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would have had. Any deduction-any equity-which the original company would have had against the original insured is to inure to the benefit of the reinsuring company.
“I am of opinion that the Republic is liable on these policies to the extent of the adjusted losses, even if the Lorillard had not paid a cent."
In Cashau v. The Northwestern &c. Insurance Co., 5 Biss. 476, in the reinsurance policy there was a clause that the reinsurer shall "pay pro rata at and in the time and manner as the reinsured.” It was held that the reinsurer was to have all the advantages of the time and manner of payment specified in the policy of the reinsured, but that it had no reference to the insolvency of the reinsured. The court in that case said:
“The insolvency of the original insurer is no defense, in whole or in part, to a suit against the reinsurer. It is claimed on the part of the defendant that the condition in its policy is an exception to this position of the law. ... The condition in that policy that ‘in case of loss the company shall pay pro rata at and in the same time and manner as the reinsured,' cannot mean that in case of the insolvency of the Fulton company the defendant shall only be obliged to pay the pro rata of the dividends of the assets of said company, upon the claim of the first insured. It cannot have such application. The condition means that the defendant shall pay at and in the same time and manner as the reinsured company shall pay or be bound to pay according to its policy, and the defendant shall have all the advantages of the time and manner of payment specified in the policy of the Fulton company, otherwise the defendant's policy would not be the contract of indemnity intended, and endless litigation might ensue.”
Bearing in mind what the contract of reinsurance, pure and simple, means, and how these contracts have been enforced in the past when some special language has been introduced in regard to the payment under a reinsurance policy, the question arises whether, by the use of the language of the eleventh subdivision, the contract of reinsurance, while still
bearing that name, has been so changed as to deprive it of its chief value. As is stated by Judge Johnson, in regard to the language used in 56 N. Y., supra, to give this language this construction will, in substance, subvert the whole contract of reinsurance as hitherto understood. We agree with the court below, that the language of the eleventh subdivision, taken in connection with the fact that it is used in a contract designated by the parties as one of reinsurance, means that the reinsuring company shall not pay more than its ratable proportion of the actual liability payable on the part of the reinsured, after deducting all liability of other reinsurers.
To hold otherwise is to utterly subvert the original meaning of the term reinsurance and to deprive the contract of its chief value. The losses are to be payable pro rata with, in the same manner and upon the same terms and conditions as paid by the reinsured company under its contracts. This means that such losses, payable pro rata, are to be paid upon the same condition as are the losses of the insurer payable under its contract. And the liability of the reinsurer shall not be in excess of the liability of the insurer under its original contracts, after deducting therefrom any and all liability of other reinsurers of the contract of the insurer or of any part thereof. It is the ratable proportion for which the other reinsurers are liable, that provision is made for deducting, and the liability of the insurer means such liability after that deduction, and does not mean there must be an actual payment of such liability by the insurer before it can have any benefit of the contract of reinsurance which is made with defendant.
Subdivision 10 of the contract does not result in any different conclusion.
This subdivision does not and cannot mean that there is to be no liability unless the reinsured should pay the loss sustained. The reinsured company under its provisions is bound to forward to the reinsuring company a statement of the date and the probable amount of loss or damage, and it is provided that after the reinsured company shall have adjusted, accepted
proofs of, or paid such loss or damage, it shall forward the proof of its loss and claim and a copy of the receipt taken for payment. It means that if the loss or claim has been in fact paid, then a copy of the receipt is to be sent, but it does not mean that there must be payment before any liability on the part of the reinsuring company exists.
We do not think that the language of these two subdivisions was intended to entirely nullify and tear up by the roots the construction given to the contract of reinsurance for so many years throughout the civilized world and upon which its chief value is based. The nature of the contract is accurately described in its commencement. It is described as a “compact of reinsurance," and there has been no doubt as to the meaning of such contract for the last two centuries. The judgment of the Court of Appeals is right, and is
UNITED STATES v. CERECEDO HERMANOS Y
APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR
No. 152. Submitted March 5, 1908.- Decided April 6, 1908.
When the meaning of a statute is doubtful the construction given by the
department charged with its execution should be given great weight.
Robertson v. Downing, 127 U, S. 607; United States v. Healy, 160 U. S. · 136. The reënactment by Congress, without change, of a statute which had
previously received long continued executive construction, is an adoption
by Congress of such construction. United States v. Falk, 204 U. S. 143. Par. 296 of the Tariff Act of July 11, 1897, construed in accordance with
The facts are stated in the opinion.
Mr. Assistant. Attorney General Sanford for appellant, submitted.
No counsel appeared for appellee.
The appellee imported into Porto Rico from France thirty cases of red wine, twenty-four bottles to the case, and each bottle containing more than one pint and less than a quart of wine.
The wine was classified by appraisers at the port of San Juan under paragraph 296 of the present tariff act and the reciprocity treaty with France of May 30, 1898, as being dutiable at $1.25 per dozen bottles, making a total of $75. Upon this classification the entry was liquidated and the duty paid.
The appellee in due time protested against the classification and the decision of the collector, stating that “the wine in question has been assessed at $1.25 per dozen bottles, when it should be by cases of 24/2 bottles.”
The board of appraisers decided against the collector and in favor of the protest, saying:
"The wine in question being contained in cases of 24 bottles, and each bottle containing over a pint, was clearly subject to duty at $1.60 per case, and any excess beyond this quantity found in such bottles would be subject to a duty only of 5 cents per pint or fractional part thereof."
The District Court affirmed the decision of the board of appraisers.
The only question in the case is the construction of paragraph 296, the material portions of which are as follows:
“In bottles or jugs, per case of 1 dozen bottles or jugs, containing each not more than 1 quart and more than 1 pint, or 24 bottles or jugs containing each not more than 1 pint, $1.60 per case; and any excess beyond these quantities found in such bottles or jugs shall be subject to a duty of 5 cents per pint or fractional part thereof...."
It is the contention of the Government that the paragraph separates still wines in bottles into three classes and fixes a specific rate of duty on each, as follows:
“(a) Bottles 'containing each not more than one pint,' which are to be assessed as full pints at $1.60 pen 24 bottles, or at the rate of 6 cents per pint; (6) bottles containing each not more than one quart and more than one pint,' which are to be assessed as full quarts at $1.60 per dozen bottles, that is, at the same rate of 6 cents per pint; and (c) bottles containing 'any excess beyond these quantities, which are to be assessed at the rate of $1.60 per dozen, plus 5 cents per pint or fractional pint on the excess over a quart contained in each bottle."
We think the contention is right, and needs no comment to make it clear. .
. Counsel for the Government also points out that the provisions of the tariff act of 1875 and subsequent acts were substantially similar to paragraph 296, and that the Treasury decisions thereunder were in accordance with the interpretation for which the Government now contends. The first of these decisions was made in 1879. In re De Luze, T. D. 4060. The ruling was repeated in 1893. “In re G. W. Sheldon & Co., T. D. 14,461. And again in 1899. In re Wyman, T. D. 20843.
We have said that when the meaning of a statute is doubtful great weight should be given to the construction placed upon it by the department charged with its execution. Robertson v. Downing, 127. U. S. 607; United States v. Healey, 160 U. S. 136. And we have decided that the reënactment by Congress, without change, of a statute, which had previously received long continued executive construction, is an adoption by Congress of such construction. United States v. Falk, 204 U. S. 143, 152.
MR. JUSTICE WHITE and MR. JUSTICE PECKHAM concur solely because of the prior administrative construction.