CHAPTER II. MORTGAGE. no original gage. ALTHOUGH the Court of Admiralty had no original juris- Court had diction in questions of mortgage, yet, as a mortgagee can now jurisdiction enforce his security upon the ship in the Court of Admiralty in mortand stands in a position analogous to that of an owner, it seems appropriate to consider mortgage immediately after possession. It is not, however, proposed to discuss the rights and liabilities of mortgagees generally, but only to consider how far and in what way the Court will exercise its jurisdiction (a), or interfere to protect the interests of mortgagees. Prior to the passing of the recent statutes extending the jurisdiction of the Court, it was clear that a mortgagee could not institute a suit; it was even doubted whether the Court, in cases where a ship had been arrested under its jurisdiction, could take cognizance of the claims of mortgagees, or whether indeed a mortgagee could have intervened in a suit for the protection of his property, even in cases where he had an ultimate interest in the proceeds of the ship (b). In order to obviate this state of things, express provision was made by Jurisdiction the 3rd section of the 3 & 4 Vict. c. 65, which provides that under 3 & whenever any ship or vessel shall be under arrest by process 65, s. 3. (a) For a discussion of the question generally, see Maclachlan on Shipping; Maude and Pollock on Shipping; Pritchard's Admiralty Digest, title Mortgage; Collins v. Lamport, 34 L. J. Chan. 196, and cases there cited. (b) The Neptune, 3 Hagg. 129-132, 3 Kapp. P. C. 94; The Prince George, 4 Vict. c. issuing from the Court, or the proceeds shall have been brought into the registry, the Court shall have full jurisdiction to take cognisance of all claims and causes of action of any person in respect of any mortgage of such ship or vessel, and to decide any suit instituted by any such person in respect of any such claims or causes of action. The remedy thus provided was, however, found to be inadequate; for although the Court would determine the right of the mortgagee to freight when the question arose in the course of a suit instituted against the ship and freight (c), yet it would not interfere where the suit was against freight alone (d). Neither did it allow the mortgagee to initiate a suit, the object of the section being not to confer any new separate and distinct powers upon the Court, but merely to enable the Court to exercise its ordinary jurisdiction to the full extent (e). Accordingly the jurisdiction of the Court was further extended Jurisdiction by the 11th section of the Admiralty Court Act, 1861. That under Ad- section provides that the Court shall have jurisdiction over miralty Court Act, any claim in respect of any mortgage duly registered accord 1861. ing to the provisions of the Merchant Shipping Act, 1854, whether the ship or the proceeds thereof are under arrest of the Court or not. And now a registered mortgagee can himself institute a suit in the ordinary way, and can have the ship arrested and detained until bail be given to the amount of his claim. It is conceived that the Court will not, under the 11th section of the Admiralty Court Act, 1861, interfere to put the mortgagee into possession of, and give him control over, the ship for the purpose of enabling him to use her, but will only exercise jurisdiction by selling the ship to meet his claim, allowing him upon application to act as a purchaser at the sale (g). (c) The Dowthorpe, 2 W. Rob. 81. 223. (e) See per Dr. Lushington in The Fortitude, 2 W. Rob. 222. (g) The Wilsons, 1 W. Rob. 173; The Highlander, 2 W. Rob. 109. As to the question, whether the Court will decree a sale at the suit of a second mortgagee of a moiety of the ship; see The Volant, Br. & L. 321. By the 70th section of the Merchant Seamen's Act, 1854, a mortgagee is not by reason of his mortgage to be deemed the owner of the ship, except so far as may be necessary for making the ship where mort gagee is not sion. 11 By the 78th section of the Merchant Shipping Act, 1854, Rights so long as the mortgagee does not take possession of the ship, the mortgagor, being the registered owner subject to the in possesmortgage, retains all the rights and powers of ownership, and his contracts with regard to the ship will be valid, provided his dealings do not materially impair the security of the mortgagee (h). A mortgagee, not in possession, of a share of a ship has not a right to institute a cause of restraint against the owners of the other shares (i), nor a mortgagee of the whole, not in possession, to institute a cause of possession. Where a bill of sale is absolute in its terms, the Court will look behind the register to the real character of the transaction, and treat as a mortgage that which is on its face an absolute transfer, if it should appear that such was the intention of the parties (k). tered mort gages. The jurisdiction conferred by the 11th section of the UnregisAdmiralty Act, 1861, is confined to mortgages registered (1) under the Merchant Shipping Act. With respect to all other mortgages the jurisdiction is limited to cases where the ship or proceeds are under arrest (m). available as a security for the mortgage debt. The 71st section gives him a power of sale, and the 70th section does not limit the common law rights of the mortgagee, but protects him against claims for which he might otherwise be liable as owner in possession. Dickinson v. Kitchen, 8 E. & B. 789; Dean v. McGhie, 4 Bing. 45; Collins v. Lamport, 34 L. J. Chan. 196. He has a right to take possession for the purposes of sale; and upon taking possession, but not till then, is entitled to accruing freight. Gardner v. Cazenove, 1 H. & N. 423. But see Brown v. Tanner, L. R. 2 Eq. 806. He may have a right to use the ship; see De Mattos v. Gibson, 30 L. J. Ch. 145; The European and Australian Royal Mail Company v. The Royal Mail Steam Packet Company, 4 K. & J. 676; but if he employs her with loss, the loss falls upon him: Marriott v. The Anchor, (h) Collins v. Lamport, 34 L. J. Ch. 196. (i) The Innisfallen, L. R. 1, Ad. 72; The Highlander, 2 W. Rob. 109; and see ante, 21, 22. (k) Gardner v. Cazenove, 1 H. & N. 423; Ward v. Beck, 32 L. J. C. P. 113; The Innisfallen, L. R. 1, Ad. 72; and see the 3rd section of the Merchant Shipping Amendment Act, 1862. (7) The provisions as to, and the effect of, the registration of mortgages will be found in sections 66-75 of the Merchant Shipping Act, 1854. (m) An unregistered mortgage is good inter partes, and as against the assignee of a bankrupt, if possession has The mortgagee takes the ship subject to maritime liens. for bottomry, wages, salvage, damage (n), and to the claim of a master for disbursements (o), and subject, also, to any possessory lien for work done to the ship by the orders of the mortgagor in possession (p). The 5th section of the Admiralty Act, 1861, confers no maritime lien, and a registered mortgagee takes precedence of a claim for necessaries made under that section (q); but the 6th section of the 3 & 4 Vict. c. 65, does confer a maritime lien for necessaries supplied within that section (r). been taken before the bankruptcy, and as against an execution creditor. Dickinson v. Kitchen, 8 E. & B. 789 ; Stapleton v. Haymen, 33 L. J. Ex. 170. By the 3rd section of the Merchant Shipping Amendment Act, 1862, equities may be enforced against owners and mortgagees of ships in respect of their interest therein, in the same manner as equities may be enforced against them in respect of any other personal property; see The Liverpool Marine Credit Co. v. Hunter, L. R. 4 Eq. 62. And the Court of Admiralty will, where no prejudice to third par ties can arise, take notice of such equities, and allow the possessors of them to intervene in any suit for their protection. The Cathcart, L. R. 1 Ad. 314. See Dowthorpe, 2 W. Rob. 77. When a mortgagee is let in to defend a suit, his right of defence is confined to the defences competent to the owner. The Chieftain, Br. & L. 104. (n) Harmer v. Bell, 7 M. P. C. C. 281; The Nymph, Swa. 86; The Royal, id. 468; and see these various heads. (0) The Mary Anne, 35 L. J. Ad. 6. (p) Williams v. Allsup, 10 C. B. N. S. 417, 30 L. J. C. P. 353. But the mortgagee is entitled to priority to material men who are not in actual possession, and who claim under the 10th sec. of the Ad. Court Act, 1861. The Scio, L. R. 1 Ad. 353. (q) The Pacific, 33 L. J. Ad. 120, Br. & L. 243; The Troubadour, L. R. 1 Ad. 302, (r) The Ella A. Clark, 32 L. J. Ad. 211. CHAPTER III. BOTTOMRY. nature of the con BOTTOMRY is a contract by which, in consideration of General money advanced for the necessities of a ship to enable it to proceed on a voyage, the keel or bottom of the ship, pars pro tract. toto, is made liable for the repayment of the money in the event of the safe arrival of the ship at its destination. Not only the ship, but the freight and cargo may be the subject of hypothecation. When the cargo alone is hypothecated, the term respondentia is applied to the contract. Respondentia bonds rest on the same general principles as bottomry bonds on the ship, but they are not to be regarded as placed precisely upon the same footing, because the interests of the owner of the cargo are not always identical with the interests of the owner of the ship (a). It will, however, be convenient to treat of bonds on ship, freight, and cargo under one general head, and to note, as occasion may arise, the differences which exist when one or the other is the subject of hypothecation. The contract of hypothecation has been adopted from the civil law, for to the common law it was unknown; it does not pass any property in the ship; it merely confers upon the lender a claim against the ship, subject to sea risk, which cannot be enforced except by process in the Admiralty Court (b). The subject therefore is one so peculiarly within (a) See Cargo, ex Sultan, Swa. 510; The Edward, Lush. 65. (b) The master cannot render the owner personally liable on the bond: Stainbank▾ Shepard, 13 C. B. 418 but it seems that, if the owner hypo- |