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period than six months, and that the articles insured shall remain the property of the same person or persons (f), and that no additional or further sum shall be insured by reason or means of such alteration ” (g).
Where a sea insurance is made for a voyage and also for time; “ or to extend to or cover any time beyond thirty days after the ship shall have arrived at her destination and been there moored at anchor, the policy shall be chargeable with duty as a policy for a voyage and also with duty as a policy for time” (h). For instance, a policy on a ship or goods insured for a voyage, and for a period exceeding thirty days and not exceeding six months after arrival, would be chargeable with duty at the rate of threepence per cent. for the voyage and threepence per cent. for time, or sixpence per cent. in all.
A policy on goods, merchandise, or other property which is executed for a transit inclusive of land as well as sea risks is to be stamped as a “sea insurance,” without any additional stamp being affixed on account of a portion of the transit being made by land (i).
Allowance for spoiled stamps on policies which have inadvertently been filled up in an incorrect manner, but not underwritten, will be made by the Commissioners of Inland Revenue, provided the application shall be made for the allowance within six months after the policies have been spoiled or rendered useless (k).
(f) A similar clause in a previous enactment was construed to prohibit the substitution of an essentially different subject for the one named in the policy, as “goods” for “outfit,” without a new stamp, as it could not be said that the thing insured remained the property of the same person. Hill v. Patten, 8 East, 373 ; 1 Camp. 72.
(9) 30 & 31 Vict. c. 23, s. 10.
(h) Ibid., s. 11, as modified by 47 & 48 Vict. c. 62, s. 8.
(i) 47 & 48 Vict. c. 62, s. 8. The
Board of Inland Revenue are advised that a policy for a transit, including land and sea risk, does not require any extra stamp in respect of fire risk during the land transit, see Appendix.
(k) 30 & 31 Vict., c. 23, s. 17. For particulars of the penalties imposed for breaches of the revenue enactments and other details, reference is made to the text of Stamp Acts relating to policies of sea insurance, as given in extenso in the Appendix.
IV.-ALTERATIONS. It is a general rule that, when a policy has once been fully underwritten, no alteration can be made in its terms, unless by the consent of all parties, or by order of a court of law or cquity. The parties may indeed make any alteration they think fit, whether by way of erasure, addition, or correction of the terms of the instrument; and, such alterations, if duly signed and not contrary to the provisions of the Stamp Acts, will have as much validity as though they formed part of the original agreement. Again, if a mistake has been made in filling up the policy, and the consent of all parties cannot be obtained to the necessary correction, it lies within the powers of a court having equitable jurisdiction to reform the instrument, so that it may give effect to the original intention of the parties (1).
Apart however from common consent, or judicial authority, no alteration can lawfully be made in a policy after it is fully subscribed; and, the effect of the making of a material alteration by the assured will be to invalidate the contract, excepting as regards those underwriters who expressly agree to the alteration by affixing their signatures or initials thereto (m). It would appear, from the cases, that an alteration, to be material, must be one which makes a real difference in the risk insured. A mere verbal alteration will not vitiate the policy, though the altered term will be a nullity as regards those underwriters who have not consented to its insertion.
The rights at Common Law which the parties possess to modify the contract at will are limited by the statutory regulations specified in the previous section. An alteration, to be covered by the original stamp, must be made before the determination of the risk originally insured ; and, it must neither prolong the time covered by the policy beyond the period for which duty has been paid, effect a change in the property
(1) For the authorities, see Arnould, 4th ed., 248, 249 ; Marshall, 2nd ed., 343.
(m) Arnould, 251.
insured, or involve the insurance of an additional amount. The object of these restrictions is to protect the revenue by preverting the making of a new contract, in whole or in part, under cover of an alteration, without the payment of the additional duty properly incurred. Accordingly, as already noticed, it was held that the subject-matter of an insurance could not be altered from “ship and outfit” to “ship and goods” without a new stamp, as the alteration was a breach of the requirement “that the articles insured shall remain the property of the same person or persons” (o). On the other hand, it has been held that the statutory restrictions do not prohibit the correction of a mistake, as in the name of the ship, or the subject-matter of the insurance; the extension of a warranty of sailing, before the determination of the risk ; the conversion of a summer into a winter risk, upon payment of an additional premium, by the modification of a similar warranty; or, the making of an alteration in the vessel's port or ports of destination during the currency of the policy (p).
V.—THE EXECUTION OF THE POLICY.
The mode in which a policy is executed varies according as the insurance is made with individual subscribers or a company. In the former case, the execution takes place upon the subscription of the policy. The ordinary mode of subscribing a policy made with private underwriters is for the agent to specify at the foot or on the back of the instrument the name of each underwriter for whom he is authorised to take the risk, with the respective sums insured, and the date of subscription ; thus
assured, whose right of action lies in consequence against the individual underwriter, and not against the aggregate body (9).
The policy is generally subscribed in the names of the underwriters by an agent who is authorised to take insurances on their account. An agent is understood to have been authorised for this purpose if he is in possession of a written authority; or, even if he has been in the habit of subscribing policies with the knowledge and approval of the underwriters. Power to subscribe policies implies power to sign off losses on behalf of the underwriters. A subscription in the usual style of a partnership firm is valid (r).
In the event of an agent subscribing a policy on behalf of an underwriter for a sum in excess of a limitation imposed upon him by the latter, it has been decided that the underwriter is not liable for any portion of the sum affixed to his name, even though the assured be ignorant of this particular restriction, provided it is notorious in the place where the contract is entered into that some limitation is imposed by underwriters upon their agents (s).
Every subscription should be dated. The date to be inserted is the day, month, and year, when the underwriter subscribes the policy; and the place for its insertion is immediately after the underwriter's name.
The mode of execution of policies of insurance effected with a joint stock company or association of underwriters will depend upon the deed or articles of the company or society. In general, it will take place when the policy is signed or sealed, or both signed and sealed, as required by the constitution of the office.
A policy which has been executed may be cancelled by the underwriter before issue ; but, after it has once been delivered, either actually or constructively, to the person for whose benefit it is intended, it cannot be cancelled without the consent of both parties (t), It is not within the ordinary functions of a
broker to cancel a contract of insurance once completely effected, without the express authority of the assured.
In an action upon a policy of insurance which purported to be “signed, sealed, and delivered” by two of the directors of the company in the presence of their secretary, the statement to that effect was deemed to be conclusive as against the company that the policy was not only duly signed and sealed, but also duly delivered. A policy, “signed, sealed, and delivered," is complete and binding as against the party executing it, though, in fact, it remains in his possession, unless there is some particular act required to be done by the other party to declare his adoption of it; and, it is not necessary that the assured should formally accept or take away a policy in order to make the delivery complete. Under such circumstances, the broker who has effected the insurance, has no power, without express instructions from the assured, to direct that the policy be cancelled (u).
An express warranty is a condition inserted in writing upon the face of the policy, the literal fulfilment of which is essential to the validity of the contract (9). The question as to whether any clause is to be considered a warranty, depends upon whether it is merely descriptive or a part of the contract. If it does not consist of words of description, it is a warranty (y). The difference between a warranty and a representation has already been stated (2).
It is not necessary that the actual word “ warranted” should be used in order to constitute a warranty. Thus, the words “in port,” or “all well” on a certain day, or any other such declaration, possesses as much force without the word “warranted” prefixed as with it. Indeed, in some instances, even an express declaration is not essential; but a mere written description will