Dowling C.J., 5 October 1838

Before His Honor James Dowling, Esq., Judge of the Court.

Wilson, Brothers. v. the brig Nimrod - This was an application to the Court to confirm a bottomry bond on the brig Nimrod, for £1400.  It appeared that in August, 1836, the plaintiffs were agents for the British brig Nimrod belonging to John Leslie, of Edinburgh.  The vessel being in want of repairs the plaintiffs, on the application of Hepburn,  the master, advances the sum of £727 1s. 8d. on the security of the vessel.  Hepburn afterwards died, but before he did so appointed Joseph Bennett, the chief officer of the vessel, master.  The brig made a voyage, and on her return was again in want of repairs, and the plaintiffs agreed to advance an additional sum of £672 18s. 4d. provided Bennett signed a bottomry bond for £1400 being for the sum already advanced to Hepburn as well as for the sum required by himself.  To this Bennett consented, and a bond at the rate of fifteen per cent per annum was signed in January, 1837, to be redeemed within twelve months, or within one month of the vessel's arrival in Sydney thereafter, and a clause was inserted that the brig should only go to the usual parts in the South Seas without the permission of the plaintiffs -  The bond having become forfeit the present application was made.

For the owners of the brig it was contended that the bond was invalid, as it should have been payable at the port of return, which was evidently London, and not at an intermediate port like Sydney; for if a master of a vessel could make a bottomry bond payable at any port he may happen to visit, the greatest frauds might be committed.  It was also said that there was no proof that Bennett was properly appointed master; and if he was, it was evident that if he could hypothecate the ship for money advanced to himself, he had no right to give a bond for money advanced to a former master; and that the introduction, by the plaintiffs, of a clause into the bond, which gave them authority over the captain, vitiated the bond.

His Honor said he would deliver his judgment on Friday next.

Counsel for the plaintiff - The Attorney-General, and Messrs a'Beckett, Foster, and Windeyer; for the defendant - Messrs Kerr and Cheeke.

Dowling C.J., 19 October 1838

Before His Honor James Dowling, Esq., Judge of the Court.

The Nimrod. - This case was fully argued a short time since, when His Honor took time to consider the case.

This morning His Honor delivered his judgment.  He said - this was an act on petition to put in suit a bottomry bond, on the brig Nimrod, for the several sums of £727 1s. 8d., and £672 18s. 4d.  Although this species of security is of very rare occurrence in this Colony, and this is, I believe, the first instance of a contested suit of the kind in the Vice Admiralty Court of New South Wales, yet the principles upon which the case is to be determined, are too well established to require any elaborate explanation. - After recapitulating the pleadings and formal parts of the case, His Honor continued:--

Under the circumstances disclosed on the act on petition, the reply, the rejoinder, and the affidavits, the question is, whether the bond can be sustained either wholly or in part.  The general principle is not disputed that the master of a vessel may, in a foreign port, hypothecate for repairs and necessaries to enable him to prosecute his voyage; nor is it denied that such bonds are regarded with the highest favor, with a view to the advancement of commerce.  In the case of the Radamanthe, Sir William Scott said:-- ``Such bonds have always been upheld by this Court with a very high hand; and it would be very detrimental to the interests of the commercial world if they were not so upheld."  Again, in the case of the Alexander, the same eminent judge said:-- ``It is important to the interests of commerce that bonds of this kind should be upheld with a very strong hand; and, accordingly, they have, at all times, been so upheld by this Court, when they appear to have been entered into bona fide and without any suspicion of fraud."  The like principle may be collected in a variety of other cases; and emphatically so in the case of the Hero.  Upon a review of the pleadings and the evidence in this case, the following constat of facts cannot, I think, be controverted, viz. - that the Nimrod is a British ship whose home port is in Great Britain - that Leslie was the legal owner in trust for Mrs. Hepburn - that Hepburn, until the time of his death, was only master, and had all the rights incidental to his office of master - that this ship was engaged not in one adventure out and home, but in the prosecution of divers voyages in the South Pacific Ocean; and that at the time of the hypothecation, Bennett, whether regularly appointed or not, was, in fact, master; and, as such, had a right to hypothecate for such causes as the jurisdiction of the Admiralty will recognize.  Having reference to the nature of the adventure in which this vessel was engaged, which involved a great variety of voyages in the wide domain of the Pacific Ocean, all of which, it must be assumed, were to be prosecuted for the benefit of her owner, it must be taken to have been in his contemplation that, in the course of such perilous adventures, she would, from time to time, require repairs and necessaries to enable her to prosecute her voyage with advantage.  To the extent of such repairs and necessaries, he must be taken to have given the master authority to pledge the ship at any foreign port to which it might become requisite to touch during the adventure.  The law, at all events, implies such an authority.  It cannot, I think, be disputed that for this purpose Sydney must be regarded as a foreign port; and it only remains to consider whether this vessel has been lawfully hypothecated as a security for the two several sums mentioned in the bond.  That the bond is divisible, and may be good in part and bad in part, cannot be denied; for, as Sir W. Scott says in the case of the Augusta; -- ``It is not necessary that the bond should be either good or bad in toto: in the equitable proceedings in this Court, it may be good in part and bad in part."  This brings me to the true question - whether this bond can be upheld; and, if so, to what extent.  Both the bond, the pleadings, and the evidence present a marked distinction between the money advanced to Hepburn and that advanced to Bennett.  Assuming that Bennett could lawfully hypothecate the vessel for the money advanced to Hepburn, I am bound to consider whether the money so advanced, was advanced upon the personal credit of Hepburn for a cause for which the vessel could not be lawfully hypothecated, or upon the credit of the hull of the vessel itself.  The bond in that part which relates to the sum of £727 1s. 8d. was limited to a mere recital that Hepburn had received from the Wilsons considerable sums of money amounting to that sum, for the purpose of enabling the brig to perform certain voyages, but what they were is not specified, nor is it shown that the sums so received were received for such purposes as would render the vessel liable to be lawfully hypothecated even by Hepburn himself, had he lived.  The affidavit of the Wilsons does not carry this part of the case any further, although their attention is particularly called to it in the reply to the act on petition.  The reply alleges - ``that the ship did not absolutely require the expenditure of either of the said sums of money alleged to have been advanced either to Hepburn or to Bennett."  Now this allegation is not met either by statement in the rejoinder, or by proof in the affidavit.  In the rejoinder it is merely said that the £727 was lent and advanced to Hepburn ``for supplies and necessaries for the brig."  In the affidavit of the Wilsons, they content themselves with stating that Hepburn standing in need of certain advances on account of the ship, they advanced accordingly.  They will not swear that the ship did absolutely require the expenditure of the £727; nor will they swear that the money was advanced on the credit of the ship.  I cannot read the words, ``on account" as equivalent to the words ``on the credit."  There may be many advances made to a captain, which, though they may constructively be said to be on account of the ship, and for the ship's purposes, yet are not such for which the ship may be lawfully hypothecated.  If this money were really advanced for the necessary purposes of the ship, and upon the credit of the ship, there could have been no difficulty in making this matter clear by positive allegation and proof.  This tenderness in swearing to this part of the case, after their attention has been so positively called to it, is the more remarkable when the Court adverts to the explicitness of the pleading and proofs respecting the advances in Bennett.  The bond itself recites, that Bennett having occasion to refit the brig, to enable her to prosecute other voyages in the South Pacific Ocean, and to obtain supplies for the same.  Here there is a lawful consideration set forth, assuming the bond to be otherwise free from objection.  The rejoinder also positively avers that the brig did absolutely require the expenditure of the said £672 (advanced to Bennett to enable her to proceed to sea; and that she could not have prosecuted any voyage without such expenditure.  The affidavit, also, as to this part of the case, swears emphatically, that the ship ``being unable to prosecute her voyages without being repaired, deponents were applied to by Bennett to advance the sums necessary to repair and fit the said ship for sea, and for the prosecution of her voyage;" and that they advanced the money to Bennett on account of the ship.  Again; Bennett swears that, the ship being unable to prosecute her voyage without being repaired, he, at the desire of Mrs. Hepburn, and as master of the ship, applied to the Wilsons to advance the sums necessary to repair and fit the ship for sea, to enable her to prosecute her voyages.  Contrasting, therefore, the positive averments and proofs respecting the sums advanced to Bennett, with the loose and uncertain mode in which the other part of the case is presented to the Court, and which might have been presented to the Court with the like stringency and certainty, if the facts warranted the predication, I am led to the conclusive inferences that the £727 was not advanced upon the credit of the ship for any lawful and necessary purpose connected with her voyage, but upon the personal credit of Hepburn, and for purposes for which the vessel could not be lawfully hypothecated.  But even if this part of the case were less vulnerable, I should hesitate in holding that Bennett could have hypothecate the vessel for a debt contracted by Hepburn to enable him to prosecute other voyages which had then been performed.  If the money advanced to him on the credit of the ship, in the performance of voyages which had terminated, it would require some strong and decisive authority to show that Bennett could saddle the ship on  anew voyage with the payment of so large a dept, with maritime premium thereon, for a debt contracted by his predecessor, after the Wilsons had, by their own laches, failed to take security from Hepburn in his life time.  However, I am not driven to decide that point, for I am of opinion that I must pronounce against the validity of that part of the bond for the reasons already stated.

It now remains to consider whether the other part of the bond is valid and binding.

The first objection is, that this being a British ship, belonging to a British port, her voyage cannot be considered as completed until arrival at her home port, and that consequently the master could not hypothecate for the voyage home as one entire risk.  On this ground it was contended that the bond was invalid.  Assuming as a general principle, that the master of a vessel cannot lawfully hypothecate a vessel on an intermediate voyage, on account of the tendency of such a practice to committing frauds upon the owners; yet I apprehend the question does not arise in the present case.  I must deal with the present case as it is presented to the Court on the pleading and evidence, and if it can be collected that what has happened must have been in the contemplation of the owner at the time he sent the vessel to sea, he must be bound, until the contrary is shown, by the general authority vested by law in the captain to hypothecate for necessary repairs and equipments.  If this vessel had been sent to the South Seas for a single voyage out and home, it may be that the captain could not hypothecate for an intermediate voyage without the express authority of the owner, or under some paramount necessity for the advantage of the owner; but I am not driven to decide that point.  It is averred and proved on the part of the promoters of this suit, and not controverted by any evidence on the part of the owner, that this vessel was employed by Leslie, the owner, in the prosecution of certain voyages in the Southern Pacific Ocean.  I must regard her therefore as being sent out for the benefit of the owner, upon a roving adventure to carry freight where she could; whether on one or more voyages in the South Seas.  The owner must be taken to have contemplated the probability of her having occasion for repairs and refittings in the course of her voyages, and to have authorised the captain to hypothecate in a foreign port in default of funds, to enable her to complete her voyage.  I agree that this power must be exercised bona fide and for the advantage of the owner.  If the transaction could be tainted with fraud, it could not be upheld; but in principle I find no authority to vitiate a bond of hypothecation for an intermediate voyage where the owner himself permits a vessel to go to sea upon a venture of this kind.  If this power of hypothecation did not exist in such a case when honestly exercised for the benefit of the owner, it would tend to check the spirit of commercial adventure so essential to the protection of the South Sea trade; a trade carried on so remote from the ship's home, and necessarily involving repeated stoppages in different foreign ports, in order to carry it on successfully.  No man would advance money upon the bottom of a vessel so employed if he had to depend upon the contingency of the vessel ultimately arriving at her home port, unless upon a maritime premium, which would be ruinous to the owner; and amount, perhaps, to a prohibition of the trade.  I am not prepared therefore to pronounce against this bond on that ground.  Then it is said that this bond was obtained from Bennet by falsely pretending that the ship could be seized fore the advances made to Hepburn.  It is not necessary to decide that the Wilsons had such a lien on the vessel as to authorise them to bring her into the Court of Vice-Admiralty; but if Bennett honestly believed that they had the power of proceeding against her, I am not prepared to say that the bond was obtained under such circumstances as would vitiate it, especially as he swears that he could not put to sea without the advances made to himself for repairs of the ship.  But then it is contended that the bond on the face of it shews that the ship was to be employed for the Wilsons' own benefit, and not for the benefit of the owner, inasmuch as it contains a stipulation limiting her voyage ``from Port Jackson to Van Dieman's Land, and such other ports and places in the Southern Ocean as the said Wilsons shall think necessary for carrying on the trade usually transacted in those places."  There is no proof before me that the vessel was employed for the benefit of the Wilsons; such a fact was capable of proof if this were really so.  I cannot infer that this stipulation necessarily imports that she was employed for their benefit.  I cannot say that the stipulation was unreasonable.  If I am right in holding that the captain might hypothecate for the intermediate voyage in question, I see no more reason why he should not limit his responsibility as much to place as to time.  This sort of contract is no doubt of a different nature from almost all others, but that which it most nearly resembles is, the contract of insurance, which would authorise such a stipulation.  The Wilson's do not stipulate that the vessel shall got to any unusual place; on the contrary, the captain has permission to go to Van Diemen's Land, also to such other ports and places in the South Pacific Ocean as are necessary for carrying on the trade usually transacted in those places.  They had a right to say ``we are not willing to lend you money on bottomry, if this vessel is to go to unusual places, whereby our risk may be increased; but if you employ her on this particular voyage, and do not take her to any other ports or places than those necessary for carrying on the trade usually transacted, we will advance you the money."  Prima facie, this was a beneficial contract for the benefit of the owner, and in the absence of all proof of fraud or improper interference on the part of the lenders, I think there is nothing on the face of the bond to render it invalid upon this ground.  Looking at the rate of maritime interest reserved, I think it is moderate, especially having reference to the value of money in this Colony.  No attempt has been made, by proof, to show that the money advanced to Bennett was not bona fide laid out in the repair and outfit of the vessel, and therefore I must take it that the amount cannot be disputed.  Had there been any reason assigned for believing that it was not so laid out, I should have referred it, as is usual in such cases, to the Registrar and merchants to ascertain and report he amount actually due.  On the whole, therefore, I pronounce against the validity of the bond, as far as respects the £727 1s. 8d. lent to Hepburn, but I pronounce it to be good as to the money afterwards advanced to Bennett, for the payment of which, and the maritime interest thereon secured by the bond, I decree the brig Nimrod to be sold.

Mr. Windeyer (for the lenders) asked the Judge to decree costs, which was opposed by Mr. Kerr, on the ground that if the lenders had applied for the second sum only the suit might not have been deferred.  His Honor said that he had considered the point; and as the plaintiffs had gained the suit the defendant must pay the costs, which must be taxed by the Registrar.

Notes