Court Opinion

ID: 8630543
Source: CourtListenerOpinion
Date Created: 2022-11-24 19:36:58.421291+00
Date Added: 2024-06-11T16:55:45.223115
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STORY, Circuit Justice.
This is the case of a libel against the brig Draco, upon an asserted bottomry bond. The claimants. Messrs. Stanton, Nichols & Whitney, assert in themselves a title as vendees, and other matters of defence, upon which I shall presently have occasion to comment. In the progress of the cause the vessel was delivered on bail to the claimants upon the usual stipulation'; and certain amendments and additions have been made in the libel and answer, with which matters it is unnecessary to intermeddle, until other more important and grave matters are disposed of, which are preliminary in their nature. The cause has been exceedingly well argued on both sides; and I shall now proceed to pronounce the opinion of the court. The asserted bottomry bond is certainly, in its form and actual structure, new in this court; and it has stipulations, which are not to be. found in any of those, which have been matter of controversy (at least as far as I have knowledge) in any of the English or American courts. I am, indeed, informed at the bar, that it is of very recent origin, although not at present uncommon in the commercial transactions of the metropolis of this state. On this account, and also, because .it constitutes the basis, on which much of the argument at *the hearing rests, I shall recite its contents in the very terms of the instrument. (Here the judge recited it verbatim.) The case, then, presented for the consideration of the court is that of an asserted bottomry bond in the form above-mentioned, made by citizens of the state of Massachusetts, in the home port of the vessel, in favor of a corporation created under the authority of a charter from the government of the same state. It bears date (as we have seen) in January, 1834, and the present suit was brought in October of the same year, before the period stipulated for the termination of the risk, according to the terms of the instrument, had expired.
The first question arising in the case is that of the jurisdiction of the district court, sitting in admiralty, over the instrument as a fit foundation for a proceeding in rem. It is not doubted, that the jurisdiction exists as to all bottomry bonds executed abroad, either by the master or owner, where such bond is given to obtain supplies for the ordinary exigencies of the ship and the voyage, to enable her to complete it; as for repairs and outfits, and the discharge of the debts and charges on the ship or adventure. But it is denied, that the present is a bottomry bond, or maritime hypothecation, in the sense of the general maritime law, upon which admiralty process lies; and in support of this objection various grounds have been relied on, which I shall presently consider. And. in the first place, it is objected, that the bond was executed by the owners in the home port; and upon such an instrument no admiralty process lies, even supposing it to be in all other respects a bottomry bond or maritime hypothecation. In regard to bottomry bonds executed abroad by the owners in person, instead of the master, no objection has been suggested in the present argument; and I confess myself wholly unable to comprehend, how any objection could, in point of law, be reasoned out to overthrow their validity. Lord Stowell has expressly affirmed it. The Barbara, 4 C. Rob. Adm. 1, 2. Mr. Justice Thompson, in an elaborate opinion, has maintained the jurisdiction upon grounds, which seem to me entirely satisfactory and conclusive. The Mary [Case No. 9,1S7J. And it is perfectly clear, that securities of that sort, made at the home port, are valid and obligatory, as bottomry claims,-in the state of Massachusetts; for the legislature have, in the general act defining the duties, powers, and restrictions of incorporated insurance companies (act of 1817, c. 120), expressly authorized such companies “to loan *1039to any citizen of this state any portion of their capital stock, not exceeding one half, •on respondentia or bottomry.” The bottomry bonds here alluded to plainly include loans in the home port to citizens upon the common maritime risks. And this is, as I conceive, entirely conformable to the established doctrine in all maritime countries (at least as far as my researches extend,) ancient and modern. By the Roman law, owners, as well -as the master, could clearly hypothecate for a maritime loan, as we shall abundantly see hereafter: and in no modern commercial nation has the power been denied to the owner, where it could be exercised by the master. But, on the contrary, it could be exercised by the owner in cases, where the master could not exercise it This is certainly time in relation to Scotland, France, Holland, and Italy, and all the other principal commercial nations of continental Europe. See 2 Emerig. Traits a la Grosse, e. s. 1, s. 2, s. 3; 2 Valin, Oomm. lib. 3, tit. 5, arts. 1, 2, 7; Poth. Traits •a la Grosse, notes 1, 7, 9; Bynk. Quest. Priv. Juris, bk. 3, e. 16; .Tac. Sea Raws. c. 1, pp. S-10; Code de Commerce de France, arts. "321, 322; 2 Bell, Comm. bk. 3, pt. 1, e. 5, arts. 459, 460, § 1; Dig. lib. 22, tit. 2; Code, lib. 4, tit. S3. And in England the principal writers, who give a description of bottomry, mention it as a contract of the owner, without any reference at all to the master. We shall see, that so is the description of Mr. Justice Blackstone in his Commentaries (2 Bl. Comm. 457), which will be hereafter cited. Mr. Marshall, follows almost the very words ■of Blackstone, saying, “Bottomry is a contract in the nature of a mortgage, on which the owner borrows money to enable him to fit ■out a ship, or to purchase a cargo for a voyage proposed; and he pledges the keel or bottom of the ship (pars pro toto,) as a security for the repayment;” and Mr. Park uses similar language. 2 Marsh. Ins. bk. 2, c. 1, p. "733; Id. c. 2, p. 740; Hughes, Ins. c. 17, pp. 451. 452; 2 Browne, Civ. & Adm. Law, 196. 197; Park. Ins. (Gtk Ed. 1S09) c. 21, p. 552. See, also. Lord Stowell’s opinion in The Zodiac. 1 Hagg. Adm. 320. Lord Stowell, in his •elaborate judgment in The Atlas. 2 Hagg. Adm. 53, copies the very language of Mr. Marshall, as the common and true definition ■■of the contract of bottomry. Lord Tenter-den, in his treatise on Shipping (Abb. Shipp, pt. 2, e. 3, §§ 17, 21), trente expressly of bot-tomry contracts made by the owners, as well as by the master, and without the slightest •distinction, as to their being equally entitled to that character. So that, either upon the ■principles of the general maritime law, or of the local law, there can be no reasonable ■ doubt, that a bottomry contract, made by the •owner in the home port, is, in a just and ac- ■ curate sense, entitled to that distinctive appellation.
Whether upon contracts so made in the home port, a remedy lies in the admiralty -in rem is quite a different question. Lord Tenterden, in his excellent treatise on Shipping (Abb. Shipp, pt. 2, c. 3, § 21), seems to have thought, that no such remedy does lie, founding himself entirely upon a dictum of Lord Holt in Johnson v. Shippen, 2 Ld. Raym. 9S3, and a dictum of Mr. Justice Lawrence in Busk v. Fearon, 4 East, 319, not however reported in the case. The dictum in each of these cases was purely extra-judicial; and the latter was probably founded entirely upon the former, which -was given at a period, when the contest for jurisdiction between the courts of common law and the court of admiralty was maintained with great zeal and pertinacity on each side, flagrante bello. If I might venture, therefore, to make the remark, “pace tanti viri,” I should say, that an obiter dictum, under such circumstances, even of so great a mind, is entitled to very little weight. Indeed, the dictum seems, when correctly examined, to import no more, than that the law will not, under such circumstances, imply an hypothecation, since the owner may give a positive security. And •this distinction is most important; for in the case of Justin v. Ballam, 2 Ld. Raym. 805, it was held, that for the repairs of a foreign ship in England no implied hypothecation exists, (a doctrine, which has been overthrown by the supreme court of the United States);2 but if an actual hypothecation or positive security on the ship was given there (it seemed admitted,) a remedy to enforce it would lie in the admiralty. So it was expressly held by the same court in Bcnzen v. Jeffries, 1 Ld. Raym. 152. Now, in the case at bar, there is, by the very terms of the instrument, an express and positive hypothecation, by way of mortgage and assignment of the brig, for the security of the loan and interest. And I do not perceive, how any sound distinction can be taken between an express hypothecation by a master, or by an owner-in such a ease, since the same objection applies to each, that it is executed within the realm, and on land, and therefore • not within the admiralty jurisdiction as a maritime hypothe-cation.
The observations of the supreme court of the United States, in the ease of Blaine v. The Charles Carter, 4 Cranch [8 U. S.) 332. merely apply to the case of an implied hy-pothecation, where the loan is made in the home port. “In the case of a bottomry bond, executed by an owner in his own place of residence (say the court,) the same reason does not exist for giving an implied admiralty claim upon the bottom (of the ship); for it is in his power to execute an express transfer or mortgage.” But not the slightest doubt was *1040expressed, that, if the bond was truly a bot-tomry bond, and an express hypothecation or mortgage was included in its terms, there would be a remedy in rem in the admiralty to enforce it. On the contrary, the doctrine repeatedly held by the supreme court of the United States, in later cases, has been, that where the contract is clearly of a maritime nature, and the local law gives a lien on the ship as a security, (and a fortiori, the rule applies, where there is a positive hypothe-cation or security given by the party. See Benzen v. Jeffries, 1 Ld. Raym. 152; Justin v. Ballam, 2 Ld. Raym. 805; Johnson v. Ship-pen, Id. 988). There the admiralty has jurisdiction in rem to enforce it Such was the doctrine .held in the case of The General Smith, 4 Wheat. [17 U. S.] 443; and it has been fully recognized in the late case of Peyroux v. Howard, 7 Pet. [32 U. S.) 341. The ground of the doctrine is, that the admiralty has a general jurisdiction over maritime contracts connected with navigation and foreign trade; but it cannot enforce them by a proceeding in rem, unless the local law attaches a hen on the thing as a security. The case of Wilmer v. The Smilax [Case No. 17,777] is directly in point as to the jurisdiction. It was a case of an express hypothecation of the ship on'bottomry; and Judge Winchester, a most learned and pains-taking judge, than whom few have studied the admiralty .jurisdiction with more care, or administered it with more ability, did not hesitate to sustain the jurisdiction, although the money was loaned to the owner in the home port The case of Corish v. The Murphy, 2 Browne, Civ. & Adm. Law, 530, Append., was a case of a bottomry bond in the home port; andafter a very able argument, the jurisdiction was sustained. Mr. Justice Thompson, in the case already alluded to, (The Mary [supra]), has placed the subject in a very clear and strong light. After having stated, that he saw no distinction as to the admiralty jurisdiction, whether the bond was made by the owner or the master, he said that the delegation of admiralty and maritime jurisdiction by the constitution of the United States was broad enough to embrace all maritime contracts, and that all civilians and jurists agree, that marine hypothecations fall under this denomination. He then added: “And why should there, upon principle, be any difference as to the jurisdiction of the court, whether the bottomry bond is given by the owner or by the master? If the jurisdiction depends upon the subject-matter of the contract, this is the same, whether the pledge is given by the one or the other. The object and effect of the bond are the same in both cases, creating a lien upon the vessel.” The case of The Barbara, 4 C. Rob. Adm. 1, goes far to sustain the same doctrine; and it was there stated by counsel, that the cases respecting domestic bonds, in which a prohibition had been granted, had been chiefly concerning bonds given by the master solely as master. The case of Hurry v. The John & Alice [Case-No. 6,923], is, I am aware, the other way. But it was made at a period, when the admiralty jurisdiction was not as well understood and defined, as it has since been by the supreme court of the United States, and: when the learned judge, who decided it, had very little experience in maritime causes.. That case cannot stand, unless upon the ground, that a bottomry bond given by an-owner, in a foreign port, is not cognizable in the admiralty; a doctrine, which is inconsistent with what I cannot but now think to-be an established doctrine in our admiralty courts. In Menetone v. Gibbons, 3 Term R. 269, Mr. Justice Buller said, that the form of' the bottomry bond does not vary the jurisdiction. The question, whether the admiralty has or has not jurisdiction, depends on the-subject-matter. And Lord Kenyon, on the-same ground added, that it would be highly inconvenient, if the admiralty had not jurisdiction in such cases, because that court proceeds in rem, whereas the courts of common law can proceed only against the parties. I do not cite this language as being founded on a case, like the present, (for it was the case of a bottomry bond made by the master in a foreign port); but to show the true ground of the admiralty jurisdiction, it being a maritime jurisdiction, and the true nature of it, a proceeding in rem. My own opinion has been long unequivocally expressed, that the admiralty has a rightful jurisdiction over all maritime contracts in personam; but that in cases of that sort it cannot proceed in rem, unless there be a maritime hen, or a positive pledge as security. And, therefore, I have no difficulty in overruling the objection, that the admiralty jurisdiction does not extend to bottomry bonds, given by the owner in the home port, where there is an express pledge as security.
Another objection is, that the bond in this case cannot be deemed to be, in the sense of the maritime law, a bottomry bond. In the first place, it is said, that the very nature of a bottomry bond requires, that the money loaned should be for the necessities or use of the ship for the voyage, as for instance, to purchase a cargo, to repair the ship, or to obtain outfits. The expenditure must be for or on the property; or, to use the expressive language of the counsel for the claimants, the bottomry lender must be a benefactor of the property. If, therefore, the money be lent, while the vessel is at sea, for other purposes, and not to be employed on the vessel, or for the voyage, although it may be (if the words of the instrument are sufficient for this purpose) a valid mortgage, it is not a maritime hypothecation. There is no doubt, that the language used in books of authority countenances this objection, though it is by no means certain, that the authors had in view any such qualification, as it professes to define and enunciate. Their language is-rather intended to be descriptive of the most *1041common forms and occasions of the'instrument, than to express the true nature and definition of it. Thus, Sir. Justice Blackstone, in his Commentaries (2 Bl. Comm. 457), says: “Bottomry (which originally arose, •from permitting the master of a ship, in a foreign country, to hypothecate the ship, in order to raise money to refit,) is in the nature of a mortgage of a ship, when the owner takes up money to enable him to carry on his voyage, and pledges the keel or bottom of the ship (partem pro toto) as a security for the repayment. In which case it is understood, that if the ship be lost, the lender loses also his whole money; but if it returns in safety, then he shall receive back his principal, and also the premium or interest agreed upon, since it may exceed the legal rate of interest. And this is allowed to be a valid contract in all trading nations, for the benefits of commerce, and by reason of the extraordinary hazard run by the lender. And, in this case, the ship and tackle, if brought home, are answerable, as well as the person of the borrower, for the money lent, &c.” And after speaking of respondentia bonds, he adds: “These terms are also applied to contracts for the repayment of money, borrowed not on the ship and goods only, but on the mere hazard of the voyage itself; when a man lends a merchant £1000. to be employed in a beneficial trade, with condition to be repaid with extraordinary interest, in case such a voyage be safely performed; which kind of agreement is sometimes called ’faenus nauticum, and sometimes ‘usura marítima.’ ” And here it may be remarked, that the learned author makes not the slightest scruple in holding a bottomry bond by the owner to be binding on the ship, as a maritime hypothecation. But, taking the whole language together, it is manifest, that he did not contemplate, that the money must necessarily be laid out for or in the ship, to constitute a genuine bottomry contract. This sort of contract was well known to the ancients, and in the Roman law, it was called “trajec-titia pecunia,” or “faenus nauticum.” The civil law gave this description of it: “Tra-jectitia pecunia est, quae trans mare vehitur; caeterum, si eodem locum consumatur. non erit trajectitia. Bed videndum, an merces ex ea pecunia eomparatae, in ea causa habeantur? Et interest, utrum etiam ipsae periculo eredi-toris navigent: tune enim trajéctitia pecunia fit.” Dig. lib. 22, tit. 2, 1. 1. But cases are put in the Pandects, which plainly show, that there are other cases, which fall within the same denomination, where the loan is not employed in the purchase of the identical goods; but the risk only is taken on them. Thus, the case is put of money lent on a pledge of goods in different ships, some of which have been already pledged to other lenders. “Faenerator, pecuniam usuris ma-ritimis dando quasdam merces in nave pigno-ri accepit;' ex quibus si non potuisset totum debitum exsolvi, aliarum mercium aliis navi-bus impositarúm, propriisque foeneratoribus obligatarum, si quid superfuisset, pignori accepit; quaesitum est, nave propria peremp-ta, ex qua totum solvi potuit, an id damnum ad creditorem pertineat, intra praestitutos dies amissa nave? An ad caeterarum navium superfluum admitti possit? Respondí. Alias, quidem pignoris diminutio, ad damnum de-bitoris, non etiam ad creditoris, pertinet. Sed cum trajectitia pecunia ita datur, ut non alias petitio ejus creditori competat, quam si salva navis intra statuta témpora pervenerit, ipsius crediti obligatio, non existente conditione, defecisse videtur.” Dig. lib. 22, tit. 2, 1. 6. An answer, that presupposes, that the money may be lent, not only upon goods purchased with it, but upon the ship itself on the risk of the voyage. The succeeding law demonstrates this still more fully, and shows, that a-bottomry bond might exist, although the-loan was merely on the risk of the ship for the voyage. “In quibusdam contractibus etiam usurae debentur, quemadmodum per stipulationem. Nam, si dedero decern tra-jectitia ut, salva, nave, sortem cum certis usuris recipiam, dicendum est, posse me sor-tem cum usuris recipere.” The trajectitia pecunia of the Roman law, was not so entirely confined to money lent for the ship, or for goods to be put on board the ship, as we might at first view suppose; though, doubtless, in the simplicity of the commerce of those times, this was the most common object of the transaction. The Code (liber 4, tit. 33, 1. 3,) puts a case, illustrating the principle, of which it is only necessary to state the introductory part, “Cum proponas te nauticum .faenus ea conditione dedisse, ut post navigi-um, quod in Africam dirigi debitor adsevera-bat, in Salonitanorum portum nave delata, faenebris pecunia tibi redderetur, ita ut navi-gii duntaxat, quod in Africam destinabatur, periculum susciperes,” &c. Emerigon, when rightly understood, confirms this opinion. “That which we call money lent upon maritime loans (a la grosse,)” says he, “was called by the Romans, ‘pecunia trajectitia;’ not that it was merely lent to the borrower of it, to be transported to another place, but because it was lent to the borrower to employ it in his maritime commerce upon the obligation of returning it in ease of a successful voyage with the stipulated nautical interest, and upon the condition, that, if the ship was lost by a peril of the sea, in the course of the voyage, the borrower should not be obliged to return either principal or interest.” Émerig. Traité des Contrats a la Grosse, c. 2, tom. p. 384 (400), b; Id. § 2, note 2. Emerigon adds, that it is called in France, “a la grosse aventure,” because the lender exposes his money to the accidents of the sea; and he contributes to gross or general averages. The definition of Pothier, which is adopted by Emerigon, is quite as comprehensive. “The contract of a maritime loan (a la grosse .aventure,)” says he, “is a contract;, by which the lender lends to the borrower a certain' *1042sum of money upon condition, that in case the loss of the effects, on account of which it is lent, taking place by any peril of the sea, or superior force (vis major,) the lender shall not be repaid, unless to the amount of what shall remain." Potk. Traité du Pret a la Grosse Aventure, art. 1, note X.
If we pursue the definitions of these authors into the analysis, which follows, we shall perceive, that they nowhere intend to insinuate, that it is indispensable, even under the French law. which is narrower than the law of some other countries on this subject, as for instance, Italy and England, that the money should be lent for the purposes of the ship or the voyage. See Emerig. Traité a la Grosse, c. 1, § 3. Thus. Pothier says: “Five things compose the essence of the contract: (1) That money should be lent. (2) That there should be one or more things, upon which the loan should be made, (to contra distinguish it from a mere wager on the voyage, which the French law inhibits). (3) That there should be risks, to which the things are exposed, to be borne by the lender. (4) A stipulated payment should be made by the borrower for the loan, in case of a successful arrival, as a price for the risks run. which is called maritime profit. (5) And there should be the agreement of the parties upon all these things. Now, taking this to be a complete specification of the essentials of a bottomry bond,, the present possesses them all in a direct and unequivocal form; and not one of them points to the necessity of the money being laid out for or upon the voyages; but only, that the property, subject to the lien, should be at risk on the voyage.” Poth. Traité a la Grosse, art. 2, note 7. Emerigon. indeed, in some places, uses language, which seems to import other distinct qualifications; as that the money should be lent for the necessities of the ship or for the voyage. But, taking its general scope, it does not seem to me to vary intentionally from the definition of Pothier; but to have a special reference to certain texts of the Homan law. or to the express provisions of the French ordinance. Valin defines the contract thus: "A maritime loan is a contract, by which the lender, in consideration of the sum, which he will lose, if the thing, upon -which he has made the loan, should perish by inevitable casualty, is authorized to stipulate for an interest or extraordinary profit, in case the thing arrives at the proper port” 2 Valin, Comm. tit. 5, p. 1. And, notwithstanding the positive provision of the French ordinance, giving the privilege of maritime hypothecation for money lent on the hull and keel of the vessel for the necessities of the ship, and, the charges for the payment of the lading for the voyage, which seem to imply, that the privilege is confined to such cases, Valin insists, that it is ot no conseqtience, whether the loan is made before or after the sailing of the vessel on the voyage, since the presumption is, that it has been usefully employed for the thing at hazard, or has been applied to debts contracted pn the same account. 1 Valin, Comm. bk. 1, tit 14, § 16, pp. 364, 366. From this doctrine, however, Emerigon dissents (2 Emerig. Traité a la Grosse, c. 5. § 3); not upon any ground of general principle, but upon the construction of the terms of the ordinance. Mr. Marshall, in his work on Insurance, gives the preference to Valin’s opinion; and manifestly supposes, that the English law agrees with it 2 Marsh. Ins. bk. 2, c. 3, p. 749: Id. c. 4, pp. 749, 750.
I have the rather brought into review the opinions of these eminent maritime jurists, because they were greatly relied on at the argument as establishing the principle, that a genuine bottomry-bond is confined to money lent for the necessities of the ship, or cargo, or voyage. I agree that this seems to be the fair result of the French ordinance, but it stands positively on the text. I agree, also, that this is uniformly the case, where the master takes up money on maritime loan; but this also turns upon the nature and qualifications. and limitations of his powers as master. But I cannot admit, upon general principles belonging to the contract as a maritime loan, that there is any such limitation or qualification applicable to the case of the owners becoming borrowers. The truth is, that contracts of bottomry are not contracts importing, in all countries, precisely the same obligation and extent And though in all commercial countries they are in use, yet the forms and operation of them are not precisely the same in different countries, but are controlled by the local laws. See The Nelson. 1 Hagg. Adm. 176; The Zodiac, Id. 325. We may apply to them the same remark, which Lord Ellenborough applied to a respondentia bond, that, “it is a contract, not of a universal nature and form,, but depending upon the particular form of the instrument, varying in different countries:” and, it may be added, variously modified by the municipal laws. And in the definition usually given of it by authors, they confine themselves (as has been already hinted,) rather to a description of the most common forms and occasions, in' which it appears, than to a strictly juridical definition. Vet it is remarkable, that Blackstone and Marshall, and Lord Stowell, in propounding a definition, speak (as we have already seen) of bottomry contracts of the owner only, omitting those of the master, which are now far more common, and strictly for the necessities of the ship.
In my opinion, there is not the slightest ground to uphold the doctrine, that, in order to constitute a bottomry bond, as such, in the sense of the maritime law, it is necessary, that the money should be advanced for the necessities of the ship, or for the cargo, or for the voyage. Whore it is given by the master, virtute officii, it must, in order to *1043have validity, be for the ship’s necessities; for the implied authority of the master extends no farther. But where it is given by the owner, as dominus navis, he may employ the money, as he pleases. It is sufficient, if the money be lent upon the bottom of the ship, at the risk of the lender, for the voyage. 'The true definition of a bottomry bond, in the sense of the general maritime law, and independent. of the peculiar regulations of the positive codes of different commercial nations, is. that it is a contract for a loan of money on the bottom of the ship, at an extraordinary interest, upon maritime risks, to be borne by the lender for a voyage, or for a definite period. See, also, 2 Marsh. Ins. bk. 2. c. 3, p. 742; Id. c. 4, pp. 748-750. See Lord Stowell’s opinion in The Atlas. 2 Hagg. Adm. 48. 52, 53, 55. 57, 58. This is the true exposition given of it by Bynkershoek, in his usual -strong and masculine manner. After having remarked upon the insufficiency of the definition of Grotius, and that the contract itself had been extended since by little and little, ■and other and other things (paulatim ad alia, ■atque alia porrectus est) since the days of Grotius, he says, “Grotii definitio nec legi-bus nec formulis satis congrua, et multis nominibus imperfecta est.” He gives his own definition in the following words; “Ut au-tem nunc obtinet Boüemery, definió, contract-urn, quo pecunia creditin' magistris navium in exteris regionibus, sive Dominis navium et mercium in his regionibus, ea lege, ut, si navis pereat, creditor jus crediti amittat; si salva advenerit in locum destinatum, sors restituatur cum usuris nauticis vel majori-bus vel.minoribus, ut pro ratione periculi inter creditorem et debitorem convenit.” Bynk. Quaest. Juris. Priv. lib. 3, c. 16. This comprehensive definition embraces precisely the same ingredients, and no more, as the essence of the contract, as are enumerated by Pothier in the passages already cited. This is precisely the view taken of it by Lord Ten-terden, in one of the most recent cases, which has occurred on the subject. He considers it to be the very essence of a bot-tomry bond, as contradistinguished from any -other bond, that it is for money taken up on maritime risks, at the hazard of the lender. Simonds v. Hodgson, 3 Barn. & Adol. 50, 56.
Mr. Bell, in his valuable Commentaries up•on the Commercial Law of Scotland (2 Bell, Comm. p. 83, c. 5, art. 460, § 1), has given a definition substantially the same, which, he ■says, contains the essence of the contract, as defined by all the great writers upon maritime law. He says, that, “by the contract of bottomry or respondentia, money is, in contemplation of a particular voyage, lent to the master of a ship in a foreign country, or to the owner of the ship or cargo in a home port; on this condition, that if the subject, on which the money is taken, is lost by sea risk or superior force, the lender shall lose his money: and that if the voy■age shall be successful, the sura shall be repaid, with a certain profit or consideration for interest and risk, as agreed upon.” And this is clearly the view taken of the contract by the supreme court of the United States, in the case of Conard v. Atlantic Ins. Co.. 1 Pet. [26 U. S.] 430. 437, where the very objections were taken, which have been taken in this case. That, indeed, was the case of a respondentia bond. But upon this point, none of the authorities cited in support of the objections make any distinction between bottomry bonds and respondentia bonds; but they profess to hold both to be governed by the same rules. The objections were, first, that the loans were made after the sailing of the ships on the voyage; secondly, that the money loaned was not appropriated to the purchase of the goods put on board, and was not the identical property, on which the risk was run. What was the language of the supreme court, in reply to these objections? “In our opinion, neither of these objections can be sustained. It is not necessary, that a respondentia bond should be made before the departure of the ship on the voyage, nor that the money loaned should be employed in the outfit of the vessel, or invested in the goods, on which the risk *is run. It matters not at what time the loan is made, nor upon what goods the risk is taken. If the risk of the voyage be substantially and really taken; if the transaction be not a device to cover usury, gaming, or fraud; if the advance be in good faith for a maritime premium; it is no objection to it. that it was made after the voyage was commenced, nor that the money was appropriated to purposes wholly unconnected with the voyage.” Now, the doctrine here stated, which was the unanimous opinion of the court, is, in my judgment, perfectly conclusive upon the point stated. And I am entirely satisfied, upon a review of the principles upon which it is founded, that it cannot be shaken but by overthrowing principles deeply settled and fixed in the maritime law. I find. too. that my learned friend Mr. Chancellor Kent, adopts this view of the subject, as the true and satisfactory doctrine on the subject. 3 Kent, Comm. Lec.t. 49. (2d Ed.) pp. 301, 362.
It is also objected, that if the bond is a good bottomry bond, still it is one of a peculiar nature, and does not give any maritime privilege or lien on the vessel; but it is to be treated as a case of a mortgage at the common law. If treated as a mortgage, it is said to be void as against the registration act of Massachusetts, respecting personal property; and if not, still there would be no lien without a delivery of possession, which has not been done. In regard to the terms of the bottomry bond, it is certainly true, that they are of a peculiar nature; but still their import is undeniably, that the loan is upon maritime risks, the ordinary risks in policies of insurance, and the property was at the time of the loan in the borrowers. There are therefore, all the proper ingredients of a *1044bottomry bond. And as to collateral matters, not displacing these, there can be no doubt, that they constitute grounds of contract, which the parties may modify according to their own pleasure. With respect to the privilege or lien, it is not a case depending upon the effect of any implied hypothecation under the maritime law; for there is an express mortgage and assignment, which is a positive hypothecation; and it being as clear, that it is for maritime risks, it follows of course, that it is a maritime hypothecation, which, in legal contemplation, is neither more or less than a maritime mortgage.
The other point, as to the necessity of registration, depends merely upon the statute of Massachusetts of 1832, c. 157, which provides for the registration of mortgages of personal property. That statute contains the following exception and proviso: “Provided, that nothing herein contained shall affect any transfer of property under bot-tomry or respondentia bonds, or of any ships or goods at sea, or abroad, if the mortgagee shall take possession thereof, as soon as may be, after the arrival of the same in this commonwealth.” As I understand this section, it expressly excepts from the operation of the statute, all transfers under bottomry or respondentia bonds; and the qualification, as to taking possession, is exclusively applied to other cases of transfer of any ship or goods at sea or abroad, by way of mortgage. And this exception is the more reasonable and just; because possession is not usually contemplated to be taken under a bottomry or respondentia bond; and a term of time after the arrival of the ship is often allowed for payment, before any proceedings can be had to enforce any right in rem. If we were to construe the exception in any other manner, and make it applicable to bottomry or respondentia bonds generally, unless possession were taken on the arrival of the vessel, it would create great public inconvenience, and indeed avoid the securities of bottomry and respondentia bonds in many cases; for possession cannot, under the ordinary bonds, be lawfully taken to enforce payment Besides, the disjunctive “or.” completely separates the former member of the sentence from the latter; so that we must read it, “any transfer of property under bottomry or respondentia bonds, or any transfer of any ship or goods at sea or abroad, if the mortgagee shall take possession,”. &c. of any such ship or goods at sea or abroad, as soon as may be after the arrival of the same. The case of a bottomry bond, being, then, (as I' conceive) upon the true interpretation of the statute, entirely out of its purview, this objection, in every variety of its form and pressure, seems to me to be unmaintainable. If the lien be secret, it is nevertheless sacred; for it is such as the law allows upon its own policy. It is not protended to be a case affected by our ship registry acts; and. therefore, it steers wide of- any objection to it, founded upon the peculiar provisions of the British Code. If, then, there was no necessity to record the instrument, and it is not within the registry acts, it can be of no consequence to the present claimants, that they purchased without notice of its existence; for such notice is not required by law, to give such a security validity against a bonk fide purchaser. The only difficulties, which can arise, are those, which may result from there being a meditated fraud in the case (which is not here pretended;) or some laches on the part of the bottomry lender, which will, in favor of such purchaser, operate as a waiver of the lien or mortgage on the property.
Some objection has been hinted against the bottomry bond, upon the ground, that it is not for a specific voyage, but for a great length of time. But it is very clear that a bottomry bond, may be upon time, as well as for a specified voyage. Indeed, in many cases (as in case of a bottomry bond on an East India or China voyage,) the voyage may last far beyond the stipulated period in the present bond. Even in the Roman law no difference was made, whether the maritime loan was made upon a specific voyage, or for a limited time. Dig. lib. 22, tit. 2, 1. 4, l. 6. And this is clearly the law of Prance, and of other continental maritime countries, as it certainly is of England and America. See 2 Emerig. Traite a la Grosse, bk. 1, c. 8, §§ 1, 263; 2 Valin, Comm. lib. 3, tit 5, art 2, pp. 4, 5; 2 Marsh. Ins. bk. 2. c. 4, pp. 748-752.
There is another objection of a very different character, which is presented against the maintenance of the present suit. It is, that the suit was commenced before the bot-tomry bond became due and payable according to its terms, the suit having been commenced before the year had expired, for which the loan was made. Several answers have been given to this objection. In the first place, that it is at all events maintainable for the first half year’s interest, which was clearly due; in the next place, that the insolvency of the borrowers put an end to any further proceedings in the adventure on their part; and in the last place, that the sale of the vessel to the present claimants was a virtual deviation from the risks, or an extinguishment of, or a dispensation from, any further risks, under the bottomry bond, on the part of the lenders. In regard to the interest, it does not seem to me, that though payable semi-annually, it could be recoverable at law, unless the principal were also recoverable. If the brig had been totally lost after the time of the first semi-annual payment of interest had passed, and before the year had expired, nothing would have been payable on the bond, either for principal or interest, for, notwithstanding the preliminary recitals, the very condition of the bond demonstrates, that neither principal nor interest could accrue, unless upon the due ar*1045rival of the brig at the expiration of the risk. The insolvency, too, has no bearing upon the case, otherwise than as it may conduce to show, that the contemplated voyage or adventure was broken up; and if it was broken up, it was so by the sale and transfer of the brig to the present claimants. The question, then, as to the breaking up of the voyage, and the consequent discharge of the libellants from any' further risk, turns upon the effect of that sale and transfer. There is no doubt, that the bottomry bond originally attached by the sailing of the brig on the contemplated adventure; so that there has been a due commencement of the maritime risks, to be borne by the lenders. We may, therefore, lay out of the case all consideration of what would have been the state of things, if • the maritime adventure had never, according to the contemplation of the parties, had an inception. See 2 Marsh. Ins. bk. 2, c. 4, pp. 749, 750. From the time of the execution of the bond, until the sale to -the claimants, the brig was clearly at the risk of the lenders at sea and in port.
Now, in point of law. there can be no doubt, that if, after the risk on the bottomry bond has commenced, the voyage, or adventure, is voluntarily .broken up by the borrower, in any manner whatsoever, whether by a voluntary abandonment of the voyage, or adventure, or by a deviation, or otherwise, the maritime risks terminate, and the bond becomes presently payable. All writers on the subject of bottomry treat this as indisputable, and governed by analogy to the law of insurance on the same subject. Bmerigon, instead of discussing the subject at large, simply contents himself with saying: “All that I have said in my treatise on Insurance, upon the subject of the route, the voyage, and the places within the risk, will apply here. A voluntary change of the route, or of the voyage, discharges the lender from all ulterior risks, though the ship should return to her legitimate track.” 2 Emerig. Traite & la Grosse, c. S, § 4. And afterwards he adds: “After the risk is terminated, the borrower is bound to pay the principal and maritime interest, which he has promised." Id. c. 9, § 1. Bynkershoek lays down the like doctrine (Bynk. Quaest. Priv. lib. 3, c. 16. See, also, 1 Bell, Comm. bk. 3, pt 1, c. 5, art. 471, § 1); and it is the established jurisprudence -of England and America (2 Marsh. Ins. bk. 2, c. 4, pp. 750, 751; Id. c. 5, pp. 755-757). “In general (says Mr. Marshall) as soon as the risk ceases, (discusso periculo) either by the ship’s safe arrival, the expiration of the term, or any other event, the' marine interest ceases, and the debt becomes absolute.” Id. He "afterwards adds, in another place, that “the lender, like an insurer, is only answerable for losses, which happen within the time and place of the risk, as specified in the contract. Therefore, if the ship, without necessity, deviate from the voyage .described in the bond, the lender will not be liable, any more than an insurer, to any loss, that may afterwards happen.” 2 Marsh. Ins. bk. 2, c. 5, pp. 756, 757.
The state of the law being such as from these authorities it would seem clearly to be, that the risk of the bottomry lender terminates under the same circumstances which would terminate the like risks upon a policy of insurance, the question, then, arises, whether in a policy of insurance upon time the risk on the subject-matter continues, after there has been an absolute sale or transfer of the property; for such is the state of the present case, as presented by the record, and insisted on by the claimants. Now, the doctrine is, as I apprehend, very clearly established, that, upon a policy of insurance, the property insured continues at the risk of the underwriter only, while the ownership of the assured continues in the property. If he sell it, or transfer it absolutely, the policy becomes void as to any future risks, and is functus officio. This was the doctrine of the house of lords in Lynch v. Dalzell, 3 Brown, Parl. Cas. 431, and was affirmed by Lord Hardwicke in Sadlers’ Co. v. Badcock, 2 Atk. 554. The same doctrine is affirmed in Marshall on Insurance (book 4, c. 2, p. 787; c. 4, pp. 800, 801, 804). The same doctrine has been repeatedly recognised in Massachusetts; and the case of Carroll v. Boston Marine Ins. Co.. 8 Mass. 515, is directly in point. That was a policy on a vessel on time; and, before the loss, the vessel was sold to another person; and the court held, that no subsequent loss was recoverable under the policy. The court on that occasion said: “It has been repeatedly decided here, that, under the forms of our policies, none but the parties to the contract, or their legal representatives in case of their death, can avail themselves of the contract, although others may in fact have an equitable or even a legal interest in the property insured.” Unless, then, some distinction can be shown between the case of a policy, and the case of a bottomry bond, this doctrine concludes the question. I know of no such distinction; and there is no ground in law or equity to sustain one. The vendee, in case of a sale, is not liable to the bot-tomry lender for either principal or interest; nor can he, on the other hand, entitle himself, as vendee, to any benefit of the bottomry bond. The sale of the vessel terminates all interest in the borrower; not only -his interest in the voyage, but his power over the voyage. The bottomry bond is a contract for any voyage during the limited period, carried on by the borrower, as owner, and not ultra. And no man has a right to say, that personal confidence in the character, business, or interests of the borrower, may not have materially influenced the formation of the contract, and the undertaking of the risk.
But the present case stands upon a stronger ground; for there is certainly a direct interdiction of any such sale during the period of the- risk. It is true, that -the clause- is con*1046tained in. or rather follows, a recital, and is inartificia lly drawn; but it contains terms of positive and direct obligation, which the parties are estopped to deny. The clause, to which I allude, after stating the mortgage and assignment of the brig, as security, proceeds as follows; “And it is hereby declared, that the whole of the said brig is thus assigned over for the security of the bottomry taken up by the said, &c., and shall be delivered to no other use or purpose whatsoever, until payment of this bond is first made, with the premium and interest, that may become due thereon.” Can it be said, with any just regard to the true meaning of the language, that this brig has not, by the sale, been delivered up to any other use or purpose, than to pay the bottomry bond? And if the brig has been so delivered up, is not the sale, in the sense of a court of equity (and such, for this purpose, a court of admiralty is, to the extent of the exercise of its own jurisdiction,) a breach of the contract? My opinion is, that the risk has terminated by the abandonment of all further rights and interests in the voyages of the brig by the transfer of the owners. And I am also of opinion, that the sale of the brig constitutes por se a violation of the contract in its substance; and therefore, that the suit is not brought too soon.
I have thus gone, at large, over the main grounds of resistance to the present claim, of the libellants, as matter fit for the cognizance and administration of an admiralty court. But it does appear to me, that, if the merits of the case are as I am of opinion they are, the escape from the admiralty court to a common law court would, to use a felicitous expression of Lord Stowell, only be to change postures on an uneasy bed. If this bottomry bond be a good mortgage at the common law, and do not require registration to give it validity (as I think it does not), then it is clear, that the legal property vested in the libellants; and if so. the sale to and use of the brig by the claimants, under an adverse title, is a conversion of the property, for which an action of trover would lie; and in such an action the libellants would be entitled to recover the full amount of the principal and interest due to them by the terms of the bond. There is, therefore, in substance, no controversy between the parties, but the simple question of priority of title; and when that is once settled, it is wholly immaterial in what court the other claims of the parties are to be adjusted. The latter are more a matter of calculation than of general discretionary damages.
The view of the case, which I have taken, renders it wholly unnecessary to examine into the other points suggested by the amended libel and answers, as to the earnings of the brig, and whether the conveyance was merely a security for a debt, or an absolute purchase. I am of opinion, that the libel-lants are entitled to the principal sum of three thousand dollars, lent at the maritime risk, to the premium of five per cent, on that sum, and to simple interest of six per cent, on the principal sum from the time of the sale to the claimants up to the time of this decree. If there is any question as to the amount, I shall refer it to an auditor to ascertain and adjust it. Decree accordingly.

 The Aurora, 1 Wheat. [14 U. S.] 96, 106; The General Smith, 4 Wheat. [17 U. S.] 438: Peyroux v. Howard, 7 Pet. [32 U. S.) 341; Turnbull v. The Enterprize [Case No. 14.242): Clinton v. The Hannah [Case No. 2.898): and Shrewsbury v. The Two Friends [Id. 12.8Í9),— were all on implied hypothecations brought by material men for services, &e., in the home port.