shipper is under no obligation to make inquiries as to the existence of a charter-party (n). In cases where the freight is made payable in advance, the shipowner will not have a lien; for money payable in advance is not freight stricto sensu, though often called so, and consequently the shipowner can have no lien for it as freight (o). The goods of a shipper in a general ship will not be affected by a clause in a charterparty, giving the shipowner a lien on all cargo and freight for arrears of hire due under the charterparty, provided only the shipper had no notice or knowledge of the lien. This will be the rule, though no bills of lading were given for the goods (p). The shipowner will not have any lien on goods actually carried for money due in respect of goods put on board at the loading port, but afterwards relanded and restored to the freighter's agents under process of law. Again, the shipowner has no lien for dead freight or demurrage, wharfage or port charges, unless by special agreement (g). Dead freight is defined (g) to be simply an unliquidated compensation recoverable by the shipowner from the freighter for deficiency of cargo. The shipowner, whether he has a lien or not, can sue the freighter on his contract to pay freight (~). CASES. 1. The charterers of a vessel shipped part of the cargo themselves under a bill of lading containing this clause: "Freight for the said goods payable at Liverpool as per charterparty." The charterparty gave the ship a lien on cargo for freight. The bill of lading was indorsed by the charterers to A. for value. Held, that as against A. the shipowner had a lien only for the freight due for the (n) The Stornoway, supra. (0) Ib. (p) How v. Kirchner, 11 Moore, P. C. Ca. 21; Kirchner v. Venus, 12 Moore, P. C. Ca. 361; see "Cases" (2) at end of this §. (a) McLean v. Fleming, L. R., 2 H. L. Sc. 128; Gray v. Carr, (r) Tapley v. Martens, 8 T. R. goods comprised in the bill of lading, and not for the whole chartered freight (8). 2. D. & Co., of Liverpool, shipped goods for Sydney. 66 The bill of lading stated the goods to be to the shipper's order or assigns, ❝he or they paying freight for the goods as per margin." In the margin was Freight payable in Liverpool to M. one month after sailing." The bill of lading was indorsed to K. & Co. for value. On arriving at Sydney, the master refused to deliver the goods to K. & Co., and claimed a lien on them for the freight, which he was advised had not been paid at Liverpool. Held, K. & Co. were entitled to the goods, the master having no lien for freight payable in advance (t). 3. A. freighted a ship to carry goods from London to Ancona, and to deliver them there to B., and engaged to pay the shipmaster for the freight. The shipmaster, on delivering them to B., took a bill of exchange from B. drawn on A., which bill was never paid. Held, A. was liable to pay the freight, notwithstanding the bill of exchange (u). (s) Fry v. Chartered Merc. Bank of India, L. R., 1 C. P. 689. (t) Kirchner v. Venus, 12 Moore, P. C. Ca. 361. (u) Tapley v. Martens, 8 T. R. 451. CHAPTER XII. BOTTOMRY AND RESPONDENTIA. -what. $81. Bottomry and BOTTOMRY is a contract entered into by a shipowner or his respondentia agent, whereby in consideration of a sum of money advanced for the use of the ship, the borrower agrees to repay the sum advanced with interest if the ship terminate her voyage successfully, and at the same time hypothecates the ship as security for the payment of the principal and interest. If the instrument by which the hypothecation is effected is a deed poll, it is called a bottomry bill (a); if it is in the form of a bond, it is termed a bottomry bond (b). However, no particular form of words is absolutely necessary, though the contract must be in writing in the case of a British ship. Bills of exchange, given for monies advanced for the necessities of the ship, will not amount to instruments of hypothecation; though, of course, good as collateral securities (c). If the money be advanced not upon the ship, but on the cargo or goods on board her, the contract to repay the sum advanced and the stipulated interest is more properly termed respondentia; though it is sometimes also termed bottomry. (a) The D. H. Bills, 4 P. D. 32. Great Pacific, L. R., 2 P. C. 516; and see Lord Stowell's judgment in The Zodia, 1 Hagg. 320. (c) Ex parte Halkett, 19 Ves. 473; The Augusta, 1 Dods. 283; The Staffordshire, L. R., 4 P. C. 194; see "Cases" (2) at end of this §. The claim of a bottomry or respondentia bondholder will prevail over that of a subsequent purchaser of the ship or goods, even though the latter had no notice of the hypothecation (d). The terms bottomry and respondentia are also used to denote contracts to repay money borrowed, not on the ship or cargo, but on the mere hazard of the voyage. Such a contract is sometimes also termed foenus nauticum, or usura maritima. For instance, if an advance be made to a merchant, to be employed in some particular voyage, in consideration of the borrower agreeing to repay it with interest at 50 per cent., or at any other extraordinary rate, if the voyage in which it is to be used be safely concluded, the mere hazard of the voyage will be the only security for the repayment of the sum advanced and interest. thereto. No one can lend money on bottomry, who is, at date of The parties the loan, a debtor in an equal or larger sum to the ship (e). If the lender be a debtor in a less amount, the bottomry bond will be invalidated pro tanto (e). A bottomry bond given to the consignee of the cargo, or even by a substituted shipmaster to the person who appointed him, is perfectly good; the borrowing being shown to have been necessary, and the transaction to have been fair and reasonable (ƒ). A bottomry bond has even been held good when given to the agent of the owners of the ship, but only under very strong circumstances of necessity (g). CASES. 1. The master of a Danish ship being without funds or credit at Hamburgh, in order to obtain necessaries to enable his ship to proceed to Africa, and then to London, obtained a loan on security of instruments, by which he pledged his ship and bound himself for the repayment of the advance within six days after her arrival (d) The Catherine, 15 Jur. 231; see "Cases" (3) at end of this §. (e) The Hebe, 2 W. Rob. 146, 412. (f) The Alexander, 1 Dods. 278; The Nelson, 1 Hagg. 169; The Rubicon, 3 Hagg. 9. (g) The Staffordshire, L. R., 4 P. C. 194; see "Cases" (2) at end of this ; The Hero, 2 Dods. 139, 144, per Sir Wm. Scott. Peculiarities of bottomry and respon in London. Held, that the instruments were valid bottomry bonds (h). 2. A bottomry bond on a ship and freight was given to the ship's agent by the master for the repairs of the ship, subject to an agreement by the bondholder, that if a bill of exchange drawn by the master on a mortgagee of the ship should be duly honoured the bond should not be enforced. The mortgagee died before the bill was presented. Neither probate of his will nor administration had been taken out when the holder of the bill, not knowing of the drawee's death, presented the bill for acceptance. Held, that the bond was valid, and that it was not necessary, in order to enforce it, that the bill of exchange should have been dishonoured (i). 3. A British ship, on which a bottomry bond had been given, payable on her arrival in England, was sold as unseaworthy, at Bahia, by the master. She was purchased by a foreigner, who, after repairing her, changed her name and sent her back to England. No notice of the bottomry bond was given at the sale. Held, that the ship was still subject to the bond (k). § 82. There are two main differences between a bottomry or respondentia contract and a common loan; the first is that dentia bonds. the money advanced is at hazard during the voyage (7), and the repayment thereof will depend on the arrival of the ship in safety. The expression of maritime risk is essential to the validity of a bottomry bond; therefore, in cases where the loan is by the terms of the deed to be repaid in any event, the contract will be invalid as a bottomry or respondentia bond (m), though, of course, collateral security, making the owner liable in any event, can be given, e. g. a bill of exchange (n). The second difference referred to is that the lender on a bottomry or respondentia contract could always stipulate for any rate (h) The Cecilie, 4 P. D. 210. (k) The Catherine, 15 Jur. 231. Indomitable, 5 Jur., N. S. 632; (m) The Indomitable, supra; The Serafina, Br. & L. 277. (n) Stainbank v. Shepard, 22 L. J., Exch. 341; 13 C. B. 418; and see § 81, p. 134. |