
    Bowne, surviving partner of Bowne & Embree, against Shaw. The Same against Neilson and Bunker.
    If both insurer and insured on lawful goods, in a policy containing the usual clause of warranty against contraband, know there is contraband on hoard, the warranty against loss under the clause against illicit trade and contraband of war will apply only to the goods insured. The suit for a return of premium must he against the underwriter, not the broker, though the assured be themselves underwriters and the broker employed by both parties.
    These were two actions on a policy of assurance on the cargo of the schooner Polly, in which verdicts were taken for the plaintiff, subject to the opinion of the court on a case made, with liberty to turn the same into a special verdict.
    The only question in the first cause was on the effect of the warranty against loss, “ by capture, or detention for or on account of any illicit trade, or trade in articles contraband of war.”
    The facts were shortly these; the property insured, no part of which was contraband, really belonged to the plaintiff and his deceased partner, who were also owners of the schooner. They, however, as agents for Joseph M. Stansbury, shipped on his account, in the _ same vessel, other articles which were contraband, and Embree even made out the invoice in his own hand-writing. The difference of premium between contraband and other goods for that voyage, was 21 per cent. At the time, however, of subscribing the policy, Shaw knew there were contraband articles on board: Heilson and Bunker did not; and, as soon as they did know it, insisted on being discharged from the policy. This the plaintiff agreed to do, but did not erase their names from the instrument. The vessel was taken, and, together with her cargo, condemned as lawful prize. In promulging the sentence, on the 18th of December, 1800, the judge rested himself on the general interest of the plaintiff in the contraband. This he inferred from its appearing that Stansbury was part owner of the vessel in the September preceding, and there being no evidence of his having ever alienated his share. He also relied on the invoice of the contraband being in the handwriting of Embree. It was, however, admitted, that the plaintiff had not, either directly or indirectly, any interest in the contraband articles.
    In the case against Neilson and Bunlcer, the return of premium was the sole object of the suit. The defendants contending the broker was as much the debtor for the premium to the assured-as the assurer, and, therefore, the action improperly ^brought against them. The [*490] facts on this point are fully detailed in the opinion of the court.
    Iloffman, for the plaintiffs.
    The court is called on to say whether the warranty is confined to the goods insured by the policy, or shall be considered so extensive as to guard against all losses, whatsoever they may be, arising from any article on board which may be contraband. There is no position of law more known, or more acted on, than this; the mere letter of a contract is not to be the rule of exposition. It is to be construed according to the spirit, and expounded according to the intent. If so, though the words be large enough to cover all goods, we may examine into the intent, which cannot be better done than by inquiring into tire the reason of introducing this .clause; the mischief it was meant to redress, and the rem edy it was designed to afford. It owes its origin to Seton, Maitland & Co. They insured contraband merchandize, without communicating its nature, and this court decided a neuter need not avow the quality of shipment, all goods being to him lawful trade. To communicate to the underwriter the particular species of commodity shipped, and yet to warrant only as to that commodity, was the clause introduced into our policies. The conduct of Neilson and Bunlcer, show this construction ought to be adopted. On being informed there were contraband articles on board, they desired- to be released from their responsibility ; this was unnecessary if the warranty covered those articles. The generality of the construction is against it. An importer must warrant against transactions and parties thousands of miles distant, and always in the dark. This would destroy insurance itself. Besides Shaw, underwrote with a knowledge of all the circumstances, and must be presumed to have taken the risk of consequences from contraband articles on himself. Our construction, therefore, as to him, must prevail
    
      Pendleton and Harrison, contra.
    The intention .of introducing the clause, on the construction of which the whole of this controversy depends, was to relieve the underwriter from his general liability. It was an exception from what was considered as the effect of the policy. Being [*491] so, the exception *must be co-extensive with the effect The words, also, used for this purpose, are equally large. They are, “ for or on account of any illicit or prohibited trade.” But, in deciding the present case, it is not necessary to determine the universal operation of the clause in question. The plaintiff here was owner of the vessel. He is presumed conusant of all that comes on board. By the old maritime law, his vessel was liable to confiscation for having contraband on board, merely from the circumstance of his supposed knowledge. This, on general principals, would affect the cargo which belonged to him, because the taint of contraband is communicated wherever there is privity. It is only in modern days that we have had the rule relaxed, but that is only when actual knowledge is not proved. Here the reverse is the case, and the circumstance of the plaintiff’s partner having written out the invoice, was a principal ingredient in causing the condemnation. In the case of Heilson and Bunker, allowing the plaintiff entitled to recover, it must be from the broker, and not from the defendants.
    
      Hamilton, in reply.
    It is contrary to the principles of a Warranty, that it should extend to all things. It can relate only to the subject matter insured. When we warrant of a certain thing, we warrant of that thing alone. Whei we warrant against acts, we may warrant against the acts of all the world. The intent of the clause cannot be doubted. It was framed by myself to avoid the construction contended for on the other side, and to confine the operation of it simply to the article insured. I have heard that every new clause in an instrument is but a fertile source of litigation, and it is with regret I find in myself a personal verification of the truth of the remark. But whatever may be the construction of the effect of the warranty, it cannot touch the present case, because all was known to the defendant. I cannot, however, agree that the operation of the clause is to be different against different persons. The rule of law must be the same as to all.
    
      
       The case alluded to, is Seton, Maitand & Co. v. Law, since reported in - 1 Johns Cas. 1.
    
    
      
       See the case of The Franklin, 3 Rob. Ad. Rep. 217, and the note there, v. 221, (a), where this point is ably treated.
    
   Lewis, Ch. J.

delivered the opinion of the court. The question between the parties of the suit against Shaw, arises upon ike warranty against loss by capture or detention for trading in articles contraband of war. The effect which Contraband shall have upon lawful goods when going to [*492] *the port of a belligerent, would be here a proper subject of inquiry, had the fact of the Polly’s carrying such contraband been secreted from the insurer at the time of subscribing the policy. But it is stated in the case that the circumstance was within his knowledge. It is, therefore, only necessary to inquire into the understanding the parties had of the contract they entered into. The goods covered by the policy on which this suit is brought were lawful, and insured at a premium of 9 per cent. Certain contraband articles were shipped in the same vessel by the plaintiffs as agents, and insured at the premium of 80 per cent. With a knowledge of this fact, the defendant subscribed the policy, and as both parties must be presumed equally acquainted with the law upon the subject, he, doubtless, took the risk of all the consequences that might result to the lawful from the illicit goods: the warranty extending, in the understanding, of the parties, to the goods only which were the subject of the policy. See Suckley v. Delafield, 2 Caines’ Rep. 222, and note here.

We are, therefore, of opinion, the plaintiff is entitled to recover as for a total loss.

In the case of the same plaintiff against Neihon and BunIter, we think the former entitled to a return of premium. The broker who held funds of both parties, debited the plaintiff in account, with the whole amount of the premium due on the policy, and credited the defendants for their proportion. In May, 1801, he settled with the plaintiff, and paid him a balance which did not include the premium in question. On two several accounts rendered the defendants, the amount of premium still stood to their credit. And although a balance in their favor has always lain in the hands of the broker to a greater amount than the premium, it does not appear to have been left there for the purpose of repayment to the plaintiff. No authority for this purpose has ever been given, and the defendants must be considered as still withholding it from the plaintiffs.

Judgment for the plaintiffs, in both suits.  