The same principle has a further consequence. The amount to be made good will not necessarily be the value of the goods or other property in their condition at the time they were sacrificed; so to calculate it would in effect be to withdraw those goods from the subsequent risks of the voyage, and thus to put them in a better position than those which were not sacrificed. Hence, in estimating the amount to be made good, the value of the goods or property sacrificed must be estimated as on arrival, with reference to the condition in which they would probably have arrived had they remained on board throughout the voyage.

The liability to pay G.A. contributions falls primarily upon the owner of the contributing interest, ship, goods or freight. But in practice the contributions are paid by the insurers of the several interests. Merchants seldom have to concern themselves with the subject. And yet in an ordinary policy of insurance there is no express provision requiring the underwriter to indemnify the assured against this liability. The policy commonly contains clauses which recognize such an obligation, e.g. a warranty against average "unless general," or an agreement that G.A. shall be payable "as per foreign statement," or "according to York-Antwerp Rules"; but it does not directly state the obligation. It assumes that. The explanation seems to be that the practice of the underwriter to pay the contribution has been so uniform, and his liability has been so fully recognized, that express provisions were needless. But one result has been that very differing views of the ground of the obligation have been held. One view has been that it is covered by the sue and labour clause of an ordinary policy, by which the insurer agrees to bear his proportion of expenses voluntarily incurred "in and about the defence, safeguard and recovery" of the insured subject.

But that has been held to be mistaken by the House of Lords (Aitchison v. Lohre, 1879, 4 A.C. 755). Another view is that the underwriter impliedly undertakes to repay sums which the law may require the assured to pay towards averting losses which would, by the contract, fall upon the underwriter. Expenses voluntarily incurred by the assured with that object are expressly made repayable by the sue and labour clause of the policy. It might well be implied that payments compulsorily required from the assured by law for contributions to G.A., or as salvage for services by salvors, will be undertaken or repaid by the underwriter, the service being for his benefit. But the decision in Aitchison v. Lohre negatives this ground also. The claim was against underwriters on a ship which had been so damaged that the cost of repairs had exceeded her insured value. A claim for the ship's contribution to certain salvage and G.A. expenses which had been incurred, over and above the cost of repairs, was disallowed. The view seems to have been that the insurer is liable for salvage and G.A. payments as losses of the subject insured, and therefore included in the sum insured, not as collateral payments made on his behalf.

This bases the claim against the insurer upon a fiction, for there has been no loss of the subject insured; in fact, the payment has been for averting such a loss. And it suggests that the insurer is not liable for salvage where the policy is free of particular average, which does not accord with practice.

An important question as to an insurer's liability for G.A. arose in the case of the Brigella (1893, P. 189), where a shipowner had incurred expenses which would have been the subject of G.A. contributions, but that he alone was interested in the voyage. There were no contributories. He claimed from the insurers of the ship what would have been the ship's G.A. contribution had there been other persons to contribute in respect of freight or cargo. The claim was disallowed on the ground that there could be no G.A. in such circumstances, and therefore no basis for a claim against the insurer. The liability of the insurer was thus made to depend, not upon the character of the loss, but upon the fact or possibility of contribution. But this was not followed in Montgomery v. Indemnity Mutual M. I. Co. (1901, 1 K.B. 147). There ship, freight and cargo all belonged to the same person. He had insured the cargo but not the ship. The cargo underwriters were held liable to pay a contribution to damage done to the ship by cutting away masts for the general safety. The loss was in theory spread over all the interests at risk, and they had undertaken to bear the cargo's share of such losses.

Their liability did not depend upon the accident of whether the interests all belonged to one person or not. This agrees with the view taken in the United States.

As to Particular Average, see under Insurance: Marine.

Authorities

Lowndes on General Average (4th ed., London, 1888); Abbott's Merchant Ships and Seamen (14th ed., London, 1901); Arnould's Marine Insurance (7th ed., London, 1901); Carver's Carriage by Sea (4th ed., London, 1905).

(T. G. C.)

[1] Per Bowen, L.J., in Svensden v. Wallace, 1883, 13 Q.B.D. at p. 84.