sea, but by the default of the borrower or master, the hypothecation bond is forfeited, and must be paid. If the ship be lost on the voyage, and the cargo forwarded by another ship, in that case the borrowers must pay the debt, for such is the spirit of the contract.a The lender, who is, in effect, an insurer, does not, as in ordinary cases of insurance, assume the risk of barratry or loss by the fraud or misconduct of the borrower or his agents. And the doctrine of seaworthiness, deviation, and the necessity of diligence and correct conduct on the part of the borrower, are equally applicable to this contract, as to that of insurance. The lender is not to bear losses proceeding from the want of seaworthiness, or from unjustifiable deviation, or from the fault of the borrower, or the inherent infirmity of the cargo. Nor does he run the risk of the goods shipped on board another ship without necessity."

*361

*These maritime loans may be safely effected in a fair and proper case, as we have already seen, at the port of destination, as well as at any other foreign port. So, the consignee of the cargo, and even the agent of the owner or charterer of the ship, under special circumstances, may take a bottomry bond, by way of security for advances made by him. The

Ins. Company of Penn. v. Duval, 10 Serg. & Rawle, 138.

b Roccus, De Navibus, n. 51. Western v. Wildy, Skinner, 152. Ord. de la Mar. tit. Contrats à la grosse, art. 12. Emerigon, tome ii. 509–512. Code de Commerce, art. 326.

• Condy's Marshall, vol. ii. 753–758. Boulay Paty, tome iii. 158—164. 171-176. Ibid. 192. So, if the vessel be sold or transferred after the risk has commenced, or the voyage be in any manner broken up by the borrower, the maritime risk terminates, and the bond becomes presently payable, in like manner as a policy of insurance becomes in a like case functus offici as to future risks. The Brig Draco, 2 Sumner, 193, 194.

d 3 Johns. Rep. 352.

• The Alexander, 1 Dodson, 278. The Hero, 2 ibid. 139. Case of the Ship Venus, Abbott on Shipping, 5th edit. Boston, 1846, p. 208.

owner himself may also execute a bottomry bond abroad, and it will be enforced in our American admiralty courts, which have undoubted jurisdiction over such contracts, though executed on land and under seal.a

It has been made a question, whether a loan on bottomry or respondentia be good, if the ship or goods be already at sea when it is effected, inasmuch as the motives to the loan are supposed to have ceased after the ship's departure. Valin is in favour of the validity of the loan, and he considers that the presumption is, either that the money has been usefully employed in the things put at risk, or in paying what was due on that account; and this reasoning is deemed solid by Marshall, notwithstanding it stands opposed to the high authority of Emerigon. It has, likewise, been recently sanctioned by the decision of the Supreme Court of the United States, who have adjudged that it is not necessary that a respondentia loan (and the law on this point is the same, whether applied to respondentia or bottomry bonds) should be made before the departure of the ship on the voyage, and that it may be made after the goods are at risk. Nor is it necessary that the money should be employed in the outfit of the vessel, or invested in the goods on which the risk is run. It is sufficient that the risk of the voyage be substantially and really taken, and the advance made in good

The Sloop Mary, 1 Paine's Rep. 671. Menetone v. Gibbons, 3 Term Rep. 267. The bottomry bond may be given by the owner, without the concurrence of the master, or by the master, according to circumstances. The Duke of Bedford, 2 Hagg. Adm. Rep. 294. And it may be made by the owner, either in a foreign or home port. The Brig Draco, 2 Sumner, 157.

Valin's Com. tome i. 366. Emerigon, tome ii. 484. Condy's Marshall, vol. ii. 747. a.

faith for a maritime premium. The *lender is not presumed to lend upon the faith of any particular appropriation of the money; and if it were otherwise, his security could not be avoided by any misapplication of the fund, where the risk was bona fide run upon other goods. The loan may be made, and the risk taken, upon the usual footing of policies of insurance, lost or not lost, and precisely as the ship was then in port; and if, before the hypothecation be given, the property be actually lost by any of the perils enumerated in it, the loss must be borne by the lender.b

After the risk has ceased, by the safe arrival of the ship, marine interest ceases, and gives place to the ordinary legal interest, on the aggregate amount of the debt due, consisting of the money lent with maritime premium. This is understood to be the rule in the French law. The ordinary interest begins upon the accumulated sum when the marine interest ceases; and Boulay Paty follows the authority of Emerigon, and of the French judicial decisions, in support of this rule, and in opposition to the doctrine of Pothier and Pardessus, who insist, that no interest whatever accrues between the cessation of the maritime interest and the judicial demand of the debt.c

a Whether a bottomry bond, executed by the owner in his own place of residence, be valid, has been questioned, but when executed by him in a foreign port, it is undoubtedly binding. The Sloop Mary, 1 Paine, c. c. 671. It is not necessary to the validity of a bottomry bond made by the owner of the vessel, that the money borrowed should be advanced for the necessities of the ship, or cargo, or voyage. The owner may employ the money as he pleases. But if made by the master, virtute officii, it must be for the ship's necessities, for the implied authority of the master extends no further. The Brig Draco, 2 Sumner, 157.

b Conard v. Atlantic Insurance Company, 1 Peters' U. S. Rep. 386.

• Emerigon, tome ii. 414. Pothier, Traité du Pret, à la grosse aventure, No. 51. M. Pardessus, Cours de Droit Com. tome iii. n. 917. Boulay Paty tome iii. 80-89. Marshall on Insurance, vol. ii. 752, lays down the rule

*The French code prohibits all loans, in the nature of bottomry or respondentia, upon seamen's wages or voyages. A sailor is not generally in a situation to expect any great profit which would justify a loan upon maritime interest, and wages are too slender a basis for a maritime loan, and the provision is dictated by sound policy. The English and American courts of admiralty have a broad equity jurisdiction over such contracts. The bottomry bond may be good in part, and bad in part; and if the premium has been unduly enhanced from a knowledge of the master's necessities, the Court of Admiralty, which acts ex æquo et bono, may moderate it, or refuse to ratify it. But if marine interest has not been stipulated, no court can supply the omission, and it will be taken to be a contract upon ordinary interest; for no new obligation can be inferred or reasoned out by a commentary on the contract itself.c

according to the opinion of Pothier, who holds that the ordinary interest, after the risk has ceased, commences only on the principal sum lent, and not on the joint principal and maritime interest, for that would be compound interest. There are no English decisions on the point, and if the French law is to govern, it is decidedly against the opinion of Pothier. There is ground for the conclusion, that when the risk has been run, and the peril ceases, the loan, with the extraordinary premium, becomes an absolute debt, which ought to carry interest if the payment be delayed. The French law declares, and it is also the doctrine of Casaregis, that a bottomry contract, if made pay. able to order, or bearer, is negotiable like a bill of exchange, and is to be dealt with and protested in like manner. Casaregis, disc. 55. Boulay Paty, tome iii. 97. Code de Commerce, art. 313.

a Code de Commerce, art. 319.

b 1 Dodson, 277. 283. The Ship Packet, 3 Mason, 255. Hagg. Adm. Rep. 176. 326, 327.

Ware's Rep. 255.

The Nelson, 1

The Cognac, 2 ibid. 377. The Hunter,

See, for further informa.

• Pothier, Traité du Pret, à la grosse, n. 19. tion on the subject of maritime loans, Emerigon's Essay on Maritime Loans, which is the most complete treatise extant on the subject. The substance of it has been ably incorporated into the work of M. Boulay Paty, on a Course of Maritime Commercial Law, and it has been closely and accurately translated by John E. Hall, Esq., of Baltimore.

anficiang

LECTURE L.

OF INSURANCE OF LIVES, AND AGAINST FIRE.

(1.) Of insurance of lives.

THESE insurances are liberal contracts, and while they create an advantageous investment of capital, they operate benevolently towards the public. Their usual purpose is to provide a fund for creditors, or for family connections in case of death. The insurer, in consideration of a sum in gross, or of periodical payments, undertakes to pay a certain sum, or an annuity, depending upon the death of a person whose life is insured. The insurance is either for the whole term of life, or for a limited period. Such is the nature of these contracts, that they are well calculated to relieve the more helpless members of a family from a precarious dependence, resting upon the life of a single person; and they very naturally engage the attention and influence the judgment of those thinking men, who have been accustomed to reflect deeply upon the past, and to form just anticipations of the future.

The practice in Europe, of life assurances, is in a great degree confined to England, and it has been introduced into the United States. It is now slowly, but gradually, attracting the public attention and confidence in our principal cities. According to a maxim of

The Massachusetts Hospital Life Insurance Company was incorporated

in 1818.