Bottomory & Respondentia Bonds

 Bottomry Bonds

- Bottomry bonds are not used in modern world.

- Bottomry is a contract by which ship's owner borrows money for equipping or repairing his vessel and pledge the ship as security for a definite period of time.

- If the ship is lost during that period due to any of the named perils the lender will lose his money.

 

 Respondentia Bonds

- Similar contract as of bottomry but ship is replaced with cargo.

 

In olden days master of a ship use to borrow money for vessel equipping or repair as it was difficult to contact the ship owner in short time period or unavailability of   money from vessel's owner.