Scottish Court of Session Decisions

The pursuers, owners of the schooner “Scotia” of Aberdeen, sued the defenders, the owner and master of the barque “Ghilino” of Genoa, for damages on account of injury done to the “Scotia” through the barque of the defenders having come into collision with it. The defenders brought a counter action against the owners of the “Scotia,” on account of injury done to their barque “Ghilino” by the said collision. The actions went to trial in April last.

In the course of leading the evidence the defenders, owners of the “Ghilino,” proposed to put in a policy of insurance on the “Scotia” for £350, and a receipt by the owners of the “Scotia” for the sum in the policy, in abatement of damages. The pursuers objected. It was agreed, after discussion, that the evidence should be received: that the jury, in assessing the damages, should leave out of view the sum already received by the owners of the “Scotia” from the underwriters, on account of the collision, and that there should be indorsed on the verdict a special finding by the jury that the sum in the policy had been received by the owners of the “Scotia.”

In both cases the jury found for the owners of the “Scotia,” finding them, in the action in which they were pursuers, entitled to £566 damages. The special finding was indorsed on the verdict.

J. M' Laren (with him Young) for the pursuers, now moved the Court to apply the verdict, and produced an assignation in their favour by the under-writers of their claim for damages against the wrongdoers.

Asher (with him Gifford), for the defenders, opposed. He contended that the owners of the “Scotia,” having already, admittedly, received $350 from the underwriters on account of the collision, could not recover the full damage found by the jury, but only the difference between what they had already received and the sum in the verdict. In point of fact, all that the jury had found, as the loss and damage due to the pursuers, was the difference between the whole sum of damage and the sum received from the underwriters. The effect of payment by insurers to the parties insured, for injury suffered, was to put them in the place of the insured, with full right to recover any compensation that might be recoverable from the party doing the Wrong— Stewart v. Greenock Marine Insurance Company, 13th Jan. 1846, 8 D., 323; Addison on Contracts, 845. Therefore, whenever the under-writers paid the owners of the “Scotia” the sum in the policy, they became vested with the right to receive compensation from the defenders; and, if they did not choose to press their claim, still that did not entitle the owners of the “Scotia” to insist. If the owners of the “Scotia” had gone in the first instance against the wrongdoers, they could not now have gone against the underwriters, and, in like manner, having gone first against the underwriters, they were barred from recovering damages a second time from the defenders.