following questions and answers: "What material is used in lubricating or oiling the bearings and machinery? A. Tallow, lard, and machine oil. Q. Will you agree to use use only lard, or sperm and lard oil for lubricating; lard and tallow, or lard and machine oil? Will you agree to keep all the bearings and machinery properly supplied with oil? A. Yes. Q. Is smoking or drinking of spirituous liquors allowed on the premises? A. No." In an action on the policy, the company set up as a defense that, after the policy had been taken out, smoking and drinking was allowed on the premises, and alleged that it was a breach of the warranty. The court held that an examination of the questions noted above in the application showed that the company had clearly made a distinction between those words in which they saw fit to exact a definite promise of the insured in his answers to the questions, and those in which they did not; in other words, that, when they had not exacted a promise as to future action in regard to the prohibition of smoking and drinking, it must be held that it was satisfied merely with the warranty as to the condition in that regard at the time of the taking out of the policy. § 53. Same: Ambiguous language. In a large number of cases, however, it is impossible to draw so easily the line between present and promissory warranties. Under these circumstances, the general principle of construction is that the warranty will be held not broader than the company has clearly made it, and so, unless it is clearly a promissory warranty, it will be construed as merely a warranty of present conditions and not as to future action. Thus, where the insured in terms of warranty described the stock insured as "a two story frame building used for winding and coloring yarn," it was held to be no warranty that it would continue to be used for that purpose (51). So, the insurance of a building as an "occupied dwelling house" is not a warranty that it will continue to be occupied (52). In this last connection, however, it is always to be borne in mind that, irrespective of any definite warranty of future use, the policy is void if the subject matter of the policy is so changed as to materially increase the risk. CHAPTER III. SPECIFIC REQUIREMENTS OF POLICIES. § 54. Introductory. Having considered the general principles of the making of the various contracts of insurance, and the important difference between representations and warranties, it will be necessary to examine the exact scope and effect of some of the more commonly found warranties or conditions in the various kinds of policies. SECTION 1. MARINE INSURANCE. § 55. Implied warranties. Rather oddly, the three most important warranties in marine insurance are not expressed on the face of the policy at all, but are universally implied as arising from the dealings of the parties. The insured is held to warrant: first, that the vessel is seaworthy; second, that the vessel shall not deviate from the proper course; and, third, that the vessel is not engaged in an illegal transaction. § 56. Warranty of seaworthiness: When applicable. In considering the warranty of seaworthiness, it is necessary in the first place to distinguish between two kinds of marine policies: that is to say, the voyage policy, where the insurance is for a given voyage from one port to another; and the time policy, where the insurance is for a stated period of time, regardless of where the vessel may be. It is everywhere agreed that the warranty of seaworthiness applies to the voyage policy. It is well settled in England that that warranty does not apply to a time policy, for the reason that at the inception of the policy the vessel may be in a place where it would be impossible to equip her in a way that would satisfy the warranty of seaworthiness. In the United States the rule varies in different jurisdictions. Apparently the generally adopted idea is that the warranty of seaworthiness applies, even in a time policy, if the vessel at the taking out of the policy is in a port where she can be equipped. Otherwise it does not (1). § 57. Same: Extent of warranty. The warranty of seaworthiness is not a "continuing warranty". That is to say, if the warranty is satisfied at the inception of the risk, the recovery is not barred if, through the negligence of the officers or seamen, the vessel subsequently becomes unseaworthy. The warranty implies that the vessel is properly equipped, provisioned, and manned for the voyage. This does not necessarily mean that at the inception of the voyage the vessel is then equipped to perform satisfactorily the entire voyage. One leading case will illustrate this limitation. A vessel was insured for the voyage, beginning on an inland river, down the river to the ocean, and then over the ocean to another port. When she began the river trip she had a sufficient equipment for that part of the trip, but not sufficient for the ocean. She took on enough to make her seaworthy for the ocean, (1) Hoxie v. Insurance Co., 7 Allen (Mass.) 211. before beginning that part of her trip. It was held that the warranty of seaworthiness was satisfied, since, through every step of her journey, she was properly equipped for that part of it (2). On the other hand, it must be noted that, inasmuch as it is a warranty of seaworthiness, any breach of this warranty voids the policy, irrespective of the question whether or not the loss is traceable to lack of seaworthiness. Thus, in one case, a vessel was insured for a voyage and made the first few miles of her voyage short two hands of her regular equipment. These two hands she afterward procured, and then was later on lost through an entirely unrelated cause. It was held that there could be no recovery on the policy, because of the breach of the warranty of seaworthiness at the beginning of the voyage (3). § 58. Warranty of non-deviation. This warranty also applies only to voyage policies. In such policies the insured impliedly warrants that the vessel shall go, by the regular route, from the port named as the port of beginning to the port named as the port of termination, and that the voyage shall begin without unreasonable delay. Here, as with the warranty of seaworthiness, if the warranty is broken, the fact that the loss is in nowise due to this breach will not prevent the company from successfully resisting recovery. Thus, in a leading case on the point, a vessel was insured from Plymouth, Massachusetts, to the Newfoundland Banks, and then back to Plymouth. After reaching the Banks she ran out of bait, and made a five (2) Bouillon v. Lupton, 15 C. B. (N. S.) 113. |