A master of a ship may need money quickly during a voyage. He may then borrow itonthe security of the ship and cargo by means of a bottomry bond. He only does so when money is necessary to complete the voyage and when communication with the owner is impossible. If money can be obtained on the shipowner’s credit. this must be done. A bottomry bond holder loses all his money if the ship is lost. If there are several bond holders, the last is paid first. The ship cannot be disposed of until the bond is paid.
Reference: The Penguin Business Dictionary, 3rd edt.
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