son to purchase the Ariel if Mr. Eckhoff did not require all the purchase money at the time of the sale and transfer, inasmuch as his son would not have sufficient money to pay for all the vessels he intended offering him for sale, and that he therefore intended to sell his ships to his son, to accept a portion of the purchase money at the time of sale, and to allow his son to pay him the remainder of the purchase money out of the earnings of the vessels.

Mr. Eckhoff, goes on to say, that by reason of what Mr. Sorenson, the father, had so communicated to him, he agreed to sell the Ariel to the claimant under the following stipulation or condition, namely, that the amount of the purchase money should be, 10,000 silver roubles, that 3,333 silver roubles and 33 copecks, or say one-third of the purchase money, should be paid in cash at the time of effecting the sale or transfer of the Ariel: that a similar sum or instalment of one-third of the purchase money should be paid in six months after the sale and transfer, and the remaining one-third in nine months. He adds, that had it not been for the very high character and well-known honour and integrity of Mr. Sorenson, the father, he would not have agreed to sell the Ariel to the son except for ready cash, inasmuch as he was then, and still was, personally unknown to the son.

It is argued that Mr. Eckhoff does not in terms deny that he agreed to be paid the remaining two-thirds of the purchase money out of the earnings of the Ariel, and therefore it must be inferred that he did so agree, and accepted the same terms as the father did on the sale of his vessels. Their lordships are of opinion that the drawing such an inference would be putting an unfair construction on Mr. Eckhoff's affidavit, especially as it is plain that he looked to Mr. Sorenson (the father) to carry him through the transaction, and being personally unknown to the son (the claimant) would be very unlikely to enter into any engagement with him as to the earnings of the ship. Afterwards, indeed, when upon the death of Mr. Sorenson, the father, in May, 1854, Mr. Eckhoff became somewhat anxious about the price of the ship, he did by his agent procure the claimant's acceptances, falling due at six and nine months from the sale and transfer of the Ariel, and a promise from the claimant that the earnings of the Ariel should be applied to the liquidation of those acceptances, being the best security he could get. It ap pears that they were so applied, and that a small sum, only about 907., remained due when the Ariel was seized in December, 1854. This subsequent arrangement is the circumstance above alluded to, in which this case is perhaps distinguishable from the cases of the other ships, as to which the appropriation of the earnings formed part of the original contract. It was urged further, that the bill of sale of the Ariel is untrue, *because it states the whole purchase money to be paid. Their [*xlix] lordships are of opinion that there is no weight in this objection. In all conveyances of freehold or leasehold estates the purchase money is always mentioned to have been fully paid, and yet there may be a collateral instrument, showing that nothing has been paid, or the whole or part of the money left upon mortgage of the estate. A bill of sale of a ship is a conveyance of a similar nature, and open to the same

considerations; the object is to enable the purchaser to become the absolute owner.

After the sale and transfer of the Ariel, it appears to have been employed under the sole control of the claimant, without any interference on the part of the seller (Mr. Eckhoff,) in voyages to England and Ireland and America, with a crew composed indeed of Russians, except the master and mate, who were Danes, but not with Russian cargoes. Under these circumstances the learned judge in the court below says: "I am inclined to hold the present sale (speaking of that of the Baltica, one of the father's ships) was bonâ fide." By which their lordships understand him to mean that the sale was real, intended to pass the property in the ship to the claimant, without any engagement to restore it under any circumstance, and without fraud or collusion.

In this opinion their lordships fully concur.

But, then, the second point above stated remains. Did any interest in the ship remain in the seller at the time of capture? And this is a point more difficult of solution. The decision of the learned judge that some interest did remain in the seller rests almost entirely on the language used by Lord Stowell in the case of the Sechs Geschwistern, 4 Rob. 100, for with the exception of that one all the other cases proceed on the ground of mala fides and collusion.

Lord Stowell there says:

"The rule which this country has been content to apply is, that property so transferred (this is, by purchase from an enemy) must be bonâ fide and absolutely transferred; that there must be a sale divesting the enemy of all further interest in it; and that anything tending to continue his interest vitiates a contract of this description altogether.

Applying that rule to the case then before him, Lord Stowell condemned the ship, and rightly so; because there were covenants in that case which preserved and retained the interest of the enemy-seller, and for restitution at the end of the war. It was a conditional, not an absolute sale. Lord Stowell concludes his judgment in these words: "Is there in this any sign of a bonâ fide transfer? Is not the hand of the French vendor still on the vessel? Looking to the control which the French Government and the vendor still retain over this property, it is impossible for me to hold that all the interest of the enemy is completely divested." In the present case there is a total absence of any such covenant or condition. The utmost that can be said is, that there is an engagement on the part of the buyer to apply the earnings of the ship to the payment of part of the price.

*The mere non-payment of a part of the price cannot of itself

be sufficient to leave an interest in the ship in the seller. That [*1] is distinctly stated by Lord Stowell in the Marianna, 6 Rob. 26.

"That objection can have little weight, since it is a matter solely for the consideration of the person who sells to judge what mode of payment he will adopt. He may consent to take a bill of exchange, or he may rely on the promissory note of the purchaser, which may come in payment for a considerable time, or may never be paid. The court will not look to such contingencies. It will be sufficient that a legal transfer

has been made, and that the mode of payment, whatever it is, has been accepted."

Here, however, there is more than mere non-payment of part of the price; there is an engagement to pay it out of the earnings, and that is contended to create an interest in and lien on the freight, and, through the freight, on the ship.

We must observe here that even supposing that the facts of this case were sufficient to show that the vendor had a lien on the freight for the purchase-money unpaid, it by no means follows that he had a lien on the ship. The ship and the freight are quite distinct-the ship may belong to one person and the freight to another; and that not only for a single voyage, but, as a security for a debt, for future voyages, provided that the contract and assignment be not such as to seperate the freight and earnings of the ship for ever from the ship itself so that they could not be re-united, but only to separate them for the temporary purpose of securing a debt, and operating only upon that separation of title till that debt should be paid. The law on this subject was distinctly laid down, as stated above, by Lord Eldon, in the case of the ship Warre, which is to be found in the notes to 8 Price, 269. The same doctrine was held in 3 Beavan, 342, Stevenson v. Dowson; in 1 Hare, 549, Langton v. Horton; in 1 Bingh. New Rep. 697, Leslie and others v. Guthrie; and in other cases.

There are no means by which, according to the contract with respect to the earnings stated in this case, the ship could in any manner be affected, either in the Admiralty, the Courts of Common Law, or the Court of Chancery. It may be doubtful, considering the loose terms of the contract, and that it was made between foreigners, whether the Court of Chancery would interfere by appointing a receiver of the freight, if the ship arrived in England and the owner had not applied the earnings. towards payment of the purchase-money. But, as between English subjects, if the court interfered, it would not be in pursuance of the contract, but by reason of breach of contract. It was said in argument that by the law, either of Russia or Denmark, some lien might be created on the ship, but that is a matter of foreign law, and therefore a fact to be proved by those who rely upon it, and no proof was offered. The difficulty, or rather the impossibility, of obtaining a satisfactory result by such inquiries appears to have been one of the reasons why Lord Stowell, in the case of the Tobago, to which we are about to allude more at length, refused to enter into them at all.

*Supposing, however, that a lien on the freight, or even on [*li] the ship, in favour of the vendor, who is to be considered as an

enemy, did exist, would that lien render the ship in the possession of the neutral owner liable to be captured? That such a lien on an enemy's ship would not be sufficient to found a claim by a neutral in a Court of Prize is clear. It was so held by Lord Stowell in the case of the Tobago, 5 Rob. 218, which was the case of a British subject claiming in respect. of a bottomry bond on a French enemy's ship which had been captured, and again in the case of the Marianna, 6 Rob. 24. That was the case of a lien on the freight and cargo of a ship, which was sold by an American

neutral to a Spanish enemy, and the lien was in respect of part of the purchase money remaining unpaid. It is true that in 1 Spinks's Admiralty Cases, 24, the Christine, the court said that the doctrine in the Marianna did not apply to cases when the bona fides of the sale was disputed, in which proof of actual payment is always essential; and no doubt that upon a question of bona fides such proof would be most important, and even essential. But the question of bona fides, in this case, has been already disposed of; their lordships are now considering the only point as to an interest remaining in the bonâ fide seller. The same doctrine as in the Tobago and the Marianna is laid down by the Supreme Court of the United States of America, in the Frances (Irvin's claim,) 8 Cranch's Rep. 417, and in San José, 2 Gallison's Rep. 283; and other cases.

Indeed, it was not disputed at the bar that such is the law of prize as regards a claimant in respect of a lien. But the converse of the proposition was contended not to be true, and that although the lien of a neutral on an enemy's ship or its freight is not sufficient to found a claim, yet the lien of an enemy on a neutral ship or its freight is sufficient to show an interest in the enemy, of which the belligerent captor is entitled to avail himself, and to defeat the neutral's claim; that a lien on an enemy's ship which would not be recognized in favour of a neutral, would be recognized against a neutral for the purpose of condemnation, if the lien be in favour of an enemy. Their lordships asked, and asked in vain, for some authority which went to establish that distinction. No such authority was produced, but their lordships were referred again to the language of Lord Stowell, in the case of the Sechs Geschwistern, which, as has been already observed, was a question as to the right of property, not of lien. Their lordships have been unable to find any authority for the alleged distinction, and, on the contrary, they are of opinion that the cases of the Tobago and of the Frances (Irvin's claim,) already cited, are plainly against the distinction. In the Tobago, the counsel for the captors argued: "Suppose a bond of this nature given upon a neutral ship, and to a person now become an enemy, could a proceeding of prize be instituted against the neutral ship, or any part of it, as the property of the enemy? Certainly not." The counsel for the claimants argued, "With regard to the case put of an enemy's interest of this description on a neutral ship, the distinction is obvious, that this interest is a thing *accessorial only to the ship; and that it might well consist with the principles of justice, that the accessory [*lii] might be restored though the ship was condemned, at the same time that it would not be reasonable or just to seize the ship itself on account of such an accessorial interest which an enemy might possess in it." Lord Stowell, in giving judgment, says: "Can the court recognize bonds of this kind as titles of property, so as to give persons a right to stand in judgment and demand restitution of such interests in a Court of Prize? The total silence of those who had argued for the claimant as to any precedents for this demand, strongly shows that it has not been the practice of the court to consider such bonds as property entitled to its protection, and I think I may venture to say that there has been no such instance.

The person advancing money on bonds of this nature acquires by that act no property in the vessel; he acquires the jus ad rem, but not the jus in re, until it has been converted and appropriated by the final process of a court of justice. The property of the vessel continues in the former proprietor, who has given a right of action against it, but nothing more. If there is no change of property, there can be no change of national character." And further, "The captor has no access whatever to the original private understanding of the parties in forming such contracts; and it is therefore unfit that he should be affected by them. His rights of capture act upon the property without regard to secret liens possessed by third parties; in like manner his rights operate on no such liens where the property itself is protected from capture. Indeed, it would be almost impossible for the captor to discover such liens in the possession of the enemy upon property belonging to a neutral; the consequence, therefore, of allowing generally the privilege here claimed would be that the captor would be subject to the disadvantage of having neutral liens set up to defeat his claims upon hostile property, whilst he could never entitle himself to any advantge from hostile liens upon neutral property." It is difficult to conceive stronger language than this to show that the distinction now attempted to be set up is wholly without foundation. The observations of the same learned judge in the Marianna are substantially to the same effect. Both these cases, it is to be observed, were decided subsequently to that of the Sechs Geschwistern. The language of the court in the Frances (Irvin's claim,) 8 Cranch's Rep. 419, is equally strong: "In cases of liens created by the mere private contract of individuals depending upon the different laws of different countries, the difficulties which an examination of such claims would impose upon the captors, and even upon the Prize Courts, in deciding upon them, and the door which such a doctrine would open to collusion between the enemy, owners of the property, and neutral claimants, have excluded such cases from the consideration of those courts." Then, after referring to the cases of the Tobago and the Marianna, it is added, "From this it appears that the doctrine of the Prize Courts upon this subject works against, as well as in favour of, captors." Their lordships have come to the conclusion that the supposed distinction does not

[*liii] exist, and that liens, whether in favour of a neutral on an

enemy's ship, or in favour of an enemy on a neutral ship, are equally to be disregarded in a Court of Prize.

One other argument was pressed, arising from the number of vessels bought by the claimant, and the magnitude of the transaction was insisted on; and the case of the Rendsberg, 4 Rob, 121., was particularly adverted to. That case was such, that Lord Stowell held it to amount to an adhering to and assisting the enemy, and it was of a very peculiar character. Their lordships are unable to see why, if the transfer of one ship was legal, under the circumstances which have here occurred, if it had stood alone, such transfer should be rendered illegal because six other ships were purchased, under similar circumstances, at the same time; unless, indeed, as affording ground to believe that all the purchases were fraudulent and collusive.