The laws of mortgages and privileges on ships : a proposal for amendment

Abstract

The institutes of Mortgages and Privileges, in their various forms, have provided a means of security from time immemorial. Economically, they are undoubtedly the best incentive available to creditors and debtors alike in providing advance facilities on the one hand, and in offering collateral on the other. Analysed in relation to maritime law, the ship owner or charterer would be in no position to finance his own business activities and likewise the financer, in any manner, would never risk funding the projects of his clients were it not for the guarantee which is provided by the privilege of selling the vessel in satisfaction of any debts due. The old Roman Institue of hypotheca may well be considered as the cradle of the modern maritime mortgage and, more specifically therefore, the Hypotheca cum fiducia, even though the Roman hypothec is of Greek origin. The principle of pledge without possession, being sanctioned by the praetor's interdict, extended to every case in which the property was charged as a security without delivery. The institute nevertheless has as its basis that of pledge.