HYPOTHECATION. A right which a creditor has over a thing belonging to an other, and which consists in a power to cause it to be sold, in order to be paid his claim out of the proceeds.
There are two species of hypothecation, one called pledge, pignus, and the other prop erly denominated hypothecation. Pledge is that species of hypothecation which is con tracted by the delivery by the debtor to the creditor of the thing hypothecated. Hypothe cation, properly so called, is that which is contracted without delivery of the thing hy pothecated; 2 Bell, Com. 25.
In the common law, cases of hypotheca tion, in the strict sense of the civil law, that is of a pledge of a chattel without possession by the pledgee, are scarcely to be found; cases of bottomry bonds and claims for sea men's wages against ships are the nearest approach to it ; but these are liens and privi leges, rather than hypothecations; Story, Bailm. § 288. It seems that chattels not in existence, though they cannot be pledged. can be hypothecated, so that the lien will attach as soon as the chattel has been pro duced; Macomber v. Parker, 14 Pick. (Mass.) 497.
In Scotland hypotheo is the landlord's right, independently of any stipulation, over the crop and stocking of his tenant, giving the landlord a security over the crop of each year for the rent of that year ; Bell.
Conventional hypothecations are those which arise by agreement of the parties.
Dig. 20. 1. 5.
General hypothecations are those by which the debtor hypothecates to his creditors all his estate which he has or may have.
Legal hypothecations are those which arise without any contract therefor between the parties, expressed or implied.
Special hypothecations are hypothecations of a particular estate.
Tacit hypothecations are such as the law gives in certain cases, without the consent of the parties, to secure the creditor. They are a species of legal hypothecation.
Thus, the public treasury has a lien over the property of public debtors ; Code 8. 15. 1. The landlord has a lien on the goods in the house leased, for the payment of his rent ; Dig. 20. 2. 2; Code 8. 15. 7. The build er has a lien, for his bill, on the house he has built; Dig. 20. 1. The pupil has a lien on the property of the curator for the bal ance of his account ; Dig. 46. 6. 22; Code 5. 37. 20. There is hypothecation of the goods of a testator for the security of the legacy ; Code 6. 43. 1.
See, generally, Pothier, de l'Hyp.; Pothier, Mar. Contr. 145, n. 26 ; Merlin, Repert.; 2 Brown, Civ. Law 195; Abbott, Shipping; Parsons, Mar. Law ; Taylor v. Hudgins, 42 Tex. 244; Whitney v. Peay, 24 Ark. 27.