Rec.] 4th, That no foreigner can be a money exchanger or banker in the kingdom, although he may have letters of naturalization;23 neither can any such be an exchange broker, whose office ought to be appointed for fairs in places where they are accustomed to be appointed, Ll. 7. and 11. tit. 1S. lib. 5. Rec. [Ll. 1. and 2. tit. 6. lib. 9. Nov. Rec.] 5th, That bankers cannot take five maravedis per thousand to pay in good money, L. 5. tit. 18. lib. 5. Rec.24 6th, That accommodation bills (cambios secos) are prohibited under various penalties; such are always considered when persons who borrow money on interest (tomaren dinero á cambio) have neither money, credit, nor correspondent in the places on which they borrow it, L. 13. tit. 18. lib. 5. Rec. [L. 4. tit. 3. lib. 9. Nov. Rec.] 7th, That the agreement to borrow money for various successive fairs, so that the interest of the first may enter into the principal sum, and cause other interest on the second,25 is prohibited, L. 13. tit. 18. lib. 5. Rec. [L. 4. tit. 3. lib. 9. Nov. Rec.] 8th, That the books of money exchangers or bankers (cambiadores) and merchants ought to be regulated or kept according to the order and in the mode prescribed by [211] L. 10. tit. 18. lib. 5. Rec.26 [L. 12. tit. 4. lib. 9. Nov. Rec.], and the establishment of public banks, according to that directed by L. 5. tit. 18. lib. 5. Rec. [L. 5. tit. 3. lib. 9. Nov. Rec.]; which, among other things, requires the license of the government and sufficient security. 9th, That the exchange, its circumstances, the value of the bills, &c. cannot be proved by the oath of the persons who shall lend the money on interest, but by public instruments, witnesses, &c., L. 13. tit. 18. lib. 5. Rec. [L. 4. tit. 3. lib. 9. Nov. Rec.] 10th, That to the books of bankers, if they are made or kept with due formality, faith is given in their favor, and against them, by reason of their being the depositaries of the public faith; which is not admitted with respect to the books of merchants,28 Escobar Muñoz de Ratiociniis, cap. 11. á n. 7. al 33., where there are various limitations laid down to this. 11th, That money cannot be lent to carry interest, nor to be trafficked with, if the person lending it be not interested in the contracts,29 L. 15. tit. 18. lib. 5. Rec. [L. 21. tit. 1. lib. 10. Nov. Rec.]

23 Neither, says Palacios, is this observed, since the greater part of the bankers (cambistas), in the kingdom, as well in the capital as in the provinces, are Frenchmen, Italians, Irishmen, &c.; and that there are also many foreign exchange or bill brokers. He adds, that in all cases that occur with respect to bills of exchange which are not provided for by the ordenanzas of commerce, attention must be paid to practice; the most accredited bankers being consulted thereupon, and the same with respect to towns where there are no ordenanzas.

24 This law is not in Nov. Rec.

25 That is, compound interest.

26 See also L. 13. tit. 4. lib. 9. Nov. Rec.

Quare, if this may not be properly translated, faith is given to their contents for or against the owners.

23 The books of merchants are entitled to faith, or are proof against them, observes Palacios, in the form and cases provided by L. 23. tit. 19. lib. 9. Rec.: this law is not in the Nov. Rec. See Cur. Philip. lib. 2. cap. 8. Com. Ter.

29 Or perhaps unless they are to share in the profit and loss: "sino es á perdida y á ganancia," says L. 21. tit. 1. lib. 10. Nov. Rec., referred to in the text. See this law.

TITLE XVII.

OF CONTRACTS, THE FULFILMENT OF WHICH DEPENDS UPON CHANCE OR CONTINGENCY.

CAP. 1. THE Contracts of which we are about to treat in this title, constitute a third class, and among them the principal is insurance, by which one person insures to the other his merchandise against the danger or risk of the sea, or land for a certain price or premium which he receives for it,' Hevia, Curia. Filip. Comerc. Nav. cap. 14. n. 1. He who takes upon himself this work is called the insurer or underwriter, and he who is insured against it, the insured or assured:2 with respect to this contract the ordinances of maritime nations vary.

[212] On the nature of this contract the following axioms are founded: 1st, That those who may contract, or are not prohibited from so doing, may insure. 2d, That all classes or descriptions of merchandise except those prohibited may be insured. 3d, That the clauses of this contract ought to be interpreted strictly, and without extension. 4th, That the insurer is made responsible for the risk by reason of the premium which is paid to him. 5th, That the insured ought to point out all the circumstances of the thing, and give notice of the injury or damage which the merchandise insured may have suffered.

From the first axiom it follows: 1st, That minors, prodigals, madmen, &c., cannot insure. 2d, Nor brokers (corredores) of merchandise for the Indies, L. 4. tit. 39. lib. 9. Rec. de Indas. [L. 4. tit. 39. lib. 9. Rec. Ind.]

From the second axiom it is inferred, that the insurance of goods. prohibited as contraband, seized for nonpayment of duty, and those which are without or beyond risk, is not valid, Hevia, Cur. Phil. ibid. n. 8. 2d, Nor of the property of enemies, or things destined for them, Wedderkop. Introd. in Jus Nauticum, lib. 3. tit. 7. § 73. 3d,

1 Palacios observes, that the particular and precise knowledge of what appertains to chap. 1 and 2, of this title depends upon the information which must be respectively afforded by the ordinanzas by which each consulado is regulated and governed: but that therefore the things which in all places constitute the essence of this contract of insurance must not be omitted; which are 1st, That there be one or many effects which form the matter or ground of it; and that one of the parties have that which may be insured by the other. 2d. That there be risks to which the effects which the assurer takes upon himself to insure, may be exposed, or ought to be exposed. 3d, That there be a determinate or indeterminate sum which the assurer promises to pay to the assured by way of indemnity, in case of the loss of the effects insured by any of the fortuitous events against which the assurer hath insured. 4th, That a certain sum or rate be agreed on, which the assured may pay, or be bound to pay to the assurer, in consideration of the insurance. 5th. The consent of the contracting parties.

2 The sum which is given as the price or considerntion of the risk, says Palacios, is called the premium or rate of insurance; and the act extending it, the instrument or policy of insurance.

That according to L. 5. tit. 39. lib. 9. Rec. de Ind., [L. 5. tit. 39. lib. 9. Rec. Ind.,] only two thirds of goods going to the Indies can be insured; and by the Consulado de Barcelona, it is permitted to insure the seventh of eight parts, if the owners are natural born subjects; and the third of fourth parts, if they are foreigners, Capitulaciones del uno 1485.3 cap. 1. 4th, That the insurance of goods loaded on the other side of the Straits of Gibraltar is not valid, according to the Consulado of Barcelona, Capitulaciones de 1484. c. 2. 5th, That the guns and tackle and furniture of the ships of the Indies cannot be insured, L. 5. tit. 39. lib. 5. Rec. de Ind. [L. 5. tit. 39. lib. 5. Rec. Ind.] 6th, That the gold and silver which come from the Indies, are not to be insured by the disposition of the Ordenanzas de Bilbao, cap. 33.

From the third axiom we deduce, 1st, That when the vessel simply is insured, the goods which she has on board are not understood to be insured, and vice versa, Hevia, Cu. Phi. ibid, n. 16. 2d, That the things which one has on board his vessel being insured, the insurance only devolves on those which he actually had on board at the time, and not on those which have been afterwards laden, Hevia, Cu. Phi. ibid. n. 12. 3d, That if the underwriter insures the goods of a person [213] that is in partnership with another, he is only considered to insure the part or share of the assured, and not that of his partner, unless it should be otherwise expressed, Hevia, Cur. Phi. ibid. num. 13. 4th, That if a vessel be insured, it is understood for the first voyage she shall make until she arrive at anchor in the port of her destination, Hevia, Cur. Phi. ibid. num. 21. and 22. 5th, That the insurance of one ship cannot be extended to another, Hevia. Cur. Phi. ibid. n. 23. 6th, That if one insures a certain quantity of goods, and they were not on board at the time the ship was lost, the underwriter is not bound to pay their value, Hevia, Cur. Phi. ibid. n. 17. 7th, That the insurance is not annulled, although the assured may place the goods on board another's vessel (en cabeza de otro), in order that it may be understood they belong to the latter, Hevia, Cu. Phi. ibid. n. 16.

By the fourth axiom it is established, 1st, That the insurance is not valid until the premium be paid, Capitulaciones de 1484, cap. 15., which ought to be paid within two months on insurances to the Indies, L. 11. tit. 39. lib. 9. Recop. Ind., [L. 11. tit. 39. lib. 9. Rec Ind.,] and within twenty-four hours at the port of Bilbao, Ord. de contrat. de Bil. c. 34. 2d, That the risk of the underwriter commences from the time the goods were laden or shipped, until they were unladen at the port or place of destination, Wedderkop, ibid. § 82. and 137., and L. 48. tit. 39. lib. 9. Rec. Ind. [L. 48. tit. 39. lib. 9. Rec. Ind.,] 3d, That the insurance of goods lost at the time of the contract is null, if the loss should have happened in a place that, reckoning a league for an hour travelling by land, the insurer might have been able to know it. L. 7. tit. 39. lib. 9. Rec. Ind. Capit. de 1484.

3 In the edition of the text edited by Palacios, it is 1484.

cap. 17. [L. 7. tit. 39. lib. 9. Rec. Ind.] Ordenanzas de Bilbao, cap. 22.4 n. 25. 4th, That the risk and damage for which the underwriter is responsible, is intrinsic (el intrinseco), arising from violence or a fortuitous event, such as tempest, fire, &c., and not that which happens from the interior vice or defect of the thing, ex. gr. if wine turn vinegar, or oil become rancid, &c., L. 42. tit. 39. lib. 9. Rec. Ind. orden. de Bilbao. (cap. 48. 50, and 65.5 quoted). [L. 42. tit. 39. lib. 9. Rec. Ind.] 5th, That the insurer is responsible for general average of throwing goods overboard (echazon), and expenses incurred for unloading and [214] lightening the vessel, Ll. 20. and 43. tit. 36. lib. 9. Rec. Ind. Wedderkop, ibid. § 91. [Ll. 20. and 43. tit. 36. lib. 9. Rec. Ind.] 6th, That the underwriter is not liable for the damage arising from the fault of the insured, or the captain or pilot of the vessel, Hevia, Cu. Phi. ibid. num. 24. Orden. de Bilbao, cap. 46. 7th, That if part of the goods were to be found which were believed lost, the insured is bound to receive it on account of the value which the insurer (asegurado), is obliged to pay him, Ordenanzas de Bilbao, cap. 61.8 8th, That the underwriter ought to take care to cause the goods to be valued, and not doing so, it shall depend upon the oath of the insured, L. 41. tit. 39. lib. 9. Rec. Ind. [L. 41. tit. 39. lib. 9. Rec. Ind.[ 9th, That the premium of insurance is not due, by the vessel that hath not performed the voyage, for the goods which were not embarked or shipped, Capitulaciones de 1484. cap. 5.; and this premium may be demanded within fifteen days on insurances to the Indies, L. 12. tit. 39. lib. 9. Rec. Ind., [L. 12. tit. 39. lib. 9. Rec. Ind.] and by the Ordenanzas de Bilbao, cap. 38.9, the insured ought to notify it to the underwriters rebating the half per cent. of what hath been given or paid. 10th, That the ship which goes to the Indies is considered lost, if within a year and a half no information hath been received of her, L. 8. tit. 39. lib. 9. Rec. Ind. [L. S. tit. 39. lib. 9. Rec. Ind.]

From the fifth axiom it arises, 1st, That he who causes insurance to be made on a vessel, must declare her built, if she was taken in time of war, if she is a very fast sailer, &c., Wedderkop, ibid. § 108. 2d, That the insured ought to attend as far as he is able, to the good condition and conservation of the goods, to which end the Orden. de Bilbao, cap. 26.,10 direct that the vessel and its tackle, apparel, and furniture (aparejos), be valued, and that the insured incur the risk of twenty-five per cent., in order that he may take more care in providing for the vessel.

Cap. 2. The second contract of this class is maritime interest (cam

4 The quotation in the text is cap. 31.

5 This quotation is erroneous with reference to the edition in the possession of the Translator, viz. that of 1813.

6 Docs not correspond with edit. of 1813.

7 Quare" asegurador?" and so it is translated. The Translator since finds in the cdition of Palacios, that the word in the text is "asegurador," as translated.

s The Quotation does not correspond with the edit. of 1813.

9 The Quotation does not correspond with the edit. of 1813.

10 Do.

11

bio maritimo). In this contract a certain amount or sum is offered on the hull (cuerpo) of the ship, or on the goods therein laden, on condition to repay the capital with certain interest in case of arriving safe at their destination. Wedderkop, ibid. Lib. 3. tit. 11. § 123. When credit is given on the ship, it is the contract which the French call contrat à grosse aventure.

Hence we draw three principles, 1st, That those only who can bind the ship and wares may make this contract. 2d, That the [215] creditor runs the risk of the ship and the goods. 3d, That, by reason of this risk, he may demand the capital with interest.

From the first of these principles it is inferred, 1st, That those interested are bound in this contract for the value of the vessel and cargo, so that the quantity or amount exceeding it is considered a pure loan (emprestito), Wedderkop, ibid. § 126.: and according to L. 6. tit. 39. lib. 9. Rec. Ind. [L. 6. tit. 39. lib. 9. Rec. Ind.] no master can borrow on interest on a vessel which goes to the Indies more than a third part of the value, and with license of the consulado. 2d, That the captain can only borrow on interest, if the parties interested be present, with their approbation; and being absent on account of some urgent necessity, as for the repairs of the vessel, &c., Ordenanzas de Bilbao, cap. 41.12

From the second principle it follows, 1st, That the creditor begins to incur the risk from the time that he made the contract until the vessel hath arrived at the port of her destination, Wedderkop, ibid. $130. 2d, That if the vessel hath incurred risk, not by a fortuitons event, but by varying the due course of her navigation, by arriving at a more distant port than that expressed in the contract, by carrying contraband goods, this ought not to cause any prejudice to the creditor, Wedderkop, ibid. § 131.; but it is to be observed that money lent on interest ought not to contribute to make good the damage caused by throwing overboard or jetsam (echazon), Wedderkop, ibid. § 134. By the third principle it is acknowledged that the interest on maritime loan (cambio) ought to be graduated in proportion to the danger and risk of the navigation, Wedderkop, ibid. § 132.

Cap. 3. The third contract which depends on chance, is wager, apuesta, or a reciprocal promise between two with respect to a conditional doubtful event, past, present, or future. Wagers or bets are

11 Vide 2d vol. Black. Commentaries, p. 457. cdit. 1809, fanus nauticum. Palacios here takes occasion to observe, that the ignorance, confusion, and informality which took place on the subject of maritime interest, induced the consulado of commerce of Barcelona, with its accustomed zeal, to represent the necessity of establishing there a register of maritime interests, which it proposed under eight articles, and which the king was pleased to approve by royal cedula of 23d of December, 1795, and that this is a proof of the necessity there is for seeing the laws which govern in each consulado, to acquire the corresponding information in these matters.

12 This quotation does not correspond with the edit. of 1813. vide cap. of ditto 24. n. 36. 37. 38. and 39. on this subject.

13 Palacios, referring to Cu. Phil. lib. 3. c. 15. n. 1. says, that a wager is a reciprocal promise which is made between two or more, each laying a wager to the contrary of what the other says, to gain or lose it upon a conditional, doubtful event (although it be with

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