said, that so many difficulties occur in apportioning the premium, the courts are often obliged to decide against it, unless there be some usage upon the subject.

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20. BOTTOMRY AND RESPONDENTIA. Bottomry is in the nature of a mortgage of a ship, when the owner of it borrows money to enable him to carry on the voyage, and pledges the keel, or bottom of the ship, as a security for the repayment; and it is understood that, if the ship be lost, the lender also loses his whole money; but, if it return in safety, then he shall receive back his principal, and also the premium or interest stipulated to be paid, however it may exceed the usual or legal rate of interest. When the ship and tackle are brought home, they are liable, as well as the person of the borrower, for the money lent. But when the loan is not made upon the vessel, but upon the goods and merchandises laden thereon, which, from their nature, must be sold or exchanged in the course of the voyage, then the borrower only is personally bound to answer the contract; who, therefore, in this case, is said to take up money at respondentia. In this consists the difference between bottomry and respondentia; that the one is a loan upon the ship, the other upon the goods; in the former the ship and tackle are liable, as well as the person of the borrower; in the latter, for the most part, recourse must be had to the person of the borrower. Another observation is, that, in a loan upon bottomry, the lender runs no risk, though the goods should be lost; and, upon respondentia, the lender must be paid his principal and interest, though the ship perish, provided the goods are safe. In all other respects the contract of bottomry and that of respondentia are upon the same footing.

These terms are also applied to another species of contract, which does not exactly fall within the description of either; namely, to a contract for the repayment of money, not upon the ship and goods only, but upon the mere hazard of the voyage itself; as if a man lend £1000 to a merchant to be employed in a beneficial trade, with a condition to be repaid with extraordinary interest, in case a specific voyage named in the condition shall be safely performed. But, by 19 Geo. II., it is enacted, "That all sums of money lent on bottomry or at respondentia upon any ship or ships belonging to his Majesty's subjects, bound to or from the East Indies, should be lent only on the ship, or on the merchandise or effects laden or to be laden on board such ship, and should be so expressed in the condition of the said bond; and the benefit of salvage should be allowed to the lender, his agents, or assigns, who alone should have a right to make assurance on the money so lent; and in case it should appear that the value of his share in the ship, or in the merchandises or effects laden on board of such ship, did not amount to the full sum or sums he had borrowed as aforesaid, such borrower should be responsible to the lender for so much of the money borrowed as he had not laid out on the ship or merchandises laden thereon, with lawful interest for the same, in the proportion the money laid out should bear to the whole money lent, notwithstanding the ship and merchandises should be totally lost."

The statute, therefore, has entirely put an end to that species of contract which was last mentioned, namely, a loan upon the inere voyage itself, as far, at least, as relates to India voyages. The statute of 7 Geo. I. c. 21, § 2, declares, 66 That all contracts made or en

tered into by any of his Majesty's subjects, or any person in trust for them, for or upon the loan of any monies, by way of the bottomry, or any ship or ships in the service of foreigners, and bound or designed to trade in the East Indies or parts aforesaid, shall be null and void." This act, however, does not mean to prevent the king's subjects from lending money on bottomry, on foreign ships trading from their own country to their settlements in the East Indies.

It became a question in the court of common pleas, whether an American ship, since the declaration of American independence, was a freight ship within the statute of the 7 Geo. I. c. 21, § 2. The court were much inclined to think the bond was void, the case being within the mischief designed to be remedied by the act. But the question was not decided.—Sumner v. Green, Mich. 30 Geo. III.

The contract of bottomry and respondentia seems to deduce its origin from the custom of permitting the master of a ship, when in a foreign country, to hypothecate the ship, in order to raise money to refit. Such a permission is absolutely necessary, and is impliedly given him in the act of constituting him master, by the marine law, which in this respect is reasonable; for, if a ship happen to be at sea, and spring a leak, or the voyage is likely to be defeated from want of necessaries, it is better that the master should have it in his power to pledge the ship and goods, or either of them, than that the ship should be lost, or the voyage defeated. But he cannot do either for any debt of his own, but merely in case of necessity, and for completing the royage. Although the master of the vessel has this power while abroad, because it is absolutely necessary for the purposes of commerce and navigation, yet the very same authority, which gave that power in those cases, has denied it when he happens to be in the same place where the owners reside. All the cases which have been determined upon the subject, seem to require, that the ship should be abroad, as well as in a state of necessity, to justify the captain or master in taking money on bottomry.-Molloy, in express terms, declares, that a master has no power to take up money on bottomry in places wherehis owners dwell: otherwise, he and his estate must be liable thereto. -Molloy, 1, 2. c. 11, § 11. If, indeed, the owners do not agree in sending the ship to sea, the majority shall carry it, and then money may be taken up by the master on bottomry for their proportion who refuse, although they reside on the spot, and it shall bind them all.

Yet it is said that if money borrowed by the master on bottomry, be applied to the necessities of the ship, the owners are liable as on money paid for their use, but not on the contract of bottomry.

It is the essence of a contract of bottomry, that the lender run the risk of the voyage, and that both principal and interest be at hazard; for, if the risk go only to the interest of premium, and not to the principal also, though a real and substantial risk be inserted, it is a contract against the statute of usury, and therefore void. This has been frequently so determined in our courts of law.

An action of debt was brought upon an obligation. The defendant pleaded the statute of usury, and showed that a ship went to fish in Newfoundland, (which voyage might be performed in eight months,) and that the plaintiff delivered £50 to the defendant, to pay £60 upon the return of the ship off Dartmouth: and, if the said ship, by occasion of leakage or tempest, should not return from Newfoundland to Dartmouth, then the defendant should pay £50 only; and, if the ship

never returned, he should pay nothing. And it was held by all the court not to be usury within the statute. For, if the ship had staid at Newfoundland two or three years, he should have paid at the return of the ship £60, and if the ship never returned, then nothing; so that the plaintiff ran hazard of having less than the interest which the laws allow and possibly, neither principal nor interest.—Sharpley v. Hurrell, Cro. Jac. 208.

The case was, upon another occasion, mentioned in argument by one of the judges of the bench; the principle on which it was decided was recognised, and the case itself was allowed to be law.-Roberts v. Tremayne, Cro. Jac. 508; and it has been confirmed by several subse quent cases.

As the hazard to be run is the very basis and foundation of this contract, it follows, that if the risk is not run, the lender cannot be entitled to the extraordinary premium; for that would be to open a door to means by which the statute of usury might be evaded. This was so decided by the court of chancery, in a case, where the plaintiff was bound, in consideration of £400, as well to perform the voyage within the six months, as at the six months' end to pay £400, and £40 premium, in case the vessel arrived safe, and was not lost in the voyage. It happened that the plaintiff never went the voyage, where by the bond becante forfeited, and he now preferred his bill to be relieved. Upon the former hearing, as the ship lay all the time in the port of London, and there was no hazard of losing the principal, the lord-keeper thought fit to decree, that the defendant should lose the premium of £40, and be contented with his principal and ordinary interest. And now, upon a rehearing, he confirmed his former decree. -Deguilder v. Depeister, 1 Vern. 269.

It remains to be shown, what these risks are to which the lender undertakes to expose himself. These are, for the most part, mentioned in the condition of the bond, and are nearly the same, against which the underwriter, in a policy of assurance, undertakes to indemnify. These accidents are, tempests, pirates, fire, capture, and every other misfortune, except such as arise either from the defects of the thing itself, on which the loan is made, or from the misconduct of the borrower. But whatever may be the perils, nothing short of a total loss will discharge the borrower. However the goods may be damaged, the obligation remains.

Capture here does not mean a mere temporary taking, but it must be such a capture as to occasion a total loss. And, therefore, if a ship be taken and detained for a short time, and yet arrive at the port of destination within the time limited, (if time be mentioned in the condition,) the bond is not forfeited, and the obligee may recover.— Joyce v. Williamson, B. R. Mich. Term, 23 Geo. III.

A lender on bottomry, or at respondentia, is neither entitled to the benefit of salvage, nor liable to contribute in case of a general average. -Walpole v. Ewer, Sittings after Trinity, 1789. But see Marshall on Insurance, vol. ii. p. 766, 3d ed. where the learned editor questions these positions.

It has been said, that, if the accident happen by default of the borrower or of the captain, the lender is discharged from the risk, and has a right to demand the payment of the bond. If, therefore, the ship be lost by a wilful deviation from the track of a voyage, the event has not happened upon which the borrower was to be discharged from his obligation.-Western v. Wildy, Skin. 152.

In the place of respondentia, a practice had arisen since 1810, for the

person borrowing the money to draw bills on an East-Indian house, payable a certain number of days after the arrival of the ship at the foreign port, the borrower at the same time consigning goods to the East-Indian house, as an inducement to the drawees to accept the bus. These bills being negotiated in England, the captains and officers of East-Indian ships were thus put in cash to pay for their investments. It has been held, in a recent case, that persons advancing money on the credit of bills of this nature and forwarding them to India for acceptance, have no insurable interest in such bills, which are void as being drawn on a contingency, and cannot recover against the underwriter on a policy in which they are described as bius of exchange.Palmer v. Pratt, 2 Bingham, 185.

It frequently happened that the borrowers on bottomry or at respon dentia became bankrupts after the loan of the money, and before we event happened which entitled the lender to repayment; by which means the debt could not be proved under the commision, and the lenders were left to such redress as they could obtain from the tankrupt, who had previously given up every thing to his creditors. being likely to prove a discouragement to trade, parliament wan obliged to interpose; and it accordingly enacted, by the 19 Geo. II. e. 32, § 2, "That the obligee in any bottomry or respondentia bond, made and entered into upon a good and valuable consideration bond fide, should be admitted to claim, and, after the contingency should have happened, to prove his or her debt or demands, in respect to such bond, in like manner as if the contingency had happened before the time of issuing the commission of bankruptcy against such oblizor,” and by the new bankrupt act, consolidating the former laws, (6 Geo. IV. e. 16, § 43,) it is provided, that the obligee in any bottomry or respon dentia bond, and the assured in any policy of insurance, shall be ad mitted to claim, and after the loss or contingency shall have happened, to prove his debt or demand, and receive dividends as if the loss or contingency had happened before the issuing the commission, and the person effecting any policy of insurance upon ships or goods with any person, as a subscriber or underwriter, becoming bankrupt, shall be entitled to prove any loss to which such bankrupt shall be liable in respect of such subscription, although the person so effecting such policy was not beneficially interested in such ships or goods, in case the person or persons so interested is not or are not within the united realm.

21. FORMS OF POLICIES.

Form of a Policy of Assurance upon a Ship and Furniture, pursuant to Act of 35 Geo. III. c. 63.

£500.

-S, day of

and from

IN the name of God, Amen.

in

tion, artillery, boat, or other

as well own name, as for and in the name and names of all

delivered the and every other pen, doth male assurance, and musy, or shall, appertain, part or in all, cause and them, and every of them, to be assured, lost or not lost, at upon the body, tackle, apparel, ordnance, munifurniture, of and in the good ship or vessel called the whereof is master, under God, for this present voyage, or whosoever else shall go for master in the said ship, or by whatsoever other name or names the said ship, or the master thereof, is or shall be named or called; beginning the adventure upon the said ship, &c. from and imand so shall continue and mediately following endure until the said ship, with her said tackle, apparel, &c. shall be arrived at and there hath moored at anchor twenty-four hours in good safety; and it shall be lawful for the said ship in this voyage, to proceed and sail to

ard touch and stay at any ports or places whatsoever prejudice to this assurance; the said ship, &c. for so much as concerns the assureds, and shall be valued at Touching the adventures and perils which we the assurers are content to bear and to take upon us in this voyage, they are, of the seas, men of war, fire, enemies, pirates, rovers, thieves, jetsons, letters of mart ard countermart, surprisals, takings at sea, arrests, restraints, and detainments, of all kings, princes, and people, of what nation, condition, or quai soever, barratry of the master and mariners, and all other perils, losses, or misfortunes, that have or shall come to the hurt, detriment, or damage, of the said ship, &e, or any part thereof: And, in case of any loss or misfortune, it shall be lawful to the assureds, their factors, servants, and assigns, to sue, labour, and travel, for, in, and about, the defence, safeguard, and recovery, of the said ship, &c. or any part thereof, without prejudice to this assurance, to the charges whereof we, the assurers, will contribute each one according to the rate and quantity of his sum herein assured; and it is farther agreed by us, the assurers, that this writing or policy of assurance shall be of as much force and effect as the surest writing or policy of assurance heretofore made in Lon. bard-street, or in the Royal Exchange, or elsewhere in London: and so we the assurers are contented, and do hereby promise and bind ourselves, each one for his own part, our heirs, executors, and goods, to the assureds, their executors, administrators, and assigns, for the true performance of the premises, confessing ourselves paid the cos sideration due unto us for this assurance by the assured of at and after

the rate of

In witness whereof we, the assurers, have subscribed our names and sums assured in London.

N. B. The ship and freight warranted free from average under three pounds per cent, unless general, or the ship be stranded.

Policy of Assurance upon Goods, pursuant to Act of 35 Geo. III. c. 63.

£1000, -G. delivered the day of

IN the name of God, Amen. as well in own name, as for and in the name and names of all and every other person or persons to whom the same doth, may, or shall, appertain, in part or in all, doth make assurance, and and them, and every of them, to be assured, lost or not lost, at and from upon any kind of goods and merchandise, whatsoever, loaden, or to be loaden, on board the good ship or vessel called the whereof is master, under God, for this present voyage,

cause

or whosoever

else shall go for master in the said ship, or by whatsoever other name or names the same ship, or the master thereof, is or shall be named or called. beginning the adventure upon the said goods and merchandise from and immediately following the loading thereof on board the said ship and so shall

:

continue and endure until the said ship, with the said goods and merchandise whatsoever shall be arrived at and the same there safely landed and it shall be lawful for the said ship, in this voyage, to stop at any ports or places whatsoever without prejudice to this assurance: the said goods and merchandises, by agreement, are and shall be valued at Touching the adventures and perils which we the assurers are contented to bear, and to take upon us in this voyage, they are, of the seas, men of war, fire, enemies, pirates, rovers, thieves, jettisons, letters of nart and countermart, surprisals, takings at sea, arrests, restraints, and detainments, of all kings, princes, and people, of what nation, condition, or quality, soever; barratry of the master or mariners, and of all other perils, losses, and misfortunes, that have or shall come to the hurt, detriment, or damage, of the said goods and merchandises, or any part thereof and in case of any loss or misfortune it shall be lawful to the assureds, their factors, servants, and assigns, to sue, labour, and travel, for, in, and about, the defence, safeguard, and recovery, of the said goods and merchandises, or any part thereof, without prejudice to this assurance, to the charges whereof we the assurers will contribute each one according to the rate and quantity of his sum herein assured; and it is agreed by us the assurers that this writing or policy of assurance shall be of as much force and effect as the surest writing or policy of assurance heretofore made in Lombard-street, or in the Royal Exchange, or elsewhere in London; and so we the assurers are contented and do hereby promise and bind ourselves, each one for his own part, our heirs, executors, and goods, to the assureds, their executors, administrators, and assigns, for the true performance of the premises, confessing ourselves paid the consideration due unto us for this assurance by the assured at and after the rate of

In witness whereof we the assurers have subscribed our names and sums assured in London.