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hypothecation


hypothecation


  1  definition  found 
 
  From  Webster's  Revised  Unabridged  Dictionary  (1913)  [web1913]: 
 
  Hypothecation  \Hy*poth`e*ca"tion\,  n.  [LL.  hypothecatio.] 
  1.  (Civ.  Law)  The  act  or  contract  by  which  property  is 
  hypothecated;  a  right  which  a  creditor  has  in  or  to  the 
  property  of  his  debtor,  in  virtue  of  which  he  may  cause  it 
  to  be  sold  and  the  price  appropriated  in  payment  of  his 
  debt.  This  is  a  right  in  the  thing  or  jus  in  re 
  --Pothier.  B.  R.  Curtis. 
 
  There  are  but  few  cases,  if  any  in  our  law,  where 
  an  hypothecation,  in  the  strict  sense  of  the  Roman 
  law,  exists;  that  is  a  pledge  without  possession  by 
  the  pledgee.  --Story. 
 
  Note:  In  the  modern  civil  law,  this  contract  has  no 
  application  to  movable  property,  not  even  to  ships,  to 
  which  and  their  cargoes  it  is  most  frequently  applied 
  in  England  and  America.  See  {Hypothecate}.  --B.  R. 
  Curtis.  Domat. 
 
  2.  (Law  of  Shipping)  A  contract  whereby,  in  consideration  of 
  money  advanced  for  the  necessities  of  the  ship,  the 
  vessel,  freight,  or  cargo  is  made  liable  for  its 
  repayment,  provided  the  ship  arrives  in  safety.  It  is 
  usually  effected  by  a  bottomry  bond.  See  {Bottomry}. 
 
  Note:  This  term  is  often  applied  to  mortgages  of  ships.