Bottomry

A bottomry, or bottomage, is when the master of a ship borrows money upon the "bottom" or keel of it, so as to forfeit the ship itself to the creditor, if the money is not paid at the time appointed with interest at the ship's safe return.

This occurs in cases where the ship needs urgent repairs during the course of its voyage or some other emergency arises and it is not possible for the master to contact the owner to arrange funds, allowing him to borrow money on the security of the ship or the cargo by executing a bond. Where both cargo and ship are hypothecated, the bond is called a bottomry bond. Due to the bond's relatively low priority as against other liens in the event of a libel against the ship, the use of bottomry bonds declined greatly in the 19th century and the subject is today of interest only to legal historians.

The Code of Hammurabi describes a form of bottomry that was a type of insurance. A bottomry would be taken, but the repayment would be contingent on the ship successfully completing the voyage.


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Look at other dictionaries:

  • bottomry — bot·tom·ry / bä təm rē/ n [alteration of earlier bottomary, modification of Dutch bodemerij, from bodem bottom, hull, ship]: a contract under which the owner of a ship pledges the ship as collateral for a loan to finance a journey money lent on… …   Law dictionary

  • bottomry — [bät′əm rē] n. [< BOTTOM, n. 9, after Du bodomerij, bottomry] a contract by which a shipowner borrows money for equipment, repairs, or a voyage, pledging the ship as security …   English World dictionary

  • Bottomry — Bot tom*ry, n. [From 1st {Bottom} in sense 8: cf. D. bodemerij. Cf. {Bummery}.] (Mar. Law) A contract in the nature of a mortgage, by which the owner of a ship, or the master as his agent, hypothecates and binds the ship (and sometimes the… …   The Collaborative International Dictionary of English

  • Bottomry — (engl.), so v.w. Bodmerei …   Pierer's Universal-Lexikon

  • Bottomry — (engl.), s. Bodmerei …   Meyers Großes Konversations-Lexikon

  • Bottomry — When the owner of a ship borrows money and uses the ship itself (referring to the ship s bottom or keel) as collateral. If the ship is lost during the course of the voyage then the creditor will lose on the loan; if the ship survives, the lender… …   Investment dictionary

  • bottomry — /botgmriy/ In maritime law, a contract by which the owner of a ship borrows for the use, equipment, or repair of the vessel, and for a definite term, and pledges the ship (or the keel or bottom of the ship, pars pro toto) as security; it being… …   Black's law dictionary

  • Bottomry —    Authority given to a banker to dispose of goods pledged as security against a loan. For example, the pledging of a ship as collateral against emergency loans needed for repairs, with a commitment to repay the loan on safe completion of the… …   Financial and business terms

  • bottomry — /bot euhm ree/, n., pl. bottomries. Marine Law. a contract, of the nature of a mortgage, by which the owner of a ship borrows money to make a voyage, pledging the ship as security. [1615 25; modeled on D bodemerij, equiv. to bodem BOTTOM + erij… …   Universalium

  • bottomry — noun An early form of maritime contract in which money could be borrowed by the owner of a ship using the ship as collateral …   Wiktionary

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