Pursuer Robert Innes, a merchant in Elgin, purchased an insurance policy in September 1769 from defenders James Stuart and James Stodart, merchants in Edinburgh. The policy covered a shipment of oats and grain from Elgin to the Firth of Forth. During the trip, the ship sprang a leak and was forced to stop at the nearest port in the harbor of Montrose. The ship also touched upon a rock in the port. The goods in the ship were considerably damaged, so Innes sought payment from Stuart and Stodart under the insurance policy. Stuart and Stodart refused to pay, finding that neither the insurance policy nor the practice of merchants covered this ship's situation. The insurance policy at issue covered damage when the ship was stranded. Stuart and Stodart maintained that the damage to the ship occurred before the ship was stranded, when the ship sprung a leak. Innes disagreed, arguing that the damage to the cargo only occurred after the ship was stranded, thereby triggering coverage under the insurance policy.

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