the United States for the Southern District of New York. danger of collisions, and the frequency of their occurrence, are much greater than on maritime voyages, renders the respective rights of underwriters and insured, growing out of such occurrences, of more moment in this than in any other civilized country; and the court has considered the inquiry presented by this case, with the care which its difficulty and its importance demand. In examining, for the first time, any question under a policy of insurance, it is necessary to ascertain whether the contract has received a practical construction, by merchants and underwriters; not through any partial or local usages, but by the general consent of the mercantile world. Such a practical construction, when clearly apparent, is of great weight, not only because the parties to the policy may be presumed to have contracted in reference to it, but because such a practice is very high evi The action was assumpsit on a time policy of insurance, subscribed by the plaintiffs in error, upon the brig Emily, during one year from the seventeenth day of October, 1843, for the sum of $8,000, the vessel being valued at the sum of $16,000. The policy, described in the declaration, assumed to insure against the usual sea perils, among which is barratry of the master and mariners. The declaration avers, that during the prosecution of a voyage, within the policy, while on the high seas, and near the entrance of the harbor of the City of New York, by and through the want of a proper lookout, by the mate of the said brig, and by and through the erroneous order of the chief mate, who was stationed on the top-gallant forecastle of the said brig, who saw the schooner, hereinafter named, and cried out to the man at the wheel, helm hard down-dence of the general convenience and substan luff "-whereas, he ought not to have given the said order; and by and through the negligence and fault of the said brig Emily, the said brig ran into a schooner called the Virginian, and so injured her that she sank, whereby the said brig Emily became liable to the owners of the said schooner and her cargo, to make good their damages; which liability was a charge and incumbrance on the said brig. The declara tion then proceeds to aver, that the brig was libeled, by the owners of the schooner and her cargo, in the District Court of the United States; that a decree was there made, whereby it was adjudged, That the collision in the pleadings mentioned, and the damages and loss incurred by the libelants, in consequence thereof, occurred by the negligence or fault of the said brig, and that the libelants were entitled to recover their damages by them sustained thereby;" that the same having been assessed, a decree therefor was made by the District Court, which, on appeal, was affirmed by the Circuit Court, which found, That the lands on board the Emily failed to keep a proper lookout, and that the said brig might have avoided the collision, by the use of proper cau tion, skill and vigilance." The declaration further avers, that the plaintiff has paid divers 362*] sums of money, to satisfy this decree and the expenses of making the defense, amounting to the sum of eight thousand dol lars. tial equity of it, as a rule. This is true of most commercial contracts; but it is especially true of a policy of insurance, which has been often declared to be an obscure, incoherent and very strange instrument," and "generally more informal than any other brought into a court of justice" (Per Buller, J., 4 T. R., 2:0; Mansfield, Ch. J., 4 Taunt., 380: Marshall, Ch. J., 6 Cr., 45; Lord Mansfield, 1 Bur., 347); but which, notwithstanding the number and variety of the interests which it embraces, and of the events by which it is affected, has been reduced to much certainty, by the long practice of acute and well-informed men in commercial countries; by the decision of courts in America and in England, and by able writers on the subject, in this and other countries. And it should not be forgotten, that not only in the introduction *of this branch [*363 of law into England, by Lord Mansfield, but in its progress since, both there and here, a constant reference has been had to the usage of merchants, and the science of insurance law has been made and kept a practical and convenient system, by avoiding subtle and refined reasoning, however logical it may seem to be, and looking for safe practical rules. Now, although cases like the present must have very frequently occurred, we are not aware of any evidence, that underwriters have paid such claims, or that, down to the time when one somewhat resembling it was rejected by the Court of King's Bench in De Vaux v. Salvador, 5 Ad. & Ellis, decided in 1836, such a claim was ever made. And we believe, that if skillful merchants, or underwriters, or lawyers, accustomed to the practice of the com mercial law, had been asked whether the insurers on one vessel were liable for damage done to another vessel, not insured by the policy, by a collision occasioned by the negligence of those on board the vessel insured, they would, down to a very recent period, have answered, unhesitatingly, in the negative. This statement of the substance of the declaration, presents the question which has been here argued, and sufficiently shows how it arose; for, although there was a demurrer to the first two counts in the declaration, and a trial upon the general issue pleaded to the other counts, and a bill of exceptions taken to the ruling at the trial, yet the same question is presented by each mode of trial, and that question is: whether, under a policy insuring aginst the usual perils, including barratry, the under writers are liable to repay to the insured, damages paid by him to the owners of another As we shall presently show, such, for a long vessel and cargo, suffered in a collision occa- time, was the opinion of the writers on insioned by the negligence of the master or mar-surance, on the continent of Europe and in iners of the vessel insured. The great and increasing internal navigation of the United States, carried on over long distances, through the channels of rivers and other comparatively narrow waters, where the England and America. And this, alone, would be strong proof of the general understanding and practice of those connected with this subject. But, although this practical interpretation of the contract is entitled to much weight, we do not consider it perfectly decisive. It may be, that by applying to the case the settled principles of the law of insurance, the loss is within the policy, and that it has not heretofore been found to be so, because an exact attention has not been given to the precise question. Or, it may be that the weight of recent authority, and the propriety of rendering the commercial law as uniform as its necessities, should constrain us to adopt the rule contended for by the defendant in error. And therefore, we proceed to examine the principles and authorities bearing on this question. Upon principle, the true inquiries are: what was the loss, and what was its cause. The loss was the existence of a lien on the vessel insured, securing a valid claim for damages, and the consequent diminution of the value of that vessel. In other words, by operation of law, the owners of the Virginian obtained a lien on the vessel insured, as security for the payment of damages, due to them for a marine tort, whereby their property was injured. What was the cause of this loss? We think it is correctly stated by this court, in the case 364*] of The Paragon, 14 Peters, 109. *In that case, it was said: "In the common case of an action for damages for a tort done by the defendant, no one is accustomed to call the verdict of the jury and the judgment of the court thereon, the cause of the loss to the defendant. It is properly attributable to the original tort, which gave the right to damages consequent thereon." The cases there spoken of, were claims in personam. But the language was used to illustrate the inquiry, what should be deemed the cause of a loss by a claim in rem, and is strictly applicable to such a claim. Whether the owners of the Virginian would proceed in rem or in personam, was at their election. It affected only their remedy. Their right, and the grounds on which it rested, and the extent of the defendant's liability, and its causes, were the same in both modes of proceeding. And in both, the cause of the loss of the defendant would be the negligence of his servants, amounting to a tort. The loss consisting in a valid claim on the vessel insured, we must look for the cause of the loss in the cause of the claim, and this is expressly averred by the declaration to have been the negligence of the servants of the assured. From the nature of the case, it was absolutely necessary to make such an averment. If the declaration had stated simply a collision, and that the plaintiff had paid the damages suffered by the Virginian and her cargo, it would clearly have been bad on demurrer; because, although it would show a loss, it would state no cause of that loss. It is only by adding the fact, that the damage done to the Virginian was caused by negligence; that is, by stating the cause of damage, that the cause of payment appears, and, when it appears, it is seen to be the negligence of the servants of the assured. We know of no principle of insurance law which prevents us from looking for this sole operative cause, or requires us to stop short of it, in applying the maxim causa proxima et non remota spectatur. The argument is, that collision, being a peril of the sea, the negligence which caused that peril to occur is not to be inquired into; it lies behind the peril, and is too remote. This is true when the loss was inflicted by collision, or was by law a necessary consequence of it. The underwriter cannot set up the negligence of the servants of the assured as a defense. But in this case he does not seek to go behind the cause of loss, and defend himself by showing this cause was produced by negligence. The insured himself goes behind the collision, and shows, as the sole reason why he has paid the money, that the negligence of his servants compelled him to pay it. It is true that an expense, attached by the law maritime to the subject insured, solely as a consequence of a peril, may be considered as proximately caused by that peril. But where the expense is attached to the vessel [*365 insured, not solely in consequence of a peril, but in consequence of the misconduct of the servants of the assured, the peril per se is not the efficient cause of the loss, and cannot in any just sense be considered its proximate cause. In such a case the real cause is the negligence, and unless the policy can be so interpreted as to insure against all losses directly referable to the negligence of the master and mariners, such a loss is not covered by the policy. We are of opinion the policy cannot be so construed. When a peril of the sea is the proximate cause of the loss, the negligence which caused that peril is not inquired into; not because the underwriter has taken upon himself all risks arising from negligence, but because he has assumed to indemnify the insured against losses from particular perils, and the assured has not warranted that his servants will use due care to avoid them. These views are sustained by many authorities. Mr. Arnould, in his valuable Treatise on Insurance, Vol. II., 775, lays down the correct rule: "Where the loss is not proximately caused by the perils of the sea, but is directly referable to the negligence or misconduct of the master or other agents of the assured, not amounting to barratry, there seems little doubt that the underwriters would be thereby discharged." To this rule must be referred that class of cases in which the misconduct of the master or mariners has either aggravated the consequences of a peril insured against, or been of itself the efficient cause of the whole loss. Thus, if damage be done by a peril insured against, and the master neglects to repair that damage, and in consequence of the want of such repairs, the vessel is lost, the neglect to make repairs, and not the sea damage, has been treated as the proximate cause of the loss. In the case of Copeland v. The N. E. Marine Ins. Co., 2 Met., 432, Mr. Chief Justice Shaw reviews many of the cases, and states that "the actual cause of the loss is the want of repair, for which the assured are responsible, and not the sea damage which caused the want of repair, for which it is admitted the underwriters are reponsible." And the same principles were applied by Mr. Justice Story, in the case of Hazard v. N. E. Marine Ins. Co., 1 Sum., 218, where the loss was by worms, which got access to the vessel in consequence of her bottom being injured by stranding, which injury the master neglected to repair. So where a vessel has been lost or disabled, and the cargo saved, a loss caused by the neglect of the master to transship, or repair his vessel and carry the cargo, cannot be recovered. (Schieffelin v. N. Y. Ins. Co., 9 Johns., 21; Bradhurst v. Col. Ins. Co., 9 Johns., 17; Am. Ins. Co. v. Centre, 4 Wend., 45; S. C., 7 Cow., 504; McGaw v. Ocean Ins. Co., 23 Pick., 405.) So, where con366*] demnation of a neutral *vessel was caused by resistance of search (Robinson v. Jones, Mass., 536); or a loss arose from the master's negligently leaving the ship's register on shore. (Čleveland v. Union Ins. Co., 8 Mass., 308.) So, where a vessel was burnt by the public authorities of a place into which the master sailed with a false bill of health, having the plague on board (Emerigon, by Meredith, 348); in these and many other similar cases, the courts, having found the efficient cause of the loss to be some neglect of duty by the master, have held the underwriter discharged. Yet it is obvious that in all such cases, one of the perils insured against, fell on the vessel. And they are to be reconciled with the other rule, that a loss caused by a peril of the sea is to be borne by the underwriter, though the master did not use due care to avoid the peril, by bearing in mind that in these cases it is negligence, and not simply a peril of the sea, which is the operative cause of the loss. It may sometimes be difficult to trace this distinction, and mistakes have doubtless been made in applying it, but it is one of no small importance in the law of insurance, and cannot be disregarded without producing confusion. The two rules are in themselves consistent. Indeed, they are both but applications, to different cases, of the maxim, causa proxima et non remota spectatur. In applying this maxim, in looking for the proximate cause of the loss, if it is found to be a peril of the sea, we inquire no further; we do not look for the cause of that peril. But if the peril of the sea, which operated in a given case, was not of itself sufficient to occasion, and did not in and by it self occasion the loss claimed, if it depended upon the cause of that peril whether the loss claimed would follow it, and therefore a particular cause of the peril is essential to be shown by the assured, then we must look beyond the peril to its cause, to ascertain the efficient cause of the loss. The case at bar presents an illustration of both rules. So far as the brig Emily was herself injured by the collision, the cause of the loss was the collision, which was a peril insured against, and the assured, showing that his vessel suffered damage from that cause, makes a case, and is entitled to recover. But he claims to recover not only for the damages done to his vessel, which was insured, but for dam ages done to the other vessel, not insured. To entitle himself to recover these, he must show not only that they were suffered by a peril of the sea, but that the underwriter is responsible for the consequences of that peril falling on a vessel not insured. It is this responsibility which is the sole basis of his claim, and to make out this responsibility he does not and cannot rest upon the occurrence of a collision; this affords no ground for this claim; he must show a particular cause for that collision; and aver that by reason of *the existence of that [*367 cause, the loss was suffered by him, and so the underwriter became responsible for it. This negligence is therefore the fact without which the loss would not have been suffered by the plaintiff, and by its operation the loss is suffered by him. In the strictest sense, it causes the loss to the plaintiff. The loss of the owners of the Virginia was occasioned by a peril of the sea, by which their vessel was injured. But nothing connects the plaintiff with that loss, or makes it his, except the negligence of his servants. Of his loss this negligence is the only efficient cause, and in the sense of the law it is the proximate cause. The ablest writers of the continent of Europe, on the subject of insurance law, have distinctly declared, that, in case of damage to another vessel solely through the fault of the master or mariners of the assured vessel, the damage must be repaired by him who occasioned it, and the insurer is not liable for it. (Pothier Traité d' Assurance, No. 49, 50: Boucher, 1500, 1501, 1502; 4 Boulay Paty, Droit Maritime, ed. of 1823, 14, 16; Santayra's Com., 7, 223; Emerigon, by Meredith, 337.) If the law of England is to be considered settled by the case of De Vaux v. Salvador, 4 Ad. & El., 420, it is clear such a loss could not be recovered there. Mr. Marshall is evidently of opinion that unless the misconduct of the master and crew amounted to barratry, the loss could not be recovered. (Marsh, on Îns, 495.) And Mr. Phillips so states in terms. (1 Phil. on Ins., 636.) It has been urged, that in the case of The Paragon (Peters v. Warren Ins. Co., 14 Pet., 99), this court adopted a rule which, if applied to the case at bar, would entitle the insured to recover. But we do not so consider it. It was there determined that a collision without fault was the proximate cause of that loss. Indeed, unless the operation of law, which fixed the lien, could be regarded as the cause of that loss, there was no cause but the collision, and that was a peril insured against. We are aware that in the case of Hall v. Washington Ins. Co., 2 Story, Mr. Justice Story took a different view of this question; and we are informed that the Supreme Court of Massachusetts has recently decided a case in conformity with his opinion, which is not yet in print, and which we have not been able to see. But with great respect for that very eminent Judge, and for that learned and able court, we think the rule we adopt is more in conformity with sound principle, as well as with the practical interpretation of the contract by underwriters and merchants; and it is the safer and more expedient rule. We cannot doubt that the knowledge by owners, masters and seamen, that underwriters were responsible for all the damage done by collision with other vessels through their negli gence, *would tend to relax their vigi- [*368 lance and materially enhance the perils, both to life and property, arising from this case. The judgment of the Circuit Court must be reversed, and the cause remanded, with direc tions to render a judgment for the defendants, on the demurrer to the first two counts, and award a venire de novo to try the general issue pleaded to the other counts. ORDER. This cause came on to be heard on the transcript of the record from the Circuit Court of the United States for the Southern District of New York, and was argued by counsel; on consideration whereof, it is now here ordered and adjudged by this court, that the judgment of the said Circuit Court in this cause be, and the same is hereby reversed, with costs; and that this cause be, and the same is hereby remanded to the said Circuit Court, with directions to enter a judgment for the plaintiff in error, on the demurrer to the first two counts, and to award a venire facias de novo, to try the general issue pleaded to the other counts. MARTHA PHIPPS, AND MARY BOWERS, wife of CHARLES RICE. Jurisdiction-Mississippi-Receiver appointed by State Court cannot be sued as such in U. S. Cir cuit court-claim in reconvention no waiver of exception to jurisdiction. Two Statutes of Mississippi, one passed in 1843 and the other in 1846, provide that where the charter of a bank shall be declared forfeited, a trustee shall be appointed to take possession of its effects, and commissioners appointed to audit accounts against it. Where these steps had been taken, and the commissioners had refused to allow a certain account, the Circuit Court of the United States had no right to entertain a bill filed by the creditors to compel the trustee to pay the rejected account. There was a want of jurisdiction. The case is upon this point examined. A claim by the trustee, in re-convention, was not a waiver of the exception to the jurisdiction. THIS case was brought up by writ of error put in a course of liquidation as an insolvent corporation, and this defendant appointed trustee, for the purpose of collecting the assets thereof, by the Circuit Court of Adams County, in the State of Mississippi; and said trustee is not amenable to any other court than the one that appointed him, and of which he is the officer; and this court has no jurisdiction whatever of him in his said capacity. The following agreement of counsel was filed in the case. It is agreed between the parties in the abovenamed suit, by Prentiss and Finney, attorneys for the plaintiffs, and Robert Mott, attorney for the defendant, that the following facts shall be admitted upon the trial of the cause, and the same are hereby admitted: 1. That the President, Directors and Com. pany of the Agricultural Bank of Mississippi, were in possession of the City Hotel, being the premises, the mesne profits of which are sued for on the 1st day of December, 1839. 2. It is admitted that the said hotel and furniture rented, from said 1st day of December, 1839, until 1st November, 1842, for the sum of $6,000 per annum, and from said 1st November, 1842, until plaintiffs took possession at the rate of $4,000 per annum, and that said rates shall be considered as the fair annual rent of said property during said periods. 3. It is admitted, that the charter of the Ag ricultural Bank has been adjudged forfeited under the laws of Mississippi, and that the defendant, Elijah Peale, is the trurstee appointed under and by virtue of said laws, to represent the said corporation. 4. It is admitted that the claim sued on was, before the commencement of this suit, presented to the commissioners appointed in Mississippi, to audit and allow claims against said Bank, to wit: to J. A. Van Dalsen and C. L.. Dubuisson, and they were *request [*370 ed to audit and allow the same, but that they refused to audit, allow, or in any way recog nize the same. 5. It is admitted that the claim sued on from the Circuit Court of the United States was, before the commencement of this suit, for the Eastern District of Louisiana. It will be seen, by reference to 4 Howard, 225, that Charles Rice, and Mary, his wife, and Martha Phipps recovered, in an action of ejectment against the Agricultural Bank of Mississippi, two undivided third parts of a lot of ground in the City of Natchez. 369* *In May, 1847, they sued out a writ of habere facias possessionem, and entered into possession of the property. Under the laws of Mississippi, the charter of the Bank became forfeited, and Elijah Peale was appointed trustee. In April, 1848, Martha Phipps, and Mary Bowers, wife of Charles Rice, filed their peti tion in the Circuit Court of the United States for the Eastern District of Louisiana, against Peale. They claimed rent of the property from 1839 to 1847, damages for injuries done to the property whilst in possession of the Bank, and the costs to which they had been put by the ejectment. Peale filed exceptions, and an answer. The second exception, upon which the judgment of this court turned, was as follows. 2. Because the charter of the Agricultural Bank was declared forfeited, and the said Bank presented to the defendant, as trustee of said Agricultural Bank, and he was requested to allow the same as a just and valid claim against said Bank; but that said defendant, as trustee as aforesaid, refused to admit, recognize, or allow said claim, or any part thereof. 6. It is admitted that the fees of counsel employed by the plaintiffs in the prosecution of the suit of ejectment against the Agricultu ral Bank, for the recovery of said City Hotel, in the Circuit Court and Supreme Court of the United States, exceeded in value the sum of $2,000, and that said sum of $2,000 would be a reasonable fee for the conduct of said suit from its commencement to its termination. It is admitted that the furniture of house, &c., on the premises, formed part of the rent in the proportion of one fourth to three fourths thereof. It is admitted that the charter of the Bank was declared forfeited by law, and the assets of the Bank put in the possession of the defendant, who still holds the same as trustee or representative. Ro. MOTT, Attorney. PRENTISS & FINNEY, For Plaintiffs. It is further admitted, that the Agricultural Bank had stopped specie payments previous to the time of the forfeiture of the charter, and did not afterwards resume. PRENTISS & FINNEY, Plaintiffs' Attorneys. In January, 1849, the cause came on to be heard, when the Circuit Court decreed, that the plaintiffs do recover from Peaie the sum of $20,058, with interest at five per cent. until paid; and that they should have execution up on the assets of the Bank, which were then, or might be thereafter, in the hands of the trustee. From this decree, Peale appealed and brought the case up to this court. It was argued by Mr. Lawrence for the plaintiff in error, and Mr. Taylor for the defendants in error. Only that point will be mentioned upon which the judgment of this court turned. Mr. Lawrence contended, for the plaintiff in error, that the action against Peale, who was a mere officer of the Adams County Court, Mississippi, for the purpose of collecting the assets of a bank in course of liquidation, could not be maintained in the United States Circuit 371*] Court for Louisiana. If the plaintiff wished to bring suit, independent of the proceedings in the Adams County Court, the suit should have been brought against the corporation in its corporate name. (Hutch. Dig., secs. 10, 11, Act 1840, p. 326; sec. 8, Act 1843, p. 328; Act February 28, 1846, p. 332; 6 Howard, Miss., 674.) Mr. Taylor, for the defendants in error: The second ground of exception is partly based upon the assumption that the affairs of the Agricultural Bank were administered by the trustee, Peale, because of the declared in solvency of the Bank. This is neither admitted nor proved to be true; and in fact, the affairs of the Bank were taken from the management of her own officers, because those of ficers had violated the laws of its existence, whereby it ceased to exist. But it does not follow, as a necessary consequence, that be cause the charter of the Bank was declared, by the Circuit Court of Adams County, to have been forfeited, or because its affairs were put in liquidation by the order of that court, or because Mr. Peale was appointed trustee by that court, no court but the Circuit Court of Adams County can entertain jurisdiction of a suit against him, as trustee. An administrator or executor is appointed to represent the estate of a person deceased, after the Probate Court has found or adjudged the fact of his death, and put his affairs into a course of liquidation in the same manner. Such executors are liable to be sued in any court whatever; and even in cases where the state laws provide expressly that they shall not be sued, except in the court by which they are appointed, they are held liable to answer to the United States Circuit Court, notwithstanding such special exemption made by the state law. See case of Depuy v. Bemiss, where this question is fully argued (2 Annual, 509); and case of Erwin v. Lowry, 7 Howard, 172-181, reviewing and approving the doctrines, and even the reasonings, of the Louisiana court; and also 14 Pet., 75, examining the same questions; all settling the doctrine that even where the representative of an estate is suable only in his own court by the state law, he may yet be sued in the United States Circuit Court, and there be held to answer, and compelled to pay a debt of the succession: because, in every case of a conflict between the laws made by Congress (in accordance with the Constitution of the United States) and the Acts of a State Legislature, the state laws must yield. We believe, that, in Mississippi, other courts besides the Circuit Court of Adams County could have entertained jurisdiction of a suit against this trustee, in his said capacity; and that even if it were shown that by the positive requirement of the laws of the State of Mississippi suit could have been brought against *Peale only in the Circuit Court [*372 of Adams County, which appointed him, we could, notwithstanding such requirement, sue Mr. Peale, as trustee, in the Circuit Court of the United States. We also submit to the court whether the third and eighth admissions of counsel, found on the seventh page of the printed record, do not admit that the plaintiff in error, Mr. Peale, is the proper person to be sued for, and on account of, the debts due by the Bank, because if, as admitted, the Bank itself had ceased to exist, and Mr. Peale was in the actual possession of all its assets, and was its representative, he is the only person who can be sued on account of the liabilities of the Bank. We think the admissions themselves afford good ground for overruling the exception. Mr. Chief Justice Taney delivered the opinion of the court: This suit was brought by the defendants in error against the plaintiff in the Circuit Court of the United States for the Eastern District of Louisiana. The proceeding was by petition in the usual form of Louisiana practice. It states that the plaintiff in error, in the capacity of trustee and assignee of the President, Directors and Company of the Agricultural Bank of Mississippi, which was located, until the term of its dissolution at Natchez, in the said State, is indebted to the petitioners in the sum of $34,000, upon the grounds set forth in the petition. They state that they were the owners of two undivided third parts of a certain lot in Natchez, in the County of Adams, in the State of Mississippi, upon which stands the City Hotel; that they were unlawfully expelled from it by the Agricultural Bank; that they afterwards recovered back the possession by an action of ejectment in the Circuit Court of the United States for the Southern District of Mississippi; and that they are entitled to the sum above mentioned, against the Bank, for damages and mesne profits while the Bank held them out of possession together with the costs they incurred in the suit to recover it. They further state, that by the decree of the Circuit Court of Adams County, a court of competent jurisdiction in the premises, the charter of the Agricutural Bank was declared forfeited, and the corporation dissolved; and that Peale, the plaintiff in error, was appointed trustee and assignee of the Bank, and is the sole legal representative of the corporation; and they aver, that by operation of law all the as |