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Standard Marine Ins. Co. v. Westchester Fire Ins. Co.

December 6, 1937

STANDARD MARINE INS. CO., LIMITED,
v.
WESTCHESTER FIRE INS. CO.



Appeal from the District Court of the United States for the Southern District of New York.

Author: Hand

Before L. HAND, AUGUSTUS N. HAND, and CHASE, Circuit Judges.

AUGUSTUS N. HAND, Circuit Judge.

The plaintiff is a British insurance corporation which seeks to share in an award against Germany made by the Mixed Claims Commission (United States and Germany) in favor of the United States on behalf of the defendant, an American insurance corporation.

During the period of the World War: (a) The plaintiff from time to time reinsured certain marine and war risk insurances and reinsurances which had been underwritten by defendant as insurer or reinsurer and by the terms of the contracts of reinsurance plaintiff became bound to accept the adjustments made by the defendant and to pay accordingly. (b) The defendant reinsured certain marine and war risk insurances and reinsurances which had been underwritten by plaintiff as insurer or reinsurer, the contracts being in substantially the same form as those described in (a), supra. (c) The plaintiff and defendant also insured and reinsured identical property under identical risks by contracts or marine and war risk insurance and reinsurance. The underwriters paid the losses for which they were liable to their assured in cases (a), (b), and (c). The Mixed Claims Commission was organized and has acted pursuant to an Executive Agreement between the United States and Germany dated August 10, 1922 (42 Stat. 2200), the terms of which were based upon the treaty of peace between the United States and Germany known as the Treaty of Berlin (42 Stat. 1939). That treaty conferred certain rights in favor of the United States of America, as a nation and on behalf of persons owing permanent allegiance to it. The award here concerned only recoveries by the United States for injuries to one of its nationals. Each of the Allied and Associated Powers, however, was to obtain similar redress for injuries to its nationals under the terms of the Treaty of Versailles.

The Treaty of Berlin provided in article 1 (42 Stat. 1942) that: "Germany undertakes to accord to the United States, and the United States shall have and enjoy, all the rights, privileges, indemnities, reparations or advantages specified in the aforesaid Joint Resolution of the Congress of the United States of July 2, 1921, including all the rights and advantages stipulated for the benefit of the United States in the Treaty of Versailles."

The Joint Resolution of July 2, 1921, "reserved to the United States of America and its nationals any and all rights, privileges, indemnities, reparations, or advantages, together with the right to enforce the same* * * which, under the treaty of Versailles, have been stipulated for its or their benefit." 42 Stat. 105, § 2.

The Joint Resolution also provided for retention by the United States of all seized German property, "until such time as the Imperial German Government and the Imperial and Royal Austro-Hungarian Government, or their successor or successors, shall have respectively made suitable provision for the satisfaction of all claims against said Governments respectively, of all persons, wheresoever domiciled, who owe permanent allegiance to the United States of America and who have suffered, through the acts of the Imperial German Government, or its agents, or the Imperial and Royal Austro-Hungarian Government, or its agents, since July 31, 1914, loss, damage, or injury to their persons or property, directly or indirectly * * * in consequence of hostilities or of any operations of war, or otherwise." 42 Stat. 106, § 5.

Under section 232 of the Treaty of Versailles incorporated by reference in the Treaty of Berlin, Germany undertook "that she will make compensation for all damage done to the civilian population of the Allied and Associated Powers and to their property during the period of the belligerency of each * * *".

Under Annex I of the Treaty of Versailles it was provided that:

"Commission may be claimed from Germany under Article 232 above in respect of the total damage under the following categories:

"(9) Damage in respect to all property wherever situated belonging to any of the Allied or Associated States or their nationals, with the exception of naval and military works or materials, which has been carried off, seized, injured or destroyed by the acts of Germany or her allies on land, on sea or from the air, or damage directly in consequence of hostilities or of any operations of war."

The obligations of Germany under the treaty, to be determined by the Commission, were defined in the ...


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