A. L. STURGE & CO. AND OTHERS v. EXCESS INSURANCE COMPANY, LTD., AND OTHERS.

(1938) 62 Ll L Rep 128

KING'S BENCH DIVISION.

Before Mr. Justice Branson.

Insurance-Bonds-Investments by Lloyd's underwriters in Canadian bonds- Option by holders to claim payment of principal and interest either in Canadian or United States dollars - Bonds containing gold clause - Policies taken out by underwriters with defendant insurance companies-Two classes of policies (A and B)-Class A policies guaranteeing "to the insured . . . the redemption of the principal at par not later than the 15th July, 1934, on stock/bonds specified in the schedule below. The company also guarantee full payment of the dividends upon the said stock/bonds at the rate of interest and upon the dates due as stated in the schedule"-Class B policies agreeing "to make good to the insured 50 per cent. of such sum or sums as the Government of British Columbia may fail to pay in cash in compliance with its obligations in respect of the insured's aforesaid holding in respect of (a) payment of interest at the rate and upon the dates due as stated in the schedule and (b) the principal sum payable on the maturity of the said stock as stated in the schedule"- Schedule specifying the securities insured, the sum insured and interest due in U.S. dollars-Bondholders paid in New York on "dollar for dollar" basis-Contention by bondholders that the issuers were under obligation to pay to the bondholders by way of principal and interest so many Canadian or U.S. paper dollars as would represent the gold value of the nominal amount of each respectively any that as they had been paid on a "dollar for dollar" basis they were entitled to be indemnified under their policies - Construction of policies-Effect of American and Canadian legislation.