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LOWERY v. CONNECTICUT FIRE INS. CO.

December 8, 1933

LOWERY
v.
CONNECTICUT FIRE INS. CO. OF HARTFORD, CONN.



The opinion of the court was delivered by: BYERS

BYERS, District Judge.

This is an admiralty cause in personam in which the owner of the Diesel vessel F. A. Lowery and the barge Lowery Sisters seeks to recover from the respondent insurance company the sum of $13,335.91, being the amount of damages fixed in accordance with a decree hereinafter to be referred to, and an additional sum representing counsel fees and disbursements in the latter cause, amounting to $1,773.94, making a total of $15,109.85.

The claim is in contract, based upon an insurance policy issued by the respondent company to W.E. Hedger Company, Incorporated, and/or the Hedger Transportation Company, Incorporated, for account of whom it may concern, and bearing date April 18, 1932.

 On April 15, 1932, the Hedger Transportation Company, Incorporated, as charterer, entered into a charter party with the libellant, as owner, in which said Diesel steamer F. A. Lowery and her six consorts, including the Lowery Sisters, were covered for the barge canal season of 1932, at an agreed daily rate for the entire fleet, commencing April 15, 1932.

 The owner paid for all provisions, wages of crew and necessary supplies to operate the Diesel vessel and man the barges in the customary manner. It was further provided as follows:

 "The charterer further agrees that all cargoes loaded on the said steamer and consorts shall be covered with carrier's legal liability insurance; said insurance shall be paid by the charterer and shall be obtained in such amount as to cover legal liability of the owner and of the steamer and her consorts."

 It was agreed that the steamer and barges were to be operated as a unit. Other provisions of the charter party seem to be presently unimportant.

 It is contended for the respondent that the charter did not constitute a demise, citing Hansen v. E.I. Du Pont De Nemours & Co. (William P. Donnelly and Barges) 33 F.2d 94, 1929 A.M.C. 586 (C.C.A.); as opposed to which view, the libellant relies on The R. Lenahan, Jr. (C.C.A.) 48 F.2d 110. The point seems not to require decision, for reasons to be stated.

 Three days after the said vessels were chartered, the insurance policy in question was procured, and in form covers both cargo insurance and carrier's legal liability; it was an open policy under which declarations were to be filed, and the paragraph having to do with the latter form of insurance provides in reference thereto as follows:

 "28. This policy also to cover the legal liability of the Assured as owners, operators, charterers, carriers, wharfingers, forwarders, freighters, etc., howsoever arising as to all cargoes at any time at the risk of the Assured, transported and/or intended to be transported between any of the points or places heretofore described in Paragraph 7 and the dates set forth in paragraph 9 hereof. The assured agreed to report all cargo carried between the aforesaid places to the company and pay the premium for this coverage as to all such cargo. The company admits the seaworthiness of all vessels as between the assured and the company as to the legal liability coverage and the company further agrees that this legal liability coverage shall include all attorneys fees and legal costs arising from the defense of any liability so incurred by the Assured hereunder. The company shall not be liable for any loss with respect to legal liability, unless the loss amounts to Twenty-five ($25.00) Dollars, each shipment separately insured."

 Many, if not all, of the provisions of the policy are more appropriate to cargo liability than to that pertaining to carriers.

 Paragraph 36, somewhat relied upon by the respondent, is as follows:

 "36. Wherever in this contract the term 'assured' is used, it shall be deemed to mean and to refer to and include in addition to the named assured, the owners of the above described cargoes, where such cargoes are insured hereunder, in the same manner as though this policy were specifically issued to such owner or to the legal holder of certificates issued under and by virtue hereof. Where the insurance herein is only against the legal liability of the named insured the term 'assured' shall be deemed to mean and to refer to and include the corporation or corporations named herein as parties hereto."

 Under date of April 28, 1932, a declaration under the policy was made by the Hedger Transportation Company and initialed by the marine underwriter of the respondent, and accepted by the latter, reading:

 "Carpinter & Baker's Agency 3 South William Street New York

 "April 28th, 1932.

 "Insurance is wanted by Hedger Transportation Company, Inc., et al. 286/325 (the number of this policy)

 "For account of Whom it may ...


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