They cannot even be given in evidence. It must be a
goes to the whole contract, and shows it HODGSON to be void ab initio. It must be an allegation of
MAR.In.Co. fraud, or of illegal consideration.
The case of Hayne v. Maltby, 3 T. R. 438. is the only one çited which bears upon the present. But there the contract was void ab initio, and the case was decided upon the principle of fraud. It's immaterial what the facts of the case were, or how slight the evidence of fraud was. It is the principle only which is to be considered.
In an action at law upon a sealed contract you cannot go into the question of consideration, but to show it fraudulent or illegal. 2 Cro. 4. Chandler 1. Lopus. i Com. Dig. 184. 2 East, 446.
February 24. ÇUSHING, J. (Narshall, Ch. J. not sitting in the cause) delivered the opinion of the court, * fol. lows:
The insurance in this case being general, as well for the parties named as “ for all and every other person or persons to whom the vessel did or might appertain," and containing no warranty of neutrality, belli. gerent as well as American property was covered by it. Some of the parties being described as of Richmond, does not necessarily imply that they all resided there ; but if they did, mere residence would not make them citizens, and even then, an express warranty was necessary, if it had been designed to run only a neutral risk. This is an answer to the 7th as well as to the 4th .plea; because there can be no undue concealment as to the parties interested, where the terms of the policy are so broad as to preclude the necessity, either of disclosing their names, or of inserting them in the instru
Preseut, Cushing, Wachington, Livingston and Johnso:1, justices.
HODGSO'N The eighth plea is also bad. The defendants acMie Ys Co. knowledge, under seal, to have received a consider.
ation of 17 1-2 per cent. for the insurance they made, which it appears was secured by a note, the amount of which was to be deducted from the sum to be paid for a loss, if any happened. On the face of the instrument, then, a valid consideration, if that be necessary, is stated, and if the note be never paid it cannot vacate the contract, or be relied on as a defence to an action on it. This court knows not why a court of equity has been applied to for an injunction. Its proceedings, therefore, can have do influence on the present suit, for notwithstanding its interposition in the way mentioned in this plea, the defendants cannot be deprived of the right they have reserved of deducting the amount of premium from whatever sum they may have to pay for the loss that has occurred.
Without deciding whether a material misrepresentation, not fraudulent, can be pleaded in avoidance of a sealed instrument, the court thinks there is no fact disclosed by either the fifth or sixth plea, which could vacate an insurance were it only a simple contract. In no part of the 5th plea is the misrepresentation alleged to be material. It is only to be inferred that it had some influence (but to what degree does not appear) in prevailing on the defendants to agree to so high a valuation. It will hard. ly, however, be insisted, that every over-valuation, however inconsiderable, or however innocently produced, will annul a contract of this nature. It would seem more reasonable, to let mistakes of this kind (if they are to have any operation at all) regulate the extent of recovery, and not deprive the party of his whole indemnity: for if an extravagant valuation be made, an underwriter cannot reasonably ask to be relieved beyond the excess complained of. The allegation that the vessel was worth, when insured, only 3,000 dollars, is also very unimportant, it being nowhere stated that the plaintiff represented her to be worth more, but only proposed that her value in the policy should be agreed
at ten thousand dollars. Now although she might HODGSON not in fact have been worth this sum, it is impossi- Marin Co. ble for the court to say that this difference was producod entirely by the mistake which was made in her age and tonnage. This would be to say that a difference of a year or two in the age, and of fifty or sixty tons in the burden of a vessel, must, in all cases, have the same effect on her value; a conclu: sion which, on investigation, would be found very incorrect. Nor, if it appeared on trial that her actual worth were no more than 3,000 dollars, would it necessarily avoid the contract, or restrict the damages to that sum; for she may, notwithstanding, have fairly cost her owners the whole amount of her valuation; who, in that case, would have honestly tepresented her as worth 10,000 dollars.
But a more fatal objection to this plea is, that the misrepresentation relied on is not stated to have been material to the risk of the voyage; and yet the only cases in which policies have heen avoided for innocent misrepresentations are those in which the matter disclosed or concealed has affected the risk so as to render it different from the one understood at the time, and on which the premium was calculated.
Most of the remarks on the 5th apply also to the 6th plea : for although it be here alleged that the misrepresentation was material “in regard 'to the contract of insurance,” it should have been stated in what particular, that it might appear whether the risk run were at all affected by it.
An objection is made to the declaration, but not much relied on, that no abandonment is averred to have been made. In covenant such averment cannot be necessary. If it be proved on the trial, it · will be sufficient.
The judgment of the circuit court on the 4th, 5th, 7th and 8th pleas must be affirmed with costs; and its judgment in favour of the defendants on the
HODGSON 6th plea reversed ; and judgment on that plea be V.
also rendered for the plaintiff. Mar. In. Co,
JOHNSON, J. The difficulties in this case arise partly from the pleadings, and partly from the case presented by the pleadings.
This policy, having been effected by a corporation under its corporate seal, has been considered as imposing an obligation on the insured to bring covenant instead of assumpsit, as is usual on such contracts.
Thus the defendants have been obliged to plead specially; and the cause comes up on demurrer, which, of course; admits the case as made up on the pleadings.
Whether there, is sufficient matter well pleaded why the plaintiff ought not to recover? is therefore the question before us.
I am of opinion that there is. I cannot for a moment suffer the sealing of the policy, or the form of the action, to impose any restriction upon the latitude of defence applicable to the contract of insu
Such a doctrine would be fatal to every incorporated insurance company. I therefore maintain, that, in the action of covenant on a policy of insurance, every defence may be taken advantage of, in pleading, that could be introduced, in evidence, before a jury. It is an exceedingly inconvenient form of action for trying the merits of questions arising out of this species of contract, and I feel disposed, if possible, to Jiminish the inevitable dif. ficulties, and the intricate and voluminous pleadings, which must grow out of this form of action, and to admit every facility which the rules of pleading will possibly sanction.
There are eight pleas filed to the present action. On the three first there are issues in fact, and the court below has given judgment on the remaining