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\ 1904] MARINE REVIEW 23 CONSTRUCTIVE TOTAL LOSS. Comment in lake shipping circles on recent losses of the' kind known as constructive total losses, such as'the Owen, Por- tage, Craig, Swain, Hutchinson and others would 'seem to indicate that this character. of loss'is not. fully understood, even' among some of the vesselmen. A' common impression seems: to be. that a vessel is not a constructive total loss unless the, actual. cost of recovery and restoration, with the incidental "expenses, properly chargeable, shall equal the. required percentage. . This per cent- age, when unmodified by policy stipulation, is 50 per: cent. of, the restored value. For sqme years the policies have contained a stipulation that the insted value shall be taken as the restored value, and in such case, if there be no other policy limitation, a constructive total loss exists only when the cost of recovery and restoration exceeds 50 per cent. of the insured value. In the last two or three years, in policies on the great lakes, a stipulation has been inserted that the cost of restoration. and repair, speaking generally, shall equal 75 per cent. of the insured value. The prin- ciple, however, remains the same; simply the percentage necessary being changed. 'The cost to be taken into account in determining whether a vessel is a constructive total loss is not, except in rare cases, the actual cost. The authorities state that it is not the actualities which must determine this question, but the high probabilities, i, e., fhe high probability that the cost of recovering and repair- ing the vessel will equal or exceed the required percentage. A constructive total loss is a creature of the law. It is a loss arising outside of the policy and exists quite independently of any terms in the policy, which are usually in limitation of the general right. Perhaps as concise and comprehensive a defini- tion as can be given is that of Chief Justice Marshall, given in 1808, that a technical (constructive) total loss originates in the danger of a real total loss. This definition conveys the whole idea of constructive or technical total loss, which is not necessarily that the vessel is so in fact, but that there is danger, igh proba- bility, of a real or-actual loss, or, as it is frequently expressed that there is high probability that the vessel cannot be "TECOys ered and repaired for less than the required percentage.- ~ __ Another feature of this: character of loss is that it is optional bial with the insured in any proper case whether 'he shall treat the loss as;a partial loss or as one constructively total. The insured*ean- in, a case which is a proper one of constructive total loss never- theless regard it asa partial loss and recover through his under- writers up to the full amount of his insurance.. The underwriters can in no case require that he shall treat it as a constructive. to- tal loss. It is required, however, by the general law, that if the insured desires to treat the loss (in a proper case) as one con- structively total, he must, as a necessary prerequisite to such claim, abandon whatever remains of the property insured to the insurers, and his right so to do is to be determined as of the time abandonment is tendered. If at that time the high proba- bility, based on the facts as they then exist, is that the property cannot be recovered and restored for a less sum than the re- quired percentage, the total loss claim is good, and events happen- ing thereafter cannot change the rights. Circumstances may so change that the property is thereafter recovered and can be or is restored for less than the required percentage, but this does not defeat the insurer's right to stand on his abandonment and claim the entire insurance, If, so far as reasonable calculation can be made at the time the abandonment iis tendered, it is in a high degree probable that the expense will exceed the required amount, the right to claim for a total loss exists.. This necessarily must be determined by the opinion of men skilled in the business. The insured may, in any case, withdraw his abandonment before it has been. accepted by the insurers, but whether the aban- donment was properly made or not, the insurers have the full right to accept it, and once having done so, the property becomes theirs and the insured must abide the result. . - ; ' When such abandonment is made and. either accepted for- mally by the underwriters or by their act, or-is, held good, it re- lates back to the time of the disaster on account of which it is made, and the subject of the insurance becomes the insurers from that date as effectually, as has been declared by the supreme cqurt, as it could be conveyed to them by the most skillfully-drawn in- strument. : : It is sometimes said that the insurer can defeat the insured's right to claim a constructively total loss by. recovering and re- pairing the vessel and tendering her back.to the owners in a re- stored condition. It seems thoroughly well settled that this can- not be done except by agreement of the parties. The insurer can in no case, there being no agreement on the subject, require the insured to repair his property, even in case of a partial loss, and in case of constructive total loss, if the insurer shall, after aban- donment tendered, assume to repair the vessel, he exercises a right of ownership and whatever he may say about not accept- ing the abandonment, he does accept it by his act of owner- ship. " oes ee After abandonment, however, both the insured and insurers have full right under the "sue and labor" clause, so-called, in the policy to recover the property and do such things as may be necessary to prevent its further destruction. There are a num- ber of cases in which the vessel has been restored by the under- writers and tendered back, but it seems that in all such there was an agreement that this might be done. Some years ago there was a clause in the policy which required the insured to recover. and restore the property, and if he failed, the insurer was author- ized to, and the right to claim constructive total loss did not 4get exist (under the terms of this policy) unless, when so recovered and repaired and the loss was adjusted, as a partial loss the amount which the underwriters would then be required to pay would equal or exceed the given percentage. This gave rise to so many questions of fact for determination by a jury, as to whether the insurers had recovered promptly, repaired properly and restored within.a reasonable time, etc., and it was so found to work against the insurer, that it was withdrawn from the poli- cies generally some. years. since: : Just what amounts'to such act of ownership as shall be taken .as an acceptance of abandonment, notwithstanding a declared in- tention not to accept, must be determined in each particular case, the general doctrine being that anything which goes beyond the immediate preservation of the property is an act of ownership and an acceptance of an abandonment tendered, unless there is some agreement which relieves against the legal effect of such act. ee es _ The essence of the entire doctrine is that it is upon the high probabilities which the insured must act' and not upon the actuali- ties; that it is the estimates upon which the doctrine proceeds and not upon actual cost, because after the repairs are once made it is too late to abandon. COMMERCE OF PORTAGE LAKE CANAL. Capt. Charles L. Potter, government engineer at Duluth, has just completed his report of the commerce of Portage lake canal for 1903. It shows that a total of 2,420,948 tons of freight, valued at $67,663,818.95, passed through the canal. There were 2,563 up- bound' passages through the canal and 1,871 -down-bound pas-. sages. Following is a comparative table of commerce for the past seven years and an itemized table for last year: FREIGHT BOUND UP AND BOUND DOWN THROUGH PORTAGE LAKE SHIP CANALS AND VALUATIONS FOR SEASONS OF 1897 to 1903, BOTH INCLUSIVE. Pp BLL Pe 3 aoa Total freight|Total valuation of otind up, tons,|Boun OwN|bound up and|freight bound up ny tons, bound down, and bound down. yo FE e Vela y "980,843. 289,880 oe 1 WHO, 84 1,020,723 $34,044,268. 95 (4898.4) 960,924 406 761° 1,367,685 39°254;415 50 iS Egor 974908" 607,841 1,582,169 54,994.843.70 1900 | ..1,190'527 - 677 245 - 1,967,772 57,880,129 .05 1901 |° 0,248,815 867,319 2.116 624 56,876,480 65 1902 | 1,460 415 1,071,908 2,582 823 65 826,818.80 1903 1,475. 758 945.090 2,420,948 67,663,818. 95 (All tons are of 2.000 Ibs.) ESTIMATED VALUE OF FREIGHT THROUGH PORTAGE LAKE SHIP CANALS, BOUND UP AND BOUND DOWN, FOR THE SEASON OF I903.. Items. i Quantities. oa Valuation. Coal (Anthracite) ....... HG Tons 101,429} °¢ 6.25 -|. $: 633.9381.25 Coal (Bituminous).;........ Tons 1,052,158 4.00 4,208,632 .00 Hloure ie og Lh Tene . Barrels 474,909 4.50. 2,187,090 .50 Wheaten a ae Bushels: |' 635.037 .79° | 501.679 28 Grain (other than wheat) ...| Bushels> £97,914 48 142,998.72 _ Hlaxrseed..03 2) ae Bushels 406 485 1.09° 443,068 .65 Manufacturediron .......... Tons. 21.893 65 00 1,423 045 00 Piguron: . 4,500. Co came Tons 5,880 21 00. 123,480.00 Iron ore ° POR eee Laaee Tons 164,348 2 35 386,217 .80 Copper. wi te cinacs vec ons 87,657 250.00 | 21,914,250.00 Building stone 730.5... 3... _ Tons 23,294 7.00 -" 168,058.00 Limestoney 3. Sa 8 Tons 38,020 1.50 - 57.120 00 Oleic ae Eke Pa Bae eos Barrels 27,853 | | 7.00. 194,971.00 Salts ace ase eer Barrels . 201,563 .60 | - 120 987.80 DANG, roe aca eer Cu. yds. 12,520 "50 +2" 6,260.00 Eumbet, 5. ca ..{M. ft. B.M. 297,898 | © 15,00 4,468,470. 00 LOGS Seine ey ae .|M. ft B.M. 17,787 12.00 213,444 00 General merchandise Tons 185,001 165.00 80 525,165.00 Totals cera, vec ee ee oad Oe $67,663,818 .95 (All tons are of 2,000 lbs.) DULUTH-SUPERIOR COMMERCE. The following summary of statistics dealing with the com- merce of Duluth-Superior harbor, head of Lake Superior, is ex- tracted from an elaborate report recently submitted to the war de- partment by Capt. Charles L. Potter, United States engineer in charge of river and harbor improvements on Lake Superior. CONDENSED STATEMENT OF COMMERCE AT THE HEAD OF THE LAKES, DULUTH AND SUPERIOR HARBORS, : Number of Year. 1895 ee 7600 7. TOO7: 35; 1808 4 i 1809: 54 1900 ... -TO0r ... 1902 4.. | 1003 4: Total . . 104,593,886 Receipts and Valuation, vessels Registered - shipments, receipts and enter'd and tonnage of net tons. shipments. departed. vessels. 6,325,351 95,000,000, _--_10,986 11,434,272 7,886,833 111,676,900 10,048 --_ 13,353,068 8,475,224 118,551,185 9,758 12,845,865 {4 10,127,201 142,643,020 10,870 14,135,237 . 11,608,088 157,143,966 11,526 14,433,501 .. 13,725,245 135,109,106 > 11,334 14,387,008 . 12,973,373 161,305,819 13,204 17,245,719 eve 17,505,793 104,444,605 15,866 f 23,811,275 - 17,966,718 177,594,212 14,098 23,250,358: $1,293,408,093 108,658 144,896,363 Huron last week. Capt. Edmund Fitzgerald, an o ld_shipmaster, died at Port