decided: February 9, 1953.
RED TOP BREWING CO.
MAZZOTTI ET AL.
Before SWAN, Chief Judge, and CLARK and FRANK, Circuit Judges.
FRANK, Circuit Judge.
The facts are sufficiently stated in Judge Bondy's opinion, reported in 107 F.Supp. 921.
The meal was shipped from Brazil to the United States. The policies insured against loss due to condemnation of the meal by the U.S. Pure Food and Drug Administration. As the meal was so condemned, that loss occurred. But the underwriters defend on the ground that there was a breach of a warranty, peculiar to these policies, reading thus:
"Warranted Brazilian Department Agriculture and/or Lloyd's and/or Board Underwriters of New York and/or Sociedad Brasiliera de Superintendencia de Embarques e Descargas Limitada certificate issued immediately prior shipment specifying merchandise is clean, free of foreign matter and insects, edible and fit for human consumption and such certificate shall be deemed Underwriters admission sound condition."
The judge, holding that such a breach occurred, set aside a verdict against the defendants and entered a judgment dismissing the complaint.
The Certificate issued by the Brazilian authorities did not contain words specifying freedom from foreign matter and insects. In his charge, the judge left it to the jury to determine whether the wording of the Certificate meant what the warranty required. The jury found that it did. There is some evidence to support the conclusion that such was the meaning to the Brazilian officials. However, as the warranty - not a standard provision of such policies but carefully inserted because of the insured risk in these special circumstances - said that the Certificate should "specify," and as the Brazilian official meaning of the Certificate was not known to the underwriters when they undertook to insure, we think the warranty must be read literally, and that it was therefore broken.
Plaintiff, however, argues that subdivisions 1 and 2 of Section 150 of the New York Insurance Law apply.*fn1 Defendants reply that subdivision 3 applies and renders inapplicable subdivisions 1 and 2.*fn2 We agree with defendants. For the terms of the warranty show that the heart of the risk was insect infestation during the sea voyage.*fn3