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the repayment of the sum lent and the premium agreed on, depends upon the safe arrival in port of the articles on which it is made, or on the value they realise in case of misfortune.
B. Bk. II., 164, F. 325, 327, G. 680, H. 569, I. 599, N. 99, Sw. 126.
47, 137. 720. Bottomry Bonds may be made :(1.) By a notarial instrument. (2.) By means of a bond signed by the parties and the
broker employed. (3.) By a simple contract.
In whichever of those ways the contract is made, it will be noted on the certificate of the ship's register, and entered duly on the Mercantile Register, without which debts of this description will not have with respect to other debts the precedence to which their description entitles them, although the contract will be binding between the parties.
Bonds entered into during the voyage are regulated by Articles 583 and 611, and are valid against third parties from the time of their execution, if they are inscribed in the Mercantile Register of the ship's home port within eight days after her arrival. If eight days elapse without the bond being inscribed in the Mercantile Register, bonds entered into during the voyage are of no effect against third parties until the day on which the inscription is made. With regard to the validity of bonds made according to (2), they must be in conformity with the broker's books; for those made according to (3), the signature must be proved.
Contracts that are not in writing give no right of action. F. 311, 312, H. 570, 571, I. 590, 591. E. 150-153. News. 81, 83, M. and P. 560, 567, Macl. 54, 58. 721. A Bottomry Bond must state: (1.) The description, name, and home port of the ship.
(2.) The name and surname of the captain and his
domicile. (3.) The names, surnames, and domiciles of the lenders
on bottomry. (4.) The sum lent and the premium agreed on. (5.) The place of repayment. (6.) The articles pledged for repayment. (7.) The voyage for which the risk is taken. F. 311, G. 684, H. 570, I. 590, N. 98, Sw. 129. E. 150. News. 81, Macl. 54.
722. Bonds may be made “to order,” in which case they are transferable by endorsement, and the transferee acquires all the rights and runs all the risks of the former holder.
B. Bk. II., 162, F. 313, G. 685,687, H. 573, I. 592, Sw. 130.
723. Loans on goods and merchandise may be made on an estimated value, to determine the sum to be lent.
724. Loans may be jointly or severally on :-
If upon the hull of the ship, the outfit, stores, and other furniture, provisions, fuel, engines, and freights carried in the bottomry voyage are deemed to be affected to the loan. If upon
the whole of it is affected ; and if upon a special part of the vessel or of the cargo, that alone which is specified is affected.
B. Bk. II., 157, F. 315, G. 681, H. 574, 575, 1. 593, N. 97, Sw. 126. E. 155. M. and P. 563, 564.
725. There can be no loan or bottomry on the wages of the crew or on anticipated profits. B. Bk. II., 158, F. 319, H. 577, 578, 1. 593, 594, Sw. 126. E. 158, 159.
726. If the lender shews that he was induced by the fraud of the borrower to advance more than the value of the
article on which the loan was secured, the bottomry will be good only for the amount of the value ascertained by experts.
The balance of the capital will run at the legal rate of interest until repayment. F. 316, H. 576, I. 594. E. 156.
727. If the whole of a loan for the purpose of loading a cargo is not used for this purpose, the balance is repayable before the vessel sails.
Similarly when the goods pledged are not loaded.
728. A loan effected by a captain in the port of residence of the owners, affects the captain's share only if the owners have not given him express authority or intervened in the operation by themselves or their authorised agents. If one or more of the owners, on being required to contribute their share for the repairs or provisioning of the ship, do not do so within twenty-four hours, their shares will be liable in the same proportion for bottomry.
Elsewhere than where the owners reside the captain may take up loans on bottomry in conformity with Articles 583 and 611.
B. Bk. II., 23, F. 234, 321, 322, G. 497, 681, H. 579, 580, I. 595, R. 1060, Sw. 127. E. 161, 162. News. 83.
729. If the articles on which the loan is made are never exposed to the risk, the contract is reduced to a simple loan, the borrower is bound to repay the money with legal interest if this is less than that agreed upon.
F. 325, H. 586, I. 597, Sw. 141 diff. E. 170.
730. Loans made during the voyage take precedence of those made previously to it, and rank in the inverse order of their dates.
Loans for the last voyage take precedence over previous
Loans made in the same port of distress and for the same purposes are payable pro ratá.
B. Bk. II., 159, F. 323, G. 771.773, H. 581, I. 675 (9) (13). E. 163.
731. Actions by the lender are extinguished by the total loss of the articles on which the loan is made, if arising from perils of the sea in the time and during the voyage named in the bond whilst the cargo is on board, but not if the loss arises from the inherent vice of the thing, or from the fault or improper conduct of the borrower, or from the barratry of the captain, or if occasioned by injuries sustained by the ship in consequence of her being employed in an illegal voyage, or if it arises from the goods being carried in a different vessel from that named in the bond, unless the change was caused by force majeure.
The proof of loss rests on the borrower, as well as the existence in the vessel of the goods declared to the lender as the objects pledged.
B. Bk. II., 164, F. 325, 329, H. 588, I. 599, 600, N. 99. E. 165, 166.
732. Lenders on bottomry contribute to General Average attaching to the articles on which the bottomry loan is made, in proportion to their respective interests. In case of Particular Averages, unless otherwise agreed by the contracting parties, the lender on bottomry will contribute so far as his interest is concerned, if the average is not caused by the perils excepted in the preceding Articles.
B. Bk. II., 167 diff., F. 330, G. 691, H. 589, I. 603, Sw. 134 diff. E. 171.
733. If the time of duration of the risk taken by the lender is not mentioned in the contract, it will run, for the ship, engines, apparel, and furniture, from the time the ship sails until she is anchored in the port of her destination, and for the cargo from the time it is placed on the quay or mole at the port of loading until discharged in that to which it is consigned.
F. 328, G. 688, H. 585, I. 60r. E. 168.
734. In case of shipwreck the sum payable on the loan is reduced to the amount of the proceeds of the property salved, less salvage charges.
If the loan be on the ship, or any part of it, freights earned on the voyage for which the loan was made are liable for its repayment as far as they go.
B. Bk. II., 165, F. 327, G. 681 diff., 691, H. 588, I. 599, N. 99. E. 167.
735. If there are both a loan on bottomry and an insurance on the same ship or cargo, the value of the proceeds of salvage, in case of shipwreck, will be divided between the lender on bottomry and assurer in proportion to the proper interests, reckoning for this purpose only the capital advanced by the lender, and without prejudice to preferential rights of other creditors as laid down in Art. 580.
F. 331, H. 610, I. 599. E. 172.
736. If there is delay in the repayment of capital and maritime premiums, the former alone bears legal interest.
B. Bk. II., 161 diff., I. 596 diff., N. 100, Sw. 131 diff.
(1.) Of the Form of the Contract. 737. To render a contract of marine insurance valid it must be in writing, in a policy signed by the contracting parties.
The policy will be drawn up and executed in duplicate, each of the contracting parties keeping one. F. 332, H. 256, 1. 420, 604, P. 595, R. 1237. E. 174. News. 125, Arn. 231, 232.
738. A policy of insurance, in addition to the conditions which only concern those interested, must contain the following particulars :(1.) The date of the contract, stating the hour at which it was agreed on.