Jellinghaus v. New York Insurance — 6 N.Y. Super. Ct. 18

Majority

p. 18

Jellinghaus v. The New York Insurance Company.

Headnote

By the provisions of a.policy of insurance'on merchandise, if there he a partial loss by sea damage, the loss shall be ascertained by a separation and.,sale of the portion of.the. goods so damaged. On the arrival of goods thus damaged, the underwriters designated an auctioneer to sell them, and requested the insured ■ to prepare them for sale, and paid him therefor. The insured sent the goods to the auctioneer, they were sold ■ as for account of the underwriters, and the auc- . tioneer failed, without paying over the proceeds to either party. Held, that the auctioneer was the joint agent of the underwriters and the insured, and the former were not responsible to tlie latter for the loss by his failure.

■'(Before Oaklet, Ch. J., and Paine, J.)

May 22;

May 25, 1850.

This was an' action to recover ■ from- tbe defendants the amount arising npon a sale of merchandise, insured by them upon, .a voyage 'from Bremen to-New York, and wbicb having been damaged upon tbe voyage, had been sent to an auctioneer to be sold, in accordance with- a condition of tbe policy. Subsequent to tbe sale,.tbe auctioneer failed and did not pay over tbe. proceeds: of the sale to either party.

. ..Tbe. cause came on for trial before Yanderpoel, J;, on tbe 20th day of .October, 1849.

Upon tbe .trial it was admitted, tbat an open policy of insurance for $100,000 was made by tbe defendants' with Spies, Christ &.,0o.; .on account of whom it might concern, .on all merchandise on'board vessels from Bremen, and certain other ports, to New York.. That in July, 1848', .46 cases of hardware, covered by tbe.policy and belonging to tbe plaintiff, were shipped from'Bremen to,-New York, on board tbe Charlotte Reed; tbat the hardware, on its arrival, was delivered to an agent of the plaintiff;, that-8.5 of the .cases were damaged by sea water; and that Spies,-.Christ &. Co. assigned to-the plaintiff their right to damage unden.the, policy; It was .also admitted.that the amount of-.,damage.had been agreed, upon only with'reference to 8 of the cases, and that the balance óf the cases were sold at auction

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Sept. 21, 1848, to ascertain the loss, and brought upon the sale $2357.14. The auctioneer’s charges and other expenses of sale were $126.84. ' * •

The policy in question formed a part of the complaint, and contained the following clause: “ In case of partial loss by sea damage to dry goods, cutlery, or other hardware, the loss shall be ascertained by a separation and sale of the portion only of the contents of the packages so damaged, and not otherwise, and the same practice shall obtain as to all other merchandise as far as practicable.”

It appeared by the testimony, that the defendants, designated the auctioneer, and directed the plaintiff’s agent to clean up the hardware preparatory to a sale under this clause, and that the agent after so preparing it, sent it to the auctioneer; that the sale was advertised to be,“on account of underwriters;” that the account in the books of the auctioneer was entered in their name, and the account of sales rendered to them; and that they paid the agent of the plaintiff for preparing the goods for the sale:

The evidence having closed, the court charged the jury that the case depended upon the question whose agent was the auctioneer in selling the goods; that although there might be ho liability on the part of the defendants as owners, it might be that they had made themselves responsible as custodians of the goods; that if, however, there was a joint employment, or if the auctioneer was the agent of the plaintiff, the verdict must be for' the defendants; but that if the defendants had taken the goods out of the custody of the plaintiff, and had exercised dominion over them, employing their own agent as auctioneer, the plaintiff was entitled to recover. The defendants excepted.^

The jury found a verdict in favor of the plaintiff, and the defendants appealed.

B. Emmet, for the defendants.

B. D. Silliman, for the plaintiff.

By the* Court.

The policy of insurance

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upon the plaintiff's goods contained a special provision, that “ in case of partial loss by sea damage to dry goods, cutlery, or other hardware, the loss shall be ascertained by a separation and sale of the portion only of the contents of the packages so damaged, and not otherwise, and the same practice shall obtain, as to all other merchandise as far as practicable.”

The parties were unable to agree as to the extent of the damages sustained by the plaintiff on a part of the goods, and his agent was notified that the company required such part to be sold, in order to ascertain the loss. The company designated an auctioneer, and told the agent to clean up the goods preparatory to the sale. They were sent by him to the auctioneer, and were sold. On the amount of sales being ascertained, the agent sent a bill to the company, stating the amount of the loss claimed, after deducting the proceeds of the sale at auction; in this bill the auctioneer’s commissions and other expenses were added to the balance left after deducting the proceeds, and appear to have been paid by the plaintiff. The auctioneer failed, and did not pay over the proceeds.

Upon this state of facts the plaintiff claimed that the defendants had taken the goods in question out of his hands, employed théir own auctioneer, directed as to the time and terms of sale, and controlled the whole affair, and that therefore the auctioneer was their agent, and the loss by his failure devolved upon them.

On the other hand, the defendants claimed that there was no abandonment of the property to the underwriters, that the goods were in the possession of the plaintiff at the time of the sale, and were sold as his, and that the loss was his.

The judge at the trial left it to the jury to decide whether the auctioneer was the agent of the plaintiff or of the defendants, or of both parties; and he instructed them that if he were the agent of the defendants in the transaction, and not of the plaintiff, the defendants were responsible for the loss arising from bis failure.

We have considered the subject, and we think, that apart from any. agreement to the contrary, the appointment ■ of an

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auctioneer to sell the property in question, under the provisions of the policy for that purpose, must be deemed in law to be the joint act of the parties, and of course .the defendant would not be responsible to the plaintiff for the loss sustained by his failure. The plaintiff, therefore, cannot succeed in this action, without showing that the defendants took the goods as their own, and sold them as their own, and,, in our judgment, the evidence in the case falls far short of making out that fact. The verdict of the jury is therefore wrong, and must be set aside, and a new trial granted.