[Pennock & Sellers vs. Dialogue.]

the party may have been the first and true inventor, if another person, either innocently as a second inventor, or piratically, were to use it without the knowledge of the first inventor, his right would be gone. In respect to a use by piracy, it is not clear that any such fraudulent use is within the intent of the statute; and upon general principles it might well be held excluded. In respect to the case of a second invention, it is questionable *at least, whether, if by *23] such second invention a public use was already acquired, it could be deemed a case within the protection of the act. If the public were already in possession and common use of an invention fairly and without fraud, there might be sound reason for presuming, that the legislature did not intend to grant an exclusive right to any one to monopolize that which was already common. There would be no quid pro quo; no price for the exclusive right or monopoly conferred upon the inventor for fourteen years.

Be this as it may, it is certain that the sixth section is not necessarily repugnant to the construction which the words of the first section require and justify. The sixth section certainly does not enumerate all the defences which a party may make in a suit brought against him for violating a patent. One obvious omission is, where he uses it under a license or grant from the inventor. The sixth section, in the clause under consideration, may well be deemed merely affirmative of what would be the result from the general principles of law applicable to other parts of the statute. It gives the right to the first and true inventor and to him only; if known or used before his supposed discovery, he is not the first, although he may be a true inventor; and that is the case to which the clause looks. But it is not inconsistent with this doctrine, that although he is the first, as well as the true inventor, yet if he shall put it into public use, or sell it for public use before he applies for a patent, that this should furnish another bar to his claim. In this view an interpretation is given to every clause of the statute without introducing any inconsistency, or interfering with the ordinary meaning of its language. No public policy is overlooked, and no injury can ordinarily occur to the first inventor, which is not in some sort the result of his own laches or voluntary inaction.

It is admitted that the subject is not wholly free from difficulties; but upon most deliberate consideration we are all of opinion, that the true construction of the act is, that the first inventor cannot acquire a good title to a patent, if he suffers the thing invented to go into public use, or to be publicly sold for use, before he makes

*24] application for a patent. His voluntary act or acquiescence in the public sale and use is an abandonment of his right; or rather creates a disability to comply with the terms and conditions on which alone the Secretary of State is authorized to grant him a patent.

The opinion of the Circuit Court was therefore perfectly correct, and the judgment is affirmed, with costs.

[Pennock & Sellers vs. Dialogue.]

This cause came on to be heard on the transcript of the record from the Circuit Court of the United States for the district of Pennsylvania, and was argued by counsel; on consideration whereof, it is the opinion of this Court, that there is no error in the judgment of the said Circuit Court. Whereupon, it is considered, ordered, and adjulged by this Court, that the said judgment of the said Circuit Court in this cause be, and the same is hereby, affirmed, with costs.

27

*THE COLUMBIAN INSURANCE COMPANY OF ALEXANDRIA, PLAINTIFFS IN ERROR vs. JOSEPH W. LAWRENCE, SURVIVOR OF LawRENCE & POINDEXTER, DEFENDANTS IN ERROR.

It is undoubtedly true, that questions respecting the admissibility of evidence, are entirely distinct from those which refer to its sufficiency or effect. They arise in different stages of the trial; and cannot, with strict propriety, be propounded at the same time. [44] L. & P. at the time an insurance was made for them against loss by fire, were entitled to one-third of the property by deed, and to two-thirds as mortgagees; but one moiety of the whole was held under an agreement which had not been complied with, and which purported on its face to be void if not complied with; but the other contracting party had not declared it void, nor called for a compliance with it. L. & P. had an insurable interest in the property. [46]

That an equitable interest may be insured is admitted; and we can perceive no reason which excludes an interest held under an executory contract. While the contract subsists, the person claiming under it has, undoubtedly, a substantial interest in the property. If it be destroyed, the loss, in contemplation of law, is his. If the purchase money be pa d, it is his in fact. If he owes the purchase money the property is equivalent, and is still valuable to him. The embarrassments of his affairs may be such that his debts may absorb all his property; but this circumstance has never been considered as proving a want of interest in it. The destruction of the property is a real loss to the person in possession, who claims title under an executory contract; and the contingency, that his title may be defeated by subsequent events, does not prevent this loss. [46] The material inquiry is, does the offer for insurance state truly the interest of the assured in the property to be insured? The offer describes the property as belonging to Lawrence & Poindexter, and states it afterwards to be their stone mill. It contains no qualifying terms, which should lead the mind to suspect that their title was not complete and absolute. The title of the assured was subject to contingencies, and was held under contracts which had become void by the non-performance of the same. This Court is of opinion, that a precarious title, depending for its continuance on events which might or might not happen, is not such a title as is described in this offer for insurance; construing the words of that offer as they are fairly to be understood. [48] The contract for insurance against fire, is one in which the underwriter generally acts on the representation of the assured; and that representation ought consequently to be fair, and to omit nothing which it is material to the underwriter to know. It may not be necessary that the person requiring insurance should state every encumbrance on his property, which it might be required of him to state if it was offered for sale; *26] but fair dealing requires that he should state *every thing which might influence the mind of the underwriter, in forming or declining the contract. [49] Generally speaking, insurances against fire are made in the confidence that the assured will use all the precautionary means to avoid the calamity insured against, which would be suggested by his interest. The extent of that interest must always influence the underwriter in taking or rejecting the risk; and in estimating the premium. Underwriters do not rely so much on the principles, as on the interest of the assured; and it would seem therefore to be material, that they should always know how far this interest is engaged in guarding the property from loss. [49]

In all treatises on insurances, and in all the cases in which the question has arisen, the principle is, that a misrepresentation which is material to the risk, avoids the policy. [49] What will not constitute a waiver of the preliminary proof of loss the assured is bound by the policy to produce. [53]

Construction of a policy of insurance against loss by fire. [56]

THIS was a writ of error to the Circuit Court of the county of Alexandria, in the District of Columbia.

The action was brought, originally, by Lawrence & Poindexter, on a policy of insurance for $7000 against fire on a mill.

The declaration, after setting out the contract of insurance, avers

[Columbian Insurance Company vs. Lawrence.]

that the plaintiffs "were interested in and the equitable owners of the insured premises at the time the insurance was made." After stating the loss by fire on the 14th February 1824, as within the policy, there is the following averment: " of which said loss, together with the proofs thereof in conformity with the conditions subjoined to the said policy, the defendants, on the 20th February 1824, at, &c. had due and regular notice."

Upon the trial of the general issue, verdict and judgment passed for the surviving plaintiff, Lawrence, for the whole amount of the insurance, under certain instructions from the Court, stated in two bills of exceptions tendered by the defendants, now plaintiffs in

error.

During the progress of the suit, Poindexter, one of the plaintiffs, died, and the suit instituted in their joint names, was carried on in the name of the survivor, for the use of his assignee.

The evidence exhibited to the jury on the part of the plaintiff, showed that Lawrence & Poindexter, by their agents, had

*

made application in writing to the defendants for insurance, [*27

in these words:

"What premium will you ask to insure the following property, belonging to Lawrence & Poindexter, for one year, against loss or damage by fire, on their stone mill, four stories high, covered with wood, situated on an island about one mile from Fredericksburg, in the county of Stafford? The mill called Elba; seven thousand dollars is wanted; not within thirty yards of any other building, except a corn-house, which is about twenty yards off."

The premium demanded was one hundred and five dollars.

The application was made upon a printed form, of which blanks are kept at the insurance office, and filled up as required. At the foot of this document was the following:

N. B. Persons offering for insurance are requested to be particular in their descriptions, more especially of what materials the walls and roofs are constructed, &c.

The policy, an unsealed instrument, was executed in the usual form, containing the several stipulations, provisos, and exceptions, usual in fire policies; and among others, the following:

"And it is understood and agreed, as well by this company as by the assured named in this policy, and all others who may become interested therein, that this insurance is made and accepted in reference to the conditions which accompany these presents; and in every case the said conditions are to be used to explain the rights and obligations of the parties, except so far forth as the policy itself expressly declares those rights and obligations."

Upon the back of this policy were printed the "Fundamental rules of the Columbian Insurance Company," and also, the "Rates of annual premiums to be paid for insurance," among which were: "1. Persons desirous to make insurance on buildings, are to state in writing the following particulars, viz.: Of what materials the

[Columbian Insurance Company vs. Lawrence.]

walls and roofs of each building are constructed, as well as the construction of the buildings contiguous thereto-whether the same are occupied as private dwellings or how otherwise-where *28] situated also the name or names of the present occupiers. "Each building must be separately valued, and a specified sum insured thereon; and in like manner a separate sum insured on the property contained therein.

"All manufactories which contain furnaces, kilns, stoves, ovens, or use fire heat, are chargeable at additional rates.

"In the assurance of goods, wares, and merchandise, the building or place, in which the same are deposited, is to be described, also whether such goods are of the kinds denominated hazardous, and whether any manufactory is carried on in the premises. And if any person or persons shall insure his or their buildings or goods, and shall cause the same to be described in the policy otherwise than as they really are, so as the same be charged at a lower premium than would otherwise be demanded, such insurance shall be of no force.

"2. Goods held in trust, or on commission, are to be insured as such, otherwise the policy will not extend to cover such property. "9. All persons assured by this company, sustaining any loss or damage by fire, are forthwith to give notice to the company, and as soon as possible thereafter, deliver as particular an account of their loss or damage, signed with their own hands, as the nature of the case will admit of, and make proof of the same by their oath or affirmation, and by their books of accounts, or other proper vouchers, as shall be reasonably required; and shall procure a certificate under the hand of a magistrate or a sworn notary, of the town or county in which the fire happened, not concerned in such loss, directly or indirectly, importing that they are acquainted with the character and circumstances of the person or persons insured, and do know, or verily believe, that he, she, or they, really, and by misfortune, without any kind of fraud or evil practice, have sustained by such fire, loss or damage to the amount therein mentioned; and, until such affidavit and certificate are produced, the loss claimed shall not be payable; also, if there appears any fraud, the claimant shall forfeit his claim to restitution or payment, by virtue *29] of his policy."

The property intended to be insured, was proved to be a square building, four stories high, built of stone to the square or eaves, the roof being framed, and covered entirely of wood, the two gable ends running up perpendicularly from the stone wall to the top of the roof, they being constructed of wood.

On the 14th of February, 1824, the property was destroyed by fire; and the following documents were given in evidence, to sustain the right of the plaintiffs to demand payment of the loss; the same having been exhibited as "the preliminary proof of the loss claimed under the policy."