p? (Snrnrll Haui Srlinnl fCibrarj) Cornell University Library KF 694.K58P3 A partial collection of cases and other 3 1924 018 848 204 Cornell University Library The original of tiiis book is in tine Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924018848204 A PARTIAL COLLECTION OF CASES AND OTHER AUTHORITIES ON THE LAW OF MOETGAGE BY GEORGE W. KmCHWEY, Nash Professor of Law in Columbia University. '^ <'!,.■ 1--% NEW YORK, 1899. Copyright 1899 by George W. Kirchwev. NEW YORK, MARTIN B. BROWN CO. TABLE OF CONTENTS. TABLE OF CASES t TABLE OF STATUTES "si INTRODUCTION. PROPERTY SECURITY FOR DEBT BOOK I. ESSENTIAL ELEMENTS OF MORTGAGE 19 CHAPTER I. Secubitt 13 CHAPTER II. Debt • • 33 (a) Is a Legal Obligation Necessary ? 33 (6) Obligations Dehors the Mortgage 46 (c) Future Indebtedness 54 CHAPTER III. Conveyance 62 (a) Mortgage, Pledge, and Lien 6^; (6) What May be Conveyed. — Equitable Liens 68 TABLE OF CONTENTS. BOOK II. Page NATUKE AND INCIDENTS OF THE MORTGAGE EBLATION 112 CHAPTER I. Common Law Eeijations 112 (a) Title 112 (6) Possession 125 (c) Dower and Curtesy 135 {d) Waste and Eepair 147 CHAPTER II. .Equitt Eblations 165 (a) Once a Mortgage, Always a Mortgage 165 (J) Mortgagee's Liability to Account 183 CHAPTER III. iDlSCIHABGE or THE Obmgation 20i (a) Tender and Payment 201 (6) Other Discharge of Debt 224 TABLE OF CASES. AcKEEMAN V Hunsickcr Ahrend v. Odiorne Alexander, Conway ®. Alford. Kribs v. Atlantic Ins. Co., Conard v. Arnold, Dexter «. Astor V. Hoyt Raird «. Baird Barnes v. Mott Beavit, Coker «. Bement, Brown ». Bogart ®. Bliss Borst V. Cary Bonham, Newcomb v. Brace v. Marlborough Brennan ■>;. Whitaker Brttt V. Carter Brown v. Bement Kelleran v. Bucklin «. Bucklin Budlong, Morris «. Burdick «. Jackson Burges, Manning i>. Bush D. Cooper Butler V. Miller Cable, Moore v. Cady, Kortwright «. Caminetti, Vogan v. CampbeJl v. Macomb Carry, Borst v. Carpenter, Shaw v. Carier, Brett v. C'ashbom r. Inglish Cbampney v. Coope Chappell ». Jardine Cha-^e V. Peck Clark, Jones v. Peterson v. Clary ». Owen Cliniie ». Wood Coker v. Beavit Coleman v. Winch • Conard ». Atlantic Ins. Co. Conway v. Alexander Coope, Cbampney «. Cooper, Bush ®. B. Davis Copeland, Richardson v. Craig, Ten Eyck v. Crane o. Turner Davenport v. Shanta Davies. Batclifl v. Davis, Cooper «. Denham, Wragg «. Derby, Hanson v. Despard v. Walbridge Dexter v. Arnold Dillaye, Mickles v. Page 58 loa^ 23 85 67 184 112 88 221 201 65 2S2 230 165 66 160 80 65 13 33 197 105 202 226 ■ 224 185 205 f>0 148 2:j0 41 80 136 219 131 106 liS 150 160 159 201 46 67 23 219 236 149 160 178 95 160 63 149 18H 183 16 184 190 Doc d. Surlces, 1 ali r. DoUiver c. St. Joseph Ins. Co. Eaton i\ Whiting Edmunds, Smithurst «. Ely, Sidenberg e. Emanuel Coll. v. Ewens Floter «. Lavington Franklin v. Neate Gai.limore, Moss «. Gillespie, Gray «. Grantham v. Hawley Gray v. Gillespie Hali. v. Doe d. Surtees Hall, Keech v. Hall V. Westcott Hanbury, Parkinson v. Hanson v. Derby Harlan, Hughes v. Hart, Stoddard ». Hawley, Grantham ®. Hodges V. Tenn. etc. Ins. Co. Holroyd v. Marshall Hooker, ex parte Horton, liift v. Hoyt, Astor v. Hoyt ». Martense Hubbell «. Moulson Huggins, Pratt r. Hughes v. Harlan Hughes V. Williams Hunsicker, Ackerman ». Hunt, Maynard i\ Huntington «. Smith Inglish. Cashborn v. Jackson, Burdick v. Jardine, Chappell v. Jones V. Clark Jones, Shepard v. Jevon, Noel «. Keech «. Hall Kelleran v. Brown King «. Smith Kortwright, Cady k. Kribbs e. Alford Lavington, Floyer «. Lee «; Stone Loder, Nelson n. Looker v. Peckwell Lozear, Shields «. Lutton f. Rodd Mack, Rect.r, etc. ». Macomb, Campbell ». Maltby, Wilsoo v. Manning «. Burges Marlborough, Brace v. Page 130 130 115 75 199 301 »8 63 127 131 89 131 130 135 180 195 183 174 50 (i9 15 84 48 160 113 98 132 227 174 194 58 203 115 136 105 121 128 187 125 125 13 147 205 85 33 49 218 79 209 202 123 148 158 202 66 TABLE OF OASES. Page Marsh, Triram v. J 16 Marshall, Holroyd v. 84 Martense, HoyI v. m Matthews i). Sheehan 19 Maynard v. Hunt 20. i McGraw, Van Pelt i>. l.-.o McMurphy v. Mlnot 113 Mickles i>. Dillaye 190 Miller, Butler v. 224 Milne, Walmsley v. 159 Minot, McMuiphy v. 112 Montross, Odell r. 170 Moody ®. Wright 70 Moore «. Cable 185 Morrill v. Noyes 98 Morris v. Budlong 197 Morris. Tuthill v. 215 Moss V. Galllmore 1-JT Mott, Barnes v. 221 Moulson, Hubbell v. 132 MuDson, Tefft i\ 109 Nash v. Preston 13.i Neate, Franklin v. 63 Neilson, Titus u. 135 Nelson «. Loder 218 Newoomb v. Bonham 16". Noel «. Jevon 13.5 Noyes, Morrill v. 93 N. Y. etc. R'y Co. r. Piatt 91 Odell e. Montro>s 170 Odiorne, Ahrend v. 108 Owen, Clary v. 160 Parkinson ». Han bury 195 Peck, Chase v. 106 Peckwell, Looker v. 79 Peterson v. Clark 150 Pike, Stowell «. 1.51 Piatt, N. Y., etc., R'y Co. ». 91 Pratt v. Huggins 337 Preston, Nash v. 135 Rasbt, Roch. Dist. Co. ». 87 RatcliflE «. Davies (►"J Rector, etc. , v. Mack 12; Richardson ®. Copeland 160 Rnch. Dist. Co. ». Rasey 87 Rodd, Lutton v. 203 Rodriguez, Villa «. 167 Russell V. Russell 104 Russell V. Smithies 183 Sawyeb, Searle ». 152 Siarle « Sawyer 153 Shants, Davenport ». 160 Shaw V Cnrpenter 41 Sheehan. Matthews v. ; 19 Shepard v Jones .187' Hhiflcls ('. Lozear 209 Sidonberg v. Ely 19V Smith. Hiiatinaton v. 115 King V. 147 Wilt>ih)re e. 203 Sniithhurst v. Kdmunds 75 Smithies, Russell v. 183 Snow 4). Stevens 139 Stickney. Vaiidiveer ». 101 St. Jos. Ins. Co., Dolliver «. 120 Stoddard r. Hart 50 Taft «. 58 V. Whiting 38 Stone, Lee c. 49 Stowelle Pike 151 Taft ». Stoddard 58 Tefit V. Munson 109 Ten Eyck « Craig 178 Tenn. etc. Ins. Co.,, Hodges v. 15 TifEt «. Horton 160 Titus V. Neilson 135 Tha ne. Van Dyne v. 141 Townsend. Williams v. 176 Trimm v. Marsh 116 Turner, Crane i). 95 Tuthill V. Morris 315 Vandivebr ®. Stickney 101 Van Dyne «. Thayie 141 Van Pelt v. McGraw 155 Villa B. Rodriguez 167 Vogan V. Caminetti 60 Walbridge, D( spard v. 16 Walmsley v. Milne 159 AVestcolt, Hall v 180 WbitaUer, Brenran v. 160 ^^ biting, Faton i). U5 Stocdard «. 28 Williams, Hughes v. 194 1). Townsend 176 Witshire v. Smith 202 Wilson V. Maltby 158 -^ — Youngs 1). 54 Winch, Coleman ». 46 Wood, Climie v. 159 Wragg V. Denham 183 Wright, Moody «. 70 Youngs i>. Wilson 54 TABLE OF STATUTES. Page Mass. Pub. Stat., cli. 181, flO 132 New York Code Civ. Proc, |1498 132 New York Real Property Act, ?214 ''.'.".' 41 New York Real Property Act, ^225 IO4 Vermont Stat. ^1498 132 SELECT CASES '' and other Authorities on the Law of Mortgage. INTRODUCTION. Property Security for Debt. Just. Inst. Lib. iv. c. G, sec. 7. Again, the Servian and quasi- Servian actions, the latter of which is also called "hypothecary," are derived wholly from the Praetor's jurisdiction. The Servian ac- tion is that by which a landlord sues for his tenant's property, over which he has a right in the nature of a pledge (pignus) as security for his rent. The quasi-Servian action is a similar remedy open to any creditor for the purpose of enforcing his pledge or hypotheca. So far then as this action is concerned, there is no difference between a pledge and a hypotheca; and, indeed, whenever a debtor and a creditor agree that certain property of the former shall be the lat- ter's security for his debt, the transaction is called by either name. In other respects, however, there is a distinction between them; for the term, pledge, is properly used only where possession of the property in question is delivered to the creditor, especially if such propertj' be moveable; whereas by the term hypotheca, strictly speaking, we signify a right arising by mere agreement without de- livery of possession. Moyle, Imp. Just., Inst. Excur. II, p. 6. The latest and most re- fined form of pledge is hypotheca, in which there was no convey- ance of either ownership or possession ; it was effected by a bare, formless agreement between the debtor and creditor, that certain spe- cific property of the former should be liable in full for his debt to the latter, who should be entitled to sell in default of payment with- in a prescribed time : "Contrabitur hypotheca per pactum conven- turn, rum quis paciscatur, ut rex cius propter aliq^am ohligationem- sint hypothecae nomine ohligatae : nee ad rem pertinet, quibus fit verbis." Dig. 20, 1. 4. Such an agreement, in itself, was inopera- tive to create rights, either real or personal; it was, however, en- forced bv the praetor, who treated the right of sale as a ius in re aliena, of which the creditor could not be deprived by any subse- quent act of the debtor, and which he could successfully assert (by remedies of his own introduction) against any other person whatso- ever, whether the creditor, his successor, alienee or trustee in bank- ruptcy. * * * Hypotheca possessed great advantages over the earlier forms of pledge, of which fiduria was quite obsolete in the time of Justinian. The pledgor was never deprived of the use and possession of his property, and yet the creditor was absolutely secured. The class of pledgable objects was largely augmented : Money could now be lent on the security of things not yet in existence, e. g., future crops and expectations {et quae nonduin sunt, futiira tamen sunt, ky- pothecae dari possent, ut fructus pendentes, partus ancillae, fetus pecorum." Dig. 20, 1.15) or of mere incorporeal rights, real and personal. (Dig.' 20, 9, 1; *. 11, 2; Dig. 13, 7, 18, pr.) Moreover, it became possible to create a general mortgage, which was done by statute, in favor of many classes of persons : e. g., of a wife or other person who gave a dos over the property of her husband, to secure its return, and of piipils over that of their guardians. Glanville^ Lib. X, cc. 6, 8, 11 (Beames). A Loan is sometimes made, upon the Credit of a putting in Pledge. When a Loan of this description takes place, sometimes movables, as Chattels, are put in pledge ; sometimes immovables, as Lands and Tenements, and Eents, whether consisting in Money, or in other things. When a Compact is made between a Creditor and Debtor, concerning the putting any thing in pledge, then, what- ever be the mode of pledging, the Debtor upon his receiving the thing lent to him, either immediately delivers possesssion of the Pledge to the Creditor, or not. Sometimes also a thing is pledged for a certain period, sometimes indefinitely. Again, sometimes, a thing is pledged as a Mortgage, sometimes not. A pledge is designated by the term Mortgage, when the fruits and Eents, which are received in the interval, in no measure tend to reduce the demand for which the pledge has been given. Wheo a Compact is entered into between a Debtor and Creditor, concerning the pledging of a particular thing, if the Debtor, after having received the Loan, should not deliver the pledge, it may be asked, what step should the Creditor have recourse to in such a case, especially as the same thing may be pledged to many other Cred- itors, both previously and subsequently? Upon this subject, it should be remarked, that the King's Court is not in the habit of giv- ing protection to or warranting private agreements of this descrip;^ tion, concerning the giving or accepting things in pledge, or others of this kind, made out of Court, or even in any other Court than that of the King. If, therefore, such Compacts are not observed, the King's Court does not interfere ; and hence it is not bound to answer concerning the right of difFereilt Creditors, as prior or sub- sequent, or respecting their privileges. But, when an immovable thing is put into pledge, and Seisin of it has been delivered to the Creditor for a definite tertai, it has either been agreed between the Creditor and Debtor, that the pro- ceeds and rents shall in the mean time reduce the Debt, or that they shall in no measure be so applied. The former Agreement is just and binding; the other, unjust and dishonest; and is that called a Mortgage, but this is not proliibited by the King's Court, although it considers such a pledge as a species of Usury. Hence, if any one die having such a pledge, and this be proved after his death, his property shall be disposed of no otherwise than as the Effects of a Usurer. In other respects, the same Rules should be observed, as in pledges of movables, concerning which we have already spoken. But, it must be remarked, that if, after any one has paid his Debt, or has in a proper manner tendered it, the Creditor should maliciously detain the pledge, the Debtor upon complaining to the Court shall have the following Writ, etc. If the Creditor lose his Seisin, either by means of the Debtor, or any other person, he cannot recover it through the assistance of the Court ; not even by a Recognition of Novel Disseisin. For if he was unjustly and without a judgment disseised of his pledge, by any other person than the Debtor himself, the Debtor may have an Assise of Novel Disseisin. If, however, the Creditor was disseised by the Debtor himself, the Court will not assist him against the Debtor, in recovering his pledge, or in giving a Re-en- try, unless through the Debtor himself; for the Creditor should resort to an original Plea of Debt, in order that the Debtor may be compelled to render him satisfaction for his Debt. Using the word vadium.^ gage, whether the possession was to be turned over to the pledgee or not, the Norman judges recognized gages or pledges of land, either with or without transfer of posses- sion. If the pledgee took possession, the transaction was a pawn; if not, it was a hypothecation. It would the greatest mistake to suppose that the feudal seisin was essential to an effectual pledge of land in feudal times. The pledgee might leave the pledgor in possession, and still be secure by recording a written contract of pledge in the King's Court : pre- cisely as, under Justinian, such a contract would have been regis- tered in a public office, or, under the Saxon laws, in a county court or a monastery. This provision for registration was a mere adapta- tion to English ground of the Roman system. Even when the pledgee of land, in feudal times, took possession, he did not take a full feudal seisin; he took only a "quasi" seisin, a seisin "devadio" as it was called — a "pledgee's seisin" — a seisin dis- tinct from a general seisin, not exclusive of that of the pledgor, biit consistent with and dependent upon it — a parasitic seisin. The word ^'seisin," of course, was not exclusively applied to freehold estates in land, but was used of chattels and of chattel estates in land, as lease- holds. And iust as a lessee of land had not a seisin of his own, but had his landlord's seisin, so in the case of a pledge, even with the possession, the freehold was deemed to remain in the pledgor, and the pledgee was said to be seised "through" the owner of the fee- to be seised not in his own name, but in the name of another. The liMrs of the pledgee who died in possession were spoken of in con- tradistinction from the ''verus liaeres." Tlie fact that the land so in pledge, and even in the possession of the pledgee, was still viewed as in the seisin of the pledgor, appears from the fact that it was subject to dower, not of the pledgee's, but of the pledgor's widow; and there could be no dower without seisin. If a pledgee in posses- sion were ousted by a stranger, he could not maintain a writ of novel disseisin to recover possession; the pledgor had to bring the action, counting on his own seisin. And where one seised as pledgee died in possession, and his heir, being excluded, brought a writ of mort d'ancestor, to get possession, he was provided, not with the ordinary writ of mort d'ancestor^ counting upon seisin generally, but with a special writ, alleging in his ancestor a seisin de vadio. The legal remedy for enforcing a simple gage or pledge of land, in the time of Glanville, so far from having those harsh features which we are wont to attribute to our early law, followed that just and equitable system of Roman law which was the cradle of our equity. When a debt secured upon land was due, the pledgee had a writ expressly framed for foreclosure, substantially identical with the Massachusetts writ of entry for foreclosure of a mortgage. The process could be enforced by the courts Ijy a seizure of the property pledged, if it remained in the pledgor's possession, or by other dis- traint; and there was a conditional judgment precisely as there is upon the Massachusetts writ of entry for foreclosure, that the debtor should still have a reasonable time to pay before, the fore- closure should become absolute. — 4 Harvard L. R. 6 (Chaplin). § 333. Item, if a feoffment be made upon such conditions, that if the feoffor pay to the feofl'ee at a certain day, &e., 40 pounds of money, that then the feoffor may re-enter, &c. In this case the feoffee is called tenant in mortgage, which is as much to say in French as mortgage, and in Latin inortmnn radiian. And it seemeth that the cause why it is called mortgage is, for that it is doubtful whether the feoffor will pay at the day limited such sum or not : and if he doth, not pay, then the land which is put in pledge upon condi- ..tion for the payment of the money, is taken from him forever, and BO dead to him upon condition, &c. And if he doth pay the money,. then the pledge is dead as to the tenant, &e. § 333. Also, as a man may make a feoffment in fee in morto-asip, so a man may make a gift in tayle in mortgage, and a lease for term- of life, or for term of years in mortgage. And all such tenants are called tenants in mortgage, according to the estates which they have in the land, &c. § 334. Also, if a feoffment l)e made in mortgao-e upon condition, that the feoffor shall pav such a sum at such n dav. ftc. as is be- tween them by their deed indented agreed and limited, although the feoffor dieth before the day of payment, dv-., yet if the heir of the feoffor pay the same sum of money at the same day to the feoffee, or tender to him the money, and the feoft'ee refuse to receive it, then may the heir enter into the land, and yet the condition is, that if the feoffor shall pay such a sum at such a day, &c., not making mention in the condition of any payment to be made by his heir, but for that the heir hath interest of right in the condition, &c., and the intent was but that the money should be paid at the day assessed, &c., and the feoffee hath no more loss, if it be paid by the heir, than if it were paid by the father, &c. ; therefore, if the heir pay the money, or tender the money at the day limited, &c., and the other refuse it, he may enter, &c. But if a stranger of his own head, who hath. not any interest, &c., will tender the aforesaid money to the feoffee at the day appointed, the feoffee is not bound to receive it. § 335. And be it remembered that in such case, where such tender of the money is made, &c., and the feoffee refuse to receive it, by which the feoffor or his heirs enter, &c., then the feoffee hath no remedy by the common law to have this money, because it shall be accounted his own folly that he refused the money, when a lawful tender of it was made unto him. § 337. Also, if a feoffment be made upon condition, that if the feoffor pay a certain sum of money to the feoffee, then it shall be lawful to the feoffor and his heirs to enter: In this case if the feoffor die before the payment made, and the heir will tender to the feoffee the money, such tender is void, because the time within which this ought to be done is passed. For when the condition is, that if the feoffor pay the money to the feoffee, &c., this is as ' much to say, as if the feoffor during his life pay the money to the feoffee, &c., and when the feoffor dieth, then the time of the tender is passed. But otherwise it is where a day of payment is limited, and the feoffor die before the day, then may the heir tender the money as is aforesaid, for that the time of the tender was not passed by the death of the feoffor. Also, it seemeth, that in such case where the feoffor dieth before the day of pay- ment, if the executors of the feoffor tender the money to the feoffee at the day of payment, this tender is good enongh; and if the feoffee refuse it, the heirs of the feoffor may enter, &c. And the reason is, for that the executors represent the person of their testa- tor, &c. § 338. And note, that in all cases of condition for payment of a certain sum in jiross touchint;- lands or tenements, if lawful tender be once refused, he which ought to tender the money is of this quit, and fullv discharged forever afterwards. Co. 209. a. This is to be understood, that he that ought to tender the money is of this discharged forever to make any other tender; but if it were a duty before, though the feoffor enter by force of the condition, vet the debt of duty remaineth. As if A. borroweth a hundred pound of B., and after mortgageth land to B. upon con- dition for payment thereof. If A. tender the money to B. and he re- fuseth it, A. may enter into the land, and the land is freed forever of the condition, but yet the debt remaineth, and may be recovered by action of debt. But if A. without any loan, debt or duty pre- ceding infeofEee B. of land" upon condition for the payment of a hundred pounds to B. in nature of a gratuity or gift. In that case if he tender the hundred pound to him according to the condi- tion, and he refuseth it, B. hath no remedy therefor, and so is our author in this and his other cases of like nature to be understood. . Lit. 339. Also, if the feoffee in moi-tgage before the day of pay- ment which should be made to him, makes his executors and die, and his heir entereth into the land as he ought, &c., it seemeth in this case that the feoffor ought to pay the liioney at the day appointed to the executors, and not to the heir of the feoffee, because the money at the beginning trenched to the feoffee in manner as a duty, and shall be intended that the estate was made by reason of the lending of the money by the feoffee, or for some other duty ; and, therefore, the payment shall not be made to the heir, as it seemeth, but the words of the condition may be such, as the payment shall be made to the heir. As if the condition were, that if the feoffor pay to the feoffee or to his heirs such a sum at such a day, &c., there after the death of the feoffee, if he dieth before the day limited, the payment ought to be made to the heir at day appointed, &c. 2 Blackst. Com. 157. ' There are some estates defeasible upon condition subsequent, that require a more peculiar notice. Such are : — Estates held in vadio, in gage, or pledge, which are of two kinds, vivum vadium,, or living pledge, and mortuum vadium, dead pledge, or mortgage. Vivum vadium, or living pledge, is when a man borrows a sum (suppose £300) of another, and grants him an estate, as of £20 per annum, to hold till the rents and profits shall repay the .sum so borrowed. This is an estate conditioned to be' void, as soon as such sum is raised. And in this case' the land or pledge is said to be living: it subsists, and surives the debt; and immediately on the discharge of that, results back to the borrower. But mortuum vadium, a dead pledge or mortgage ( which is much more common than the other), is where a man borrows of another a specific sum (e. g. £300) and grants him an estate in fee, on condition that if he, the mortgagor, shall repay the mortgagee the said sum of £200 on a certain day mentioned in the deed, that then the mortgagor may re-enter on the estate so granted in pledge ; or, as is now the more usual way, that then the mortgagee shall reconvey the estate to the mortgagor. In this case, the land, which is so put in pledge, is by law, in case of non-payment at the time limited, for- •ever dead and gone from the mortgagor; and the mortgagee's estate in the lands is then no longer conditional, but absolute. But, -SO long as it continues conditional, that is, between the time of lending the money and the time allotted for payment, the mort- gagee is called tenant in mortgage. But as it was formerly a doubt, whether, by taking such estate in fee, it did not become liable to the wife's dower and other incumbrances of the mortgagee (though that doubt, has been long ago overruled by our courts of equity), it, therefore, became usual to grant only a long term of years by Tvay of mortgage, with condition to be void on repayment of the mortgage money, which course has been since pretty generally cpn- iinued principally because on the death of the mortgagee such term becomes vested in his personal representatives, who alone are en- titled in equity to receive the money lent, whatever nature the mort- gage may happen to be. As soon as the estate is created, the mortgagee may immediately ■enter upon the lands ; but is liable to be dispossessed, upon per- formance of the condition by payment of the mortgage money at ihe day limited. And, therefore, the usual way is to agree that the mortgagor shall hold the land till the day assigned for payment; when, in case of failure, whereby the estate becomes absolute, the mortgagee may enter upon it and take possession, without any possibility at law of being afterwards evicted by the mortgagor, to whom the land is, now forever dead. But here again the courts of -of equity interpose, and though a mortgage be thus forfeited, and the estate absolutely vested in the mortejagee at the common law, yet they will consider the real value of the tenements compared with the sum borrowed. And, if the estate be of greater value than the sum lent thereon, they will allow the mortgagor at any reasonable time to recall or redeem his estate; paying to the mort- gagee his principal, interest and expenses; for otherwise, in strict- ness of law, an estate worth £1000 might be forfeited for non- payment of £100, or a less sum. This reasonable advantage, al- lowed to mortgagors, is called the equity of redemption; and this enables a mortgagor to call on the mortgagee who has posses- sion of his estate, to deliver it back and account for the rents and profits received, on payment of his whole debt and interest ; thereby turning the mortuum into a kind of vivum. vadium,. But on the other hand, the mortgagee may either compel the sale of the estate in order to get the whole of his money immediately, or else call upon the mortgagor to redeem his estate presently, or in default thereof, to be forever foreclosed from redeeming the same; that is, to lose Tiis equity of redemption without possibility of recall. And also, in some cases of fraudulent mortgages, the fraudulent mortgagor for- feits all equity of redemption whatsoever. It is not, however, usual for mortgagees to take possession of the mortgaged estate unless -where the security is precarious, or small ; or where the mortgagor neglects ev6n the payment of interest; when the mortgagee is fre- quently obliged to bring an ejectment, and take the land into his own hands in the nature of a pledge, or the pignus of the Eoman law; whereas, while it remains in the hands of the mortgagor, it more resembles their hypotheca, which was, where the posses- sion of the thing pledged remained with the debtor. But by statute 7 Geo. II, ch. 20, after payment or tender by the mortgagor of principal, interest and costs, the mortgagee can maintain no eject- ment, but may be compelled to re-assign his security. In Glanville's time, when the universal method of conveyance was by livery of seisin or corporal tradition of the lands, no gage or pledge of lands- was good unless possession was also delivered to the creditori "Si non sequator ipsius vadii traditio, curia domini regis hujus- modi privatas conventiones tueri non solet;" for which the reason given is, to prevent subsequent and fraudulent pledges of the same land, "Cum in tali casu possit eadem res pluribus aliis ereditoribus turn prius turn posterius invidiari." And the frauds which have arisen since the exchange of these public and notorious conveyances for more private and secret bargains, have. well evinced the wisdom of our ancient law. A fourth species of estates, defeasible on condition subsequent, are those held bj^ statute merchant, and statute staple; which are very nearly related to the vivum vadium before mentioned, or estate held till the profits thereof shall discharge a debt liquidated or ascertained. For both the statute merchant and statute staple are securities for money ; the one entered into before the chief magistrate of some trading town, pursuant to the statute 13 Edw. I, de mercatoribuy, RTid thence called a statute merchant; the other pursuant to the statute 27 Edw. Ill, ch. 9, before the mayor of the staple, that is to say, the grand mart for the principal commodi- ties or manufactures of the kingdom, formerly held by act of Par- liament in certain trading towns, from whence this security is called a statute staple. They are both, I say, securities for debts ac- knowledged to be due; and originally permitted only among traders, for the benefit of commerce; whereby not only the body of the debtor may be imprisoned, and his sroods seized in satisfaction of the debt, but also his lands may be delivered to the creditor, till out of the rents and profits of them the debt may be satisfied ; and, during such time as the creditor so holds the iands, he is tenant by statute merchant or statute staple. There is also a similar security, the recognizance in the nature of a statute staple, ac-' knowledeed before either of the chief justices, or (out of term) before their substitutes, the mayor of the staple at Westminster and the recorder of London ; wherebv the benefit of this mercantile transaction is extended to all the Kinar's subjects in general, by virtiip of tbp statn+o 23. Hen. VTIT. ch. C^. amended bv 8 Gon. T. ch. 25. which directs such recognizances to .he enrolled and certified into chancery. But these, by the statute of frauds, 29 Car. II, ch. 3, are only binding upon tlie lands m the hands of bona fide pur- chasers, from the day of their enrollment, which is ordered to be marked on the record. Another similar conditional estate, created by operation of law, for security and satisfaction of debts, is called an estate by elegit. What an elegit is, and why so called, will be explained in the third part of these commentaries. At present I need only mention, that it is the name of a writ, founded on the statute of Westm. 2, by which, after a plaintiff has obtained judgment for his debt at law, the sheriff gives him possession of one-half of the defendant's lands and tenements, to be occupied and enjoyed until his debt and damages are fully paid; and during the time he so holds them, he is called tenant by elegit. It is easy to observe that this is also a mere conditional estate, defeasible as soon as the debt is levied. But it is remarkable that the feudal restraints of alienating lands, and charging them with the debts of the owner, were softened much earlier and much more effectually for the benefit of trade and commerce, than for any other consideration. Before the statute of quia emptores, it is generally thought that the proprietor of lands was enabled to alienate no more than a moiety of them; the statute, therefore, of Westm. 2, permits only so much of them to be affected by the process of law, as a man was capable of alienati.Big' by his own deed. But by the statute de mercaioribus (passed in same year) the whole of a man's lands was liable to be pledged: in a statute merchant, for a debt contracted in trade; though one- half of them was liable to be taken in execution for any other debt of the owner. I shall conclude what I had to remark of these estates, by statute merchant, statute staple and eligit, with the observation of Sir Edward- Coke. "These tenants have uncertain interests in lands and tenements, and yet they have but chattels and no free^ holds" (which make them an exception to the general rule), "because, though they may hold an estate of inheritance, or for life, ut liberum tenementum, until their debt be paid; yet it shall go to their executors; for utAs similitudinary ; and though to re- cover their estates, they shall have the same remedy (by assize) as a tenant of the freehold shall have, yet it is but the similitude of a freehold, and nullum simile est idem." This, indeed, only proves them to be chattel interests, because they go to the executors, which is inconsistent with the nature of a freehold; but it does not assign the reason whv these estates, in contradistinction to other uncertain interests, shall vest in the executors of the tenant and not the heir, which is probably owing to this : That, being a security and' remedy provided for personal debts due to the deceased, to which debts the executor is entitled, the law has, therefore, thus directed" their succession; as judging it reasonable from a principle of nat- ural equity, that the security and remedy should be vested in those to whom the debts, if recovered, would belong. For, upon the same principle, if lands be devised to a man's executor, until out of the profits the debts due from the testator be discharged, this interest in the lands shall be a chattel interest, and on the death of such executor shall go to his executors, because they being liable to pay the original testator's debts, so far as his assets will extend, are in reason entitled to possess that fund out of which he- has directed them to be paid. 4 Kent^ Com. 140. The law of pledges shows an accurate and refined sense of justice, and the wisdom of the provisions by which the interests of the debtor and creditor are equally guarded, is to be traced to the Eoman law, and shines with almost equal advantage, and with the most attractive simplicity, in the pages of Glanville. It forms a striking contrast to the common law mortgage of the freehold, which was a feoffment upon condition, or the creation of a base or determinable fee, with a right of reverter attached to it. The legal estate vested immediately in the feoffee, and a mere right of re-entry, upon performance of the condition, by payment of the debt strictly at the day, remained with the mortgagor and his heirs, and which right of entry was neither alienable nor de- visable. If the mortgagor was in default, tlie condition was for- feited, and the estate became absolute in the mortgagee, without the right or hope of redemption. So rigorous a doctrine, and pro- ductive of such forbidding, and, as it eventually proved, of such intolerable 'injustice, naturally led to exact and scrupulous regula- tions concerning the time, mode and manner of performing the condition, and they became all important to the mortgagor. The tender of the debt was required to b? at the time and place pre- scribed; and if there was no place mentioned in the contract, the mortgagor was bound to seek the mortgagee, and a tender upon the land was not sufficient. "Among conditional estates are mortgages of land and tenements. These are sometimes of the freehold and inheritance, and sometimes for a term of years only. 1. Of the freehold and inheritance : Where a feoffment is mad© upon condition, that if the feoffor pay the feoffee £40 at a certain ■day, then he shall re-enter, &c. Here the land and all the feoffor's estate in it pass presently to the feoffee by common law; and the feoffor has only the condition left, and no estate in the land that he can assign over. Co. Lit. 205. a. So if one here, by deed duly acknowledged and registered, conveys his land to another and "his heirs upon the like condition, the land and all the mortgagor's ■estate in it pass presently to the mortgagee by force of the pro- vincial act of. 9 Will. 3. c. 7: (1 P. Will. 74.) * * * 10 "It is objected to this doctrine, that Lord Mansfield, in consider- ing what species of property a mortgage has in the estate mortgaged lately, said (2 Burr. 978, 979), that "a mortgage is a charge upon the land, and whatever would give the money, will carry the estate in the land along with it, to every purpose. The estate in the land is the same thing as the money due upon it. It will be liable to debts; it will go to executors; it will pass by a will not made and executed with the solemnities required by the statute of frauds. Th^ assignment of the debt, or forgiving it, will draw the land after it, as a consequence, nay, it would do it though the debt were forgiven only by parole ; for the right to the land w,ould follow, not- withstanding the statute of frauds." (a Cha.. Rep. 3.) "Upon this authority it is said that the mortgagee has no legal estate in the land ; that all mortgages are personal estate ; and if the land is not redeemed nor redeemable, the judge of pro- bate has a right to assign to the widow, where there are children, a third, and where there are none, half the land, to hold, not during life, but forever, in fee. * * * In order the better to settle the authority of these propositions,, said to have fallen from Lord Mansfield, it may not be amiss, first to consider the third proposition, viz. : "that the estate in the land is the same thing as the money due upon it ;" as it may serve to il- lustrate the rest, and show what is intended to be implied in some or all of them. If the mortgagee's estate in the land is the same thing, as the money due upon it, then the money due upon the land is the mortgagee's estate in it; and consequently there is no difference between the mortgage of land for a term only, and a mortgage of it in fee, if it be for the same sum; the money, which is the estate in the land, being exactly the same in both cases; and the mortgagee in fee has no other nor greater estate in the land than the mortgagee of a term only hath. This proposition, if true, when taken according to the words of it, without restriction or limitation, at once destroys the distinction between the vadium vivum and the vadium mortuum. Its renders idle the invention and substitution of mortgages for a term instead of mortgages in fee, and tends to prove that the mortgagee has no estate, accord- ing to the legal sense of words, in the land. But surely Lord Mansfield did not so imderstand the proposition ; for in that which immediately precedes it, he plainly distinguishes between the money and the estate in the land, and so he doth in those which follow. In the same case he just before says, that if it appeared that the testator really meant and intended to devise the close as land, it would be a devise of the land, the mortgage being forfeited by law, and the estate in the land having become absolute. What, was the money become absolute? No, surely. His lordship meant, that the conditional fee simple which the mortgagee had in the close 11 by the non-payment of the money by the day, had become an absolute fee simple in law; so that he might devise the land to his son and daughter in fee tail; and if that was his intent in the will, the close would pass accordingly, as an estate of inheritance in fee tail- so long as it continued, which would be until it was redeemed, or the estate tail was spent, agreeably to what Lord Keeper Wright said in Gilb. Eq. Ca. 3. in the case of a mortgage in fee. The money due on the mortgage could not, by Lord Mansfield, be considered as the estate in the land, so as to make the money real estate, nor the estate in the land money, so as to make an estate in fee in land or the land itself personal estate. His lordship doubtless well knew there was a diilerence between a mortgage, of land for a term only and a mortgage in fee : That the former was but a chattel and the latter an estate of inheritance ; that the former, unless dependent upon the inheritance, was legal assets, and the latter equitable assets only; that the former went directly to the executor, &c., but the latter descended to the heir, and the execu- tor could not have the land without the aid of the Court of Chan- eery. And yet the several propositions, as they stand, confound mortgages for a term and mortgages in fee together; as though there was no difference between them, which is not reasonable to suppose Lord Mansfield ever did; and, therefore, it must be sup- posed the reporter did not take down the restrictions, with which his lordship qualified his propositions, and left them to be implied by the reader. * * * For if the mortgagor in fee shall, after the day of payment is elapsed, pay the mortgage money to the mortgagee, it doth' not revest the fee in him in law, nor even in equity ; because the mort- gagee is deemed in such a case by the Court of Chancery a trus- tee of the mortgagor, &c., until the estate is reconveyed ; and so is a vendor after a contract to convey, and the land, though not con- veyed, will in equity pass by the will of the vendee as his land. (3 Chan. Eep. 3.) And surely, forgiving the debt will not vest the estate in the mortgagor, more than payment of the mortgage money. Nay, where mortgages are devised to executors, upon pay- ment of the money to them, the heir is decreed to join in the re- conveyance. * * * Upon the whole the futility of the allegations, " that mortgages are personal estate, that a mortgagee has no estate in the land, and that the land niortgaged, even after it has become irredeemable, may be distributed by the judge of probate as personal estate," is evident. * * * Authorities showing the estate, both legal and equitable, to be in the rarotgagee. 3 Atk. 353-4. 3 Cha. Ca. 97. 1 Cha. Ca. 285. Per Trowbridge, J., Of Mortgages, 8 Mass. 551. 12 BOOK I. ESSENTIAL ELEMENTS OF MORTGAGE. CHAPTER I. Sbcuritt. KELLERAN v. BROWN. [4 Mass. 443.— 1808.] THIS was a writ of entry, and upon the general issue pleaded was tried before Thatcher, J., September term, 1806, when a verdict was rendered for the demandant. In support of the action, the demandant read in evidence a deed of Timothy Manly conveying the land demanded to the demand- ant in fee. The tenant, in defense of the action, having prayed in aid the title of Timothy Manly, under whom he claims the premises as his ten- ant, the counsel for the tenant, to show the demandant ought not to have judgment, except as in an action upon a mortgage, offered to read in evidence an agreement in writing signed by the demand- ant, and bearing even date with the deed aforesaid, in the follow- ing terms, viz. : "Thomaston, May 26, 1800. I, Edward Kelleran, the subscriber, having purchased of Timothy Manly a lot of land lying in said Thomaston, containing fifty acres (being the lot which the said Manly purchased of Ebenezer Bly) for which I have re- ceived a warranty deed; but if the said Manly shall repay me the sum of four hundred dollars, with the lawful interest on the same in one year from the date hereof, I then will reconvey the said lot of land to him. Edward Kelleran;" and also offered to prove to the jury that the tenant. Brown, at the time of the commencement of this action, and for a long time before, was, and ever since has been, tenant at will of the premises demanded, under the said Timothy Manly, the aid of whose title is prayed in this action. The demandant's counsel objecting, the judge rejected said agree- ment and evidence, as inadmissible. To which opinion the judge the counsel for the tenant excepted, as erroneous; whereupon the cause stood continued for the opinion of the Court upon the said exceptions. 18 / At last J uiie term in this county, the cause was briefly spoken to. by Mellen in support of the exceptions, and thence continued for advisement, and now the opinion of the Court was delivered by PAKSONS, C. J. The demandant has sued a writ of entry, to. recover his seisin of the lands demanded in his writ and count. The tenant pleads the general issue, and to maintain the issue on his part, offers to give in evidence that he is the tenant at will to one Timothy Manly; and that Manly conveyed the lands demanded to Kelleran in mortgage. To prove that the conveyance was a mortgage, he offered to read in evidence a contract in writing,, under the demandant's hand of the following tenor: (Here his Honor read the agreement before recited.) But the judge rejected the evidence that he was tenant at will, and refused to let this con- tract be read to the Jury. As the demandant, in his writ, had demanded a freehold of the tenant, he, by pleading the general issue, had admitted orb record that he was the tenant of the freehold. He was, therefore, estopped from proving that he had not the freehold, but was a tenant at will. As to the effect of the written contract, if it be an instrument of defeasance at common law of the conveyance made by Manly to the demandant, the tenant might have read it in evidence, to show that the demandant was entitled only to the conditional judg- ment, as in a suit to foreclose a mortgage. (j In chancery, whenever it appears, from written evidence, that land is conveyed as a pledge to secure the payment of money, the conveyance will be treated as a mortgage, in whatever form the land was pledged. And if we had all the equity powers of a Court of Chancery, I should be satisfied that the conveyance in this ease, with the written contract of conveyance, woiild be deemed in equity a mortgage, and the grantee would be allowed to redeem. But the equity powers of this Court are derived from statute,. and are extremely limited. We can relieve mortgagors only in cases where the lands are granted on condition, by force of any deed of mortgage, or bargain and sale with defeasance. (Vide Statutes 1785, c. 32; 1798, c. 77.) N'ow a defeasance of any in- strument of conveyance, must be of as high a nature as the con- veyance, must be executed at the same time, and is to be consid- ered as part of it ; so that the conveyance and defeasance must be taken together, and considered as parts of one contract. If,Jtliere- fore, the conveyance is by deed, the defeasance must be by deed. In this case the conveyance by Manly to Kelleran was by deed, and the agreement by Kelleran was merely by a simple contract ; and^^w- everit might in equity have the effect of a defeasance, at law it is not^a defeasance of the deed of Kelleran. The counsel for the tenant referred to the statute of 1802, c. 33, which provides that no conveyance of any land, nnless for a term 14 ^ :^' less than seven years, shall be defeated or incumbered by any bond or other deed, or instrument of defeasance, unless they are regis- tered. This provision cannot avail to enlarge our jurisdiction, which -was not within the purview of the act. What shall be deemed an instrument of defeasance must still be determined upon the principles of the common law. The written contract to Kel- leran not under his seal was, in our opinion, properly rejected as evidence. Judgment according to the verdict. HODGES v. THE TENNESSEE MAKINE AND FIEE INSURANCE CO. [8 N. Y. 416.— 1853.] JOHNSON J.* The determination of the judge in allowing the amendment of the pleadings was within his discretionary power, and is not the subject of review, in this Court. I The remaining question in the cause relates to the existence of an insurable interest in Slamm at the time of the assignment of the / policy to Hodges and of the loss. If such an interest existed, then the plaintiff's recovery cannot be disturbed. TTpon the evidence there is no doubt of the following facts : That 'at the time when the insurance was effected, September 1, 184S, Slamm was the ouaier in fee of the premises insured; that on the 'r'^ 4th of September, 1848, he conveyed the premises to Pledges by a ; deed absolute upon its face, but intended to operate as a mortgage, and that upon the same day he transferred the policy to Hodges as collateral security, and that this transfer was made by the assent of the company. If there is no rule of law forbidding us to take notice of the fact that the deed was intended as a mortgage, then beyond all question Slamm as the owner *of the equity of redemption in the premises had an interest in the insurance which had been effected by him as the owner of the fee, and the assignment with the company's a.s- sent transferred this interest to Hodges as collateral security, ancT he may upon the ground of the same interest sustain the recovery which has been had in this ease. The question then, taking it most strongly against the plaintiff, is, whether in equity Slamm^might liave a bill to redeem against Hodges, notwithstanding the deed was absolute upon its face. Webh V. Rice, 6- Hill, 219, does not conflict with the proposition *The opinion cnl? is here given. 15 ^^ h that such a bill might be maintained. It only i^rofesses to decide that at law unwritten evidence is in admissible to show that a deed was intended as a mortgage. Ftoiiljjl early ,day-iii_tkis_State-the admissibility of such evidence had. been .established, as Jhg^law of our Courts of Equity, and it is not fitting that the question should now be re-examined. Upon the authority of Strong v. Stewart, 4 J. C, 167; Clark v. Henry, 2 Cow., 333; Whittick v. Kane, 1 Paige, 306 ; Van Buren v. Olmsted, 5 Paige, 10 ; Mclntyre v. Hum- phreys, 1 Hoff. 34, with which agree Taylor v. Little, 2 Sumner; 338, Jenkins v. Eldredge, 3 Story, 293, in all which cases except Clark V. Henry, the point was directly before the court, we think that the plaintiff's recovery in this case ought to be sustained. DESPAKD V. WALBRIDGE. [15 N. Y. 37-t-1857.] I'his action was brought to recover for the use and occupation of a store, in BufEalo, by the defendant, from May 1st, 1851, to August 1st, 1851, which the complaint averred to be worth $375. It also averred that the defendant on May 1st, 1851, agreed to pay for such use and occupation $1,500 per annum, payable quarterly. The ac- tion was tried before a referee, who found the following facts : On the 8th of March, 1850, one Sherwood demised to H. B. Eitchie the store above mentioned, and another adjoining, for two years from the first of May then next, with a right of renewal on certatli con- ditions, Ritchie covenanting to pay a certain rent. On the 17th of November, 1850, Eitchie assigned this lease and his title to the term thereby granted to the plaintiff. At the time of such assign- ment the defendant was in possession of the premises as a sub- tenant of Eitchie, under a lease executed April 30th, 1850, for the term of one j'ear from May 1st, 1850. Sherwood, the original lessor, on the 9th of October, 1850, as- signed his interest in the lease executed by Ritchie to Eobert Codd for the'purpose of securing a debt which he owed to Codd. On the 19th of November, 1850, Ritchie assigned to Codd all his interest as landlord in the sub-lease executed between himself and the de- fendant. The defendant occupied the premises under the lease from Eitchie, and after the assignment thereof to Codd paid the rent to the latter. On the 1st day of May, 1851, the plaintiff served on the defendant a written notice that he was the assignee of Ritchie's term, and that in case the defendant held over beyond his term, then at the point of expiring, the plaintiff would consider the premises as held and taken by defendant for the term of one year from May 1st, 1851, at the annual rent of $1500, payable quarterly. The plaintiff, having proved these facts, rested his case, and the defendant moved for a nonsuit, which, being refused by the referee, he took an exception. Other exceptions were taken upon the trial, K. and to the referee's report, which, with the facts relating thereto, sufficiently appear in the opinion of the court. The referee re- ported that the defendant occupied under an implied agreement to pay what the occupation of the' premises was reasonably worth, which he found to be at the rate of $1,200 per annum. Judgment was entered upon his report, which was affirmed by the Supreme Court at general term, and the defendant appealed. SELDEjST, J.* The principal question is that which arises upon the exception stated in the referee's report. It is set forth in the answer, in substance, that the assignment of the Sherwood lease from Ritchie to the plaintiff was made at the request and for the benefit of Codd, and for the solo purpose of aiding the latter in the collection of his debt against Sherwood. It is also stated that this debt had been fully paid before May 1st, 1851, by Hiram E. Howard, who had succeeded to the rights of Sherwood in the prem- ises, and that Ritchie, on the 1st of May, 1851, surrendered all his rights in the premises to Howard, whose tenant the defendant then became. These facts the defendant offered to prove and his offer ■was rejected. ***** But it is urged that the proof offered was properly excluded for another reason. The assignment to the plaintiff being absolute in its terms, it is said that parol evidence was inadmissible to show that it was intended as security merely; and the case of Webb v. Rice (6 Hill, 219), is cited in support of this position. It was held in that case that in an action at law parol evidence could not Toe received to show that a deed, absolute upon its face, was intended as a mortgage. It was conceded, however, that the rule was settled otherwise in equity. In the case of Hodges v. The Tennessee In- surance Company (4 Seld., 416), this court held that the rule in equity continued the same since the case of Webb v. Rice as be- fare. The only question, therefore, upon this subject is whether the equity rule is applicable to the present ease, which is a purely legal action. As, however, since the enactment of the Code of Procedure a defendant may avail himself of an equitable as well as a legal defense in all cases, whatever may be the nature of the action, there would seem to be but little room for doubt upon the point. (Dohson v. Pierce, 2 Kern, 156; Crary v. Goodman, id., 266 ; Code, § 150, subd. 2.) That a deed absolute on its face was intended as a mortgage, would, before the Code, have been an equit- able defense, because it could not have been proved at law. In order that it should now be made available in legal actions, as pro- vided by the Code, the evidence to establish it must be admitted in that class of actions. *Onl.v portioTiP of the opinion are given. J7 It may still be said that, admitting it to be shown that the as- signment to the plaintiff was merely collateral to the debt of Sher- wood to Codd, and that this debt had been fully paid prior to May 1st, 1851, yet so long as the lease was not reassigned, the legal title remained in the plaintiff, and that Ritchie could not surren- der the lease while this title remained outstanding. The answer to this is, that if the assignment was collateral, it is the same as if the condition had been incorporated in the assignment itself, that upon payment of the debt the rights of the assignee should cease; and in such a case it is clear that no formal reassignment would be necessary. Whatever might be the effect of such an assign- ment in the hands of a subsequent bona fide assignee, it cannot be set up by the original assignee as evidence of a subsisting title in him, after full performance of the conditions upon which it was made. There is still another question of fact which arose at the trial, but which was not passed upon by the referee, viz., whether the as- signment to the plaintiff was intended as a security not only for the debt of Sherwood to Codd, but for that of Ritchie also. Should it turn out upon the new trial that the lease was assigned as security for both debts, and either remained unpaid on the 1st of May, 1851, then the case on the part of the plaintiff would be made out. The judgment must be reversed and a new trial must be ordered, with costs to abide the event. All the judges who had heard the argument concurring in this opinion, Neiu trial ordered. "It is now too late to controvert the proposition that a deed, -=^^ absolute upon its face, may, in equity, be shown, by parol or other ^if\ I extrinsic evidence, to have been intended as a mortgage; and fraud or mistake in the preparation or as to the form of the instrument is not an essential element in an action for relief, and to give effect to the intention of the parties. The courts of this State are fully committed to the doctrine; and, whatever may be the rule in other States, here in passing upon the question we have only to stand . upon the safe maxim of stare decisis. It is not enough, in view of the fact that the adjudications have entered into and controlled business transactions and become a rule of property, to authorize a reconsideration of the questions, that the rule has been authorita- tively adjudged otherwise as a rule of evidence in common law courts, and that eminent judges have contended earnestly against its adoption as a rule in courts of equity. Notwithstanding their protests the rule has been, upon the fullest consideration, deliber- ately established, and cannot now be lightly departed from. The principle was recognized by the Chancellor in Holmes v. Grant 18 (8 Paige, 2i'3). Although it was not applied in that case, and had been before assm-ted under like circumstances in Robinson v. Crop- sey (2 Edw. Ch. R.,.138) ; affirmed (6 Paige, 480). ' ' It was expressly adjudged in Strong v. Stewart (4 J. C. R., 167), that parol evidence was admissible, to show that a mortgage only was intended by an assignment absolute in terms ; and to the same effect in Clark v. Henry (3 Cow., 324) ; which was followed by this court in Murray v, Walker (31 N. Y. 399). In Hodges v. Ten- nessee Marine, and Fire Insurance Co. (4 Seld., 416) the court says that "from an early day in this State the rule that parol evidence is admissible for the purpose named has been established as the law of our courts of equity, and it is not fitting that the question should be re-examined, and the cases in which it has been so ad- judged are cited with apprpval." In Sturtevant v. Sturtevant (20 N. Y., 39), the same judge pronouncing the opinion as in the case last cited, distinguishes between the case of a mortgage and trust, and it was decided that while a deed absolute in terms could be shown to be a mortgage, a trust in favor of the grantee could not be established by parol., And see Despard v. Walbridge (15 N. Y., 374). The rule does not ponflict with the other rule, which forbids that a deed or other written instrument shall be contradicted or varied by parol evidence. The linstrument is equally valid, whether intended as an absolute conveyance or a mortgage. Effect is only given to it according to the intent of the parties, and courts of equity will always look through the forms of a transaction and give effect to it, so as to carry out the substantial intent of the parties." Allen J., in Horn v. Keteltas 46 N. Y., 605, 609 (1871). MATTHEWS v. SEEEHAK [69 N. Y. 585.— 1877.] APPEAL from judgment of the General Term of the Supreme Court in the third judicial department affirming a judgment in favor of plaintiff entered upon a verdict. This action was brought by plaintiff, as administratrix with the will annexed, of Dennis O'Keefe, deceased, to recover moneys al- leged to have beesn collected by defendant upon a policy of insur- ance issued upon the life of said O'Keefe, and assigned by him to defendant as security for advances made by the latter. EARIj, J. In December, 1869, an arrangement was made be- tween the plaintiff's testator, O'Keefe, and the defendant, whereby O'Keefe was to procure a policy of insurance on his life from the Phoenix Life Insurance Company, and assign it to the defendant, who was to pay the premiums and have the benefit of the policy, with the understanding that if at any time O'Keefe desired to redeem the policy, he could do so by paying the premiums advanced by defendant, with the interest thereon. In pursuance of this ar- 19 rangement, O'Keefe procured the company to issue a policy on his hie, which was immediately assigned to the defendant by an as- signment absolute in form, and he paid all the premiums to the time of O'Keefe's death m 1874. Before that time O'Keefe, for the purpose of redeeming the policy, offered to pay the defendant the amount advanced hy him for the premiums, and defendant re- fused to take the money. After the death of O'Keefe, the defend- ant received from the insurance company the amount insured, and retained the same, refusing, upon plaintiff's demand, to pay any portion thereof to her. 'Jlhis^ action was brought to recover the sum received by the defendant, less the amount for which he held the policy as security. Upon the trial, the facts above stated ap- pearing, and there being no conflicting evidence, the court directed a verdict for the plaintiff. The verdict was properly directed. Upon the undisputed evi- dence, O'Keefe had the option to treat the policy as a security for the premiums paid by the defendant, and to redeem the same. While O'Keefe was not bound to redeem, or personally liable for the money advanced by the defendant, there was sufficient considera- tion for the arrangement made. O'Keefe submitted to examina- tion, procured his life to be insured, and assigned the policy to the defendant in cojisideration that the defendant would pay the premiums and give him the option to redeem. The substance and legal effect of the transaction was to make the defendant a mort- gagee of the policy to secure him for the premiums paid, and hei could not claim an absolute title thereto, except upon O'Keefe's failure to exercise his option to redeem. This was not simply an agreement by the defendant to sell to O'Keefe, upon payment by him of the apiount of the premiums advanced with interest, a policy absolutely belonging to the defendant, an agreement void under the statute of frauds; because there was no writing or part payment. It was an agreement that the defendant might take and hold the policy as security and the right to redeem attended the policy into the defendant's hands, and at all times affected hia title. Such an agreement may be shown by parol, although the assignment be absolute in form. (Hodges v. The T. M. and Fire Ins. Co., 8 N. Y., 416; Despard v. Walbridge, 15 N". Y., 374; Horn v. Keteltas, 46 N. Y., 605 ; Hope v. Balou, 58 N. Y., 380.) |, It matters not that O'Keefe did not absolutely promise to pay )\ the amount which defendant should advance for the premiums. To constitute a valid mortgage it is not essential that the mort- gagee should have any other remedy but that upon his mortgage. This is recognized by the Revised Statutes in references to real estate mortgages (1 E. S. 739), which provide that when there shall be no express covenant in the mortgage for the payment of the money received, and no bond or other separate instrument to 20 secure such payment, the remedies of the mortgagee shall be con- fined to the lands mentioned in the mortgage. In all cases the remedy of the mortgagee may by the agreement of the parties be confined to the mortgage. It is sometimes difficult to determine whether a transaction con- stitutes a mortgage or an absolute sale and a conditional resale; and whether it shaU be construed to be one or the other depends upon the intention of the parties as evidenced by the instrument executed, and all the circumstances of the case. No general rule upon the subject can be laid down which will govern all cases, al- though it is said that the fact that there was no debt which could be personally enforced is a strong, but not an absolutely controlling circumstance, that the transaction was not a mortgage, but a sale and a conditional resale. In all doubtful cases a contract will he, construed to he a mortgage rather than a conditional sale, because in the case of a mortgage the mortgagor, although he has not strict- ly complied with the terms of the mortgage, still has his right of redemption; while in the ease of a conditional sale, without strict compliance, the rights of the conditional purchaser are forfeited {Longuet v. Seawen, 1 Ves. Sen., 402; Glover v. Payn, 19 Wend., 578; Conway's Exrs. v. Alexander 7 Cranch, 318; Edrington v. Harper, 3 J. J. Marshall, 354; Floyer v. Lavington, 1 P. Wms., 268; Chapman's Admin'x v. Turner, 1 Colls. R. 280; Wharf v. Howell, 5 Binney, 499.) In Floyer v. Lavington, it is said : "As to the objection that there was no covenant for the payment of the principal or interest, that was not material; the same not being necessary for the making of a mortgage, nor yet necessary that the right should be mutual, viz. : for the mortgagee to compel the payment as well as for the mortgagor to compel a redemption; since such conveyance, as in the present case, though without any covenant or bond for the payment of the money, would yet be plainly a mortgage." In Brown v. Dewey (1 Sandf. Ch. E., 56), it was held that "the absence of the personal liability of the grantor to repay the money is not a conclusive test in deciding whether the conveyance is absolute or is intended as a security." In Holmes v. Grant (8 Paige, 243, 257), Denio, V. C, says: "It is not essen- tial that the personal remedy against the mortgagor should be pre- served. There is a debt quoad the redemption, but not in respect to the personal remedy." In Flagg v. Mann (14 Pick., 467), Putnam, J., says: "There was no collateral undertaking on the part of Luther (the grantor) to pay the money whicL Walker and Fisher (grantees) should advance in the five years; so there was no mutuality. And this fact, though not conclusive, is to he taken into consideration in ascertaining whether the transaction was a mortgage, or a sale with a contract for a repurchase upon strict terms. (See also Rice v, Rice, 4 Pick., 349.) In Kerr v. Gilmore 31 (6 Watts, 405), Kennedy, J., says: "The want of a personal security for the repayment of the money has, taken in connection with other circumstances, been regarded as tending to show that a defeasible pairchase and not a mortgage was intended, but this circumstance alone has never been held sufficient to prevent a re- demption." Again, "that the mortgagee should have a remedy against the person of the mortgagor also, in order to make the con- veyance a mortgage, is more than I can assent to." * * * In Horn V. Kciflhts (viipni), Allhv, J., say< tliat the circoimstance that there was no agreement to pay the money secured is one enti- tled to considerable weight in determining whether a conveyance was intended as a mortgage, but that it is only one of the circum- stances to be considered, and , not ■ conclusi^x' : and Ch. J. Mae- shall, in Coiiwaj/'g E.ns. v. Alexander (7 Cranch, 218), says: "The want of a covenant to repay the money is not complete evi- dence that a conditional sale was intended, but is a circumstance of no inconsiderable importance." It is clear, therefore, both upon principle and authority, that the circumstance that O'Keefe was not personally obligated to pay to the defendant the amount of the premiums which he should ad- vance is not absolutely controlling .upon the question, whether there was a mortgage, or a sale and a conditional resale. It is an important circumstance in such cases and, in the conflict of evi- dence, not unfrequently a controlling one. There are many cases, some of which are cited by the learned counsel for the appellant, in which it has been held to be not as matter of law conclusive, but as matter of fact decisive. If we should hold this to be a case of conditional resale, and that the consequence follows which has been • so learnedly argued on behalf of the defendant, that the agreement ' is void under the statute of frauds, the intention of the parties ■ would be defeated. This is, therefore, a case where the court should lean to hold the transaction to constitute a mortgage, thus giving what was clearly intended, the right of redemption. There was nothing said about a re-purchase or a re-sale, or a re- assignment, but the right to redeem was expressly stipulated. The language used shows that the parties intended that the policy should be held as security for the premiums paid. Such a con- struction is at least as admissible as any other, and hence the court did not err -in directing a verdict for the plaintiff. I have treated the transaction as a mortgage, but it is unim- portant to determine whether it was a mortf/rnje or a pledge, as the same course of rea.soning would apply and the same consequences would follow, whether it was one or the other. The judgment must therefore he affirmed. 22 CONWAY V. ALEXANDER. [r Cranch, 218.— 181-.'. J MARSHALL, C'h. J., delivered the opinion of the Court as fol- lows :* ■ This suit was brought by Walter S. Alexander as devisee of Robert Alexander, to redeem certain lands lying in the neighbor- hood of Alexandria, which were conveyed by Robert Alexander, in trust, by deed dated the 30th of March, 1788, and which were after- wards conveyed to William Lyles, and by him to the testator of the plaintiffs in error. The deed of the 20th of March, 1788, is between Robert Alexan- der of the first part, William Lyles of the second part, and Robert T. Hooe, Robert Muire and John Allison of the third part. Robert Alexander^fter reciting that he was seized of one undivided moiety +'' of 400 acres of land, except 40 acres thereof previously sold to Bald- C . win Dade, as tenant in common with Charles Alexander, in con- ^7?^ O sideration of eight hundred pounds paid by William Lyles, and of o*^ the covenants therein mentioned, grants, bargains and_sells twenty '-^: acres, part of the said undivided moiety, to William Lyles, his heirs, and assigns forever, and the residue thereof, except that which had been previously sold to Baldwin Dade, to the said Robert T. Hooe, Robert Muire and John Allison, in trust, to convey the same to William Lvles at any reasonable time after the first day of July, 1790, unless Robert Alexander shall pay to the said William Lyles, on or before that dav, the sum of £700, with interest from the said 26th day of March, 'l788. And if the said Robert Alexander shall pay the said William Lyles on or before that day the said sum of £700 with interest, then to reconvey the same to the said Robert Alexander. Robert Alexander further covenants that, in the event of a reconveyance to him, the said twenty acres sold absolutely shall be laid off adjoining the tract of land on which William Lyles then lived. The trustees covenant to convey to William Lyles, on the non-payment of the said sum of £700 ; and to reconvey to Robert Alexander in the event of payment. Robert Alexander covenants for further assurances as to the 140 acres, and warrants the twenty acres to William Lyles and his heirs. On the 19th day of July, 1790, the trustees, by a deed in which the trust is recited, and that Robert Alexander has failed to pay the said sum of £700, convey the said land in fee to William Lyles. On the 23rd of August, 1790, William Lyles, in consideration of £900, conveyed the said twenty acres of land and 140 acres of land to Eichard Conway, with special warranty against himself and his heirs. On the 9th day of April, in the year 1791, a deed of partial partition was made between Richard Conway and Charles Alexander. This deed shows that Charles Alexander asserted an ♦This statement of facts is omitted. 33 exclusive title in himself to a considerable part of this land. Soon after this deed of partition was executed Eichard Conway entered upon a part of the lands assigned to him, and made on them permanent improvements of great value and at considera- ble expense. In January or February, 1793, Kobert Alexander departed this life, having first made his last will in writing, in which he devises the land sold to Baldwin Dade; but does not mention the lanfi sold to William Lyles. The plaintiff, who was then an infant, and who attained his age of twenty-one years in November, 1803, brought his bill to redeem in 1807. He claims under the residuary clause of Robert Alexander's will. The question to be decided is whether Eobert Alexander, by his i'deed of March, 1788, made a conditional sale of the property con- veyed by that deed to trustees, which sale became absolute by the non-payment of £700, with interest, on the 1st of July, 1790, and by the conveyance of the 19th of that month, or is to be considered as having only mortgaged the property so conveyed. To deny the power of two individuals, capable of acting for them- selves, to make a contract for the purchase and sale of lands de- feasible by the payment of money at a future day, or, in other words, to make a sale with a reservation to the vendor of a right to repurchase the same land at a fixed price and at a specified time, would be to transfer to the Court of Chancery, in a considerable degree, the guardianship of adults as well as of infants. Such con- tracts are certainly not prohibited either by the letter or the policy of the law. But the policy of the law does prohibit the conversion of a real mortgage into a sale. And as lenders of money are less under the pressure of circumstances which control the perfect and free exercise of the judgment than borrowers, the effort is fre- quently made by persons of this description to avail themselves of the advantage of this superiority, in order to obtain inequitable advantages. For this reason the leaning of courts has been against them, and doubtful cases have generally been decided to be mort- gages. But as a conditional sale, if really intended, is valid, the inquiry in every case must be, whether the contract in the specific case is a security for the repayment of money or an actual sale. In this case the form of the deed is not in itself conclusive either way. The want of a covenant to repay the money is not complete evidence that a conditional sale was intended, but is a circum- stance of no inconsiderable importance. If the vendee must be restrained to his principal and interest, that principal and interest ought to be secure. It_is, therefore, a necessary ingredient in a mortgage that the mortgagee should have a remedy against the person of the debtor. If this remedy really exists, its" not being reserved in terms will not affect the case. But it must exist in order to justify a construction which overrules the express words 24 of the instrument. Its existence, in this case, is certainly not to be collected from the deed. There is no acknowledgment of a pre- existing debt, nor any covenant for repayment. An action at law for the recovery of the money certainly ctuld not have been sus- tained; and if, to a bill in chancery praying a sale of the prem- ises, and a decree for so much money as might remain due, Eobert Alexander had answered that this was a sale and not a mortgage, clear proof to the contrary must have been produced to justify a decree agaiast him. That the conveyance is made to trustees is not a circumstance of much weight. It manifests an intention in the drawer of the in- strument to avoid the usual forms of a mortgage, and introduces third persons, who are perfect strangers to the transaction, for no other conceivable purpose than to entitle William Lyles to a con- veyance subsequent to the non-payment of the £700 on the day fixed for its payment, which should be absolute in its form. This intention, however, would have no influence on the case, if the instrument was really a security for money advanced and to be re- paid. It is also a circumstance which, though light, is not to be en- tirely disregarded-, that the twenty acres, which were admitted to be purchased absolutely, were not divided and conveyed separately. It would seem as if the parties considered it as least possible that a division might be useless. Having made these observations on the deed itself the Court will proceed to examine those extrinsic circumstances which are to de- termine whether it is to be construed a sale or a mortgage. Itis^certain that this deed was not given to secure a^pre-eiisling debt. The connection between the parties commenced with this transaction. The proof is also complete that there was no negotia- tion between the parties respecting a loan of money ; no proposition ever made respecting a mortgage. The testimony on this subject is from Mr. Lyles himself and from Mr. Charles Lee. There is some contrariety in their testimony, but they concur in this material point. Mr. Lyles represents Alexander as desirous of selling the whole land absolutely, and himself as wishing to decline an abso- lute purchase of more than twenty acres. Mr. Lee states Lyles as having represented to him that Alexander was unwilling to sell more than twenty acres absolutely, and offered to sell the residue conditionally. There is not, however, a syllable in the cause, inti- mating a proposition to borrow money or to mortgage property. No expression is proved to have ever fallen from Eobert Alexander before or after the transaction respecting a loan or a mortgage. He does not appear to have imagined that money was to be so obtained ; and when it became absolutely nt^eessary to raise money, he seems to have considered the sale of property as his only resource. To this circumstance the Court attaches much importance. Had there 25 iDeen any treaty, any conversation ix'specting a loan or a mortgage, the deed might have been, with more reason, considered as a cover intended to veil a transaction differing in reality from the ap- pearance it assunied. But there was no such conversation. The parties met and treated upon the ground of sale and not of mort- gage. It is not entirely unworthy of notice that William Lyles was not a lender of money, nor a man who was in the habit of placing his funds beyond his reach. This, however, has not been relied upon, hecause the evidence is admitted to be complete that Lyles did not intend to take a mortgage. But it is insisted that he intended to take a security for money, and to avoid the equity of redemption ; an intention which a CoUrt of Chancery will invariably defeat. His not being in the practice of lending money is certainly an argu- ment against hi« intending this transaction as a loan, and the evi- dence in the cause furnishes strong reason for the opinion that Robert Alexander himself did not so understand it. In this view of the case the proposition made to Lyles, being for a sale and not for a mortgage, is entitled to great consideration. There are other circumstances, too, which bear strongly upon this point. The case, in its own nature, furnishes intrinsic evidence of the improbability that the trustees would have conveyed to William Lyles without some communication with Robert Alexander. They certainly ought to have known from himself, and it was easy to procure the information, that the money had not been paid. If he had considered this deed as a mortgage he would naturally have resisted the conveyance, and it is probable that the trustees would have declined making, it. This probability is very much strength- ened by the facts which are stated by Mr. Lee. The declaration made to him by Lyles, after having carried the deed drawn by Mr. Lee to Mr. Hooe, that the trustees were unwilling to execute it until the assent of Alexander could be obtained, and the direc- tions given to apply for that assent, furnish strong reasons for the opinion that this assent was given. It is also a very material circumstance that, after a public sale from Lyles to Conway, and a partition between Conway and Charles Alexander, Conway took possession of the premises, and began those expensive improvements which have added so much to the value of the property. These fac,;s must be presumed to have been known to Robert Alexander. They passed within his view. Yet his most intimate friends never heard him suggest that he re- tained any interest in the land. In this aspect of the case, too, the will of Robert Alexander is far from being unimportant. That he mentions forty acres sold to Baldwin Dade, and does not mention one hundred and forty acres, the residue of the same tract, can be ascribed only ;o t!ie opinion that the residue was no longer his. 26 'PliiSj Ihen^. is a case .in which there was no previous debL, no loanj in contemplation, no stipulation for the repayment of the money advanced, and no proposition for or conversation about a mortgage. It is a case in which one party certainly considered himself as mak- ing a purchase, and the other appears to have considered himself as making a conditional sale. Yet there are circnmstances which nearly balance these, and have induced much doubt and hesitation- in the mind of some of the court. The sale, on the part of Alexander, was not completely voluntary. He was in jail and was much pressed for a sum of money. Though this circumstance does not deprive a man of the right to dispose- of his property, it gives a complexion to his contracts, and must have some influence in a doubtful case. The very fact that the sale was conditional implies an expectation to redeem. A conditional sale made in such a situation at a price bearing no proportion on- the value of the property would bring su^spicion on the whole trans- action. The excessive inadequacy of price would in itself, in the opinion of some of the judges, furnish irresistible proof that a sale could not have been intended. If lands were sold at £5 per acre conditionally, which, in fact, were worth £15, or £20, or £50 per acre, the evidence furnished by this fact, that only a security for money could be intended, would be, in the opinion of three judges, so strong as to overrule all the opposing testimony in the cause. But the testimony on this point is too uncertain and conflicting to prevail against the strong proof of intending a sale and pur- chase, which was stated. The sales made by Mr. Dick and Mr. Hartshome of lots for building, although of land more remote from the town of Alexandria than that sold to Lyles, may be more valua- ble as building lots, and may consequently sell at a much higher price than this ground would have commanded. The relative value- of property in the neighborhood of a town depends on so many other circumstances than mere distance, and is so different at differ- ent times, that these sales cannot be taken as a sure guide. That twenty acres, part of the tract, were sold absolutely for £5 per acre; :that Lyles sold to Conway at a very small advance; that he had jpreviously offered the property to others unsuccessfully ; that it was valued by several persons at a price not much above what he gave; 'that Eobert Alexander, although rich in other property, made no ' effort to relieve this, are facts which render the real value, at the time of sale, too doubtful to make the inadequacy of price a circum- stance of sufficient weight to convert this deed into a mortgage. It is, therefore, the opinion of the Court that the decree of the Circuit Court is erroneous and ought to be reversed, and that the- cause be remanded to that court with directions to dismiss the bilL Decree reversed. 37 The volume of proof taken on the issue thus raised is large, and the evidence is contradictory, as is common in such cases where, ad- mittedly, a loan of some kind was at some time talked about. The conveyance to Davis of the undivided one-third interest of Coyle. being to him, his heirs and assigns forever, with a covenant of war- ranty, and without a defeasance, either in the conveyance or in a collateral paper — the parol evidence that there was a debt, and thaJl the deed was intended to secure it and to operate only as a mort- gage, must be clear, unequivocal and convincing, or the presump- tion that the instrument is what it purports to be must prevail. This well-settled rule of equity jurisprudence was applied by this court in Howland v. Blake, 79 U. S. 634, 626. The case stated in the bill herein is not supported by the weight of evidence. On the contrary, it sustains the allegations of the answer. Especially, the force of the letter of Coyle to Davis, of June 11, 1867, is not broken by any satisfactory explanation. It would serve no useful purpose to discuss the testimony at length. There is but one point to which it is needful to refer. Great stress is laid, in cases of this kind, on inadequacy of consideration where there is a considerable dispro- portion between the price paid and the real value of the property. Russell V. Southard, 12 How., 139, 148. There is testimony on both sides, on the question of disproportion, in this ease. But the pre- ponderance is very large on the part of Davis, that the share of Coyle in the property was sold for about its sale value, in view of its condition. There was a poorly liuilt and poorly arranged build- ing on the premises, which was incapable of actual partition ; the law did not permit a partition by a sale in invitum, and Coyle's in- terest was a minority interest. These considerations made it diffi- cult of sale at all. Per Blatchford, J., in Coyle v. Davis 116 U S 108, 112. stoddaVEd v. wiriTiyn. [46 N. Y. 637.— 1871.] Appeal from judgment of the General Term of the Supreme Court m the fourth judicial district, affirming a judgment in favor of defendant, entered upon the report of a referee. The action is brought by plaintiff, as assignee of Abiel Stod- dard, to redeem certain real estate, alleged to have been conveyed to defendant as security for the repayment of certain advances made and liabilities incurred by him. The facts are sufficiently set forth in the opinion. Grover. J.* From the facts found it appears that in April, 1864 one Abiel Stoddard, entered into a written contract with the 'owner for the purchase of a parcel of land situate in the County of Sara toga, for the sum of $3,500, to be paid in one year, upon payment •Parts only of the opinion are given. 2S of which he was to receive a conveyance of said land from the vendor; that he entered into possession of the land by the consent of the vendor ; that about the time the purchase money became due, being unable to pay it, he entered into a parol contract with the de- fendant, by which he was to advance for him to the vendor $500 and receive a conveyance from the vendor of the land in his own name, and upon receiving such conveyance execute to one Davison a mortgage upon said land for $2,000, together with his bond for the same amount, with the proceeds of which the vendor was to be paid the balance of the purchase money; that it was further agreed that the defendant should hold the title thus acquired as security for the money advanced by him and the liability incurred, and also as security upon another transaction between the parties, and permit Stoddard to redeem the same in one year, or at some time thereafter which was not particularly specified; that this agreement was so far executed that in pursuance thereof the vendor was paid, and a conveyance of the land executed to the defendant ; that Stoddard continued in possession of the land for about two years, receiving the profits thereof, and made improvements thereon to the amount of $300. That at the expiration of that time the de- fendant entered into possession, and has since received the rents and profits, and cut and removed timber therefrom of considerable value. That Stoddard has not paid the defendant the money ad- vanced by him, or any part thereof. That Stoddard, before the commencement of the action, by an instrument in writing by him signed, but not sealed, for a valuable consideration assigned and transferred to the plaintiff all his right, title and interest in and to the premises, whether legal or equitable. From these facts the legal conclusions of the referee were, (1) that the plaintiff was not entitled to redeem; ( 2) that the defendant was the legal owner of said land, freed from any legal or equitable lien or interest of the plaintiff. To which the plaintiff excepted. The question is, whether these conclusions are correct. The agreement of the vendor to sell" and convey the premises made with Abiel Stoddard vested in him the equitable title to the land, and made him his trustee of the legal title, while he became the trustee for the vendor of the purchase money. (Story's Equity, 789, 792, 1212; McKechnie v. Sterling, 48 Barb., 330; Moore v. Burrows, 34 id., 173. This equitable interest in the premises was capable of being mortgaged. Murray v. Walker, 31 N. Y. 399). A deed, absolute upon its face, may be shown by parol to have been intended as a security, and if so so shown will be held to be a mort-- gage. (filarJc v. Henry, 2 Cowen, 327 ; Van Buren v. Olmstead, 5 Paige, 9 ; Hodges v. The Tennessee Fire, etc., Co., 4 Selden, 416 ; Van Duzen v. Worrell, 3 Keyes, 311.) "When the owner of the equit- able title directs his trustee of the legal title to convey such title to a third person as security for a debt of the former to the latter, or 29 as _. security for any other person, it is obvious that the latter hold» title as mortgagee of the former. That he did direct such convey- ance for such a purpose may be shown by parol. This is equally aa clear as that an absolute deed may be so shown to have been in- tended by the parties as a security, and therefore a mortgage. Whether the legal title is held by the party wishing to mortgage the land, and the deed, therefore, given by him, or such title held by a third person as his trustee, who conveys the same at his request,, does not affect the rule in this respect. The counsel for the respondent made an able argument to show that the facts found by the referee were not such as to warrant the court's decreeing specific performance of the contract between the defendant and Abiel Stoddard. But this is not the relief sought by the action. That relief is a redemption by the mortgagor *of the premises from the mortgagee, and the rules governing cases of specific performance have no application. As was said in Case v. Carroll (35 N. Y., 385, by Denio, J.), in equity the relations of the parties witc those of mortgagor and mortgagee and the equity of redemption could not he cut off without a strict foreclosure or foreclosure and sale in a court of equity. The way to dissolve such a relation is well settled, and that is, to call upon the mortgagor to redeem or be foreclosed. It follows, that from the facts found by the referee, the plaintiff was entitled to redeem ; and it appears from the opinion that such was the conclusion of the General Term, but for the obstacles hereafter commented upon. The first ground taken by the General Term was, that there was no seal affixed to the instrument by which Abiel Stoddard attempted to transfer his in- terest in the premises to his brother, and that for this reason it was void. For this, the learr.ed judge relies upon section 137 (1 R. S., 738). But that section includes only grants in fee, or of freehold estates in land. The interest transferred by Abiel Stoddard to the plaintiff was neither of these estates, but simply an equitable right of redemption. Consequently, the statute has no application to this case. The learned judge also refers to section 6 (3 E. S., 134). That section provides, that no estate or interest in lands, other than leases for a term not exceeding one year, etc., shall hereafter be created, granted, assigned, surrendered or declared, unless by act or operation of law, or by a deed or conveyance in writinsr, sub- scribed by the party creating, granting, assigning, surrendering or declaring the same, or by his lawful agents thereunto authorized by writing. The instrument in question was subscribed bv Abiel Stod- dard. We have already seen thnt the interest transferred was not such as to the bring the case within the provisions of section 137 (1 E. S., 738), and that, therefore, a seal was not requisite to the validity of the instrument. It is further said that the instrument executed by Abiel Stoddard was not sufficient to transfer his right of redemption to the plaintiff. 30 The language of that instrument is, so far as applicable to this ques- tion, "all of my right, title and interest whatever to the land," de- scribing it. This is sufficient to embrace an equity of redemption ; and the right to an account of the profits, etc., received by the de- fendant passed therewith as an incident thereto. The remaining ground suggested, but not passed upon in the opinion, was, that the instrument purporting to transfer the interest of Abiel Stoddard to the plaintiff was void, for the reason that at the time of its delivery, the defendant was in possession of the land, claiming adversely to the plaintiff, l^o such fact is found by the referee; but reference is made to the coinplaint. That states, in substance, that the defendant was in possession, and denied the right of Abiel Stoddard to redeem. No authority is referred to, but I apprehend that the learned judge had in view section 147 (E. S., 739). That provides that every grant of lands shall be absolutely void, if, at the time of the delivery thereof, such land'^ shall be in the actual possession of a person claiming under a title adverse to that of the grantor. But it was not a grant of the lands, out of the equity of redemption, that was transferred by the instru- ment. (See Bis.'^t'l v. J\forgan, ,5fi Barb., 369.) It follows, that the judgment entered upon the report of the referee, and that of the General Term, affirming the same, must be reversed. * * * It must be assumed as proved and found, that Daniel D. Carr had negotiated for and had concluded a treaty for the purchase of the premises from Berry, the original o-mier, and for his own benefit; that he was able to and did pay a part of the purchase-money; that some or all of the residue was advanced by the plaintiff for and at the request of Daniel D., who thereby became a debtor to the plain- tiff for the amount thus advanced; and that in pursuance of the agreement made with Daniel D., and in performance of it. Berry conveyed the premises to the plaintiff, thus vesting the legal title in him in consummation of the equitable title wliich Daniel D. had under his agreement ; and that Daniel D. took immediate pos- session of the premises, and occupied them as his own, making subsequent payments upon the loan of the plaintiff, and reducing the debt to a small amount, if not extinguishing it altogether; that Daniel D. remained in possession for some nine years and until his death, about 1867; during all which time his rights as the owner, subject only to the lien of the plaintiff for his advances, were ac- knowledged by the plaintiff, who only claimed as absolute owner, and adverse to Daniel D. after the death of the latter. The property has greatly appreciated in value since the purchase. These facts. which are clearly inferable from the evidence, with the fact found by the jury, mahe the plaintiff a mortgagee. By the transaction a trust was created in the nature of a mortgage for the security of the plaintiff, with right of redemption in Daniel D. Carr. It is 31 well established that a deed, absolute on its face, can be shown by parol or other extrinsic evidence to have been intended as a mort- gage, and that the relation of mortgagor and mortgagee being thus established, all the rights and obligations incident to that rela- tion attach to the parties. (Horn V. KeteUas, 4:6 'N.Y., 605). The fact once established, either by the terms of the conveyance or by other evidence, that' the grant was intended as a mortgage, the rights of the parties are measured by the rules of law applicable to mortgagors and mortgagees ; and the convej-ance remains but a mortgage until the equity of redemption is foreclosed, and the mort- gagee cannot have ejectment against the mortgagor, or those claim- ing under him, until after foreclosure. (Murray v. Walker, 31 N. Y., 399 ; Clini- v. llntnj, 2 'Cow., ;i?4). It is not material that the conveyance sliould be made by the debtor or by him in whotti the equity of redemption will exist. It is sufficient if the debtor and he who claims to occupy the position of mortgagor with the right of redemption, has an interest, legal or equitable, in the premises, and the grantee of the legal title has and acquired such title by the act and assent of the debtor, and as a securitv for his debt. ( Stod- dard V. Whiting, 46 N. Y., 627.) In the case cited the plaintiff sought to redeem the premises from the defendant, who had taken the title, upon paying a balance due upon a contract of purchase held by the assignor of the plaintiff who had entered under the con- tract and paid a part of the purchase money before the arrange- ment with the defendant, who took the conveyance directly from the original vendor. But the principle of the case is decisive of this appeal. That the contract was in writing, and the vendee had made partial payment of the purchase money, and was in possession of the premises, only Jiak^jthe two cases to differ, circumstantially, and affect the degree, r^er than the character of the evidence to establish the relation- sMp of mortgagor and mortgagee. The purchase here was by the borrower of the money from the plaintiff, and his rights as pur- chased were recognized by the seller; the possession of the actual buyer followed immediately 1%)on the purchase, and he paid a part of the purchase money at the time, and became a debtor to the plaintiff for the amount advanced by him. The circumstances are as significant and the equities as palpable as in Stoddard v. Whiting; and it needs no extension of the rule there ad.i'udged to declare the conveyance to the plaintiff to have been intended as a mortgage Per Allen, J., in Oarr v. Carr, 52 N. Y., 357. 83 CHAPTEE II. DEBT. (a.) Is a Legal Obligation Necessary? Lit. sec. 338j and Co. Lit., 209, a., h., p., supra. Floyer v. Lav- ington. 1 Peere Wins. 268. — 1714. Sir Joseph Jekyll, arguendo. As to the objection that here was no covenant for the payment of the principal or interest, he said tliat was not material ; the same not being necessary for the making of a mortgage, nor yet necessary that the right should be mutual, viz., for the mortgagee to compel the payment as well as for the mortgagor to compel a redemption; since such conveyance as in the present case, though without any covenant or bond for the payment of the money, would yet be plainl}- a mortgage.* BUCKLIN" V. BUCKLIN. [1 Abb. App. Oas. 242.— 1864.] Olive E. Bucklin brought this action in the Supreme Court against William and George K. Bucklin, to foreclose a mortgage made by their ancestor, William Bucklin, Sr. William Bucklin, Sr., and his wife, Esther, previous to his execut- ing this mortgage had separated, and she had filed a bill in chancery for a juidicial separation (a mensa et thoro) on the ground of his cruel treatment of her. In the bill she prayed that he might be compelled to maintain her, and that the custody of their infant daughter, Olive E., might be awarded to her. Upon the bill she obtained an injunction restraining him from molesting the child. In order to compromise the controversy and stay the prosecutioii of the suit, the husband, William Bucklin, Sr., agreed to make provision for the support of his wife and the infant, together, and separate from himself, and convey a house and lot to the child with- in six months. To effect this settlement the mortgage in suit was executed to Vedder Green (who appeared as the next friend of the wife in her divorce suit) and was expressed to be made to him in trust for the wife and infant daughter. *See also Howel v. Price, id., 291, and 2. Atk. 496. ; 83 The mortgage, which was set forth in the complaint, recited the above facts, and after providing for the said support of the wife and daughter, and the suspension of proceedings in the suit, without modification or discontinuance, the mortgage contained the follow- ing language: "Now, for the purpose of securing the perform- ance by the said "William, of the aforesaid agreements and cove- nants on his part to be performed, this indenture witnesseth — that the said William Bucklin, in consideration of the premises, and also on consideration of the sum of one dollar, paid to the said Wil- liam by the said Vedder Green, the receipt of which sum is hereby confessed and acknowledged, hath granted, bargained, sold," &c., "and doth grant," &c., to Vedder Green and his heirs and assigns forever (here was inserted the description of the lands; habendum to him, his heirs and assigns, forever), "provided, that if the said William Bucklin shall within the period of six months convey to Olive Esther Bucklin real estate of the value of one thousand dol- lars, to consist of a dwelling," &c., and if he shall permit Esther to occupy the same without molestation, and if he shall pay to Esther Bucklin three hundred dollars annually during their joint lives, and shall permit the said Esther Bucklin to have the custody, man- agement, &c., of said Olive Esther Bucklin, without any interfer- ence on his part (and if he should also perform certain other. con- ditions relating to personal property), then this indenture shall be void. And it is hereby declared that this mortgage is given to Vedder Green in trust for the benefit of Esther Bucklin and her infant daughter, Olive Esther Bucklin. And in case the above con- ditions on the part of said William, or any of them, shall be broken, and it shall at any time hereafter be necessary to enforce this mort- gage, the amount that shall be recovered on said mortgage shall be recovered for the benefit of the said Esther and her infant daughter or the survivor of them. The complaint then averred that Bucklin, Sr., wholly failed to convey land and dwelling, &c., as he agreed (though payment of the annuity was admitted), and demanded judgment for the fore- closure of the mortgage for the sum of one thousand dollars, the value of the land and dwelling promised to be conveyed, and inter- est, &c. When the mortgage was made, in 1836, the child (the present plaintiff) was about three yciirs of age. The trustee, Vedder Green, died in 1841, the husband and wife died in 1843 and 1844. In 1857, the daughter, coming of age, procured an order of court ap- pointing her to enforce the trust and bring an action in her own name. The defendants were heirs of the mortgagor in possession. The judge before whom the ca.use was tried sustained the mort- gage ; found that the husband and wife never afterward cohabited, though for a short time they resided in the same house, and he 34 gave judgment for plaintiff with interest from ^he date of the mortgage. The Supreme Courtj at General Term, affirmed this judgment, holding that this was an action on a sealed instrument, and, if tht cause of action had accrued after the Code of Procedure went into efiect, it would have been governed by section 90 of the Code, but that as it had accmed before that time, it was governed by 2 E. S., c. 8, tit. 3, art. 1, Sec. 9, which enacts that the time which shali have elapsed between the death of any person, and the granting of letters testamentary or of administration on his estate, shall not bt deemed any part of the time limited by any law, for the commence- ment of actions by executors or administrators. That had the trust descended to the personal representatives of the trustee, this cause of action would have been saved from the operation of the statute ; and that the cestui que trust should not be prejudiced by having the trust fall on the court of chancery, as it did on the death of Green, but that an analogous rule should be appplied, and the whole term of twenty-one years allowed in which to bring the action, which would prevent it from being barred. From that judgment the defendants appealed to this court. By the Court. — Denio, Ch. J. — The mortgage, so far as it is now sought to be enforced, was created, among other objects, to se- cure the plaintiff, then an infant of tender age, a portion of her father's property, to aid in her maintenance during her infancy, and to furnish her with a small independent estate in real prop- erty. The differences which had arisen between her parents pre- sented the occasion for this gift; but its validity did not depend upon the merits of that controversy, nor yet upon the legal effect of the agreement for a separation between her father and mother, nor upon the legality of the provisions made by the former for the latter. The contract, so far as it relates to that provision, has either been performed or it is now incapable of performance. The party entitled to its benefits has been long dead, and it does not appear that she left any representative capable of enforcing any of its stipulations which ^rere not performed at her death. Moreover, this suit was not brought to recover such an interest. But the plain- tiff survives, and is entitled to the settlement attempted to be made in her favor, provided it was legally valid when made, and pro- vided her rights have not been lost by lapse of time. Where the rights of creditors do not stand in the way, and there appear not to have been any in this case, it is perfectly lawful for a parent to make such provision out of his estate for a child or chil- dren, by present, gift or by testament, as he may think proper. There are cases in which a voluntary executory gift will not be en- forced by the courts ; but an executed one is as valid as though based a full pecuniary consideration. 35 mor A mortgage is an executed conditional transfer of the real estate „ortgage. In judgment of law, any conveyance which would be sufficient to pass the title to a purchaser conveys it to the mort- gagee. The instrument executed by William Bucklin, to Vedder Green would be a perfect deed of bargain and sale but for the condi- tion by which it was to become void upon performance of the agree- ment. It expresses a pecuniary consideration which, though nomi- nal, is as adequate to waive a use as though it were the full value of the laad, and though it may not have been paid, the defendant is estopped by his deed from denying its payment. By the Kevised Statutes it is denominated a grant; but for all substantial purposes it has the efEect of a deed of bargain and sale. 1 E. S., 738, 739, Sections 137, 138, 142. At common law, and before the Jurisdiction of courts of equity to relieve against forfeitures had been established this deed would have vested in the trustee an estate in fee simple defeasible only by the performance of the conditions. This is, of course, a technical view of the nature of a mortgage. By applying to the transaction the equitable doctrines of the courts of equity, now also recognized to a great extent by the courts of law and by modem statutes, the mortgage is simply a security for the payment of the money it was given to secure, and the mortgagor continues to own the land, while the mortgagee's interest is that of a creditor only. But the defendants' position is formal also. They insist that courts of equity will not decree the performance of a voluntary executory agreement even where the subject is a portion intended for a child or other relative, and authorities are referred to sustain that position. Duvoll v. WilsoUj 9 Barh., 487, and cases cited; but see Sauverhye v. Arden, 1 Johns., Ch. 240, 266, and cases referred to by Chancellor Kent. If the settlement be an executed one, like a deed or mortgage, the doctrine relied on has no application. The title of the mortgaged premises is transferred by legal conveyance. The mortgagor retains an equity of redemption, equivalent, for many purposes, to a general ownership of the land, but yet, in point of form, an equity. The mortgagor may, it is true, come into a court of equity to enforce his mortgage, as the mortgagee must in order to redeem. The reason why a mortgagee must resort to equity is not because the mortgage is an executory transaction, and requires the aid of a court of chancery to compel a specific performance. On non-performance of the conditions the mortgage is forfeited at law, but the equity of redemption remains in the mortgagor or his representatives. ITo prospective language of the parties which can be written is strong enough to produce the forfeiture of that equity, ■which can only be extinguished l)y n decree, or an equivalent pro- ceeding, under a positive statute. This rule is expressed bv the phrase, "once a mortgage always a mortgage." The mortgagee cannot rlestrny this equity except by a suit in chancery or a statute foreclosure. Formerly, he could bring ejectment to get possession of the estate, after forfeiture at law, but that is now forbidden by statute. Still if he can be got into possession without a breach of the peace, his title under the mortgage deed is strong enough in law to enable him to defend an ejectment brought by the mortgagee. Mic- Icles V. Dillugv, 17 ^V. 1'., 80; J/tcA-Zes v. Townsend, 18 Id., 575. The plaintiff brings her suit in equity, not for the purpose of being aided in establishing her mortgage under the notion of being remedying a defective conveyance,or obtaining a specific performance,but to fore- close and extinguish the defendants' equity of redemption, which a court of law is not competent to deal with. She does not come to establish a voluntary equitable agreement, but to enforce a legal title under an executed conveyance, and to cut off an equity attached to that legal title and vested in the defendants. A point is made that the mortgage is invalid because made to Green as a trustee, he confessedly having no beneficial interest, and because the purposes of the trust are not such as are contem- plated by the fifty-fifth section of the chapter of the Eevised Stat- utes relating to uses and trusts. Xow, although for the purpose of showing that a mortgage is an executed conveyance, and not a mere executory agreement, I have recurred to the legal nature of that instrument as a conveyance of the land mortgaged, I am not pre- pared to concede that it should be regarded as "a disposition of the land h\' deed" within the meanins; of the article of the Eevised Statutes respecting uses and trusts. 1 E. S., 727. The modern idea of a mortgage is a pledge of the land to secure the payment of money. The statute relates to interests in lands, properly so called, and not to collateral pledges made for the purpose of securing in- terests in personalty. Debts secured by mortgage are declared to be personal assets and go to the personal representatives. 2 E. S., 82, Sec. 6, subd. 8. A trust of personalty is not within the statutes of uses and trusts, and may be created for any purpose not forbidden bv law. This mortgage is not, therefore, at all within the influence of the fifty-fifth section, or within the one which abolishes uses and trusts. But if it were otherwise, and if the interest in the land conveyed bv a mortgagor to a mortgagee were regarded as within the purview of that section, the only effect in this instance would be to anni- hilate the title and strike out the name of Green, the trustee, and to invest the beneficiaries with the title nominally conferred on Green. This effect is produced by section 49 of said article, which declares that if a disposition of land be made to one or more persons, to the use of or in trust for another, no estate or interest, legal or equitable, shall vest in the trustee; and section 47, which confers upon the beneficiary in such cases an estate of the same nualitv as his beneficial interest. Aa:ain, a trust may, bv section 55, al'-o be createrl to sell lands foi- +h° nurnose of satisfying anv charge there- on. This does not require a pre-existing cliarge. One created at tlae same time and by the same instrument which contains the con- veyance would be sufficient to bring tlie disposition within the terms and spirit of the section, and would embrace the case of a mort- I think, therefore, that the instrument contained a valid mortgage of the land described in it, and that it was an available security for the performance of the contract to purchase and convey lands to the value of one thousand dollars to and for the benefit of the plain- tiff. * BAIRD V. BAIED. [145 A'. Y. 659— IS. .'5.] Appeals from judgment of the General Term of the Supreme Court in the Fifth Judicial Department, entered upon orders made October 8, 1894, which affirmed judgments in favor of defendants entered upon decisons of the special county judge of Monroe county on trial at Special Term, dismissing the complaint in each action. The following is the opinion : •I'rior to the year 1873, John Baird, the plaintiff's husband ana lestator, was the owner of the farm which is covered by the two mortgages sought to be foreclosed in these actions. In that year, his two sons, William and James, defendants, went into possession of it, and the father directed the assessors to transfer the assessment on the farm to his sons. They have remained in possession ever since. In October, 1874, the father deeded the farm to the sons, who took title under these deeds as tenants in common. It ap- peared that the father had two other farms, all of which had been paid for and improved with the aid of the labor and services of his sons, vi>: had worked for him after their majority. On a settlement between the father and the two sons, it was agreed that he was indebted to them in the sum of $5,000, and that was the considera- tion for the conveyance. A deed was given to each son conveying an undivided half of the farm in consideration of $2,500. The evi- dence tended to show, and the trial court has foiind, that the inten- tion was to vest the title in the sons in fee; but it appears that the father had some fears that his sons would not be able to take care of the property thus conveyed and that it might be lost in specu-- lation or otherwise. In order to prevent such a result, as he said, he required the sons to give back to him mortgages for $1,500 each on the farm. No bond was given and no actual debt was intended to be secured, and they were not recorded by the father in his life- time. With respect to the purpose and consideration of these mort- gages the testimonv tended to show, and the trial court found, that *See also MnHheim v. Sh'ehan. dO N V. S8J, 591, a. c. naee 19 mwni •Compare Kinn v. Or-'m, 6 Allen. 139 (a caae of ni.edae to aecnrp kn illoooi ,^o™„„.^^ .„a Maggs t. Ame,. 4 Bin?. 470 (a case of guarantee of tb? obl?gat°on of a married wom"n"^' '"'' 38 they were not intended to secure any debt or to be or become a valid subsisting security, or to be recorded or enforced, and were, in fact; . without any consideration whatever. In the year 1875 the wife of Jolm Eaird and mother of tlie defendants, died, and the year following he married the plaintiff. He died in 1883, leaving a will, in which the plaintifl: was named as executrix. In that capacity she brought actions against each of the sons to foreclose the mort- .gages given by them respectively. The complaint was dismissed in each case and the judgments were affirmed at General Term. There are two appeals and two records,but both judgments rest on precisely the same facts, and the questions involved in both appeals are iden- tical. Both cases, may, therefore, be conveniently considered and disposed of as one. "The plaintiff's right to enforce the mortgage is the same and Jio other than the mortgagee, her husband and testator, had in his lifetime. She stands in place of her husband and cannot enforce the instrument unless he could, and every defense that the de- fendants could urge against the mortgage during the life of the father, they may interpose now against his personal representative. The instruments purport to have been given to secure the payment of money, but it was shown at the trial affirmatively, and found by, the trial court, that no debt in fact existed in favor of the father -against either of the sons ; that there was no intention to give the I mortgage on the one hand, or to hold it on the other, as security for I / any debt. That, in fact, there was no legal or equitable considera-M tion moving between the parites and no intention on either side! I "to treat the instruments as binding obligations or as valid or sub-|/ sisting securities. The evidence upon which these findings were/) made, if competent, was sufficient, and the fact is not open to que// tion or review here. "The findings are based upon the business relations which the parties occupied to each other before the father gave up the pos- session of the farm to the sons and then conveyed it to them, taking 'back the mortgages in question, and upon his subsequent conduct and declarations as to the character of the instruments and the purpose of their execution and delivery. The general principle that an instrument under seal, in the form of a mortgage upon real estate, which upon its face expresses a consideration and purports to have been given as security for a debt may, nevertheless, as between ihe parties, be shown to have been purely voluntary or without any consideration, and so invalid, is not denied. (Davis v. Bechstein, 60 K Y., 440; Hill v. Hoole, 116 id., 299; Brigffs v. Langford, 107 id., 680; Thomas on Mort., Sec. 847; Jones on Mort., See. 1397.) "The plaintiff was not entitled to maintain the actions for the foreclosure of the mortgages unless it was found that there was some debt due to her for the payment of which they were the security. The findings are that no debt ever existed, and this is conclusive 39 against the plaintiff's right of action. In an action to enforce a mortgage by sale of the land the amount, if anything, of the lien is an issue wliich the parties certainly have the right to contest. It is the debt which gives the mortgage vitality as a charge upon the land, and generally where there is no debt or obligation there is no subsisting mortgage. The instruments contain a considera- tion clause and a seal, and much of what has been said by courts and writers to the effect that a party cannot be permitted to defeat his own deed by parol proof is based upon the importance which was attached to the presence of these conditions in an instrument by the common law. The conception that some consideration was necessary to support every promise and covenant was borrowed from the civil law, but the consideration was formerly deemed to be conclusively established by the presence of the consideration clause or the seal. It was originally supposed that the recitals and clauses of a contract expressing a consideration could not be varied by parol proof to the contrary, but that rule was gradually abandoned, and now that clause is open to parol proof. (McCrea v. Purmot, 16 Wend., 460; Hebbard v. Haughian, 70 N. Y., 54; Ham v. Van Orden, 84 id., 369.) So,, also, the conclusive presumption pf a consideration which formerly arose from the presence of a seal was modified by statute, and it is now open to the maker of such an in- strument to allege and prove the absence of any consideration in fact as defense. (3 R. S., (5th ,ed.,) 691, sec. 77, 78; Code, sec. 840). There are, it is true, expressions to be found in some eases to the effect that while the question of consideration is open to be varied by parol proof, yet the party cannot be permitted to claim that a deed or other instrument with a consideration clause or a seal, oi both, is wholly without consideration, and thus entirely defeat it. If this idea is anything more than a somewhat shadowy and fan- ciful remnant of the ancient law, it is not easy to define its precise scope on practical application when applied to an executory instru- ment like a mortgage. To say that in a case like this it is open to the defendant to reduce by parol proof the sum expressed as the consideration to one dollar or any other nominal sum, but that he cannot go any farther, would be to confess that the distinction, if it exists, is altogether without substance. The instrument woulfl be defeated in either case. It is quite certain that by recent adjudi- cations deeds and other instruments have been defeated, in a great variety of cases, by parol proof of want of consideration, or that they were delivered upon conditions which would render their use for any other object a fraud upon the maker, or that the purpose for which delivery was made was different from that indicated upon their face. It will be sufficient to refer to some of the cases without further comment. (Eevnolds v. Eohinson, 110 IT. T., 654; Ble^witt V. BooniTn. 142 id.. .157 ; Andrews v. Brewster. 124 id.. 433 ) So 40 also, actions to foreclose mortgages have been defeated upon allega- tions and proof differing in no substantial respect from tliat appear- ing in this case. "It is not quite correct to say that the defendant was permitted to show by parol that these instruments were never to have any operation or effect. They were, in fact, executed and delivered for a purpose, though not to secure the payment of money, and they may have accomplished the very object contemplated. That was to protect the defendants against their own improvidence in con- tracting debts upon the faith of their title to the farm. Whether that purpose was lawful or- practicable or possible or the contrary is quite foreign to the inquiry. It is enough to know that such was the motive and consideration in the minds of all the paxties which induced the execution and delivery, and no other. Having procured them in. that way, it would be unconscionable now for the mortgagee or his personal representative 'to use or enforce them as obligations for the payment of money. "We think there was no error in the result and that the judg- ments should be affirmed with costs." O'Brien, J., reads for affirmance. Bartlett, J., concurs; Peckham and Gray, JJ., concur in the re- sult ; Andrews, Ch. J., dissents ; Haight, J., not sitting. Judgments affirmed. N. Y. Real Phop. Act. § 314. Covenants in Mortgages. A mortgage of real property does not imply a covenant for the payment of the sum intended to be secured ; and where such cove- nant is not expressed in the mortgage, or a bond or other separate instrument to secure such payment has not been given, the remedies of the mortgagee are confined to the property mentioned in the mortgage. SHAW v. CARPENTEE. [54 Vt. 155—1881.] [Petition to Foreclose a Mortgage.] Eoyce, Ch. J. — This cause was heard upon the report of a special master appointed to ascertain and report the amount due on the mortgage described in the petition. It appears from the report that on the 24th day of July, 1872, one Benj. D. Peterson, who was then engaged in the business of bottling eider, soda and mineral waters, at the City of Burlington, sold the good-will of the business and all his stock — tools, bottles, machinery and fixtures — then in use by him in said business, as specified in certain inventories, which were signed by the said Peterson, to the defendant, Carpenter. Upon said inventories the various articles sold were separately carried out with a separate price for each item. The footings of the separate pages were brought forward upon the last page, where the aggregate correctly appeared of the sum $3,221.81. To this 41 aiuouiit an item of $116 was added, which was included in the note first due. It is not found what the consideration for that item was. The good-will of the business was included in the sale and was not estimated in the inventory. It is probable that it may have been estuualed by the parties at that time. For the amount so ascertained the defendant. Carpenter, executed four promissory notes payable to said Peterson or order, and secured the same by the mortgage sought to be foreclosed. Said notes have all been paid but the last, which was for $S00, and that fell due on the 34th of July, ISTti. The interest on that note was paid to the 24th of July, 18?6. On the 28th day of October, 1ST2, and before the maturity of any of said notes, Peterson sold them and the mortgage for an adequate consideration to the petitioner, the petitioner, then be- lieving the notes to be based on a valid and legal consideration and not suspecting that any illegal element entered into the con- sideration. Of the property sold by Peterson to Carpenter, and which formed apart of the consideration of said notes, the master has found there ■were the following goods, in kind and amount : Lager beer, $23.94; Cider, $422; Ale, $209.38; Porter, $6.72; Alcohol, $2.35. The defendant Carpenter claims that if any part of the considera- tion for the notes was illegal, they are void ; that no recovery could he had upon them, and that a court of equity cannot grant any relief io the petitioner. The first inquiry is, was the sale of any of the articles above •enumerated prohibited by law ? It is found that the lager beer was not an intoxicating drink, and its sale was not then prohibited, the act foi-bidding its sale having been passed in 1878. The sale of the cider was not illegal, unless the place where it was sold was a place of public resort. The sale of the ale, porter and alcohol being- illegal, the considera- tion for the notes, as far as the value of tho=G articles went to make up the amount for which the notes were given, was an illegal con- sideration. The important question in the case is, as to the effect that such partial illegality of consideration is to have upon the rights of the parties. Eobinson v. Bland, administratrix of Sir John Bland, 3 Burr., 1077, has always been regarded as a leading case, and opin- ions were given in it by Lord Mansfield and Justices Denison and Wilmot. The declaration contained three counts : The first, upon a bill of exchange ; the second, for money lent and advanced ; and the third, for money had and received. A verdict was had for the -plaintiff for £672, the amount of the bill of exchange. It was found that the consideration for the bill of exchange was £300, lent by the plaintiff to Sir John Bland at the time and place of play, and £373 -were lost at the same time and place by Sir John Bland to the plain- 43 tiff at play. It was held that the £372, part of the consideration for the bill, being for money lost at play, could not be recovered, all such securities being void under the statute, and that a part of the con- sideration for the bill being illegal, no recovery could be had under the first count; that the plaintiff was entitled to the £300 lent, and was allowed to recover it, under the count for money lent and ad- vanced. Judge Denison says there is a distinction between the contract and security. If part of the contract arises upon a good considera- tion, and part of it upon a bad one, it is divisible. But it is other- wise as to the security. That, being entire, is bad for the whole. Judge Wilmot : "As to contracts being good and the security void, the contracts may certainly be good, though the security be void."" The same principle as to such a security being void was enunci- ated in Scott V. Gilmore, 3 Taunt., 226. See also, Yundt v. Koberts, 5 Serg., and Eawle, 139; Phillips v. Cockayne, 3 Campbell, 119; Edgell V. Stanford, 6 Vt., 551. These two first eases have oftenest •been quoted as authority for the rule that has generally prevailed in the English and American courts, that where a part of the con- sideration for a security is illegal the whole security is void. The notes which were given for the good-will and property sold to Carpenter were all infected with illegality, and the defense of illegality attached to all of them ; so that if what is now claimed as a defense can be allowed, if proceedings had been instituted to com- pel payment before anything had been paid, the entire claim could have been defeated, notwithstanding Carpenter had received and was in the enjoyment of the property, upon the ground that the portion of the property above enumerated was illegally sold. It has somewhere been said that the declaring such a security void was to be regarded as a punishment of the party for having made an illegal contract. The loss of property illegally sold would generally be considered a sufficient punishment, certainly, when the sale was only malum prohibitum, and no wrongful intention appears. But a court of equity could never hold that one might be deprived of his entire fortune, because, in the consideration agreed to be paid for it, there was intermingled some article the sale of whichwas prohibited. We regard the case of Carlton v. Woods, supra, as sound law and well sustained by authority. Its application works out just and equitable results, and we shall apply the principles there enunciated in the decision of this case. Peterson could have Tccnyerpd asjflinst Carpenter in an action of assumpsit, for all that was sold to him, except the ale, porter and alcohol. The mortgage would be treated as security for the debt due from Carpenter, on account of the property legallv sold to him. Peterson might have foreclosed the mortgage, and thus have com- pelled payment of the debt. 4^ Tlie petitioner, by his purchase of the notes and mortgage, ac- quired aii the rights, legal and equitable, of Peterson. He coiuld maintain a suit at law for his own benefit, in the name of Peterson, or a partition in equity, as assignee of the mortgage, to foreclose it. And in the disposition of such a petition it is the duty of a court of equity, which has been said to be the great sanctuary of plain dealing and honesty, to compel the payment of that portion of the debt that was secured by it, that was legally and fairly contracted. Dissenting opinion was delivered by Eoss, J. I am unable to concur in the decision of the court in this ease. A part of the consideration of the note being illegal, the note is void and no action can be maintained thereon to enforce its collec- tion. To the cases cited by the court, in the main opinion, may be added Cobb v. Cowdery et. al., 40 Vt. 25 : Bowen v. Buck, 28 Vt. 308. In Cobb v. Cowdery, supra, the distinction is taken between a consideration in part \o\A, in part illegal. The note failing, what is ^ there left for the mortgage to stand upon ? The mortgage is but an ' incident to the debt it secures. On the authorities cited by the court in support of its decision, as well as all the reasoning, partial illegal- ity of consideration avoids all securities. The note was a security, or evidence of the debt, of a higher nature than the original contract. The latter was merged in the note. The note in suit, and all the notes secured by the mortgage, were tainted by illegal consideration entering into them. Each note being an entire contract of itself, no division of the legal from the illegal part of the consideration could be effected. Courts established for the enforcement of law, will not give aid or countenance to anything illegal : nor, where the illegal is commingled with the legal, will they aid in separating or purging the former from the latter. Their proper function is to es- tablish and enforce the legal and to condemn and punish the illegal. Where a part, however small, of the consideration of an entire con- tract is illegal, the whole contract is tainted, and courts will not compel its performance. Collins v. Blanton, 2 Wils. 341, is a lead- ing case on this subject, in which the Lord Chief Justice Wilmot uses the quaint but forcible and often quoted language : "You shall not stipulate for iniquity ; all writers upon our law agree in this, no polluted hand shall touch the pure fountains of justice; whoever is a party to an unlawful contract, if he hath once paid the money stipu- lated to be paid in pursuance thereof, he shall not have the help of a court to fetch it back again ; you shall not have a right of action when you come into a court of justice in this unclean manner to recover it back. Procul! procul este profani." The mortgage is an entire contract. Its consideration was the notes, the payment of which was therein secured ; every one of which was tainted with an illegal consideration in part. It was not given to secure the performance by Carpenter of his contract with Peterson, of July 34, 1872, by which he purcha^sed his business and stock in trade, 44 but was given solely to secure the payment of the notes which were executed "in payment of that purchase. If the action were upon the notes, it is conceded that no recovery could be had; because every one o fthem is tainted with illegal considera- tion. The illegal could not be separated from the legal portion of the consideration, and an enforcement of the collection of the notes would be the enforeenient of an illegal contr'ict. How does it differ when the mortgage, which is but an incident to the notes, is allowed to be foreclosed? Is it not an enforcement of an illegal contract? To foreclose the mortgage for the legal part of the consideration must not the illegal portion be ascertained and rejected, which the majority hold could not be done, if the action were upon the notes ? What is the foreclosure but an action upon the notes described in its condition? And to ascertain the legal part of the consider&,tion of the mortgage must not the notes be treated as divisible? I can see no other means of separating the legal from the illegal part of its consideration. It may well be admitted that a mortgage, given to secure the pay- ment of several notes, or debts, a part of which arose out of wholly- legal transactions, and a part of which were tainted with illegality, could be enforced to compel the payment of the former alone. In such a case the orator would not have to show in evidence, nor rely upon anything illegal, in maintaining his suit. In the language of Gibbs, Ch. J., in Simpson v. Bloss, 7 Taunt. 246, in speaking of Faikney v. Eeynous, 4 Burr. 2069, and Petrie v. Hannay, 3 Term. Eep. 418 : "The ground of their decision was, that the plain- tiffs required no aid from the illegal transaction to establish their ease." This, as I understand, is the test most frequently applied in this class of cases. If the plaintifE can show a good cause of action, independent of and without bringing into the case anything illegal, either by way of proof or otherwise, he may maintain his action therefor. If, on the other hand, he derives any aid from the illegal part of the transaction, by being obliged to show it to make out the legal part, or otherwise, he must fail. The court will not allow the unclean thing withiii the temple of justice. In the foreclosure of his mortgage the orator was bound to show in proof his notee, every one of which was tainted with illegality; and for that reason the notes all fall, and the mortgage given to secure them alone, falls with them. This point my brethren have not deemed worthy of their attention, nor alluded to. But if I am in error on this point, I cannot concur with my associates in holding that the original contract is divisible. The contract is to be construed as a whole. Thus construed, it is an entire, indivisible contract. It was a sale of a business, as a going concern, including the good will, stock in trade, machinery and fixtures. It is not to be inferred, or intended, that Peterson would have sold the good will of the business, without selling the 45 stock in trade, machinery and fixtures, nor that Carpenter would have purchased the latter without the former. It was not the sale of the good will as one separate transaction, of each bottle, barrel,, and fixture as another separate transaction, and so divisible. But one consideration is named or paid; and but one thing is sold — the business, including the stock, &e., and good will as a going concern. As said by Devens, J., in Young & Conant Mfg. Co. v. Wakefield, 121 Mass. 91 : "If but one consideration is paid for all the articles sold, so that it is not possible to determine the amount of considera- tion paid for each, the contract is entire. Carleton v. Woods, 28 jST. H. 290, comes nearer to supporting the decision of the majority of the court, but, in my judgment, is dis- tinguishable from the ease at bar. It is there distinctly held that if the contract is entire, and part of the consideration is illegal, the contract is void ; but that where an entire stock of goods is sold, at one and the same time, but each article for a separate and dis- tinct and agreed value, the contract is not to be regarded as entire and indivisible. The sale was for cost and freight, and Woods, J., says : "We are unable to see how this case differs from the case of a sale by a merchant of various goods to his customers, at one and the same time, for separate values, stated at the time, which, when computed, would, of course, amount to a certain sum in the aggre- gate." It was on this theory that the court held that, although the notes could not be maintained, because a part of the consideration was for spirituous liquors illegally sold, yet, on the general counts in assumpsit, for goods sold and delivered, the plaintiff might re- cover for the goods sold, as the court held, independently of, and as transactions separate from, the purchase of the liquors. To say the least, this was pressing the doctrine of divisibility of a contract to the extreme verge, and I am unwilling to go further. There may have been more in the case than appears in the report, justifying the holding of the court. On the facts stated, I think the authority is clearly against that contract being divisible. That case, however, lacks the element of being the sale of a going busi- ness, including the good will, and does not appear to have been reduced to writing. In my judgment, the decree of the Court of Chancery should be reversed, and the cause rerhanded, with a man- date to enter a decree dismissing the bill with costs. (5.) Obligations dehors the mortgage. COLEMAN V. WINCH. [1 Pcere Wms. T^o.— 1881.] A. seised in fee of lands makes a mortgage- to B. for ilOO, and afterwards borrows £100 more of B. upon bond, and dies : the heir- at-law conveys the inheritance and equity of redemption of the premises to trustees, in trust for payment of all the bond and sim- ple contract debts of his father equally: after which the trustees bring their bill to redeem B., who insists on being paid his debt by bond, as well as that by mortgage: and for the mortgagee it was objected : 46 First, That as he had the estate at law absolutely, and the trustees could not come at it without the interposition of equity, it seemed not agreeable to reason, that he should be hindered by this court from receiving what was due to him by bond as well as by mort- gage, the former being as just a debt, and as much due in conscience as the latter. Secondly, That if the heir had brought a bill to redeem the mort- gage, it was plain he must have paid as well the bond debt as that by mortgage ; and if the heir must have paid it, why should any one claiming under him be in a better condition than he him- self? Lord Chancellor: The bond of the ancestor, wherein the heir isi bound, becomes upon the ancestor's death the heir's own debt, fori which he is suable in the debit and detinet; and therefore if he J comes to redeem the mortgage made by his ancestor, he must payj the debt by bond, as well as that by mortgage; but though this be] the debt of the heir, it cannot be said to be due from the heir'si assignee, the bond being no lien upon the land : which appears most! plainly, in that it was no lien on the land even against the *mort- gagor himself, who happened to be indebted to the same person by^ mortgage and by bond. Suppose one be indebted to A. by mort- gage for a term for years, and also indebted to him by bond: if on the death of the mortgagor, his executor brings a bill to redeem the mortgage, he must pay both; but if the executor assigns over the equity of redemption of the mortgaged term, and the assignee of the executor brings a bill to redeem', he shall only pay the mort- gage money. So if the testator being possessed of a term mortgages it to A., and becomes also indebted to A. by simple contract and dies, his executor bringing a bill to redeem, shall pay both the mort- gage and the debt by simple contract, becafuse the very equity of redemption is assets to pay simple-contract debts ; but if any credi- tor of the testator brings a bill to redeem this mortgage, he shall pay only the mortgage. Lord Chancellor farther said, that the law of England, in suits against heirs, imitated the civil law ; where an heir sued by a bond creditor is sued as for his own debt in the debit and detinet, and is prima facie supposed to have assets, but that the heir might dis- charge himself by saying, that at the time of the writ brought he had no assets, or, if he has assets descended, may show those assets, o'f which the plaintiff may, if he pleases, take judgment; and that in case the heir had aliened before action brought, though at law there was no remedy against him, yet in equity he was responsible for the value of the land aliened ; but now the heir is made liable at law for the value of the assets he has aliened. * Quaere tamen: for in the case of Baxter versus Manning, 1 Vern. 244, it was decreed by Lord Keeper North that where the mortgagree lent more money to the mortgagor on bond, the mortgagor should not redeem without paying the bond debt as well as the mortgage; and yet, in the case of ChalUs V Oasborn Precedents in Chw.nf'ery 407. it was laid down by the cniin- sel for a rule, and agreed to by Lord Cowper, that the mortgagor himself is in such case to be let into a redemption upon payment of the mortgage money only; though possibly there may be some difference, as to the rule of the court, between a mortgagor's coming to redeem and a mortgagee bringing his bill to should be foreclose. 47 ? EX PARTE HOOPEE. (1 Merivale, 7.— 1815.) Assignment, by the Bankrupts, of Leasehold Premises, by way of Mortgage, for securing the sum of £400 and interest. The bankrupts subsequently becoming indebted to the Mortgagee in further sums received by them for his use, an account was stated and settled between the parties, on which a balance of £400 was ascertained, and the following memorandum delivered : "Hewett and Hopkins, debtors, to Mr. P. Ford, £400 on balance of account due the 12th day of June, 1813." The bankrupts farther entered into a parol engagement that the last mentioned £400 should be tacked to the original mortgage ; and that, as soon as a new lease of the premises could be obtained, a mortgage security for the same should be executed by the bankrupts; bat which, owing to th renewal not having been obtained, was never done. Interest was paid on both sums to the 12th of June, 1814; and on the 8th of December following the commission issued. The petition prayed a sale of the mortgaged premises, and that, after applying £800 in liquidation of the debt, the residue might be proved; with the usual directions. ,The single point before the court was, whether or not the peti- tioners were entitled to tack on the second £400 debt to their mort- gage security. The petition came on to be heard before the long vacation, when the Chancellor, having expressed himself adverse to the prayer, it was requested that it might stand over, and was this day re-argued. The Lord Ohancellok : There is an evident distinction between the cases of loan and purchase; and without expressing any opinion on the questioQ, whether, in the former case, payment of the whole, or of part of the purchase money, is, or is not, a part performance to take it out of the statute, it is enough to say that the advance of money upon a contract for loan afEords, of necessity, no evidence of any intentian brut that of creating the relation of debtor and creditor. The doctrine of equitable mortgage by deposite of title-deeds has been too long established to be now disputed; but it may be said that it ought never to have been established. I am still more dissatis- fied with the principle upon which I have acted of extending the original doctrine so as to make the deposite a security for subse- quent advances. At all events, that doctrine is not to be further en- larged. In the present case, the legal estate has been assigned byl way of mortgage. The mortgagee is not entitled to say, "I holdl this conveyance as a deposite;" because the contract under which] he holds it is a contract for conveyance only, and not for deposite. The subsequent memorandum in writing creates nothing more than /, a debt by simple contract, and cannot be added to by parol. // The cases on this subject have gone too far already ; and I would be understood as saying that I will not add to their authority, wherever the circumstances are such as to warrant me in making a distinction. The- petition dismissed with liberty to file a hill. 48 Lee v. Stone, 5 Gill. & J. 1.21. The opinion of Dorsey, J., is in part as follows, viz. : "It has been further contended that the appellants are to be first paid, as well the balance due them from Key, as that which appears on the auditor's account; Booth, as the security, being answerable for the defalcations of the guardian ; that the appellants being seised of the legal estate in the land sold, their legal title could not be taken from them until they were paid, not only the remaining balance of the purchase-money upon whatever account due from Booth to them, and this pretension is rested upon the familiar prin- ciples of equity, "that he who seeks eq-uity, must do equity; and that a multiplication or circuity of action should be avoided." But these principles have never been carried to the extent, that would be necessary to their affording relief to a party in the predica- ment of the present appellants. They stand here in the character of_c omp l ainants seeking to enf orce their jjen, for a balanc e of thq purchase^inow5yjJl2__a_sakjDfJ;Ji^^ their lien at- t aches; a nd require this Cou rtjicitj)nly_ to enforce_ their lien, but to ta ck JtTo ano ther debt, apart fr om which their a pplication is en- titled to no priority over other cr editors ; and this to the exclusion of another~ereditor before the Court/whose debt is secured by a lien on the premises. If there be any case to warrant this requisition, it has not been presented to our notice in the argument, and has certainly escaped our researches upon the subject. ! ^t is true, tha t i f a mortgagor goes into chancery to redeem, upon the axioms of equity above mentioned, he will not be permitted to do so but upon pa yment, no t^nly of the mortgage debt, but of all other debts due from himjo^herniortgagee.^ In this there is no prejudice to the rights of others; nobody has a right to complain; no' injustice is done to anybody B ut it is also true, that if the mortgagee seek a foreclosure in ch ancery, the mor t gagor will be p erm itted to redeem, u pon pay- ment of themort g^^ debt only, no matter to what amount, on other accounts, he in ay stand _ind ebted 'tl3~ the mortgagee. And"~it is^u^ly^cIeaJThat if T^bsequent mortgagee, or judgment creditor, file a bill to redeem, he will be permitted to do so upon the payment of the mortgage debt alone. Whilst these well-settled principles of equity remain unshaken, upon no system of analogy or consistency can the claim of the appellants be gratified. JThfiii; do ctrine is, in effect, simply this, th^Jn al],cases_Fhere_thejale of t'ETreal estate of a deceased^debtorJs^deCTeed, the d^bts_due_to^the heirTailawTtoVhom^su^h^tate hasjieseended^T>etheIr nSurewhat ffi^ylni^Tmust firsTbe^gaid, evenjo^^ exclusion of judgment crcciitors. ^Tolueh'a length the doctrine of tacking has never yet heiiTcarried.* •In Scripture v. Johnson, 3 Conn., 211 n819), it ie 6aid : ," There is no doubt as to the right of the Plaintiff (mortgagor) to redeem the whole of the premises mortgaged; but as he who will hLp eomtv must do IqGity, it must be on condition not only of paying the sum charged upon thJland butthe debt collaterally due to the mortgagee." Da"row7. Kelly,,! Dallas, 142 (l.?85), is contra. 49 STODDARD v. HAET. [23 N. Y., 556.— 1861.] Appeal from Supreme Court. The action was to restrain the foreclosure by advertisement, and to compel the cancellation of a mortgage held by the appellant against one Spicer. The trial was before a referee, who found these facts : On the 4th of March, 1852, « Spicer procured from the defendant, on the security of the bond 5 and mortgage in question, an advance of $200 on lumber to be there- 1 after furnished. The mortgage was recorded on the 8th of March, ' 1852. The original condition of the bond and mortgage was for the payment of $200 and interest on the 15th of June, 1852. At the time the $200 was advanced, it was agreed by the parties ( that if Spicer should want more money, the defendant would ad- I vance it, and for the purpose of securing it, the amount of such ) further advance should be ^inserted in the bond, with the parol J agreement that the mortgage should be considered as security for what was thus inserted. Accordingly, within ten days after the mortgage was given, Spicer j applied for and obtained from the defendant a further advance of 1 $180, inserting at the same time in the bond a further condition 1 for the payment of that amount, with interest, on the Ist of June, ^ 1852. The mortgage, which had been in the meantime recorded, was | conditioned for the payment of $300 and interest, with the addi- j tional clause : "According to the condition of a certain bond obliga- tory bearing even date herewith." On the 12th of July following, Spicer was indebted to the re- spondent, Stoddard, in the sum of $500, for rent due and to become due, and with full and specific information from Spicer of all the foregoing facts, Stoddard took a subsequeiit mortgage on the prem- ises fo rthe amount of his debt; and afterwards, in January, 1853,1 he obtained from Spicer a deed of the property, which was received' in satisfaction of his mortgage. On the 25th of February, 1863, the defendant commenced ^l foreclosure by advertisement, claiming the amount due to be ^380, | with interest. The plaintiff, on the 1st of March, tendered as the. amount due, the sum of $200, kith interest and costs, and de-. manded a satisfaction piece, which the defendant refused. The referee decided that the defendant had no lien on the prem-.. ( ises except for the $200 and interest, and that the mortgage should ' be cancelled on payment of that amount, with costs. The judgment entered upon the referee's report was affirmed? on appeal at general term in the Eighth Distiret, and the defendant appealed to this court. John K. Porter, for the appellant. E. Peshine Smith, for the respondent. CoMSTOCK, Ch. j. In a loose and general sense the equity of this case is on the side of the defendant, because he made the subse- quent advance" of $180, it being agreed that this, as well as th^. 50 ongmaUuni of $<;U0, shonid hv considered as secured by the mort- gage. The question, however, is, whether the rules of law will give that effect to tlie transaction. It will be convenient first to determine the legal constraction and effect of the mortgage, unaided by the parol facts, but read in connection with the bond to which it is collateral. On the part of the defendant it is contended tha the two instruments, constituting, as they do, a single security, are to be read as one; and, therefore, tha,t the new advance, being written in the condition of the bond, is it to be deemed actually incorporated in the condition of the mortgage also, so as to render the latter a legal security for both the sums in question. This proposition does not require, nor does it admit, any aid froin the understanding of the parties derived from the intrinsic evidence. If it be a sound one, it is universally sound ; so that, if a bond be given for $2,000 actually loaned, and a mortgage collateral thereto be given for $1,000, the latter is always to be read and construed as a security for the larger sum. The instrument being legally perfect, there is no occasion to reform it, or to involve the doctrine of equitable lien, of specific per- formance, or any kindred doctrine of equity . I think this proposition, cannot be maintained. A bond and mortg-a,P-e are two instT-nm ents. although one may be collateral t o the^ther. The_o]iej8_iL_personaJ_oWigaJdra the debtjjhe other creates a Ikn iipon^land foFlSes jc^^ -SS§t, and_itjnay welTliFtorXjiortioi^^ whole? If the per- sonal obligation expresses tw{7iums71md the collateral instrument expresses only one of them, I see no reason why each should not be construed according to its own terms. So, if the condition of a bond be for a larger, and that of the mortgage be for a smaller sum, the obvious effect of both the instruments is that the maker binds himself generally for the whole debt, while he specifically pledges the mortgaged land for only a given part of it. I n this case the written co ndition of the bond is _to pay the $200, andjthe_further sum of $T8ir]^whilelJhat_of thejnortgagejs only to pay the $200. Ea ch instrume nt is^ perTect,_and eaelLadmits of a^jplaiiLeoiistaictiaii and'ett'ec t acco rding _to its own langua ge. If w e_ do notjookjmt- si^e ot tiiem, there is no ^mb^mty^_^A_debt was created, consisting oFtwo sums. The land wasjnortgaged^jfor one qrffiosjj_smns_only. In the next place, if the doctrine were admitted that a mortgage passes the freehold or legal estate in lands, it would probably fol- low that a parol agreement that the security should stand for a new •advance would be good against the mortgagor or any one claiming under him not having the rights of iona fide purchasers. The title being conveved by the instrument, the equities of the parties might be adjusted or modified by any new agreement without a writing. But it is entirely settled with us that such is not the nature of effect of a mortgage. With us a mortgage is not a lien or security only, and not in any sense a title. (Kortright v. Cady, 21 iST. Y., 343, and cases cited.) This ground of sustaining the defendant's lien for the additional advance, therefore, cannot be maintained. The defendant has no title to the land in question ; 51 and we have already seen that he has no legal mortgage for a greater sum than $200. At the commencement of this suit the defendant was proceeding to foreclose his mortgage, by advertising to sell the premises under the power of sale contained in the instrument; and he claimed in his notice both the sums of money in question. The plaintiff, be- fore instituting the suit, tendered the sum of $200 secured by the mortgage, according to its terms, with the interest, and the costs which had accrued. Prom what has been said, it follows tliat this tender extinguished the lien and power of sale, and that a sale afterwards made under the power would be a nullity. (Koi't right e. Cady, supra.) Of course, we now speak of the lien as a legal one, expressed in the mortgage, and having no other existence. It is claimed, however, that the defendant acquired some equi- table lien or right to charge the new advance upon the land, and that, although such a lien or right cannot be enforced in the manner attempted, because there is no legal power of sale to enforce it, yet, as the plaintiff asks the interference of a court of equity, he must do all that equity requires as the condition of relief ; in other words, he must offer to pay the whole debt in specie to the plaintiff. The argument may be sound if the defendant did acquire any such equitable title or right; and this is the next subject of inquiry. In England is has long been held that a desposit of title deeds by a debtor with his creditor is evidence of a valid agreement id give a mortgage, which agreement is enforced by treating the transac- tion as an equitable mortgage. It has always been admitted by English jurists tha this doctrine contravenes the statute of frauds, although it has become well settled in the jurisprudence of that country. (4 Kent. Com., 151.) It is confined there to the pre- cise case of a deposit of title deeds. A mere parol agreement to make a mortgage, or to deposit deeds, does not create an equitable lien. In this State the doctrine is almost unknown, because we have no practice of creating liens in this manner. Equity, however, here as well as there, does sometimes specifically enforce parol agreements which are within the statute of frauds; and I see no reason to doubt that such an agreement to make a mortgage may be enforced when money or value has been parted with on the faith of it, and the circumstances are such as to render it inequita.ble to refuse the relief. But, in the present case, the precise difficulty is in the absence of any such agreement. The defendant had loaned $200, and held a mortgage for that amount. He then advanced another sum ; but there was no agreement to make another mort- gage, or to change, in any respect, tbe terms of the one already made. The additional sum was inserted in the bond, with an un- derstanding thereby that the mortgage should be "considered "" as a security for that sum also. The instrument, as it waiS made, wa.s a plain security for $200; and no chanoe in its terms was contem- plated. Nor is there the least pretence th*t any writing was to be executed creating a special security for the new advance. Now, a ■^U of mnnpyj with a. m ere understanding that the land oi^S boD-ower is a security for the debt, does not create a mortgage, legal or equitabl e. If it be specifically agreed to execute a legal mort- gage, a. vyiy different question arises. The deposit of title deeds is evidence of such an agreement. But here there was no agreement to do ajiything which was not actually done. Consequently, if enough was not done to create a mortgage, then none was created. There is no room for the doctrine of specific performance, because there is nothing unperformed. The parties may have misunderstood the effect of what they did ; but nothing in the transaction was left unfinished of which equity can now decree the complete execution. The question, then, is upon the legal interpretation and effect of the acts done, which, as we, have seen, failed to create a lien. The understanding and belief of the parties do not change the law. _ For analogous reasons I do not see that the defendant can de- rive any aid from the doctrine of reforming contracts in equity. If a writing does not truly express the agreement of the parties; if anything was omitted which was agreed to be inserted ; or if any- thing be inserted contrary to their intention, equity will relieve against the mistake by reforming the contract. But in this case no mistake is alleged or proved. Everything agreed upon was done. The subsequent advance of money was to be inserted in the con- dition of the bond, and it was inserted accordingly. There was no agreement to make a new mortgage ,or to change the terms of the existing. It is said the understanding of the parties was that the mortgage should secure this advance also ; but if is not pretended that this understanding was to be expressed in any form of writing. If A. should loan money to B., and take a bond with the under- standing that the farm of the latter should be considered a security, but with no intention or agreement to make a mortgage or writing of an}' sort, as the law requires, in order to create a lien, none would be created at law or in equity. The transaction, in judgment of law, would amount simply to a loan upon the bond of the borrower. Such, I think, in substance, was the transaction in question.' There was no. mistake, unless it be in misunderstanding the legal effect of what was said and done. But even this is not alleged. It is not stated or proved that the parties belicA'cd or understood that 'the insertion of the new loan in the bond had the effect in law of enlarg- ing the mortgage also. Will a court of equity, then, make a new contract for parties in order to effectuate a mere understanding where no agreement is pretended different from the one which the writing already ex- presses, and where there are no circumstances of surprise, imposi- tion, fraud or misplaced confidence? To do so, I think, would be taking a step in advance of the settled rule on the subject, especially if the relief sought be in direct opposition to the statute of frauds. In the case of Hunt vs. Eousmaniere's Executors (1 Peters, 1), the general intention of the parties was to effect a security upon a ship at sea equivalent to a mortgage or bill of sale. With that design, a power of attorney to sell was executed, which, as they understood and were advised, accomplished the object in view. As a power merely, the instrument was revoked by the death of the party who assigned it, and a bill was filed to reform the writing so that it 58 might stand as a security according to the intention. It was ad- judged, in the Supreme Court of tlie United States, upon the fullest consideration, that the bill could not be maintained — the ground of decision being that the court could not make an agreement of a different tenor and ellect from the one which the parties themselves had intentionallj' entered into. The case before us seems to me still weaker in its circumstanees, because not only was there no agreement for a better security than the defendant actually, re- ceived, but it does not e\'en appear that he acted under any mistake as to the legal effect of the transaction. The new advance of money was inserted in the bond; but there is no pretence of a belief that this in any respect affected the mortgage. There, was a parol agree- ment that the mortgage should be considered as a security also for the sum thus inserted. The other party might give effect to this agreement in any suit or proceeding against him to foreclose, if he voluntarily chose to do k>. But it is not alleged that, under a mis- take even of the law, this agri'ement was supposed to be of any bind- ing force or effect. On the ^hole, I am of opinion that the defend- ant's lien, whether viewed at law or equity,- was only for the original sum of $300, and, consequently, that the judgment of the court below is right. Davies and Mason, Js.. dissented; Hoyt, J., did not sit in the ease.' Judgment affirmed. (c. ) Future Indcbtcdiii'xx. YOUNGS V. WILSOX. [27 N. Y., 351.— 1863.] Appeal from the Supreme Court. Action to foreclose a mort- gage. The complaint set forth a bond, executed by Moses W. East- man to George Y'oungs and Abel Hunt, bearing date June 4, 1849, in the penal sum of two thousand four hundred dollars, with a con- dition similar to that of the mortgage next mentioned. It also set forth a mortgage, bearing the same date and between the same parties, by which Eastman conveyed to Youngs and Hunt certain lands in Yates county, which were particularly described, which conveyance was made subject to the following condition, viz. : "That if the said Moses W. Eastman shall well and truly pay, and save harmless, and indemnify the said George Youngs and Abel Hunt, and each of them, of and from all liabilities which they, or either of them, may have at any time heretofore contracted to and for the said Moses W. Eastman, either as surety, indorsers or guar- antors, or otherwise, whether now due or yet to grow due, and shall save harmless, the said George Youngs and Abel Hunt, and each of them, of and from all damages, costs and charges on account of the same," then the conveyance was to cease ; but in case "default should be made in the payment of all or any part of the said lia- bilities, as the same should become due," the lands were to be sold and the amount due, with costs and charges, to be deducted from the proceeds, and the surijUis, if any, paid to the mortgagor. 54 The coinplainl also stated, that the iii<)i-i>;a^ne was duly recorded in the clerk's olticf ot Yates county, on the day of its date; that Youngs had paid deijts of Eastman, on which he was liable as surety or indovser, at the tinu- wheji the mortgage was executed, which amounted to $754-. (jl (of which a particular accoujit was given); and that the estate of Hunt remained liable on a note given by Eastman to one Owens, on the 24th day of December, 184(5, for $263, on which said Hunt was indorser, wdiich, with interest, still remained unpaid; that the mortgaged premises had been conveyed to the defendant, James Miles, who, with the other defendants, claimed some interest in the premises, which interest had accrued subsequent to the lien of the mortgage. There was the usual prayer for a foreclosure, and a sale of the mortgaged premises, and payment of the plaintiffs' demands and costs out of the proceeds. The usual judgment of foreclosure for the sale of the mortgaged premises, and the payment, out of the proceeds of the sale, of the costs and expenses, and the amounts found due to the several plain- tiffs, was entered at a special term ; from which judgment Lewis 0. Wilson, only, appealed to the Supreme Court at general term. On the hearing of that appeal, the judgment at the special term was reversed, and tlie complaint disiuissed, as against the appellant, with costs, on the ground that the mortgage was fraudulent and void, as against creditors of the mortgagor, for uncertainty in re- spect to the debt or debts it was intended to secure. From that judgment the plaintiffs brought the present appeal. After the bringing of such appeal both the appellants died, and the personal representatives of the appellant Youngs were substituted in his place. There had been no substitution as to the executors of Abel Hunt, and it was assumed, on the argument, that as to them the appeal was at an end. Selden^ J. I cannot concur with the court below in the opinion that the mortgage in question was void as against creditors or pur- chasers. There is no pretence, and could be none, that it was not valid between the parties to it. It described the debts which it was intended to secure, with such certainty that there could be no dif- ficulty in determining what debts were, and what were not, em- braced in the description. In such cases, the maxim, that that is certain w^hich may be made certain, applies. It is not requisite that the condition shotild be so completely certain as to preclude the necessity of extraneous inquiry. (Monell v. Smith, 5 Cow,, 441; Eobinson, v. Williams, 23 'N. Y., 380 ; Stoughton v. Pasco, 5 Conn., 442 ; Merrills v. Swift, 18 id.', 257 ; United States v. Hooe, 3 Cranch., 73; Kramer v. The Farmers and Mechanics' Bank, 15 Ohio, 253.) The mortgage having been duly recorded, if not fraudulent in fact, was as effectual against subsequent cerditors and purchasers as it was against the mortgagor. If it was sufficiently certain to be valid against the party who made it, it was equally certain and valid against all persons claiming under him. If valid between the parties it was a mortgage, and, as it was duly recorded, it was not within the provision of the statute which declares void, as against 55 subsequent purchasers, unrecorded conveyances. The only statute bearing at all upon the question is the following : "Every conveyance of real estate within this State, hereafter made, shall be recorded in the office of the clerk of the county where- such real estate shall be situated; and every such conveyance not so recorded shall be void, as against any subsequent purchaser in good faith and for a valuable consideration of the same real estate,. or any portion thereof, whose conveyance shall be first recorded." I can discover nothing in this statute to justify the distinction be- tween certainty against the party and certainty as against subse- quent creditors or purchasers, which forms the basis of the judgment of the court below. If the instrument was certain enough to amount to a conveyance, it was a recorded conveyance, and valid as such. A purchaser, with notice of any outstanding equity aginst his vendor, takes the place of such vendor, and acquires his rights only (Frost V. Beekman, 1 Johns., Ch. 301 ; 3 Sugden on A'endors and Purchasers, 440) ; and notice of circumstances sufficient to put a party upon inquiry, has the same effect as actual notice of the facts which could be learned on reasonable inquiry. (3 Sugden, 468 Dunham v. Day, 15 Johns., 569; Peters v. G-oodrich, 3 Conn., 150; Williamson v. Brown, 15 N. Y., 359.) The registry of the mort- gage was equivalent to actual notice of its existence and contents, and the purchaser, with such notice, is bound by all the equities which the holder of the mortgage had against the mortgagor, whose place he talres. (Stoughton v. Pasco, 5 Conn., 442, 447.) The condition of the purchaser in the present case is precisely the same as it would have been at common law, if he had purchased with ac- tual notice of the prior mortgage. In that case it cannot be doubted that he would have taken subject to the mortgage, if it was valid against the mortgagor. The rule adopted in Connecticut, in Hart v. Chalker (14 Conn., 77), on which the court below placed much reliance, is, that "where a mortgage is given to secure an ascertained debt, the amount of the debt ought to be stated." I am not disposed to question the wisdom of this rule, although it would sometimes be inconvenient and do injustice, and its propriety is not free from doubt (see 5 Conn., 449). But I cannot deduce it irom our statute, which merelv pro- vides that conveyances not recorded shall be void against purchasers. The mortgage of Eastman was valid between the parties ; it was a conveyance, and it was recorded, and therefore was not made void by the statute. It is only with reference to the question of an actual intention to defraud creditors, that the indefinite description of the debts in- tended to be secured by the mortgage could be material. What in- fluence such indefiniteness might have in that respect, we are not called upon to determine. There is no allegation in the answer which could raise that question, and if there had been, we could not notice it ,in the absence of any finding by the court belnw upon the question of fact. (Grant v. Morse, 33 N. Y., 324.) I am, therefore, of the opinion that the court below erred in declaring the mortgage void, as against Wilson. Rfi Upon the other questions presented by the case, so far as they related to the rights of George Youngs (and to that extent only are they now before the court), I entertain no doubt that they were correctly decided by the Special Term. The judgment of the Gen- eral Term should, therefore, be reversed, ajid that of the Special Term affirmed, as to the relief granted by that judgment to George Y oungs. There are no appellants here representing the estate of Abel Hunt, and the judgment dismissing the complaint, as against the execu- tors of that estate, will not be affected by the judgment of this court. The propriety of bringing on the argument of the appeal, without the presence of parties representing that estate, is very questionable,, but, as neither of the parties before the court interposed any objec- tion on that account, the defect in the proceedings, if it be one, has not been regarded. Marvin, J. The judgment of the Special Term, in favor of the plaintiffs, was reversed by the General Term, upon the sole ground that the mortgage was fradulent and void, as to subsequent creditors, on the ground of vagueness and uncertainty in respect to the debts it was intended to secure. ^ It is conceded that a mortgage given to secure future contingent liabilities may be valid, but the position is that in case the debt exists or the liability has been incurred at the time the mortgage is executed, it must be truly stated, so as to enable creditors, upon examining the record of the mortgage, to ascertain the amount of the debt or the nature and character of the liability assumed. The validity of the mortgage is not questioned upon the ground that there was, in fact, no valid consideration between the parties to it. In my opinion, the court erred in reversing the judgment. There was a good and sufficient consideration for the mortgage. The consideration expressed was $2,400 money ; but this was not the true consideration. It has long and often been held in this State that the real consideration of mortgages or deeds may be shown by parol, though different from that expressed in the instrument; and this court, in j\fcKinster v. F.Jibcock (26 IST. Y., 378), applied the rule to a chattel mortgage, in which the consideration expressed was money, when, in truth, the real consideration was the indorse- ment of the note of the mortgagor, and the mortgage was giynn by way of security. This court sustained the mortgage, the referee having found as a fact that it was executed in good faith, and not with intent to hinder, delay or defraud creditors. So, in this case, the parol evidence upon the trial showed what the consideration ac- tually wa.«, and it was siifRcient, viz., liabilities assumed by the mort- gagee for the mortgagor, and the amount which had been naid of such liahilities. It mav be said in this case, as was said in the case just referred to, and also in Shiras v. Craig (7 Tranch., 34), by Chief Justice Marshall, in which the real transaction did not ap- pear on the face of the mortg-age, that such cases are liable to sus- picion; that thev must sustain a rigorous examination, and that it is always advisable fairly and T'lainly to state the truth. And in this case I will say that it would have been far better to have speci- 57 fied the liabilities assumed, sn that the creditors of the mortgagor or others interested would be able more readilj' to examine into the facts, and ascertain whether they wei'e true or fictitious. But, if the consideration is actually valid and sufficient, and it is found as a fact, upon sufficient evidence, that the instrument was not executed with intent to hinder, delay or defraud creditors, the court cannot declare the instrument void, as to creditors, upon the ground that the consideration, as expressed, is vague and uncertain. (See Eob- inson v. Williams, 22 N. Y.. 380, in which many of tlie cases are referred to.) The judgment of the General Term should be reversed, and that of the Special Term affirmed. Denio, Ch. J., Davies, Wright, Selden, Emott and Balcora, J. J., concurring. Judgment accordingly. AcKEHMAN V. HuxsioKBR, 85 N. Y., 47, (1881). Action to foreclose a mortgage. Certain of the defendants, who were judg- ment creditors of the mortgagor, answered, claiming that their judgments were liens superior to the mortgage, as to a portion of the amount claimed by plaintifE to be secured thereby. The mort- gage was given to plaintiff to secure him for any indorsements he had made or should thereafter make for the mortgagor to the amount of $6,000. Some of tbe indorsements were made subsequent to the judgments referred to. In the opinion (per Andrews, J.,) it is said : "There is no question as to the validity of mortgages to secure future advances or liabilities. They have become a recognized form of security. Their frequent use has grown out of the necessities of trade, and their convenience in the transactions of business. They enable parties to provide for continuoiis dealings the nature or ex- tent of which may not be known or anticipated at the time, and they avoid the expense and inconvenience of executing a new secur- ity on each new transaction. It is well known that such mortgages are constantly taken by banks and Ijankers as security for final bal- ances, and banking facihties are extended and daily credits given in reliance upon them. Mortgages for future advances have some- times been regarded with jealousy, but their validity is now fully recognized and established. Bank of ITtica v. Finch, 3 Barb., Ch. 294; Truscott v. King, 6 N. Y., 147 ; Robinson v. Williams, 22 id., 380 ; Shirras v. Caig, 7 Cranch, 34 ; Lawrence v. Tucker, 23 How., (U. S.) 14; Leeds v. Cameron, 3 Sumn., 492." TAFT V. STODDAED. [142 Mass., 545.— 1886.] BILL IN EQUITY, filed October 18, 1884, by the administrator of the estate of Whitman Holbrook, to fedeem a certain parcel of land in Upton from a mortgage given by Ezekiel B. Stoddard to William Dickinson, and assigned to the defendant. 58 Hearing, in the Superior Court, before Aljlrich, J., who, after a final decree for the plaintiff, reported the case for the determination of this court, in substance as follows : On February 28, 3870, Ezekiel B. Stoddard conveyed in mort- gage, by a deed duly recorded, certain land in Upton to William Dickinson, the condition of the mortgage being as follows: "Pro- vided, nevertheless, that if the said Ezekiel B. Stoddard, his heirs, executors, administrators, or assigns, the sum of ten thousand dol- lars on demand, with interest semi-annually at the rate of nine per ceoit., and secure and save him harmless for all indorsements, lia- bilities, expenses, and services, on my account or for my benefit and reqtuest, together with such sums, if any, as said Dickinson, his executors, administrators, or assigns, or either of them, shall pay for the insurance of said buildings, with lawful interest for the same semi-annually, then this deed, as also a certain note bearing even date with these presents, given by, said Ezekiel B. Stoddard, to the said "William Dickinson, to pay the same sum, with interest, at the time aforsesaid, shall be void." The, note secured by this mortgage was for $10,000, payable on demand, with interest semi-annually at the rate of nine per cent, per annum, and was witnessed. On March 6, 1878, Ezekiel B. Stoddard conveyed in mortgage, by^ a deed duly recorded to Whitman Holbrook, a portion of the prem- ises described in the deed to Dickinson. The deed contained a cove- nant that the premises were free from all incumbrances except the- mortgage to William Dickinson. , On July 16, 1880, WilHam Dickinson, in consideration of one- dollar, assigned his mortgage, "the real estate thereby conveyed, and the note and claim secured thereby," to the defendant by an assignment absolute in form. Ezekiel B. Stoddard, a relative of the defendant, having been,; of supposed liability, as a condition of his assigning said mortgage to the plaintiff. The final decree, dated July 24, 1886, stated that the defendant was entitled to hold the first mortgage as security for the payment to him for his services as trustee and attorney, and for his advances for and in behalf of Ezekiel B. Stoddard, amounting in all, com- puted as before stated, to the sum of $3,568.37; and that, on pay- ment by the plaintiff, within ninety days, of this sum, with interest from the date of the decree, the defendant should assign said first mortgage and note to the plaintifl. MOKTON-.C. J. : This is a bill in equity, brought by the adminis- 1 trator of the estate of a second mortgage to redeem land from a first mortgage. The first mortgage was originally given by Ezekiel i B. Stoddard to one Dickinson, and was afterwards assigned to the ^ defendant. It was, in form, a mortgage to secure the payment of a note for $10,000. It was proved by oral testimony, at the hear- ing, that it was, in fact, given for the benefit of the defendant, to secure him for advances which he had made, and which he might hereafter make, for the benefit of the mortgagor in the settlement of his affairs, and for the services rendered by the defendant in such 59 settlement. Dickinson held tlie mortgage, until he assigned it, m trust fur the defendant. Breen v. Seward, 11 Gray, 118. Wei cannot see that the rights and equities of the parties in this suit are I / ■different from what they would have been if the mortgage had been/' ■originally made directly to the defendant. It has been repeatedly held by this court, that, on a bill to redeem by a mortgagor, it is competent for the mortgagee to sliow by oral testimony what was the real debt or obligation which the mortgage was given to secure, and e\'en to show that, after it was given, the parties agreed that it should be lield as security for a new and dif- ferent debt. In such cases, a court of equity will not aid a mort- gagor, or permit him to redeem, until he does equity, and pays the debt intended to be secured l)y tlie mortgage, according to the agree- ment and real equities between the parties. Joslyn v. Wyman, 5 Allen, 62: Stone v. Lane, 10 Allen, 74; Cpton v. South Reading Bank, 120 Mass., 1.t3. The same principle is applied when a bill to redeem is brought by one who has taken a conveyance from the mortgagor with a knowledge of the facts. Joslyn v. Wyman, ubi supra; Stone v. Lane, uhi supra. In the case at bar, the plaintiff has no higher equity than that ) •of the mortgagor. The second mortgage is expressly made subject to the first, and, A\hen Whitman Holbrook, the plaintiff's intestate, \' took his mortgage, he was informed of the origin, character and ^ purposes of the first mortgage. He took it with a knowledge of the facts. His administrator stands in no better position than the mortgagor; and, in this suit, the defendant is entitled to hold his mortgage as security for the payment of his services and advances, as found by the presiding justice of the Superior Court. As the defendant never made any demands for the sums claimed for his services, we see no error in the ruling of the Superior Coiirt, that he is not entitled to interest thereon. The Superior Court has found that the defendant has fully exe- cuted the trust assumed by him under the indenture of 1867, and that he is not now under any liabilitv to any of the creditors of E. B. Stoddard & Company under said indenture. It follows that the defendant cannot hold his mortgage as security for an alleged liability which does not exist. The rulings of the Superior Court were correct. Decree affirmed. VOGAN V. CAMINETTI. [65 Cal, 438.— 1884.] Appeal from a judgment of the Superior Court of the County of Amador, and from an order refusing a new trial. This was a suit for the foreclosure of a mortgage to secure the j payment of a promissory note of four hundred dollars. The de-l fendant, administrator of the estate of Shipman, the mortgagor,' admitted the execution of the note and mortgage, but averred that the mortgage was given to secure advances that had been or should 60 thereafter be made by the mortgagee, to provide Shipman with food, care and attention during a sickness from which he was then suffering, and to pay his funeral expenses in tlie event of his death. It was also averred that the amoiint expended b}' the mortgagee for the purposes mentioned, was less than the face of the mortgage. Ths-ee^aLgav^ jiulgmentjorihejmn^ two hundred and thirty-five do21urs--ajid_sixty-nine cents. The CouRrTTTteTibject of the transaction between the deceased Vogan and the deceased Shipman being to indemnify Vogan for the ' liabilities he had incurred and might incur on Shipman's account, | the amount of the mortgage and note served only to limit the ex- tent of the security. Upon the foreclosure of that mortgage, the amount for which judgment was rendered was, properly, the amount the mortgagee had paid under the liability for which he was se-/ -cured, with interest from the day of payment. (Jones on Mort., Vol. 1, Sec. 384). Judgment and order affirmed. 61 CHAPTER III. CONVEYANCE. {a)Mortgage, Pledge and Lien. EATCLIFF V. DAVIES. [Cro. Jac, 244.— 1610.] Action of Trover and Conversion of an hatband set with pearls and diamonds ; upon not guilty pleaded, a special verdict was founds that the plaintiff was possessed thereof, and pawned it to John Whitlock for £25, but no certain time appointed for the redemption thereof; that Whitlock being sick, his wife in presence, and with his assent, delivered it to the defendant, and afterwards he made his said wife his executrix, and died, who proved the will; that the- plaintiff tendered to the said executrix the said £25, who refused,, and afterwards demanded the hatband of the defendant, who re- fused to deliver it; but converted it to his own use : whereupon, &c. And in this case three points vi'ere moved : first, there being no time appointed for the redemption; whether it may be made after the death of him to whom it was pawned, or ought to be in the lives of both the parties and all the justices resolved, it may be well made after the death of him to whom it was pledged, but not after the death of him who pledged it. Yelverton and Croke doubted, and held, that it could not ; for he at his peril ought to redeem it in his time, as it is upon a mortgage; but Fleming and the others against it : for pledging doth not make an absolute property, but it is a delivery only until he pays, &c., so it is a debt unto the one, and a retainer of the thing unto the other : for which there may be a re- demand at any time upon the payment of the money. For the pledge delivered is but as security for his money lent, so as he wha borrows the money is to have again his pledge when he repays it, and his tender givas him interest therein; and there is difference between mortgage of land and pledging of goods ; for the mortgagee hath an absolute interest in the land, but the other hath but a spe- cial property in the goods, to detain them for his security. 5 Hen. r, 1, 9 Ed. 4, 25. 36 Ed. 3 Bar. 188. Secondly, it was resolved, that 7. 1. 9 Ed. 4. 25. 36 Ed. 3 Bar. 188. Secondly, it was resolved, by this delivery of the said goods by the feme, with the assent of her haron, to the defendant, there passed no interest of them to the defendant, but (as it were) a custody only: and therefore the 62 tender of the redemption ought to be made to the executrix, and not to the defendant. Thirdly, that when he tendered the money to the executrix, and she refused, it was as good as payment; and the espe- cial property of the goods is revested in the plaintiff : then, when he demanded them of the defendant and he refused to deliver them, but converted them to his own use, a Trover and Conversion well lies, although he came unto them by a lawful delivery, and not by Trover : wherefore it was adjudged for the plaintiff. FEANKLIN v. NEATB. [13ilf. and W. 481.— 1844.] The judgment of the court was delivered on the 10th of Decem- ber by Eolfe, B. — This was an action of trover for a chronometer. It appeared on. the trial that the chronometer in question had been pawned by the owner with the defendant, and at the time of the pawn, the owner delivered to the defendant a written paper, au- thorizing him to sell if the chronometer was not redeemed within a year. The owner afterwards sold it to the plaintiff, subject to the defendant's right as pawnee. The plaintiff, then, after the year had expired, tendered to the defendant the amount due on the pawn, but the defendant denied the plaintiff's right to redeem, and re- fused to deliver up the chronometer, and, therefore, the plaintiff brought this action. On this state of facts, the verdict on the issue on the plea denying the plaintiff's possession, was by the direction of my brother Parke, who tried the cause taken for the defendant, with liberty, nevertheless, for the plaintiff to move to enter a ver- dict for him, with 19£ damages, in case the Court should be of opinion that he had proved the issue. The learned Judge was in- clined to think that this was not the case of a simple pawn, but that the terms on which the chronometer was pledged were such as to give the defendant something more than the right of a pawnee, and operated as a mortgage. If he was a mortgagee, and the ab- solute property was transferred to him, defeasible upon repayment of the money advanced, the assignee of the right of redemption, which only remained in the original owner, could have maintained no action of trover after tendering the money; but, considering the terms of the instrument which accompanied the deposit, we all agree in thinking, that, though they gave more than the ordinary right of a pawnee, viz., the right to sell, which, being part of the security for the advance, was irrevocable by the pledgor or his assignee, they did not constitute a mortgage or transfer of the entire legal prop- ertv in the chattel itself. The case, therefore, stands on the same footing, as far as relates to tke right of the pawnor, with an ordi- nary pledge. A T^le nisi having been granted, pursuant to the leave reserved, Mr. Petersdorff, for the defendant, showed cause, and contended that the verdict was right, on the ground that a pawnor cannot transfer to another such a right of possession as enables him to bring an action of trover. There is very little to be found in the 63 books on Ihe subject of the ri take and carry away to his own use such corn as should be gr(.)wing upon the ground at the end of the term. Then Sutton eon\-eyed the reversion to the plaintiff, and John Sankee, executor to Richard, having sowed the corn, and that being growing upon the ground at the end of the term, sold it to the defendant. And it was argued by Hutton for the plaintiff, that it was merely contingent whether there should be corn growing upon the ground at the end of the term or not. .Vlso, the lessor never had property in the corn; and, therefore, could not give nor grant it, but it sounded properly in covenant; for the right of the corn standing in the end of the term being certain, ac- crues with the land to the lessor, and it was said to be adjudged. Ana it was agreed by the Court that if A. seised of land sow it with corn, and then convey it away to B. for life, remainder to G. for life, and then B. die before the corn reapt ; now C. shall have it and not the executors of B., though his estate was uncertain. Xote, the reason of industry and charge in B. fails, yet judgment in this case was given against the plaintiif, that is, that the property and ver\' right of the com, when it hapned, was jiast away, for it was both a covenant and a grant. And, therefore, if it had been of natural fruits, as of grass or hay, which run merely with the land, the like grant would have carried them in property after the term. Now, though corn be frucfins iiidii.'itrialiff, so that he that sows it may seem to have a kind of property ipso facto in it divided from the land; and, therefore, the executor shall have it, and not the heirs ; yet in this case, all the colour, that the plaintiff hath to it, is by the land which he claims from the lessor which gave the com. And though the lessor had it not actually in him, not certain, yet he had it potentially ; for the land is the mother and root of all fruits. Therefore, he that hath it mav grant all fruits that may arise upon it after, and the property shall pass as soon as the fruits are extant, as 21 H, 6. A parson may grant all the tithwool that he shall have in such a year ; yet, perhaps, he shall have none ; but a man cannot grant all the wool that shall grow upon his sheep that he shall buy hereafter; forthere he hath it neitheractually nor potentially. And though the words are here not bv words of gift of the corn,but that it shall be lawful for him to take it to his own use, it is as good to transfer the property, for the intent and com- mon use of such words, as a lease without impeachment of waste, for the like reason, and not e.r ri trrmiiii, gives the trees. MOODY V. WRIGHT. [13 ^frfriilf ir.— 1847.] The positions taken by the opposing counsel liavp been fuUv and ably presented, in their respective arguments, but, in the view we have taken of the case, it has become unnecessary to express any opinion upon several of the points raised. We have directed 70 our attention more pai'ticularly to one, which is a leading and ma- terial one^ and decisive of the ease. The instrument offered in evidence by the petitioner, as the foundation of the claim, purports to convey to him certain articles «f personal propert}^ consisting of hides, skins and bark, all then in existence, and in possession of the grantors, and also whatever hides, skins, bark or stock, of wliatcver description, that may here- after belong to the grantors, wlierever situated, and wliether manu- factured or not, and at market or not, or the proceeds if sold; also, all leather thereafter manufactured from the proceeds of proper' v then on hand, and in whatever shape the property might thereafter exist, or whatever form it might assume ; so that the then present and future property and earnings of the tan works might stand •conveyed, pledged and hypothecated to the petitioner. This- instrument, so far as it purports to mortgage the prop- erty of the mortgagors then in existence, and held by them, w:is in all respects a valid instrument; and if any such property now re- mains for it to operate upon, it will be effectual to pass the same to the petitioner. "We understand, however, that the ease shows no such property in the hands of the assignee, and that the specifie property conveyed by the petitioner to Wright & Hoxse, and by them reconveyed in mortgage to him, has no lonj^er any existence, and that the only ground of sustaining this petition is that of a lien upon subsequently acquired property, which had no existence at the time of the execution of the mortgage, and wliich has no other connexion with it, than that, to some extent, it may have been purchased with funds which were the proceeds of various sales from the tannery; first, of the articles purchased, and their pro- ceeds applied to the purchase of new stock, which, when manu- factured, was again sold, and its proceeds invested; and so from time to time. This instrument is clearly, therefore, an attempt to mortgage or hvpothecate after acquired property. Can such secur- ity be made effectual by the making and recording of such instru- ment, without any further act of the parties, with no delivery by the mortgagor, and no act on the part of the mortgagee, taking pos- session or exercisine: any rights of property in the newly acquired articles, by virtue of the provisions in the mortgage as to property ? This subject has been recently before us, in the case of Jones v. Eichardson, ]0 Met., 481, involving the question as to the validity of such a mortgage in a court of law. The subject was very ma- turelv considered, and the Court were all clearly of opinion that suoh mortgage did not pass after acquired property. It was stated, in that case, as an elementary principle, that "a person cannot grant or mortgage property of which he is not possessed, and to ■which he has no title." All the qualification introduced was, that one may grant personal property of which he is potentially, though not actually, possessed, as in the case of the grant of all the wool that shall grow on the sheep he owns at the time of the grant, but not wool w^hich shall grow on sheep which are not his, but which he may afterwards buy. 71 In our opinion these principles as to conveyance of property are equally sound and equally to be enforced, whether the question as to the right of property is raised in a court of law or of equity. The parties appear before us, each claiming the property by con- veyance; the petitioner by the instrument already recited, and the deiendant as assignee, holding by virtue of a deed from a ma,ster in chancery, for the benefit of all the creditors of Wright & Hoxse. Whether it would really be more equitable, in a case like the present, that the after acquired property should be holden b\- the one party or the other ; ^vhether the claims of the individual creditor would, in an equitable view, be more meritorious than those of the entire body of creditors, seeking a distribution pro rata, would depend, not so much on anything disclosed on the face of the mortgage, as upon a full knowledge of the entire course of business of the mortgagor, and tlie circumstances appertaining to the prop- erty which is now the subject of controversy, the mode of its ac- quisition, &c. Supposing ourselves clothed with full equity powers, and treating this case as before us unembarrassed by any question as to our lim- ited jurisdiction in chancery, we are not satisfied that the petitioner has shown any such title to this property as would authorize us to hold it to be subject to a lien for the note of Wright & Hoxse to the petitioner, as against creditors who have acquired a right to it be- fore any act of the petitioner had taken place, reducing the property to his possession, or by asserting effectually any right under the prospective hypothecation, as by making a claim and taking pos- session under it, while in the possession of Wright & Hoxse. There are doubtless equitable liens which may be enforced in courts of equity, though not available in a court of law. ilany such might be enumerated. That which nearest approaches the present case is that of an agreement to convey property, or do some act, the per- formance of which has been casually postponed ; and in dealing with the rights of the parties in such case, a court of equity will consider a thing done which was agreed to be done. That class of cases does not present, however, the difficulties that arise in the present case. The property which is the subject of the agreement, in the case supposed, was in existence, and the power to convey the same, or stipulated for a conveyance, existed. Not do the cases of Davis V. Xe^vton, 6 Met., 537, and Eastman v. Foster, 8 Met., 19, at all conflict with the view we have taken of the present case. The property, in reference to which these cases presented questions, was in existence, was susceptible of being conve3'ed and was the subject of bargain and sale. In the case Eastman v. Foster, more particularly relied upon, the mortgage was a good and valid mort- gage in law, and of property then in existence, and the party only went into equity to enforce a claim arising under such valid mort- gage. The case was one of implied trust, of which this court has jurisdiction, and which it may well enforce. The difficulty that trespasses in the present case is the want of any binding original contract, which per xe could have force and effect to change the after acquired property, without some fiirther act by the parties, after tlie property should have come into ex- istence. Such act we deem to have been necessary to perfect the title of the petitioner, whether his rights of property in such after acquired articles are sought to be enforced in e(|uity or at law. We are fully aware that a different view of this question was taken by Mr. Justice Story in the case of Mitchell v. Winslow, 2 Story, R. 630j and that the result to which he came differs from onirs as to the effect to be given to such mortgages in a court of equity. In relation to that case, it is supposed by the counsel for the petitioner, that it had, to some extent, the sanction of this court, in the remarks of the judge who delivered the opinion in the case of Jones V. Richardson. But we apprehend that no such view was intended to be suggested. The case then before the court was an action at law ; and the obvious and quite sufficient answer to the ease of Mitchell v. Winslow which was relied upon by the then plaintiffs, was, "that was a case in equity," without entering upon the further inquiry whether we should, as a court of equity, in a case before us, come to the same result. The case of Langton v. Horton, 1 Hare, 549, much relied upon as sanctioning the doctrine that such convey- ance might be supported in a court of equity, seems to us to go no further than this, viz., that there having been such a contract be- tween the parties, as would in equity have given the plaintiff a title to the cargo when it arrived, and that contract having been perfect- ed by possession lawfully taken, it being acaseof porperty mortaged while at sea, and it being sufficient to take possession forthwith on its arrival, the plaintiffs were entitled to hold under this contract, as against a judgment creditor. On the other hand, another ad- judication may be referred to as strongly sustaining the view we itake of the invalidity of this mortgage in equity, I allude to the case of Mogg v. Baker, 3 Mees. Welsh., 195. in the Court of Ex- chequer. As I understand that case, the doctrine that a lien may be enforced in equitv. in a case like the present, is whollv repudi- ated. The court held that an agreement to mortgage certain spe- cific furniture then in existence would constitute an equitable title in the party holding such agreement, and prevent its passing to the assignees of the insolvent ; but if it was only an agreement to mort- gage the furniture to be subsequently acquired, then it would confer no right in equity. It is true, as was remarked by the counsel for the petitioner, that the court were dealing there with the equity principle of construing that to have been done which was agreed to be done; but no question arose as to the correctness of that prinicple of equity, and the only point of controversy was, whether taking that to have been done/which was agreed to be done, it would constitute a valid, equitable lien. And whether it would do so or not, was made to depend upon the fact whether the prop- erty was subsequently acquired; and, if so, it was held that the agreement would confer no right in equity. The doctrine of that case which seems fully to sanction the principle we have adopted ,-T, the nresent ease, was affirmed by the Court, of Queen's Bench, S Gale V. Bumell, 7 Adolph & Ellis, N. R., 850. 78 The result to which wc have come, upon the present petition, may be stated in the following propositions : The petitioner can- not hold the property in controNers}', as mortgaged property, be- cause it \\'as not m existence, and, therefore, not capable of being convej-ed in mortgage, at the time when the mortgage was made. The instrument could not operate to pass the property as a pledge, because the custody of the same was not taken and retaiaied by the pledgee. ''J'he jiroperty cannot lie held as charged with a lien, be- cause a lien cannot be created by an executory agreement, of such being accompanied by possession or delivery of the property. A stipulation that future acquired property shall Ije holden as security for some present engagement, is an executory agreement, of such a character, that the creditor with whom it is made may, under it, take the property into his iiossession, when it conies into existence, and is the subject of transfer by his debtor, and hold it for his se- curity ; and whenever he does so take it into his possession, before any attachment has been made of tlie same, or any alienation thereof, such creditor, under his executory agreement, may hold the same ; but, until such an act done by him, he has no title to the same: and that, such act being done, and the possession thus ac- quired, the executory agreement of the debtor authorizing it, it will then become holden by virtue of a valid lien or pledge. The executory agreement of the owner, in such a case, is a continuing agreement, so that when the creditor does take possession under it, he acts lawfully under the agreement of one then having the dis- posing power, and this makes the lien good. If, however, before taking possession, or doing such acts as are necessary to give vitality to the mortgage, as to the subsequently acquired prop- erty, an attachment or assignment for the benefit of creditors talces place, the opportunity for completing the lien is lost, and the mort- gage or pledge not being perfected, the property ])asses to the as- signee, and must be held by him for the benefit of the creditors generally. There was no act done bv the petitioner and by Wright & Hoxse jointly, or by either of the parties, which was sufficient to give effect to the original mortgage, as to the after acquired property. The recording of the mortgage bv the petitioner did not; for that was before such property was acquired. The annual payment of interest by Wright & Hoxse could have no such effect. It was neither actually nor symbolically accepting the transfer or convey- ance of the articles after they were acquired by Wright & Hoxse. As to the point suggested, that this agreement between these parties might be treated as a conditional sale by the petitioner, the change of property to taJ-ce effect only on payment of the note, it was competent for the petitioner to have made such a condi- tional sale, and the effect of such sale would have been, that he would not have been divested of the property in the articles thus conditionally sold. But no such principle can avail the petitioner here, as no articles remain in existence that were liis property and possessed by him at the time of the sale. The petitioner seeks not to reclaim such articles, but those subsequently acquired by his 74 debtors. Xor is there any ground for the suggestion that this may- be treated as the constitution of an agency on the part of Wright & Hoxse, and that, as such agents, all their acquisitions would enure to the petitioner as the principal until the note of Wright & Hoxse was fully paid. In no way, that we perceive, can we give effect to this contract, so as to give the petitioner the lien, upon the after acquired prop- erty, that he seeks to establish. Petition dismissed with costs. SMITHUEST V. EDMUNDS. [14 N. J. Eq., 408.— 1862.] This waga^motion to dissolve an iir[unction, under circum- stances whicETaretuTly stated in the opmion'ofThe Chancellor. The CHANCELLOK: T he complainant, being the owner of the Columbia House Hotel, at Cape Island, with its appurtenances, and of the furniture therein, and being in possession of the premises, by an indenture bearing date on the seventeenth of June, 1860, leasei i the real es tate t^^jTamesBLLaird, for the term of three years from the first of~May, IBBO, at The yearly rental of $5,000, payable in equal installments, on the fifteenth day of July and thirty-first day of August in each year, and s^ld and trans ferred to tha-lessee, 4he furm tureajid_other household articles for the^sum of $5.5 63.42 . LairdTas t he lessee.^ a coHateraFsecurity for the punc- t ual payment of the rent, resold and retran sferred to the lessor all of s aid furniture and other household articles, and also sold, assigned and^ ansferred and covenanted and agreed to sell, assign and trans- fer, a ll other a rticles ofTiirnitu re whi ch theT^ see_shouldr' purchase and place, or cause^to be purchased and placed upon sa id demi sed gremises_during the^s aid term, it be ing then know n to a nd conteni^ plated by said par+.ips that i t won1d be necessary for the lessee to pu r- chase and place a lar ge amount of furniture on said premises ,Jn__ad- dition to that which wasjt hen there, and it being the agreement a nd ' intention ot said parties that when and so often as any additional f uiSiture'shoi Tld'he'3)Trrchased'%n^^lacedroi rtBe^premise the les - see, i t should "W ^eenied and con.sld'ered as belonging to the com- pTainant as collater al_security for the payment of"said rent^AndThe lessee, among other things, covenanted and agreed with the lessor that the said furniture and other household articles, as well as that which then was on said premises as that which should thereafter be placed thereon by the lessee, should not be sold or otherwise dis- posed of, or removed from said premises during the term, but should remain thereon, as the property of the complainant, as col- lateral security for the payment of said rent. The bill charges that, in pursuance of the lease, the lessee en- tered upon the possession and enjoyment of the premises, and that large arrears of rent are due to the complainant ; that after the execution of the lease, the lessee, as had been contemplated, pur- chased and placed on the demised premises a large amount of fumi- 75 ture, of the value of about $5,000, in addition to that purchased of the complainant, which still remains thereon. The complainant insists that, by virtue of his contract with the lessee, all the said furniture belongs to him as collateral security for the payment of rent, and that it cannot lawfully be sold or removed from the said premises by the said lessee, or by virtue of any process or pro- ceedings against him. _The bill further fbaro-es, that siindry judgments _at^Jj^ w ha ve been recovered against the^lessee, and that, by virtue oJ~executioiis issued thereon, the sheriSof the County of Cape May hasTevied upon the said furniture on the demisedjprem ises, an d advertisedThe same for sale. The bill pra\'s that an injunction may be issued toT^estrainT;he sheriff froin selling the said furniture, or any part thereof, and from removing the same from the demised premises. An injunction issued pursuant to the prayer of the bill. The de- fendant now moves to dissolve the injunction for want of equity in the bill. The question at issue turns upon the validity and effect of the contract between the complainant and Laird relative to the furni- ture and other household articles specified in the agreement. As to so much of the furniture as A^'as sold by the complainant to Laird, and which was upon the premises at the date of the lease, the validity of the contract is not called in queslijon. But in regard to that part of the furniture Avhich was not at the time owned by the lessee, but which it was then contemplated should thereafter be purchased and placed upon the premises, it is insisted that the con- tract is invalid and inoperative. (2 Story's Eq. Jur., Sec. 875; 1 Eden on Inj., Waterman, 1.5 note.) To autkorize the interference of the court, the complainant must show by hifl bill the existence of a right, legal or equitable, and the danger of the deprivation of that right. No fraud is imputed to the parties in the making of the agreement. The objection is^ that a valid sale or transfer cannot be made of chattels which at the time of the contract are not owned by the vendor, and have no actual or potential existence. It is clear that, if valid at all, the contract must be valid as a chattel mortgage, It is not a pledge. These chattels were not delivered, and they were not capable of delivery at the time of the contract. They had no existence. At the common law, there cannot be a technical pledge of property not then in existence or to be acquired by the pledgor in future. Story on Bailments, Sec. 286, 394. It is equally clear that the contract cannot operate as a legal sale or mortgage of the chattels. To constitute a valid sale at law, the vendor must have a present property, either actual or potential, in the thing sold. Grantham v. Hawley, Hobart's E., 132 ; Co. Litt., 265, a, note 1 ; Robinson v. Maedonnell, 5 Maule & S., 228 ; 2 Kent's Com., 468; 1 Parsons on Com., 437; Story on Sales, Sec. 185, 186. It is not necessary that the vendor should have the actual prop- erty, or that the chattels should have an actual existence. It is enough that he have it potentially. The distinction was taken in 76 the early (*kse at Granthani v. Hawlev, alroadv referrt'd to. The lessor m that case covenantod that the lessee oF a term ini"-ht take the corn that -hou'd be sjrowins; at the end of the term/ It was held that the words were good to transfer the property as soon aa it was extant, the lessor of the land having the crops not actually, but potentially. So it was said, a parson may grant all the tithes of wool that he may have in a certain vear. But a man cannot grant all the wool that shall grow upon his sheep that he shall hereafter buy, for there he hath it neither aetualh' nor po- tentially. The distinction will be fo'und recognized in most of the leading cases, and fullv stated bv the elementarv writers already cited. ■ ■ ■' , In this case the less ee had neither actual nor potentia.) property m the chattels mortgaged. T hey were articles which it was contem - plated should be thereafler purchased by the lessee, a n d the ag ree- men ^is that when and so often as a.ny q.d diti on a.1 furniture shall " be purchased and placed on the premises by the lessee, it shall ^^ong to the lessor as collate ral se'curitv for the payment of rent^ ^ and shall not be sold or otherwise disposed of or re moved from th e~ pr emises during the term] It will be assumed, as" the authoritks clearly establish, that the agreement does not constitute a valid transfer or mortgage at law of the after acquired chattels. T;he oreal question is, whether the contract _ create s_as equitable mortgage ( ofThe^hatfeirw Hich a cour t of equTR- jmirenEoroeaTiT^miteprag; / a gain sTa subsequent executicm creditor. InThe case of~Cahgdon v. Horton, 1 Hare, 549, this question was carefully examined and decided hj Vice Chancellor Wigram. The owner of a whaling ship, then on her voyage to the South Seas, in order to secure to the assignees certain indebtedness for advances, assigned the ship, with her appurtenances, and also all oil and head matter and other cargo which might be caught and brought home in the said ship on and from her then present voy- age. It was held that the assignment was, as against the assignor, a valid assignment in equity, as well of the future cargo to be taken during the particular voyage as of the cargo, if any, which existed at the time of the assignment ; and the master, having deliv- ered up possession of the ship and cargo to the mortgagees imme- diately upon his return from the voyage, it was further held, that the equitable title of the mortgagees to the cargo was perfected, and could not be defeated by a judgment creditor of the assignor, who afterward sued out a writ of fieri facias, and proceeded to take the ship and cargo in execution. It may be suggested that the owner of the ship might be deemed to have a potential ownership in the whales to be thereafter caught during that particular voyage, and that upon this ground the assignment might be held valid at law. It was held otherwise, and a similar assignment was declared to be invalid at law by Lord Ellenborough, in Eobinson v. Mac- donell, Maule & Sel. , 228. But if by any latitude of interpretation that view might be taken it manifestly did not influence the result of the cause. 77 In the course of his opinion, the Vice Chancellor says : "I lay out of the view all questions as to the operation of the instru- ment at law, and look at the case only as a question in equity." And again he says: "I rely in this case on the general principle, that there having been such a contract as would in equity entitle the plaintiffs, as against the owner, to the cargo when it arrived, and the title under that contract having been perfected by a possession lawfully taken under the deed, which there is no attempt on the part of the owner to impeach, the subsequent judgment creditor cannot take that property from the plaintiffs." It may be again suggested that there is this further dissimilarity between the cases. In the reported case, the ship and cargo, on her return from the voyage, was delivered to the mortgagees, and thus the equitable title of the mortgagees was perfected; whereas in the present case the chat- tels were not delivered to the mortgagee, but remained in the pos- session of the mortgagor. It is true the chattels were not in the actual possession of the lessor, but they were delivered to the lessee upon the demised premises, where, in accordance with the contem- plation of the parties and the terms of the agreement, they were to be used by the tenant, and from which they were not be removed during- the continuance of the term. This in no wise affected the Talidity of the contract, but was a delivery according to the terms and spirit of the contract, which perfected the equitable title of the mortgagee. In this regard there is no real dissimilarity between the cases. In the more recent case of Mitchell v. Winslow, 2 Story's K., 630, this question underwent a more elaborate examination, by Mr. Jus- tice Story, in the Circuit Court of the United States. The Court held that te make a grant or assignment valid at law, the thing which is the subject of it must have an existence, actual or potential, at the time of such grant or assignment. But the courts of equity support assignments, _not__Qnly of choses i n action, but of con- ti^^tinfef^tFandexpectations, and also of things which have no- presents-actual or potential existence^ but rest in mere possibility onty. ~Ln the cx>urse of a very elaborate opinion, after quoting at some- length from the opinion of the Vice Chancellor in Langton v. Hor- -ton, Judge Story said: "Now it seems to me that this reason- ing is exceedingly cogent and striking, and it stands upon grounds entirely satisfactory and compulsive upon the whole subject." And as the result of his investigation, he adds : "It seems to me the ' clear result of all the authorities, that wherever the parties by their contract intended to create a postive lien or charge, either upon real or personal property, whether then owned by the assignor or not, or if personal property, whether it is then in esse or not, it attaches in equity as a lien or charge upon the particular property, as soon J as the assignor or contractor acquires a title thereto against the lat-( ter, and all persons asserting a claim thereto under him, either' voluntary or with notice, or in bankruptcy." These cases, I think, in principle clearly control the present case, and I am quite satisfied to rest my conclusion upon their authority. It would be difficulty 78 f indeed, upon a question of equity, to cite higher authority, upon Vither side of the Atlantic, than the eminent judges whose opinions nave been referred to. A further question occurs, viz., whether, admitting the equitable mortgage to be valid against the mortgagor, and all persons claim- ing under him with notice, it will be enforced against a subsequent judgment creditor of the mortgagor. It was so held by Vice Chan- cellor Wigram in the case of Langton v. Horton, already cited. The subject afterwards underwent a more elaborate examination by the same learned judge, in the case of Whitworth v. Gaugain, 3 Hare, 416, where the grounds of his conclusion are clearly and convinc- ingly stated. The motion to dissolve the injunction is denied with costs. LOOKEK V. PECKWELL. [38N.J.L., 253-1876.] In replevin. On error to the Essex Circuit. The opinion of the court was delivered by Van Syckel, J. This cause was tried in the Essex County Circuit Court, by consent of parties, before the court without a jury, upon admitted facts. A brief statement will present the point in issue. ' ,One John M. Mackenzie, to secure his debt to the plaintiff, executed to him a mortgage upon his fixtures, stock and materials, &c., of his bakery in Newark, described therein as follows: "All the bake- house fixtures and utensils now being in and about my bakery, No. •±13 Broad street; also, all Hour, &c., and all other stock manu- factured, and unmanufactured, and all materials whatsoever being in and about said bakery, or that may at any time during the con- tinuance of this mortgage be purchased and obtained to replenish and replace the same or any part thereof, together with," &c. The. mortgage was duly registered, as_re quired by l aw. After the d elivery of the mortgage. Mackenzie, in order to replenis h his stock , purchased twent y barre lsof^our, which were delive red to him on the sidewalk iiTTront of hisT)akery, where they^ wer e s eized by the defendant "as sheriff7 j)y^vJTtTg^f_ajLixecution jn ,his hands,jipon a, judgment ih favor of Totten against _said M ackenzie, for good s sold to hi m after the making and registermgof the mortgage, and' b 'elore the purchase of said twentv b arrels of flour, whi ch were pur^ chased of other parties^ The question submitted on the case is, whether tfie twentyTjarrels of flour were subject to the lien of the mortgage ? Perkins, title Grants, Sec. (Jo, says ; "It is a common learning in the law, that a man cannot grant or charge that which he hath not." A grant will operate only upongoods which tiiejj^antorjias actually or pot^ti^y at theTimeJofTEgrgra'iit- '"Chief JusticTTindall fully reeogqnized this rule in Lunn v. Thorton, 1 Com. Bench, 379, which has since been received as au- thority both in England and this country, as applicable to sales as well as to mortgages. 78 The suggestion of Chief Justice Tindall, that the grant might be so framed as to give the grantee a right between themselves to seize after-acquired goods of the grantor, was acted upon in Con- greve V. Evetts, 10 Exch. 2!»S ; Hope v. Havley, 5 Ellis & B. 830, and in other cases cited below, but the doctrine Jield in the prijicipal case has not been shaken; on the contrary, it is in a mass of cases declared to be settled, if not elementary law. (iale v. Burnell, 7 Q. R. 850; Chidell v. Galsworthy, (i C. B. (N. S.) 471; Jones v. Richardson, 10 Mete, 4S1 ; Barnard v. Eaton, 2 Cush. 2\U ; Bice v. Stone, 1 Allen 5G6; Low v. Pew, 108 :\Iass. :U7 ; Van Hoozer v. Cory, 34 Barb. 9 ; and many other cases cited in Benjamin on Sales, Sec. 79, note k. That this is the rule at law, is regarded by (Jhancellor Green in Smithurst v. Edmunds, 1 ilcCarter 408, as beyond controversy, ^e sa.;^s_fhfltJ-o^ rinstitute a valid leg al sale, the vendor must haYe__a present property, either actual or p otential, in the thing sold. The judgment of the court below in favor of the defandant was right, and should be affirmed. BRETT V. CARTER. [2 Lowell 4.58—1875.] "R^ l in eipiity iu^J-.he assig n ee__m bjmkruptcy _i)f .One Osbome X. Sargent, agaiiist a mortgag£e_.of_jtlie^_stock of. stationerj^^and. other similar goods. It appeared that Sargent bought out the stock in trade of the defendant Carter, as carried on by him at a cer- tain place, in November, 1874, and on the same day he gave back a mortgage to secure the payment of the purchase money by instal- ments, represented by promisory notes extending over a period of four years. The mortgage conveyed the stock "and any other goods which may from time to time, during the existence of this mort- gage, be purchased by the grantor and put into said store to replace any part of said stock which may have been disposed of." Among the covenants was one, that, if the stock should be diminished "faster than said sum hereby secured is paid, said grantor is to fur- nish further security for said sum, whenever required by said grantee." Two of the notes were duly paid, but one that came due in No- vember, 1875, was not paid in full, and the defenda.nt demanded further security, and a mortgage was given of siich stock as had been acquired during the year. This mortgage was given about two weeks before the petition in bankruptcy was filed, and the theory of the bill was that it was a preference. The complainants afterwards asked leave to amend, and allege the first mortgage to be void, on the ground that the mortgagor was tacitly permitted to sell the goods in the ordinary course of his trade. The defendant insisted that both mortgages were valid. 80 i" Xowell, J. The court of appeals of New York decided, by a bench wliich was ecpially di\"iiled in opinion, that a mortgage of chattels which jjennits the niortuaitor to continue in possession and to sell the goods in the ordinary course of business, is void on its face, as mere matter of law 'irisu-old v. Sheldon, 4 Comstock, ,/581. This decision has a remarkable following, and its doctrine f appear,-? to have become the settled law of Xew York, Ohio and Illi- nois. It is not the law of England, Maine, Massachusetts, Michi- gan, or Iowa. In several States it has not l>een passed upon. But as this new doctrine, or, rather, revival of an old one, has been said by jMr. Justice Davis, of the Supreme Court, to be so general and just that it may be presumed to be the law of Indiana, in the ab- sence of express and unambiguous decisions of the courts of that State to the contrai'y, and as 1 venture to doubt both the generality and the justice of the doctrine, it becomes me, with all the respect I feel for that opinion, to state my reasons for not acceding to it. If the rule, whichever way it may be, were a settled rule of property in Massachusetts, inquiry into its history or justice would be un- necessary; but although I have no doubt my decision will accord with the law of ]\Iassachusetts, I have not found a case in this State in which the decisions in Xew York were reviewed, and it is possi- bly still a question for discussion. I had supposed it to be well settled, after much debate and con- flict of opinion, certainly, but substantially settled, that when a vendor or mortgagor was permitted to retain the possession and control of his goods and act as apparent owner, the question whether this was a fraud or not was one of fact for the jury, excepting un- der a peculiar clause of the bankruptcy law of England. It is so pronounced by Mr. May, in his valuable treatise on Voluntary and Fraudulent Conveyances, p. 126, and by the cases he cites, and by the learned editors, both English and American, of Smith's Lead- ing Cases, notes to Twyne's Case, vol. i., p. 1, &c. By the law of England, as I understand it, there are no constructive or artificial frauds, or, if the term is preferred, frauds in law, remaining, ex- cepting, first, such as are expressly made so by statute, as, for in- stance, when a bankrupt retains the order and disposition of goods, as apparent owner, with the consent of the true owner. We have not adopted this part of the bankrupt law, as was somewhat emphat- icallv said in a late case in the Supreme Court.Sawyer v. Turpin, 91 U. S. (lOtto) 114, 131, or 2d, Where the act is necessarily a fraud on creditors, as where an insolvent person gives away a part of nis estate for no valuable consideration, or the whole of it to one antece- dent creditor. These, to be sure, are examples, but ver}^ few others could be adduced, and I understand the true law both here and in England to have been, until lately, that a conveyance for valuable present consideration is never a fraud in law on the face of the deed, and, if fraud is alleged to exist, it must be proved as a fact ; and that ■wa.s the law even before registration was required for the benefit of persons dealing with the mortgagor. It is very strange that after our Legislatures have met the diffi- culty in Twyne's case, by requiring registration, which gives not 81 only construct! ve^ bat in moat cases actual, notice of mortgages, and when many of them have provided that fraud shall be a ques- tion of fact for the jury, the decisions which I have cited, and others following them, should have reverted to the harsher doctrine which had already grown obsolete before the laws provided any notice at all, or any rule of evidence about fraud. It is plain that such a doctrine virtually prevents a trader from mortgaging his stock at any time for any useful purpose, for if he cannot sell in the ordinary course of trade, or only as the trustee and agent of the mortgagee, he might as well give possession to the mort- gagee at once and go out of business. In this ease he never could have begun business, for the whole stock was supplied by the de- fendant. I would refer in this connection to the very able opinions of Judge Dillon in Hughs v. Cory, 20 Iowa, 399, and of Judge Campbell in Gay v. Bidwell, 7 Mich. 519, in which they refuse to follow the de- cisions in New York, and give reasons for that refusal, which, in my judgment, are unanswerable. If it be said that this is one of those cases in which fraud is a necessary result of the deed, all I can say is that this brings us to an ultimate fact of observation and experience, and I am unable to see the necessity. Indeed, it is much more difficult for me to see how creditors can be defrauded in such a ease, when they are told in the deed itself that the debtor has no credit and no property that he can call his own, than that the mortgagee is most outrageously defrauded by such a rule, which devotes his property to the pay- ment of another person's old debts the very instant that he has parted with the possession, taking back a security which is admitted to be honestly given. Take this very case as an illustration. It is admitted there was no fraud in fact ; that the trader's whole stock was supplied by the defendant ; that the mortgage shows that all the stock, present and future, is hypothecated, not as a cover or blind, for there was none, but to the payment of a certain debt by certain instalments. No offer is made to prove that any one was deceived, or even was ig- norant of the mortgage, but I am asked to find fraud in law when I know, and it is admitted. t here was none in fact. Besides cases already cited, see Briggsv. Parkman, 2 Met. 258; Jones v. Hugge- ford, 3 id. 515 ; Barnard v. Eaton, 2 Cush. 294 ; Cobb v. Parr, 16 Gray, 597; Mitchell v. Winslow, 2 Storv 630; Abbott v. Goodwin, 30 Maine, 408. The second point in this case is no less interesting than the first. By the mortgage, the stock that shall be put into the shop by the mortgagor is included in the conveyance. It is undoubtedly the law of courts of equity, fis cases presently to be cited will show, that after acquired chattels definitely pointed out. as, for instance, bv reference to the ship, mill, or place into which they are to be brought, may be lawfully assigned as security. The commnn Irw recoo-ni^pg such transfers of land bv way of estoppel, and of chattels when they are the produce of land or of chattels alreadv o^\Tied bv the transferrer, hut not of future chattels simpKciter. unless there be some novus 82 actus intcrvenU'iis aftor thu eliaUels are acquired; that is- to say^ either some new transfer, or possession tal-cen under the old. it nia}- be cause of regret tliat the law should be different in the courts ot eouimon law and equity, but this is of no importance in bankruptcy, because it has been the law for a great while that aji assignee in bankruptcy taJ^es only the beneficial interest of the bank- rupt; and the courts of law have admitted equitable defences, such as equitable liens, &c., to be set up in such cases, years before they had power by statute or usage to admit equitable pleas in ordinary controversies; and it was every day's practice to find these courts passing upon equitable titles in behalf of a defendant, which they professed to know nothing about, and certainly could not deal with, if relied on by a plaintiff. Siieh was and is the law, and a very just law, a.s far as it goes. But granting the rule in equity to be that after-acquired chat- tels may be mortgaged, the point that has given me most difficutty is whether such is the law of Massachusetts. I suppose that the Federal courts, in all matters of title to property, whether real or personal, when there is no question of commercial or maritime or general law^ and none of the conflict of laws, are as much bound in equity as at common law by the jurisprudence of the State in which they sit. Or, in other words, I understand that the thirty- fourth section of the judiciary act, making the laws of the State the rule in actions at common law, is declaratory only, and that on both sides of this court I am bound to follow^ the law of Massachnsetts in the local questions, and the general law in general questions. Xow, the onl}' decision I can find in equity in this State upon this subject certainly decides very distinctly that even in equity a mortgage of after-acquired chattels is invalid (Moody v. Wright, 13 Met. 17). In that ease the court refused to follow the then re- cent decision of Story, J., in Mitchell v. Winslow, 3 Story, 630, and relied largely on the dictum of a very distinguished judge. Baron Parke, who said, in Mogg v. Baker, 2 M. & W., 195, that there was no such lien in equity. Some years after these decisions were ren- dered the House of Lords unanimously followed the doctrine of Judge Story, and reversed a decision of Lord Campbell, which had been founded on the dictum already referred to, and Baron Parke concurred in the reversal (Holyrod v. Marshall, 10 H. of L. 191. This was not a new doctrine in courts of equity. (See Curtis v. Auber. 1 Jac. & W. 532 ; Re Ship Warre, 8 Price, 269 ; Langton v. Morton, 1 Hare, 549 ; Douglas v. Eussell, 4 Sim. 524; 1 Myl. & K. 428 ; Re Howe, 1 Paige, 129.) These cases have been repeatedly followed in England, and even more often in this country, and, so far as I am aware, with not a single decision the other way of late ^^ears. It is true that a great many of the cases arose upon mortgages given by railroad com- panies, and some few judges have founded a distinction upon that circumstance. But there is no difference in principle between the mortgage by such a corporation of its rolling stock not yet in esse and that by a trader of his future stock in trade in a particular shop. Thetnith merely is, that from the nature of the former, the 83 large sums which they deal with, and the time at which they must be negotiated, which is before the road is finished, attention was called to the great injustice that would be done in displacing the first mortgage in favor either of general creditors or even of subse- quent mortgagees; but similar injustice will be done in all such cases to the extent of the value involved. The following are some of these decisions: Holyrod v. Marshall, 10 H. of L., 191; Pennock ■ V. Coe, 23 How. 117; Morrill v. Noyes, 56 Main, 458; Pierce v. Emery, 32 N. H. 484; Benjamin v. ElmiraE. E. Co., 49 Barb. 441; Phila., &c. Co. v. Woelpper, 64 Penn. St. (14 Smith) 366; Phil- lips v. Winslow, 18 B. Mon. 431; Sillers v. Lester, 48 Miss. 513; Pierce v. Mil. E. E. Co., 24 Wis. 551. Considering the decision of Judge Story in this circuit, and the reasons given, by the court of Massachusetts for not following it, and the entire consistency of all the recent decisions with Judge Story's views, and the disappearance of Baron Parke's dictum, I am not prepared to say, that if the supreme judicial court were now asked to review their decision in Moody v. Wright, it is at all certain they would not reverse it, and under the circumstances I do not feel bound to hold that that case furnishes a settled rule of property which I must follow. So far from that, T believe that the law of Massachusetts in e ^pi i t y i« t Ji at t vnnrimcrp rti flftpr-apq nirpd phnt- tels is val id. "TT ani^^he_QpiiUQn_±ha^4he-«iortgagfi oi l&lLj^xeeited a_ vilid lien in~behalf_of tjiejdefendant upon the stock of_goodsJnJlie_shop y ,^^A, aSTKeTimej)f_th^ban]nT^ a nd t hat the mortga ge of 1875 doe s not vitiate thisTi en. nThejjtiires, howpver , which were Tint men- t ioned in the lirst~mortg age, cannot be hel d by the second, becau se t hat was ^iv.en after-iJiiL bankrup trH ad become inao ]:Eent,-to-iEe knowledge of the defendant. Decree accordingly. HOLEOYD T. MAESHALL.. [10 H. L. C. 191, 209-1862.] The Lord Chancellor (Lord Westburi'), after stating the facts fy of the case, said :/ "My Lords, the question is, whether as to the f machinery added and substituted since the date of the mortgag'e I the title of the mortgagees, or that of the judgment creditor ought to prevail,/ It is admitted that the judgment creditor has no title ~ as to the machinery originally comprised in the bill of sale ; but it is contended that the mortgagees had no specific estate or interest in the future machinery. It is also admitted that if the mortgagees had an equitable estate in the added machinery, the same could not be taken in execution by the judgment creditor. "The question may be easily decided by the application of a few elementan' principles long settled in courts of equity. In, e quity i t is not necessary for jjie^aljeiiatiojLof pcopfirty that there should be a' formal deed' of convey ance. A contract for valuable considera- tion,'""b7^w}iicFlFis agreed to make a present transfer of property, passes at once the Ijeneficial interest, provided the contract is one 84 'k^, of which a court of equity will decree specific performance. In the language of Lord Hardwicke, the vendor becomes a trustee for the vendee, subject, of course, to the contract being one to be spe- cifically performed. And this is true, not only of contracts relating to real estate, but also of contracts relating to personal property, provided that the latter are such as a court of equity woidd direct to be specifically performed. Bhit it is alleged that this is not the effect of the contract, be- cause it relates to machinery not existing at the time, but to be acquired and fixed and placed in the mill at a future time. It is quite true that a dee dj^iich professes to co nvey .property whicEjs n ot in exist ence atT;he time is as a c onveyance, void at law, sim^ply because there is nothing toconvey. So in__eq uity a contract which engage5~to-^aaisfer property^ whiclTis notjn existence, cannot oper- ate as an im rtied iato "alienation mer ely because there is nothing \o t ransfer. , ~^^~-— — ( "But if a vendor or mortgagor agrees to sell or mortgage proper- I ty, real or personal, of which he is not possessed at the time, and ht I receives the consideration for the contract, and afterwards becomes possessed of property answering the description in the contract, I there is no doubt that a court of equity wcTillffliompel him to per- form the contract, and that the contract would in equity transfer the beneficial interest to the mortgagee or purchaser immediately on the property being acquired. This, of course, assumes that the supposed contract is one of that class of which a court of equity would decree the specific performance. If it be so, then immediate- ly on the acquisition of the property described the vendor or mort- igagor would hold it in trust for the purchaser or mortgagee, ae- \cording to the terms of the contract. For if a contract be in other I 'respects good and fit to be performed, and the consideration has I I been received, incapacity to perform it at the time of its execution ( will be no answer when the means of doing so are afterwards ob- tained. "Apply these familiar principles to the present case; it follows that immediately on the new machinery and effects being fixed or placed' in the mill, they became subject to the operation of the con- tract, and passed in equity to the mortgagees, to whom Taylor was bound to make a legal conveyance, and for whom he, in the mean- time, was a trustee of the property in question." i KEIBBS V. ALFOED et al. [120 N. 7. 519—1890.] Parker, J. On the 15th day of May, 1880, one Johnsoi^.. then being the owxLer_inT^lof_cfirtain 1 a n rl g ^j^-poii fpri^Wi rl p1 i ypTpil fj> Thoma s Argue~an~instrument in writing (which for convenience will hereafter be termed a lease), whic h conferred un n-n th^ IgffPT the exclusive right toj)roduce_oil_andgasf^ rio d~ortw e1 ve year sT TFor thaFpurpose it permitted him to go upon the land "aSd make necessary erections; but as to any other use S5 ( Johnson reserved Uie possession and right of enjoyment. It gave to Argue the right to remove any and all tools, boilers, engines and machinery; also the casing to the wells and drive-pipe, if Johnson should refuse to pay a fair price therefor. t Pursuant to the terms of the lease Argue and his assignees fplaced upon the property engines, boilers and other machinery /necessary to carry on the operations for which the lease provided, \ and in view of the intent of the parties as manifested by the terms / of the lease and otherwise, these articles retained their character and / person.ilitv after annexation. (Potter v. Cromwell, 40 N. Y. 287; \ Murdock v. Gifford, 18 id. 28; Hoyle v. P. & M. E. E. Co., 54 id. 314, 324; McRae v. C. X. Banlc, G6 id. 489-495.) In October, 1880, Argue assigned his interest in the lease to Al- / bert Garrett and Adam Prentice. Thereafter Adam Prentice, to se- ) cure the payment of $950.50, executed and delivered to the plain- ' tilf a mortgage on his undivided interest in the lease and upon all I "his interest in the oil wells now thereon aud to be by him place d \ thp rponfwitb all h i.s] interes t m the atxuctures^Jixtures, aquipments la nd apjpurtenances now on said lease. or hereafter -to. -he. placed thereon."' On the 10th of January, 1881, a copy of the mortgage was filed in the Town Clerk's office, and thereafter it was duly refiled. Sub- sequently, and on the 24th dav of August, 1882, Garrett and Pren- tice sold and assigned all their rights and interest.s under the lease to the defendants ,-\lford and Curtis, who thereafter finished one well, put down two others, and added largely to the plant by way of engines, boilers and other machinery. And the substantial question presented bv this appeal is, whether the tubings, casings, engines, boilers, shafting and other machinery purchased and placed upon the property after the giving of the mortgage are embraced within it. True, the appellant contends that his title to the chattels is not burdened with the plaintiff's mortgage, because, as he alleges, Alford and Curtis purchased in good faith and without notice ; but this claim is not well founded, for while a search, which failed to disclose the existence of a mort- gage, was timely made in the Town Clerk's office, the referee has fo\ind upon sufficient evidence to support it, that the mortgage was filed as a chattel mortgage in the proper Town Clerk's office, and within thirty days of the expiration of the year thereafter it was refiled with the statement required by statute. Alford and Curtis are, therefore, chargeable with constructive notice, and the lien of the plaintiff is not affected by their failure to find the mortgage. In some jurisdictions validity is denied to a contract in so far as it purports to embrace property to he acquired after date. The rea- son assigned for this holding is tersely stated in Perkins (§ 65): "It is a common learning in the law that a man cannot grant or charge that which he hath not." In others it is held to be invalirl in law and vet operative in equi- ty. Unexplained, this seems to be a solecism, and results from a use of lano^iiage which fails to accurately convey the idea intended. Invalidity at law imports nothing more than a mortgage of prop- 86 erty thereaftur to be acquired is ineffectual as a grant to pass the legal title. A court of equity, in giving effect to such a provision, does not put itself in contlict with that principle. It does not hold that a conveyance of that which does not e.xist operates as a present transfer in equity, any more than it does in law. But it construes the instrument as operating against as operating by way of present contract to give a lien, which, as between the parties, takes effect and attaches to the subject of it as soon as it comes into the owner- ship of the party. Such we deem the rule to be in equity in this State. (McCaJfrei/ r. Woodiii, 65 A'. V. 459;. Wisner r. Ocum- paiu/h. 71 id. 113- Coats z: Donnell. 94 id. 168-177.) As between the mortgagor, or his assignee, and the mortgagee, therefore, the chattel mortgage operated to create a lien in equity as to the chattels purchased and placed upon the property bv tlie mortgagor subsequent to its date. This lien the trial court rightly enforced by its judgment. But it went further and declared, in ef- fect, that the lien attached to the personalty placed upon the prop- erty by the assignees of the mortgagor as well. This, we think, was error. The assignees did not contract that the machinery to be placed upon the property by them should be subject to the provis- ions of the mortgage. They did not assume or agree to pay the mortgage or carry out its provisions. Indeed, the assignment con- tained no condition or covenant whatsoever, and the assignees did not even know of the existence of the mortgage. Their acceptance of the lease bound them to fulfill the covenants running with the land. ( 113 Penn St. 83 ; Spencer's Case, 1 Smith's L. C. 145.) But it did not, in addition, burden them with the obligation to make good the personal covenants given by the lessee to third par- ties as security for an indebtedness, because they had constructive notice of the existence of the mortgage the lien of plaintiff can be enforced, and the defendants deprived of the machinery on the premises at the time of the purchase by them of the lease. But the lien provided for by the instrument could in any event only extend to property thereafter acquired by the mortgagor. It could not at- tach to chattels to which the mortgagor has not acquired either title or possession. Indeed, it does not, by the terms, purport to em- brace any other after acquired property than that placed thereon by the mortgagor. All concur except Bradley and Haight, JJ., not sitting. Judgment accordingly. THE EOCHESTEK DISTILLING CO. v. RASEY. [142 N. Y. 570—1894.] Appeal from order of General Term of the Supreme Court in the Fifth Judicial Department, made Oct. 4, 1892, which reversed a judgment in favor of defendant entered upon a verdict directed by the court and granted a new trial. In February, 1890, the plaintiff recovered a judgment ag-ainst one Lovell for $147.44. In April 1890, Lovell, being the lessee of certain farm lands, in order to secure one Page as an accommoda- tion indorser and for the repayment of money borrowed from him, 87 esecuted and delivered to him a chattel mortgage, which covered "the grass now growing upon the premises leased, etc.; also all the corn, potatoes, oats and beans, which are now sown or planted, or which are hereafter sown or planted during the next year, etc." At the time but a small part of the land had been planted with potatoes, and the greater part of the planting of potatoes, and all that of the beans was done in the following month. On July 5th an execution was issued upon plaintiff's judgment, and the sheriff levied upon the growing crops and advertised their sale in August, at which sale plaintiff purchased them. After the levy by the sheriff. Page, the chattel mortgagee, on July 15th foreclosed under his mortgage, gave notice and sold the growing crops to the defendant. Defend- ant took possession of the property so purchased and this action was brought to recover its possession. The trial judge, being moved by each of the parties for a verdict in his favor, directed it for the plain- tiff as to the beans and for the defendant as to the potatoes, and ordered the exception taken to that direction to be heard, in the first instance, at the General Term. Tea.t court sustained the plain- tiff's exception to the ruling of the trial judge and ordered a new- trial, but allowed an appeal to this court, on the ground that a question of law was involved which ought to be reviewed. Gray, J. "I think this case does not. in principle, differ from any other case, where a chattel mortgage has been given upon property in expectancy, and which has no potential existence at the time of its execution. The fact that the subject of the mortgage is a crop to be planted and raised in the future upon land does not affect the determination of this question upon established principles. It may be that precisely such a case, in its facts, has not been passed upon in this court ; but there are expressions of opinion in several cases of a kindred nature, in the reports of this court and of other courts in this State, which leave us in no doubt as to the doctrine which should govern. The proposition that a mortgage upon chattels hav- ing no actual, nor potential existence, can operate to charge them vtath a lien, when they come into existence, as against an attaching or an execution creditor, has frequently been discountenanced and re- pudiated. Grantham v. Haw]eA'(Hobart, 133), is the general source of authority for the proposition that one may grant what he has only potentially, and there is no good reason for doubting that that which has a potential, or possible existence, like the spontaneouB product of the earth, or the increase of that which is in existence,- may properly be the subject of sale, or of mortgage. The right to it, when it comes into existence, is regarded as a present vested right. That which is, however, the annual product of labor and of the cultivation of the earth cannot be said to have either an actual or a potential existence before a planting. This action being one at law, the inquirv is limited to ascertain- ing the strictlv legal rights of two contending creditors to the prop- erty of their debtor, Powell, in the crops which he has raised. It is unlike some of the cases which have arisen between the lessor of land and his lessee. In such a case a different principle might op- erate to create and support the lien of the landlord upon the crops 8ft as they come into existence upon tlie land. The title to the land being in him, an agreement between him and the lessee for a lien upon the crops to be raised to secure the payment of the rent would operate and be given legal effect, as a reservation at the time of the title to the product of the land. That was the case of Andrew v. Newcomb (32 N. Y. 417), where the owner of land agreed with another that he might cultivate it at a certain rent ; the crop to re- main the property of the landlord until the tenant should give him security for the rent. Judge P«nion repudiated the idea that the arrangement could be called a conditional sale of the tiax, because the subject was not in existence. He held that the idea of a pledge or of a sale had no application and that the effect of the contract was to give to the landlord the original title to the crop. Jiis re- marks upon the subsequent vesting of the title to crops when they came into being, have reference to such an arrangement between landlord and tenant and not to the case of a mortgage, or condi- tional sale to some third person of crops yet to be planted. Mr. Thomas, in his work on Chattel Mortgages, upon the subject of mortgaging a crop not yet planted, says (Sec. 149) : "The weight of authority inclines to the view that the lien is an equitable one and differs, in some respects, from the charge created by a mortgage of property in existence at the date of the agreement;'' and again, he says: "The authorities are mainly to the effect that such a mort- gage conveys no title or interest as against attaching, or judgment creditors of the mortgagor." About this question of mortgaging personal property, to be subse- quently acquired, much has been written in the books, which I deem unnecessary to resume here at any great length. It results from a review of the authorities that a mortgage cannot be given future ef- fect as a lien upon personal property, which, at the time of its de- livery, was not in existence, actually or potentially, when the rights of creditors have intervened. At law such a mortgage must be con- ceded to be void. The mortgage could have no positive operation to transfer in praesenti property not in esse. At furthest, it might operate by way of a present contract between the parties that the creditor should have a lien upon the property to be subsequently ac- quired by his debtor, which equity would enforce as against the lat- ter. In Gardner v. McEwen (19 N. Y. 123), the chattel mortgage to the plaintiff upon property in the store, "or which might thereafter be purchased and put into the store," was held inoperative to con- vey the title to the after-acquired property, as against the defendant who purchased it at a .«ale under execution upon a judgment aa;ainst the mortgagor. McCaffrey v. Woodin (65 N". Y. 459), was an ac- tion in trover. Plaintiff was lessee and defendant was agent for the lessor. The former covenanted in the lease that the latter should have "a lien as security for the payment of the rent" on all personal property, etc., which should be put upon the premises, "and such lien to be enforced, on the non-payment of the rent, by the taking and the sale of such property in the same manner as in cases of chattel mortgages in default thereof." By virtue of this provision 89 in the lease the defendant took the farm produce. The decision up- held the right of the landlord to do so, holding that as the crops came into existence they vested in the landlord. It is to be noted that the court considered the case as one to be governed by equitable principles, observing that "the matter conies up solely between the parties, there being no intervening rights of creditors." Eeferring to Gardner v. McEwen ( supra) . it was was remarked that "is a case between the mortgagee and creditors, and was affected by our act concerning filing chattel mortgages." Treating the question as one for the application of equitable principles, it was held that the les- sor was entitled to set up her equitable rights as a defence to the plaintiff's (the lessee's) action of trover. In the came case. Gray, C, observed that ,if the relation of mortgagor and mortgagee had been created between the parties, "it was inoperative upon any prop- erty which at the time of its execution was not actually, or poten- tially, either possessed or owned by McCaffrey." Kribbs v. Alford (120 N". Y. 519) recognizes the invalidity at law of a chattel mortgage of property thereafter to be acquired, but holds that as between the parties their contract would be construed in equity as creating an equitable lien, which could be enforced. The idea of a chattel mortgage is that of a conveyance of personal property to secure the debt of the mortgagor, which, being condition- al at the time, becomes absolute if, at a fixed time, the property is not redeemed and the statute makes it valid, as against creditors of the mortgagor, only when filed as directed. The statute provides for the filing as a substitute for "an immediate deliver^'," or "an ac- tual and continued change of possession of the things morig'aged." Such provisions seem to me to exclude the idea of a chattel mort- gage upon non-existent things ; or that such an instrument could operate to defeat the lien of an attaching, or an execution creditor upon subsequently acquired property. Eegarding the chattel mort- gage in question as a mere executory agreement to give a lien, when the property came into existence some further act was necessary in order to make it an actual and effectual lien as against creditors. But there was no further act by the parties to the instrument to create such an actual lien, and the levy of the execution upon the crops operated to transfer their possession from the owner to that of the sheriff. As against his possession the equities of the mort- gagee are unavailing for anv purnose. Between the two creditors it is a question of who had gained the legal right to have the crops in satisfaction of his claim and the equitable right of the mortgaafee to them, as against his debtor, was defeated bv the seizure at the in-. stance of the judgment creditor. We are satisfied as to the correct- ness of the conclusion reached by the General Term below, that there should have been a direction of a verdict for the plaintiff for the po- tatoes and beans, obtained from the planting done after the execu- tion and delivery of the mortgagre. The order appealed from should be affirmed, and under the stipu- lation, judgment absolute should be ordered for the plaintiff, with costs in all the courts. All concur, except Earl, J., not voting. Ordered acrordingly. 90 PLATT V. NEW YORK & SEA BEACH RAILWAY CO. [9 App. Div. 87—1896.] Appeal by the petitioner, August Meidling, as guardian ad litem of August Meidling, Jr., an infant, from an order of the Supreme Court, made at the Kings County Special Term and entered in the office of the Clerk of the County of Kings on the 23d day of May, 1896, denying the petitioner's motion to vacate an order appointing a receiver and also a judgment entered in the action, or to modify the same. This action was brought for the purpose of foreclosing a mort- gage executed by the New Y^ork & Sea Beach Railway Company. On January 11, 1896, the plaintiffs in this action procured an order appointing a receiver of said company, and all the property then owned by it. Subsequently a judgment of foreclosure was entered by which the receivership was continued and a sale directed of all the property in the receiver's hands. Thereupon the appellant, who is a judgment creditor of the New Y'ork & Sea Beach Railway Com- pany, instituted this proceeding for the purpose of having the order appointing the receiver and the judgment of foreclosure and sale so modified as to affect only such property as the mortgagor had when the mortgage was executed. Hatch, J. "The validity of the mortgage is not controverted. But it is claimed that under it no lien was acquired upon the per- sonal property purchased subsequent to its execution, as against the petitioner herein. That the lien should attach to after-acquired property is within the express terms of the mortgage, and it is not disputed that such is its effect as between the parties thereto. By the provisions of the statute (Laws 1850, Chap. 140, Sec. 28, Subd. 10), authority was conferred to mortgage the corporate property and franchises for the purpose of completing, furnishing or operating the railroad. And this authority has been continued in the same language under the revision of the railroad law (Laws 1892, Chap. 676, Sec. 4, Subd. 10). The statute contemplates that it may be necessary to borrow money for the purpose of the physical creation, of the road and putting it in operation. If is quite evident that in the accomplishment of this purpose property would be created and acquired that had no actual or potential existence at the time when the loan was made and the mortgage given. It is the usual course of procedure in the construction of a railroad that money is raised by mortgage on its property, and tliat the structure is built and operated to a large extent by means of the loans thus obtained, and much of the property is created and acquired after the loan is made. The statute makes no distinction between property necessary for the completion and furnishing of the road and that which is essen- tial to its operation. By the terms of the law, therefore, it was con- templated that, for the money thus obtained the property acquired should be pledged as the security for its repayment, and this cannot be accomplished without holding that the lien of the mortgage at- 91 taches to such property as sliall liu Jieccssary for that purpose, wheth- er it is in existence at the time when the mortgage is given or is sub- secjuently ae(iuired and whcthci- sucli property be such as is domin- ated ival or personal So it was early held that such a mortgage creut. d m equii)', a lien u| on pro^jrriy subsequently ac- quired supeiior t" the lien of a snb equent incnnibrance by mortgage or judgment. (Se\inour v. Canandaigua & Niagara Falls K. R. Co., ^o Barb. 2S4; Benjamin \. Ehnira, Jefferson & Canan- daigua E. R. Co., 4!) id. 44:7; Stevens v. Watson, 4 Abb. Ct. App. Dec. 302). In those cases the (juestion arose respi'cting liens upon subsequently acquired real proj)erty. But the discussion shows that the court eonsiclered the rule applicable as well to personal as to real property. Such has been the uniform rule applied in the Fed- eral courts. (Mitchell v. Winslow, 2 Story, 630; Central Trust Co. V. Kneeland, 138 V. S. 419). The difficulties which have arisen relate not so much to the recog- nition of the mortgage as a lien, for the doctrine of the above-cited cases has never been questioned, but rather to the steps necessary to be taken to evidence the lien. The first debate arose over the question whether the rolling stock and equipment of the road re- tained its character as personal property, and if so, was it requisite that the mortgage should be filed as a mortgage of chattels. The Supreme Court divided upon the question, and decisions were ren- dered both ways. The Court of Appeals, in Hoyle v. Plattsburg & Montreal R. R. Co. (.54 X. Y. 314), settled the question by holding that it was personal property, and that the mortgage covering it must be filed as a mortgage of chattels, as proscribed by the act of 1833, or the same would be void as against the general creditors of the corporation. To meet this conclusion, the Legislature, in 1868, passed an act (Laws of ISfiS, Chap. TTO), providina; that it shall not be necessary to file such mortgage, as a mortgage of chattels when it covers real and personal property and is recorded as a mort- gage of real estate in each county in or through which the railroad runs. By this act the status of such propertw so far as it relates to liens by way of mortgage is mnd'' pT-a^'tically subject to the same rules and is placed upon the same footinc: as real property. The business carried on by railroads, the great e^-tent of territory which thev cover, and the fact that the rollin"' stoc'" i-^ at all times widely distributed, not only throughout the State throiie'h which its lines mainly run, but also throughout the different States of the T'nion, create an essential difference between it and property whose situf: is practically fixed. This, coupled with the necessity which exists for certainty of seenritv to tltose advancina- money, usually in very large amounts, upon the faith of railroad property and the practical difficulty, if not impossibility, of a railroad being able to realize upon its property in this manner, if the technical rules re- specting liens npon personal property should obtain, evidently cre- ated an intent in the mind of the Legislature to make such property subiect to the sa.me rules, so far as practicable, as apply to liens upon real propertv. It is quite evident that if it should he held necessary to constantly revise such a mortgage, in order to cover what has 93 been, it may be purchased by the money advanced or to supply op- erating needs and replenish what is destroyed, it would render such security so doubtful and precarious as not only to impair, but to practically destroy its value. We can see no reai^on for drawing a distinction in this regard bet\\een real and personal property. On the contran-, as the authority for the mortgage of both is derived from the same source, and the same reasons e.\ist why both should be available and answerable as security, we think it more in har- mony with the legislative intent to subject it to the same rules. {N. T. Sccuriti^ Vo. V. ^andoga Gas Co., 88 Hun., 50!) j. This view does not bring- us in conflict with R. T). Co. v. Rasey (142 X. Y. 570). That case proceeded from the well-settled legal rule that a mortgage of chattels, having no actual or potential existence when the mort- gage was given, is void as to intervening creditors. For resisons al- ready stated that rule has no application to a mortgage of this char- acter. It follows that the order appealed from should lie aflHi'med.* Morrill v. Xoyes.— 56 Me. 458—1863. Per Davis, J. The question whether a mortgage of personal property not in ex- istence, or not owned at the time by the mortgager, can be made available by the mortgagee, as a lien upon property afterwards ac- quired, has been discussed in many recent cases, with some apparent difference of opinion. Some of the courts have denied that any dif- ference exists, and have attempted to reconcile the cases on the ground that such a mortgage, though void at law, is valid in equity. But this is a loose use of language, and tends more to confuse than to reconcile. If such a mortgage is absolutely void, for w^ant of any subject matter to support it, then it should be so held in equity, as well as at law. But, if not thus void, to what extent and in what sense, is it valid? It is only by conceding its validity that it is per- tinent to inquire whether the remedy is in equity, or by a suit at law. As a general proposition it may be said that a mortgage of such goods as may be in a store on a future day, or of such furniture as mav be in a house, or of such machinery as mav be in a mill, or of such stock as may be on a farm, when no particular property is re- ferred to. will not convey anv title or create any lien upon, such property subsequently acquired, which can be upheld or enforced in a suit at law. {Head v. Goodwin. 37 Maine, 181 : Barnard v. Ea- ton. 2 Cush.. 594; Codmnn v. Freeman. 3 Gush... 306 ; Ofix v. Sill 8 Barh.. 103; Gardner v. McEwen. 19 N. Y.. 5 Smith, 133; Tapfield V. RilJman. 46 Ena. G. L.. 343: Linin v. Thornton. 50 Eiirj. G. L.. 379; Gale v. Burnell, 53 Eng. G. L.. 850.) In Connecticut a mort- gage of a shifting stock of goods in a store w^as held to create the same lien upon goods subsequentlv nurchased as upon those owned at the time. (Holly v. Brown. 14 Gonn. 355.) A .similar decision was made in this State, in the case of Head v. Goodvin. 37 Maine, 181. But that case is questioned in ■Tone.'i v. Richnrd. N. Y., 598; Dodge V. Wellman, 1 Abb., C't. App Dec, 512; In re, Howe, supra; White T. Carpenter, 2 Paige, 217; Arnold v. Patrick, 6 id., 310). Under our statute a parol agreement, in respect to lands, cannot be avoid- ed in equity, because it is not in writing, where there has been a part performance of it. (Freeman v. Freeman, 43 X. Y., 34). A fortiori, it cannot where it has been fully executed. The plaintiff is not a bona fide purchaser, but stands in the shoes of the bank- rupt. He cannot, therefore, assert any better right than the bank- rupt himself. The exeoition of the mortgage gave the defendants a lien, which took effect, by relation, as against the bankrupt and purchasers from him with notice, at the time the agreement to give it was made. The plaintiff, not being a bowi fide purchaser, took the transfer to him subject to that lien. ' That being so, no question of fraud or of a preference in violation of the provisions of the bankrupt act has arisen, and the evidence precludes any inference of other kinds of fraud. It is unnecessary to review the cases cited on behalf of the appellants, for none of them seem to us to conflict with the foregoing views. The plaintiff is not in a position to raise the objection that the agreement to discharge the old mortgage, and to receive the new •one in lieu of it, was invalid because the guardian violated his duty and transcended his power in making such an as;reement. Such a transaction is not absolutely void, but is avoidable onlv, at the elec- tion of the infants on coming of age. It beincr obviouslv for the benefit of the infants that the lien shall be established and upheld, we will give effect to the intendment, that their ratification will be forthcoming at the proper time, and to the rule that no one but bemselves can disavow the authority of their guardian to make the aereement. (Co. Lit., 2 b: 2 Kent Com., 23(i- Keane v. Boycott, 2 H. Bl., 511 ; TJ. S. v. Bainbridge, 1 Mason). The plaintiff has no claim to be the champion or protector of the infants and can ac- quire no rights by assuming that character. Some objections to the admission of evidence were taken by the plaintiff. We think they were properly overruled. The judgment should be aflfirmed, with costs, to be paid out of the estate of the bankrupt, if that is sufficient ; otherwise by the plaintiff personally. CHASE V. PECK. [21 7\''. r. 581— 18G0.] Denio, J. : The determination of this case will depend upon the character of, and the effect to be attributed to, the instrument exe- ■cuted by Alonzo Aylesworth to Isaac and Sarah Howland, at the 106 same time that the latter conveyed to him the premises in con- troversy. From the two papers, taken together, it is apparent that it was parcel of the consideration, upon which the conveyance was executed, that Aylesworth, the grantee, should support the grantors during their joint and several lives. ^'^Thfi-pajper signed, by him. pro- fesses, in the first place, to pledge the entire use of the farm for that purpose ; and it is added that, if its produce shall be insuffi- cient for the object, the entire fee shall be appropriated to accom- plish it. It was, probably, intended that the transaction should operate, to a certain extent, as a gift; but this was only so far as the value of the property conveyed should exceed the value of the return which was to be made for it. As respected the latter, the ar- rangement was a contract, which imposed a cretain duty upon the grantee, to be performed for the benefit of the grantors, and which, moreover, attempted to create a lien upon the subject of the con- veyance, to- secure the performance of the duty undertaken by the grantee. The intention of the parties is plain; but the question to be considered is, in what legal or equitable light the arrangement is to be regarded by the Court. In our opinion, the instrument signed by Aylesworth is to be considered as creating an equitable incumbrance in the nature of a mortgage. By the law of England, as administered in the Court of Chan- I eery, an equitable mortgage may be created by any writing from which the intention to create it may be shown ; or it may be effected bv a simple deposit of title deeds without writing. It will also be allowed in favor of a vendor, for unpaid purchase money or of a purchaser who has advanced his money on the faith of a contract for a conveyance. (Miller on Equitable Mortgages, pp. 1, 3, 218 and eases cited). The courts of equity in this State have adopted the general doc- trines of the English chancery upon this subject, as upon many others. The cases of a mortgage created by a writing not sufficient to convey the premises, or by a deposit of title deeds, have not been frequent with us; but the doctrine has been applied in a few in- a few instances, and I do not find any judgment or dictum by which it has ever been questioned. In Jackson v. Dunlap (1 John. Ca., 114) a vendor of land had executed and acknowledged a con- veyance to the vendee, but a part of the purchase money had not been paid, and it was then agreed that the grantor should retain the deed until the balance should be actually paid. It was equivocal upon the testimony whether the deed had been delivered so as to pass the title or not. If it had not been, the question we are consid- ering would not arise; but Kent, Ch. J., considered the delivery complete, and that the deed was then retained by the grantor by way of security till payment. This, he said, was the creation of an equitable lien in the grantee. The other judges seem to have been of opinion that the title did not pass. In Jackson v. Parkhurst (4 Wend., 369,) it was held by the Court, Judge Sutherland giving the opinion, that the pledge or deposit of a deed with the grantor, by way of security, would give him a lien in the nature of a mort- gage ; but the case being at law, it was held that such a title could 107 not be .set up against the legal estate. In the matter of Howe and wife, (1 Paige, 135) the English doctrine, that an agreement for a mortgage is in equity a specific lien on the land, wa.s asserted and applied by Chancellor Walworth. The cases in which a lien for the pui'tihase money has been estab- lished, where the title had passed to the purchaser, are more numer- ous. (Garson v. Grear, 1 J. C. E., 308; Warner v. Van Alstyne, 3 Paige, 513; Arnold v. Patrick, 6 Paige, 310; Hallock v. Smith, 3 Barb., S. C. E., 267); These cases proceed upon the same principle which the defendant seeks to establish. The difference in circum- stance which exists in the present case is against the plaintiff ; for Mr. and Mrs. Howland received back from Aylesworth a written in- strument, in which the lien reserved was explicitly stated, while in the cases referred to, the lien was predicated on the implied inten- tion of the parties without a writing or even a verbal agreement for that purpose. Another example of the same doctrine is furnished, where there is an executory contract for the purchase of lands, the title remaining in the vendor; and subsequently to the contract he suffers liens upon the premises to be created. It is well settled, that the interest of the vendee will be. protected against every one but a bona fide purchaser or incumbrancer who has advanced money or property without notice of the vendee's equity. (Lane v. Ludlow, 6 Paige, 316, note; Parks v. Jackson, 11 Wend., 442). In such cases the vendee is considered in equity as the owner, and the vendor as his trustee. Arhen-d V. Odiorne.— [118 il/a.s-.s-. 261—1875.] Gray, C. J. The plaintiff principally relies upon the doctrine of the English courts of chancery that the vendor of real estate by an absolute deed has a lien thereon for the unpaid purchase money, without proof of any agreement of the parties to that effect. The most plausible foundation of the English doctrine would seem to be that justice required that the vendor should be enabled, by some form of judicial process, to charge the land in the hands of the vendee as security for the unpaid purchase money. And the restriction of the doctrine to real estate suggests the inference that the Court of Chancery was induced to interpose by the consideration that by the law of England real estate could neither be attached on mesne process, nor, except in certain cases or to a limited ex- tent, taken in execution for debt. 2 Bl. Com. 160, 161, 4 Kent Com. (12th ed.), 428, 429. The English doctrine of vendor's lien has "been adjudged not to exist in Maine. Philbrook v. Delano, 29 Maine, 410. 415. And it does not appear to have been ever adopted in any of the New Eng- land States, except Vermont, in which, after being affirmed by the court, it has been abolished by the Legislature. Arlin v. Brown, 44 N. H., 10; Perry v. Grant, io E. I., 334; Dean v. Deaji, 6 Conn., 285; Atwood v. Vincent, 17 Conn., 575; Manly v. Slason, 21 Vt., 271; St. of Vt. of 1851, c. 47; Gen. Sts. of Vt. of 1862, c. 65, Sec. 33. 108 In Brown v. Oilman, 4 Wlieat., 255, •■?!)(), Chief Justice Marshall treated the question a-i governed by the consideration whether the doctrine had been adopted by the law of the particular State. And the doctrine has never been affirmed by the Supreme Court of the United States, except where established by the local law, as, for in- stance, in Ohio, Bayley v. Uiveuleaf, 7 Wheat., -tG ; Tiernan v. Beam, Ohio, 383; in Georgia, McLean v. McLellan, ]0 I'et. G25, 6-iO; Hardin v. Miller, Dudley, 120, and the District of Columbia, Chilton V. Brand, 2 Black, 458, the doctrine having been previously affirmed in the Statee of Maryland and Virginia, out of which the district has been formed; Moreton v. Harrison, 1 Bland, 491 ; Red- ford V. Gobson, 12 Leigh, 332, although it has since been abolished in Virginia by statute. Yancey v. Mauck, 15 Grat., 300. The decisions in the courts of those and many other States in fa- vor of the doctrine, which are collected in the notes to 2 Sugden on Vendors (8th Am. ed.) c. 19, suggest no reasons and afford no grounds why we should now for the first time adopt in this common- wealth a doctrine which has never been supposed by the profession to be in force here; which would introduce a new exception to the statute of frauds; which, as experience elsewhere has shown, tends to promote uncertainty and litigation, and which appears to us to be unfounded in principle, unsuitable to our condition and usages, and unnecessary to secure the just rights of the parties. If no third person has acquired any rights in the land by bona fide attachment or conveyance, the original vendor may secure payment of the debt due- him for the purchase money by the usual attachment on mesne process. If any third person has acquired rights in the property, thei»e is no reason why equity, any more than the common law, should interpose to defeat them. It may be doubted whether, upon the case stated in the bill, the plaintiff would be held entitled to the lien which he asserts, in those courts which recognize the existence of a vendor's lien for unpaid purchase money. 1 PeiTy on Trusts, See. 235. But as we are clearly of opinion that no such lien exists in this Commonwealth in any case without agreement in writing, we do not propose to en- tangle ourselves in the refinements and embarrassments which are inseparable from its judicial consideration and affirmance. Bill dismissed. TEFFT V. MUNSOlSr. [57 N. F. 97— 1875.] This was an action to restrain defendants, loan commissioners for Washington County, from foreclosing a mortgage executed to them by Martin B. Perkins and wife. On the 18th day of January, 1848, Gamaliel Perkins purchased of Cortland Howland certain lands in Washington County, which were conveyed to him by warranty deed recorded March 7, 1848, in the clerk's office of said county. Gamaliel Perkins, immediately af- ter his purchase, let his son, Martin B. Perkins, into possession of 109 the premises, who forged a deed of the land from his father to him- self and placed it upon record in the clerk's office of said county,. May 27, 1850. On the 1st day of October, 1850, Martin B. and his wife e.xeeuted a mortgage upon said land to the loan commissionera of said county, to secure the sum of $1,000 loaned to him. This mortgage contained covenants that Martin B. and his wife were lawfully seised of a good, sure, perfect, absolute and indefeasible es- tate of inheritance in the premises, and that they were free and clear of and from all former and other gifts, grants, bargains, sales, liens, etc., and this mortgage was, on the day of its date, duly recorded in the book kept by the loan commissioners, as required by law. On the 23d of January, 1860, a deed of said lands, bearing date April 1, 1853, was recorded in the County Clerk's office, which purported to be executed by Martin B. and wife to his father. On the 16th day of December, 1859, Gamaliel Perkins conveyed said land to Martin B., by deed recorded January 14, 1860. Until this convey- ance from his father ilartin B. had no title to the land, although he remained in possession of the same from 1848. On the 31st of Jamuary, 1867, Martin B., being still in possession of the lands, con- veyed them to the plaintiff, who paid full value for the same with- out any actual notice of the mortgage to the loan commissioners. The deed to the plaintiff was recorded February 9, 1867. The coiirt below decided that plaintiff was not entitled to the re- lief sought, and directed a dismissal of the complaint. Judgment was perfected accordingly. Eael^ C. : The plaintiff claims that the mortgage to the loan eom- missionens has no validity as against him, and that his deed has priosity over it under the laws in reference to the registry of deeds and mortgages. It is a principle of law, not now open to doubt, that ordinarily, if one who has no title to lands, nevertheless makes a deed of conveyance, with warranty, and afterward himself pur- chases and receives the title, the same will vest immediately in his grantee who holds his deed vnth warranty as against such grantor by estoppel. In such ease the estoppel is held to bind the land, and to create an estate and interest in it. The grantor in such case, being at the same time the warrantor of the title which he has as- sumed the right to convey, will not, in a court of justice, be heard to set up a title in himself against his own prior grant ; he will not be heard to say that he had not the title at the date of the convey- ance, or that it did not pass to hisgrantee in virtue of his deed. Work V. Welland, 13 N. H., 389 ; Kimball v. Blaisdell, 5 id.; 533 ; Somes V. Skinner, 3 Pick., 53; The Banlc of Utica v. Mersereaii, 3 Barb., Ch., 528, 567 ; Jackson v. Bull, 1 John. Cas., 81, 90 ; White V. Patten, 34 Pick., 324 ; Pike v. Galvin, 29 Maine, 183. And the doctrine, as will be seen by these authorities, is equally well set- tled that the estoppel binds not only the parties, but all privies in estate, privies in blood and privies in law, and in such case the title is treated as having been previously vested in the grantor, and as having passed immediately upon the execution of his deed, by way of estoppel. In this ease Martin B. Perkins conveyed the lands to the loan commissioners, by mortgage with warranty of title, and 110 thereby became estopped from disputing that, at the date of the mortgage, he had the title and conveyed it, and this estoppel ap- plied equally to the plaintiff to whom he made a subsequent convey- ance, by deed, after he obtained the title from his father, and who thus claimed to be his privy in estate. The plaintifE was estopped from denying that his grantor, Martin B. Perkins, had the title to the land at the date of the mortgage, and he must, therefore, for every purpose as against the plaintiff, be treated as having the title to the land at that date. 1, therefore, can see no difficult}- in this case, growing out of the law as to the registry of conveyance. Martin B. Perkins, having title, made the mortgage which was duly recorded. He then con- veyed to his father ajid the deed was recorded. His father then conveyed to him and the deed was recorded. He then conveyed to the plaintiff and his deed was recorded. Thus the title and record of the mortgage were prior to the title and record of the deed to plaintiff, and the priority claimed by plaintiff cannot be allowed. Assuming it to be the rule that the record of a conveyance made by one having no title, is, ordinarily a nullity, and constructive notice to no one. The plaintiff cannot avail himself of this rule, as he is estopped from denying that the mortgagor had the title at the date of the mortgage. The case of White v. Patten, ^upra, is entirely analogous to this. In that case the plaintiff' derived his title from a mortgage, made to him by one Thayer, containing covenants of seisin, warranty, etc., and recorded Feb. 19, 1834. At the time of the execution of this mortgage the title was not in Thayer, but in one Perrv, his father-in-law. Perry afterward, by deed recorded August 2d, 1831, conveyed the land in fee simple to Thayer, 'who conveyed the land )jy mortgage to tlu^ defendant, recorded the same day. The counsel for the defendant used the same arguments in a great measure which have been urged upon our attention by the counsel for the plaintiff in this case, both as to the title and the reg- istry of the mortgages, and yet the court held in a very able opinion that the plaintiff had the prior and better title. I am, therefore, of opinion that the judgment should be affirmed, ■with costs. Ill BOOK II. NATURE AND INCIDENTS OF THE MORTGAGE RELA- TION. CHAPTER I. COMMON LAW RELATIONS. (a) Title. MoJILRPHY V. MINOT. [4 New Hampshire. 251—1837.] Reported, 2 Gray, Cas. Prop. 743. ASTOR V. HOYT. [5 Wenil., Guy— L«.3(.).] Savage, Cii. J. The question then arises, which was principally discussed upon the argument, is the mortgagee to be considered the assignee of the leasehold premise.s? And if so, is he liable to the payment of the damages for the breach of Maddn's covenant ? That the covenant to pay all assessments is a covenant running with the land there can be no doubt (5 Co., 25) ; and that the assignee is lia- ble for the breach of such a covenant occurring while he is assignee is equally clear; but whether the mortgagee is assignee, and if as- signee, whether he is liable for breaches of the covenant before the assignment, are questions to be discussed. In England I think it must be conceded to be settid that wehre the mortgagor, by the form of the instrument, conveys or assigns by way of mortgage his whole estate, the mortgagee is considered, at law and in equity too, the assignee. We read, indeed, in some of the books that though the mortgage purports to convey an estate defeasable by matter subse- quent, yet that the courts of equity consider them, in their true in- tent, as mere securities for money ; but the decision of the courts, both of law and equity, which are the highest evidence of what the law is, have generally considered mortgages as conveyances ; and by the mode of drawing them there it seems necessary that when the condition is performed there should be a reconveyance or reassign- ment. In Sparkes v. Smith, 2 Vernon, 275, the court refused to compel a mortgagee to disclose whether a lease was assigned to him to enable the plaintiif to prosecute him as assignee upon the cove- nant of the lessee, who was also mortgagor, clearly implying that as assignee of the whole term, even by way of mortgage, he would be liable; and in Pilkington v. Shaller, 2 Vern., 374, where a recovery 113 had been had in a similar case against the plaintiff as assignee, the court refused to relieve him. saying the mortgat^ee was ill advised "to take an assignment uf the whole term. In the case of Eaton v. Jaques, Doug., 16U, the Court of King's Bi'nch disregarded these cases and thought them not well considered. Lord Mansfield was of opinion that upon principle the assignee is liable only in respect of the possession, and that as a mortgage was a mere security, the mortgagee out of possession was not liable as assignee. About ten years afterwards Lord Thurlow entertained a different opinion, and did what was refused in Pilkington v. Shaller. He compelled a person who had received a lease in deposit as security to take an assignment, that he might be prosecuted as assignee upon the cove- nant of the lessee to build a house. The question seems to have been finally and deliberately settled in Williams v. Bosanquet, 1 Brod. & Bing., T2, by ten judges, overruling the doctrine of Lord Mansfield in Eaton v. Jaques. Dallas, Ch. J., in giving the decision of the court, states explicitely the grounds of the decision. »He shows from authority that the lessee is liable for the rent, whether he en- . ter or not; he is liable by virtue of his lease, and he argues that the assignee is under the same liability, whether he takes an absolute as- signment or only by way of security, for the lessee conveys by the assignment his whole interest, whicli the assignee takes ; and as the lessee was liable before entry, so must the assignee be liable in like manner. In that case, he remarks, the assignment was of all the right, title and interest of the assignor, and so completely did the interest pass that there was a covenant to reassign upon payment of the money. The money was not paid before the day when, if not paid, the assignment was to become absolute, so that the case was that of an absolute assignment. He also held there was a privity of estate, for the acceptance of the assignment was equal to actual en- trj' and privity of contract, because contract was with the lessee and his assigns, and the defendants were such assigTis ; therefore the contract was between the lessor and assignee. Chancellor Walworth considers the case of Williams v. Bosanquet as settling the principle in England that a mortgagee of leasehold premises, whether in possession or not, is liable upon the covenants as assignee, but he things such a principle cannot prevail in this State, because we hold the mortgagor to be the true owner, and the mortgagee as having nothing but a chattel interest while out of pos- session. The counsel for the appellant insists, however, that in that respect there is no difference in the doctrine held, in England and here, for Lord Mansfield said in The King v. St. Michaels, Doug., 632, it was an affront to common sense to say the mortgagor is not the real owner. Such was indeed the doctrine of Lord Mansfield and of Buller, justice, but that is the very doctrine that is repudi- ated in William v. Bosanquet. Lord Mansfield asserts that the mort- > gagor is the real owner. Not so, says Ch. J. Dallas, giving the opin- ion of the ten judges ; the whole interest is assigned ; it vests abso- lutelv, and is not the less absolute because the assignor (the mort- gagor) , may entitle himself to a reassignment. Unless, therefore, a man can be the real owner after he has parted with all his interest, 113 the chancellor must be right in saying that the English doctrine of the ten judges is inapplicable here. If the law is the same here as in England, and the law there is that the mortgagee out of posses- sion has the whole estate, then this court was in error in the case of Waters v. Stewart, 1 Caines' Cas. in Err., 47, where they decided that the equity of redemption remaining in the mortgagor was real estate, and liable to be sold on execution; and the Supreme Court were equally in error when they decided that the mortgagee out of possession had no interest which could be sold on execution (Jack- son V. Willard, 4 Johns. E., 41), for if he had the whole estate it certainly might be sold. It would seem, too, that Powell must have been under a great mistake when he stated that the mortgagor might levy a fine or suffer a common recovery ; that he had an estate which descended to his heirs, and which he might devise by his will. Powell on Mortgages, 75, 76, 170. Here, however, the mortgagor is the owner against all the world, subject only to the lien of the mortgagee. In Mclntyre v. Scott, 8 Johns. E., 159, it was held that the mortgagee of a ship, out of pos- session, was not liable for supplies; and in Eunyan v. Mersereau, 11 Johns. E., 538, the assignee of the mortgagor was permitted to maintain trespass against the mortgagee after condition broken. The court conclude their opinion in that case by saying : "The light in which mortgages have been considered in order to be consistent, necessarily leads to the conclusion that the freehold must be con- sidered in the plaintiff, and he of course is entitled to judgment. In that ease the court rely on the doctrines of Lord Mansfield in Eaton V. Jaques, and to show that the interest of the mortgagee is only a chattel interest, they refer to the well established principles that mortgages pass by a will not made with the solemnities of the statute, and that the assignment of the debt draws the land after it. In Coles V. Coles, 15 Johns. E., 330, Spencer, J., repeats the doc- trine of Eunyan v. Mesereau, and in that case it was decided that the wife might be endowed out of equity of redemption. In Hitch- eodk V. Harington, 6 Johns. E., 895, Kent, Ch. J., says of the mort- gage : "We now regard the mortgage estate only for the benefit of the mortgagee and his assigns. As to the rest of the world, as long as it is not put in force, it is only a pledge or lien on the bond, with which they have no concern any further than not to disturb it." And in Dickinson v. Jackson, 6 Cowen, 147, we held that until de- fault in payment of the money due by the mortgage, or some part thereof, and the termination of a notice to quit, the mortgagee has no right of entry as against the mortgagor, and cannot bring eject- ment against him, though he may against the assignee of the mort- gagor, the tenancy being broken by the assignment. It is too late for us now to retrace our steps and adopt the doctrine of Williams V. Bosanquet, even if it ^\'as connect. To recover against an assignee of the lessee it must be averred and proved that all the right, title and interest of the lessee passed l)y assignment to the assignee. After these decisii ns, ean ew say that all the right, title and inter- est of the mortgagor has passed to the mortgagee oat of possession? So far from it, we hold that the mortgagee, be^^'^re foreclosure or 114 the coininenc-L'inent of pi-dceedings to foreclose, has but a chattel in- terest. It is perfectly clear, therefore, that a mortgagee of a term out of possession is not in this State to be considered the assignee. HuxTiNiiToN V. Smiih. — [4 Cunn. 235 — 18--32.] Hos.MKK, Cii. J. On the first plea in the case before us the only- question is, whether after the expiration of the law daj', and before an entry or foreclosure, the interest of a mortgagee in the premises mortgaged may be set off on execution. The fee simple of the land is in the mortgagor, and the mortga- gee, before entry of foreclosure has, at most, a chose in action, and a right to the possession, in order to render the mortgage available to the payment of his debt. The mortgage is an incident only to the debt, which is the principle. It cannot be detached from it; dis- tinct from the debt, it has no determinate value, and the assignee must hold it, at the will and disposal of the creditor, who has the note or bond, for which it is a collateral security. The debt may require only a small part of the land to satisfy it, and by the levy of several executions the mortgagor desiring to redeem may be much embarrassed. The land cannot be taken for the debt^ of the mortgagee until his entry upon it, and, in my opinion, until fore- clorure. These principles are so thoroughly established, and so fre- quently has it been decided directly that mortgaged premises not entered upon by the mortgagee or foreclosed cannot be taken for his debts that a more extensive investigation of the subject is un- necessary. Fish V. Fish, 1 Conn. Rep., 559 ; Portland Bank v. Hall, 13 IMass' Eep., 207; Blanchard v. Colburn & al., 16 Mass. Eep., 345 ; Jackson v. Willard, 4 Johns. Eep., 41; Jackson v. Dubois, 4 Johns. Eep.. 316; Hitchcock v. Harrington, 6 Johns. Eep., 290; Collins v. Torrv, 7 Johns. Eep., 278. Eatox v. Whiting, 3 Pick. 4S4 (1826). Parker, C. J., delivered the opinion of the court. The opinion expressed in the case of Blanchard v. Colburn & ux., 16 Mass. Eep., 345, that the interest of a mortgagee in real estate mortgaged to him for security of a debt, or the performance of a condition, is not liable to be levied upon for the debts of the mortgagee and po, of course is not liable to attachment on mesne process, we see no cause to change. It is in fact but a chose in action, at least until entry to foreclose, and although the legal effect of tlie mortgage is to give an immediate right of entry or of action to the mortgagee, yet. the estate does not become his, in fact, until he does some act to divest the mortgagor, who, to all intents and purposes, remains the owner of the land un- til the mortgagee chooses to assert his right under the deed. It is, as before said, in the nature of a pledge, and a pawn or pledge can- not be seized in execution for the debt of the pledgee. The mort- gagor may be compelled to pay over the debt to the creditor of the mortgagee on the trustee process, with the same xceptions as are provided for other cases, and payment under such process will dis- charge the mortgage pro tanto ; so that the creditor of the mort- 115 gagee is not without remedy, as has been suggested. The law in New York and Connecticut is the same as with us. In the courts of both those States it has been decided that a mortgagee before entry has not such an interest in the land as can be sold, levied upon, or attached. See Jackson v. Willard, 4 Johns. -Rep. 41; Runyon v. Mersereau, 11 Johns. Rep. 534; Johnson v. Hart, 3 Johns. Cas. 329; also Huntington v. Smith, 4 Connect. Rep. 237, in which Ho^iiner, C. J., states at large reasons, similar to those given in Blanchard v. Colburn & ux. by this court. Before the ease of Blanchard v. Col- burn & ux. the same principle have been decided in the case of Port- land Bank v. Hall, 13 Mass. Rep., 207. So that we are -warranted in considering it as settled law, that the interest of a mortgagee be- fore entry is not attachable; and we might add with Hosmer, C. J., in the case cited from Connect. Rep., that we doubt whether it is attachable before foreclosure, for until then all the inconveniences suggested as the ground of decision would occur. TRIMM V. MARSH. [54 New York, 599.-1874.] This was an action for an accounting as to the amount due upon a bond and mortgage, and for the recovery of the possessin of the mortgaged premises, upon payment of the amount due. In 1858 one Ridgeway, being the owner of certain premises situ- ate in the City of New York, mortgaged them to an insurance com- to secure $2,000 ; the insurance company assigned the mortgage to the defendant, Sarah A. Marsh. Ridgeway afterward conveyed the premises to the plaintiff Brown, who subsequently, in October, 1865, entered into an agreement with plaintiff Trimm to convey the same to him. In 1861 the defendant, Sarah, commenced an action to foreclose this mortgage, making plaintiff. Brown, and others parties, and obtained judgment of foreclosure. The premises were sold un- der the judgment in 1862, and defendant, Sarah A. Marsh, became the purchaser, and received a sheriff's deed. Immediately after the sale she entered into possession of the premises, and she or the nther defendant has ever since been in possession. In October, 1864, by an order of the Supreme Court,, granted after due notice and hearing the parties interested, the foreclosure sale was set aside and de- clared null and void, and a resale was ordered, which never took place. In November, 1864, the defendant, Sarah A. Marsh, recov- ered a judgment against plaintiff. Brown, which was duly entered and docketed, and in 1865 she caused an execution to be issued upon said judgment to the Sheriff of New York, who, in May of the same year, sold "all right, title and interest" of which the said Elezabeth C. Brown was seized or possessed in the said land, the said Sarah A. Marsh becoming the purchaser and taking the sheriff's certificate of sale. In September, 1865, she conveyed the said premises by deed to the other defendant, and in September, 1866, after the com- mencement of this suit, she also transferred to him the sheriff's certificate, and he soon after received the sheriff's deed. The de- fendant, "William B. Marsh, had notice of all the facts when he took him title, and was not a lona fide purchaser for value. Since the 115 defendants went into possession of the premises they have assumed and claimed an absolute title, free from any right of redemption in the plaintiffs or either of them. The plaintiffs commenced this action to redeem the said premises from the mortgage and judgment of foreclosure, and the principal defence relied on by the defendants was their title under the judg- ment and execution sale against plaintiff Brown. The referee de- cided the same in favor of plaintiffs, holding that the execution sale, being made by the assignee of the mortgagee in possession, was null and void and conferred no title upon the purchaser. Eael.C. The only legal proposition involved in the ease, which we deem it important to consider, is whether a mortgagee of real estate in possession can cause the equity of redemption of the mort- gagor to be sold on an execution and become the purchaser of the same, and, after obtaining the sheriff's deed, set up his title thus acquired against the claim of the mortgagor to redeem from the mortgage in an equitable action commenced by him for that pur- pose; or. to state the proposition in other words, has the owner of the equity of redemption of mortgaged premises, after default and after the owner of the mortgage. has taken possession, such an in- terest in the premises as can be sold upon execution against him? If this question be answered in the affirmative, the decision of the General Term was right and must be affirmed. The respective rights of the mortgagor and mortgagee in the land mortgaged have been the stibject of much discussion, and it is impossible to reconcile all that learned judges and writers have said upon the subject. By the common law of England the legal estate was vesled in the mortgagee, to be defeated by the perform- ance of a condition subsequent, to-wit, payment at the law day. In default of such payment, the title became absolute and irredeemable in the mortgagee. But, two centuries ago, courts of equity assumed jurisdiction to relieve mortgagors against forfeitures, and, thence- forth, in equity a mortgage has been regarded as a mere security, as creating an interest in the mortgaged premises of a personal na- ture, like that which the mortgagee has in the debt itself. These equitable principles have had an increasing influence upon courts of law, and Chancellor Kent says that "the case of mortgages is one of the most splendid instances in the history of our jurispru- dence of the triumph of equitable principles over technical rules, and the homage which those principles have received by their adop- tion in the courts of law." (4 Kent's Com., 158.) The common-law rule, as modified bv the equitable principles above alluded to, still prevails in England. There the courts still hold that the legal title passes to the moragee, and becomes by de- fault absolutely vested in him at law. and that the mortgagor has, after default, nothing but an equity of redemption to be enforced in a court of equity. After default the mortgagor can again become reinvested with the title to his land only bv a reconvevance by the mortgagee. The same rule prevails in the New Endand States, and in manv of the other States of the Union. But this common- law Tule has never, to its full extent, been adopted in this state. 117 Here the mortgagor has, both in law and equity, been regarded as the owner of the fee, and the mortgage has been regarded as a mere chose in action, a mere security of a personal nature. (Waters v. Stewart, 1 Caine"s Cases in Error, 47 ; Jackson v. Willard, 4 John. 42; Eunyan v. JMersereau, 11 id., 534; Astor v. Hoyt, .5 Wend., 603 Packer v. Rochester and Syracuse Eailroad Co., 17 N. Y., 283-395 Kortright v. Cady, 21 id., 343; Power v. Lester, 33 id., 527; Merritt V. Bartholick, 36 id., 44.) Prior til the Eevised Statutes the mortgagee could maintain eject- ment to reco\er tlie mortgaged premises. This right has been taken away (2 E. S., 312), and now the mortgagor, both before and after default, is entitled to the possession of the premises, of which he cannot be deprived without his consent, e.xcept by foreclosure. It is not disputed that before possession taken by the mortgagee the mort- gagor has an interest in the real estate which can be sold upon exe- cution ; that his willow is entitled to dower; that he can convey and devise his interest as real estate; that at his death it descends to his heirs ; that he has e\'ery attribute and right of an absolute owner of the real estate, subjoet to the lien of the mortgage, and that his title can be defeated only Ijy foreclosure. It is not disputed that the mortgasi>e before possession taken has only a chose in action; that he holds the mortgage only as security for the debt; that he can sell the bond and mortgage bv mere delivery as personal proprty; that at his ileath they ]iass to his personal representatives as a por- tion of liis ])ersonal estate; that he has no such estate in the land as can be sold on execution, or as he can give his widow dower; and that he has no attribute or ownership in the land. It was said by Judge James, in Powei- v. Lester (supra), that "a mortgage is a mere security, an incumbrance upon land. It gives the mort- gagee no title or estate whatever. The mortgagor remains the owner, and may maintain trespass even against the mortgagee. A mortgage is but a chattel interest ; it may be assigned by delivery, and cannot be seized and sold on an execution." Judge Pratt says, in Packer v. The Eochester & Syracuse Eailroad Company (supra) , that "a mortgagee has a mere chose in action, secured by a lien upon the land. Since the Eevised Statutes there is no attribute left in the mort- gagee, before foreclosure, upon which he can make any pretense for a claim of title. For the mere right, when he goes into pos- session by the consent of the mortgagor, to retain possession, is not an attribute of title. He would have the same right in case of a pledge." At common law, payment or tender at the law day extinguished the lien of the mortgage and reinvested the mortgagor, without a reconvevance by the mort2;agee, with his title. But tender or pay- ment after the law day did not have this effect, and in such case re- conveyance was necessary; and such is still the rule in England and in manv states of the Fnion. But it has always been the law of this state that payment or tender, at any time aiter the mortgage debt became due and before foreclosure, destroved the lien of the morte-agp and restored the mortgagor to his full title. As the mort- gagee had no title, a reconveyance was not required by the law as ex- 118 pounded by our courts. So that here the term law day, which occu- pies such a prominent phice in the early diseiissiojis as to mortgages, has no particular significance. The mortgagor lia.< his 'iaw day" until his title has been foreclosed by sale undei the mortgage, and it is a misnDnier in this State to call the mortgagor's right in the land, before or after default, an ccpiity of redemption; a mere right to go into equity and redeem. This was a proper description of the mortgagor's right in the land according to the law as expounded in England. But in this State the interest of the mortgagor in the land is the same before and after default, and is a legal estate, with all the incidents and attributes of such an estate. But it is claimed by the learned counsel for the ajipellants that the position of the mortgagee is materially changed when he gets posses- sion. It is true, notwithstanding the provision of the Revised Stat- utes, which prohibits an action of ejectment by the mortgagee to obtain the possession of the mortgaged premises, that after he has lawfully obtained the possession he may retain it until the debt se- cured by the mortgage has been paid. Before taking possession the mortgagee has no title in the lands. How can the mere possession change the title from the mortgagor to the mortgagee, or in any way diminish the estate of the one or enlarge the estate of the other? Before taking possession the martgagee had a mere lien upon the real estate pledged for the security of his debt. ,Vfter possession he has in his possession the property pledged as security, the title re- maining as it w^as before.. The mortgagor's title is still a legal one, vrith all the incidents of a legal title subject to the pledge, and the mortgagee's interest is still a mere debt secured by the pledge. If the mortgagee should die in possession, the debt would still go to his personal representatives to be administered as personal estate, and the mortgagor's title would go to his heirs. Payment, or even tender, would destroy the mortgagee's right to retain possession, and would enable the mortgagor to maintain ejectment to recover possession. The mortgagee, in auch case, so far from having any title, holds the land as the land of the mortgagor, and is liable to account to him for the rents and profits. Judge Comstock, in Kort- right V. Cady (supra), says : "The mortgagee's right to bring eject- ment, or, being in possession, to defend himself against an eject- ment by the mortgagor, is but a right to recover or retain posses- sion of the pledge for the purpose of paying the debt. Such a right is but the incident of the debt, and has no relation to a title or estate in land. The notion that a mortgagee's possession, whether before or after default, enlarges his estate, or in any respect changes the simple relation of debtor and creditor between him and his mort- gagor, rests upon no foundation. We mav call it a just and lawful possassion, like the possession of any other pledge, but wliere its ob- ject is accomplished it is neither just nor lawful for an instant longer." T cannot doubt, therefore, that the mortgagor, after default, and after the mortgagee has taken possession, has such an estate in the land as can be sold upon execution. It is not nocessarv to decide whether, in such case, the mortgagee has also such an estate in the 119 land as can be sold upon execution, because, if he has, it does not follow that the mortgagor has not also such a right. They might each own an estate which could be sold. But I am of opinion that the mortgagee has no estate in the land which can be sold on exe- cution. His interest is a mere chose in action, a debt secured by a pledge of real estate. His debt is not merged in the real estate by his possession. He has no interest in the real estate which he can sell, or which can be sold separate from the debt. Such a sale would convey nothing. Whoever took the real estate from him would take it subject to the same liability as he was under to account for the rents and profits to the mortgagor. It has been decided that a trans- fer of the mortgage without the debt is a mere nullity. (Merritt v. Bartholick, »upra.) The fact that at the time of the execution sale, the defendants were in possession, claiming the absolute title, can make no differ- ence, as land held adversely to the true owner can be sold upon execution against him. (Tuttle v. Jackson, 6 Wend., 213; Truax V. Thorn, 2 Barb., 156.) I am, therefore, of the opinion that the title of the defendant under the execution sale was valid, and that the plaintiff had no right to redeem. The order of the General Term must be affirmed, and judgment absolute rendered against the plaintiffs, with costs. * DoLLivEK V. St. Joseph Insurakce Co., 128 Mass., 315 (1880). Mortgagor of real property insured the same under a policy, wherein he represented himself as having "the entire, unconditional and sole ownership" of the property. It was held that there was no misrep- resentation. SouLE, J. It has long been settled in this commonwealth that, as to all the world except the mortgagee, a mortgagor is the owner of the mort- gaged lands, at least till the mortgagee has entered for possession. Willington v. Gale, 7 Mass., 138 ; Waltham Bank v. Waltham, 10 Met., 334; White v. Whitney, 3 Met., 81 ; Ewer v. Hobbs, 5 Met., 1 ; Henry's case, 4 Gush., 257; Howard v. Eobinson, 5 Gush., 119 ; Buf- fum V. Bowditch Ins. Co., 10 Gush., 540 ; Famsworth v. Boston, 126 Mass., 1. This being the law, and the mortgagees not being in pos- session of the premises, the plaintiff's assignor might well be de- scribed in a policy of insurance as the owner of the property in- sured; and, inasmuch as his estate was in fee simple, not an estate for life, and not a base, qualified or conditional fee, it might well be described as the entire and unconditional ownership ; and as he had no joint tenant in common, his estate was well described as the sole ownership. As between him and the defendant, the mortgages and the lease were mere incumbrances to his title, not affecting its char- +The elaborate dissentinfr opinion of Gray C, nrgning for the legal character of the mort- gage estate eBpecially after default and entry, is omitted. 12n acter as entire, and not changing it from an absolute to a conditional estate or ownership. Even as between him and the mortgagees, the mortgagees' estate was the conditional one, determinable by satis- faction of the condition set out in the mortgage deed. Thei'e was no joint tenancy nor tenancy in common of the mortgagor and the mortgagees. All the characteristics of such tenancies are lacking in their relations to the property. Chapfell t'. Jabdine.— [51 Conn. 64 — 1884.] Paek^ C. J. This is a suit, for the foreclosure of certain mort- gaged premises, constituting an island, known as Earn Island, in Long Island Sound. The complaint alleges that the land mort- gaged, at the time the deed was given, lay in the town of Southold, Suffolk County, in the State of New York, and it is averred that the mortgage was recorded in the office of the clerk of Suffolk County, in that State. It is further alleged that Earn Island, by the recent establishment of the boundary line between the State of Few York and this State, has become a part of the town of Stonington, in this State. The complaint is demurred to, so that the averment stands admitted that the island was, when the mortgage was made, a part of the State of New York. The mortgaged premises having been in the State of New York when the mortgage was made, it is of course to be governed in its construction and effect by the laws of that State then in force. In McCormick v. Sullivant, 10 Wheat., 192, the court says : "It is an acknowledged principle of law that the title and disposition of real property is exclusively subject to the laws of the country where it is situated, which can alone prescribe the mode by which a title to it can pass from one person to another." The same doctrine is held in United States v. Crosby, 7 Cranch, 115; Kerr v. Moon, 9 Wheat., 565; Darby v. Mayer, 10 id., 465, and in many other cases. In- deed, the doctrine is unquestioned law everywhere. Now, according to the laws of the State of New York then and still in force, a mortgage of real estate creates a mere chose in ac- tion, a pledge, a security for the debt. It conveys no title to the property. The claim of the mortgagee is a mere chattel interest. He has no right to the possession of the property. The title and seisin remain in the mortgagor, and he can maintain trespass and ejectment against the mortgagee, if he takes possession of the prop- erty without the consent of the mortgagor. Now it is clear that there is no remedy by way of foreclosure known to our law which is adapted or appropriate to giving relief on a mortgage of this character. Our remedy is adapted to a mort- gage deed which conveys the title of the property to the mortgagee, and when the law day has passed the forfeiture, stated in the deed, becomes absolute at law, and vests a full and complete title in the mortgagee, with the exception of the equitable right of redemption, which still remains in the mortgagor. The object of the decree of foreclosure is to extinguish this right of redemption if the mortgage debt is not paid by a specified time. The decree acts 12t ■upon this right only. It convevs nothing to and decrees nothing in the mortgagee if the debt is not paid. After the law day has passed the right of redemption becomes a mere cloud on the title the mort- gagee then has, and when it is removed his title becomes clear and perfect. Phelps v. Sage, day, 151; Roath v. Smith, 5 Conn., 136; Chamberlain V. Thompson, 10 id., 244; Porter v. Seeley, 13 id., 564; Smith V. Vincent, 15 id., 1; Doton v. Russell, 1? id., 146; Cross v. Robinson, 31 id., 379; Dudley v. Caldwell, 19 id., 218; Colwell v. Warner, 36 id., 224. What effect would such a decree produce upon a mortgage like the one under consideration, where the legal title remains in the mortgagor, and nothing but a pledgee's interest is in the mortgagee, even after the debt becomes due ? It could only xtinguish the right of redemption, if it could do that. It could not give the mortgagee the right of possesion of the property, for the mortgagor has still the legal title, which carries with it the right of possession. It would require another proceeding in equity, to say the least, to dis- possess him of that title, and vest it in the mortgagee. Hence it is clear that full redress cannot be given the plaintiff in this proceed- ing. But the plaintiff has a lien on the property in the nature of a pledge to secure payment of the mortgage debt. And although our remedy of strict foreclosure may not be adapted to given redress to the plaintiff through the medium of such a lien, still a court of equity can devise a mode that will be appropriate, for it would be strange if a lawful lien upon property to decure a debt could not be enforced according to its tenor by a court of chancery. It is said that every wrong has its remedy ; so it may be said that every case requiring equitable relief has its corresponding mode of redress. We have no doubt that a court of equity has the power to subject the property in question to the payment of this debt, upon a proper complaint adapted to the purpose. When personal property is pledged to secure the payment of a debt, it may be take nand sold that payment may be made, after giving the pledger a reasonable opportunity for redemption. So here, we think a similar course might be taken with this property. Such a course would fall in with the original intent of the parties, and with the civil code and mode of procedure of the State of New York. Modes of redress in that State have of course no force in this State, but such a mode of ]irocedure seems to be adapted to a case of this character. And we further think that on an amended complaint, setting forth all the essential facts, and praying that if there shall be a de- fault in redeeming the property during such time as the court shall allow for redemption, then the right of redemption shall be forever foreclosed, and in the legal title and possession of the prop- erty be decreed in the mortgage, such course might be taken. We think either of the modes suggested might be pursued, but in- asmuch as the course which has been taken leaves the legal title and possession of the property in the mortgagor, we think the court erred in holding the complaint sufficient, and in passing- the decree thereon. 122 EECTOE, ETC., CHRIST CHUECH v. MACK et al. -[93 .V. 1'. 488—1883.] This action was brought to restrain defendants from obstructing the l ight and air f rom the windows of plaintiff's church edifice, ad- joining a lot owned by said defendant, Rhoda E. Mack. Plaintiff was formerly owner of said lot ,which was subject to a mortgage given to one Bell. It conveyed the same to defendant, John Mack, subject to the mortgage which the grantee assumed and agreed to pay. By the deed an easement was reserved of light and air to the g'rantor's church so long as its premises were used for chur;ch pur- poses. Mack conveyed to a third person, who, on the same day, con- veyed to Rhoda E., wife of said John Mack. Her deed was made subject to the Bell mortgage, but contained no assumption of the same by her. The holder of the mortgage, at the request of defend- ants herein, foreclosed the mortgage by suit; plaintiff was made a party defendant therein. Judgment of foreclosure in the ordinary form was entered, and upon the sale under it Mrs. Mack became the purchaser and received the referee's deed. Mrs. Mack thereafter erected a fence upon her lot, which cut off the light from the base- ment windows of plaintiff's church." FiNCH^ J. It is conceded that a purchase under the foreclosure of the Bell mortgage would have given to a stranger to the title an ownership discharged of the plaintiff's easement. That the same result attends the purchase by Mrs. Mack, notwithstanding her relation to the property, follows from the reason upon which the conceded rule is founded. The statute provides that the deed given in pursuance of a sale on foreclosure shall vest in the purchaser "the same estate (and no other or greater) that would have vested in the mortgage if the equity of redemption had been foreclosed," and further declares that such deeds shall be as valid as if executed by the mortgagor and mortgagee. The construction to be put upon these two provisions waw earlv settled in tliifi court. ( Brainerd v. Cooper, 10 N. Y. 358 ; Packer v. The Eoch. & Syracuse R. R. Co., 17 id. 287.) In the last of these cases it was said that where legal title is concerned, a mortgage, which for many other purposes is a mere^^hoseliTaction, is a conveyance of the land; that the interest remaining in the mortgagor is an equity, and that the foreclosure cuts off and extinguishes that equity, and leaves the title conveyed by the mortgage. It was added that such was precisely the effect of a strict foreclosure, and that in construing the statute its two clauses were to be read in harmony. It was, therefore, decided that when the act says the master's deed "shall have the same validity as if executed bv the mortgagor, it is not to be taken that the purchaser is .to be considered as holding under the mortgagor by title subse- quent to the mortgage in a sense which would subject him to the ef- fect of the mortgagor's acts intermediate the mortgage and fore- closure." "While it is clearly the modern doctrine that the mort- gagee has by virtue of his mortgage no estate in or title to the land, or the right of possession before or after the mortgage debt be- comes due (Ten Eyck v. Craig, (52 N. Y. 431), and only acquires 123 such title liy purchase upon tin.' foreclosuru sale, yet the charax^ter- and extent of his title sd aequii'ed is (li'sci'ibed in the statute by a reference to the olii rule and the old practice, when the mortgagor's right could be iitly termed an equity of redemption which could be foreclosed, leaving an absolute estate in the mortgage. The effect of the foreclosure deed, therefore, as deteniiined by the statute, is to vest in the purchaser the entire interest and estate of mortgagor and mortgagee us it existed at the date of the mortgage, and unaf- fected by the subsequent incumbrances and conveyances of the mort- gagor. And thus, while the plaiutitf eor|i()ration held title to the Mack lot, tney held it subject to the Bell mortgage and to the abso- lute title into which that mortgage might ripen by a foreclosure and sale. When they sold to j\Iack, reserving in easeinent in the lot for light and air to their adjoining windows, they held their easement, and Mack held his ownership, still subji'ct to the Bell mortgage and the absolute title into which it might be turned. Mack had assumed the payment of the Bell mortgage, but conveyed thnmgh a third person to his wife, subject to that mortgage, but without any lia- bility for its payment assumed by her. Upon its foreclosure she became the purchaser and took the deed. That vested in her, under the statute provision, the title of the mortgagor and mortgagee un- affected by the intermediate acts of tlu? mortgagor and those suc- ceeding to his interest, unless there be something in her position which subjects her to a different rule. The statute allowed her to be a purchaser, and in determining the effect of the foreclosure deed its terms draw no distinction among purchasers. It does not discriminate. Whoever may lawful- ly purchase becomes the purchaser whose title is described and de- termined, and we have no warrant in the facts to take Mrs. Mack out of the statutory protection. The argument of the General Term, and of the learned counsel for the respondent on this appeal were both aimed at the result of converting her purchase into a mere payment and discharge of the mortgage lien, and her deed into a release of the incumbrance. The General Term reached the n'^ult by a disregard of the first clause of the statute declaring the etfect af the deed, and what seems to us a misinterpretation dI' the second clause. Tn brief, the rea- soning was that the deed was to be ciuiivalent to' one made by the mortgagor and mortgagee ; that the mortgagor had already conveyed and his title incumbered by an after constituted easement had reached Mrs. Mack; that she could not be said to piirehase what she already had; that so her deed was only equivalent to one made by the mortgagee, and he having no title, but merely a lien, the foreclosure deed operated only as a release to Mrs. Mack, however it might operate as to a stranger. We deem this reasoning defec- tive in two respects. It construes the statute to transfer the mort- gagor's title as it stood, not at the date of his mortgag-e, but bur- dened with its after incumbrances and limitations, imposed by him or his grantees; and it assumes what is not true, that Mrs. Mack already had the entire title of the mortgagor, and so could take noth- ing from him, but only the right of the mortgagee. The mortgagor 134 had the absolutL' title incumbered only by the mortgage. That title he transferred to the church, but when the latter conveyed to Mack it reserved an easement or servitude, and so piirted with less than it received from the mortgagor. This title i\Irs. Mack took, and therefore did not get the entire interest which the mortgagor himself had. There was something which she had not got ; which by a foreclosure of the Bell mortgage wo^lld pass, ami which it was possible for her to purchase. A further ground is stated which is based upon a theory that Mi's. Mack by virtue of her ownership of the lot came under some obligation to pay off the mortgage, and so could not in equity as- sert a title founded upon a breach of that obligation. Cases are cited in other States which hold that the mortgagor owes to his mortgagee the duty of paying taxes upon the land and cannot by neglecting their payment and causing a sale and then become a purchaser, cut off the lien of the mortgagee. If the purchase had been made by Mr. ilack, who had assumed the payment of the mortgage, the question would have arisen. But ]\Irs. Mack owed no duty of payment either to the mortgagee or to the plaintiff. She assumed no such obligation. She violated no duty and incurred no personal liability by omitting to pay off the incumbrance. It was her right and privilege not to do so, and in the omission she did no wrong of which either party could lawfully complain. She had the right to leave the mortgagee to his remedy, and when he, asserted it, the law allowed her to becorne the purchaser, and made no dis- tinction between her rights and those of a stranger to the title. It was urged that this view of the case left the plaintiff without any power to save its easement, since on the sale Mrs. Mack could safely outbid all others and beyond the mortgage debt. But the plaintiff should not have waited until the sale. When brought into court as a defendant, and certain to be bound by the decree, it should have sought to modify the decree, and showing the peril of Its easement and offering to bid the full amount of the mortgage debt and costs upon a sale subject to the servitude, it should have asked that the sale be so made. The mortgagee could not object since the debt would be paid in full and he had no greater right; and Mrs. Mack could have asserted no equity to have the sale so made as to free her from the easement. But when no limitation or condition is imposed by the decree, and no duty of payment rests on the purchaser, the statute determines the estate which passes by the foreclosure deed. Judgment accordingly. (b) Possession, KEECH v. HALL. [Wouglas, 21—1778.] Ejectment tried at Guildhall, before Buller, Justice, nad verdict for the plaintiff. After a motion for a new trial, or leave to enter up judgment of nonsuit, and cases shown, the Court took time to con- sider; and, now. Lord Mansfield stated the case, and gave the opin- ion of the Court, as follows : 125 LordMaxsfield: This is t in ajatitaieut broughtJLQ^a warehouse in the city, by a mortgagee, against a lessee under a lease in writing for seven years, made .af ter-the date of the mortgage, by the mortgagor, who had continued in possession. The lease was 'at a rack-rent. The mortgagee had no notice of the lease, nor the lessee any notice of the mortgage. The defendant offered to attorn to the mortgagee before the ejectment was brought. The plaintiff is willing to suffer the defendant to redeem. There was no notice to quit; so that though the written lease should be bad, if the lessee is to be con- sidered as tenant from year to year, the plaintiff must fail in this ,action. TlyixiJifistion, therefore, for the Court to decide, is, whether, )by the agreement understood between mortgagors and mortgagees, 1 iwhieh is, that the latter shall receive interest and the former keep ' 'possession, the mortgagee has given an implid authority to the mort- jgagor to let from year to year, at a rack-rent; or whether he may ;not treat the defendant as a trespasser, disseisor and wrongdoer. No ease has been cited where this question has been agitated, much less decided. The only case at all like the present, is one that was tried before me on the. home circuit (Belehier v. Collins); but, there, the mortgagee was privy to the lease, and, afterwards, by a knavish trick, wanted to turn the tenant out. I do not wonder that such a case has not occurred before. Where the lease is not a bene- ficial lease, it is for the interest of the mortgagee to continue the ten- ant ; and where it is, the tenant may put himself in the place of the mortgagor, and either redeem himself, or get a friend to do it. The idea that the question may be more proper for a court of equity, goes upon a mistake. It emphatically belongs to a court of law, in opposition to a court of equity ; for a lessee at a rack-rent is a pur- chaser for a valuable consideration, and in every case between pur- chasers for a valuable consideration, a court of equity must follow not lead the law. On full consideration, we are all clearly of opin- ion, that there is no inference of fraud or consent against the mort- gagee, to prevent him from considering the lessee as a wrongdoer. It is rightly admitted that if the mortgagee had encouraged the ten- ant to lay out money, he could not maintain this action ; but here the question turns upon the agreement between the mortgagor and the mortgagee; when the mortgagor is left in possession, the true in- ference to be drawn, is an agreement that he shall posssss the prem- ises at will in the strictest sense, and, therefore, no notice is ever given him to quit, and he is not even entitled to reap the crop, as other tenants at will are, because all is liable to the debt; on pay- ment of which the mortgagee's title ceases. The mortgagorTias no power, express or implied, to let leases, not subject to every cir- cumstance of the mortgage. If by implication, tbe mortgagor had such a power, it must go to a great extent; to leases where a fine is taken on a renewal for lives. The tenant stands exactly in the sit- tiation of the mortgagor. The possession of the mortgagor cannot be considered as holding out a false appearance. It does not induce a belief that there is no mortgage; for it is the nature of the transaction, that the mortgagor shall continue in possessiion. Who- ever wants to be secure when he takes a lease, .should inquire after 126 and examine the title deeds. In practice, indeed, (especially in the case of great estates) that is not often done, because the tenant re- lies on the honor of his landlord ; but whenever one of two innocent persons must be a loser, the rule is, qui prior est tempore, potior est jure. If one must suffer, it is he who has not used due diligence in looking into the title. It was said at the bar, that if the plaintiff, in a case like this, can recover, he will also be entitled to the mesne profits from the tenant, in an action of trespass, which would be a manifest hardship and injustice, as the tenant would then pay the rent twice. I give no opinion on that point; but there may be a distinction, for the mortgagor may be considered as receiving the rents in order to pay the interest, by an implied authority from the mortgagee, till he determine his will. As^to the lessee's right to reap the crop which he may have sown previous to the determination of the will of the mortgagee, that point does not arise in this case, the ejectment oeing for a warehouse; but, however that may be, it could be no bar to the mortgagee's recovering in ejectment. It would only give the lessee a right of ingress and egress to take the crop ; as to which, with regards to tenants at will, the text of Littleton is clear. We are all clearly of opinion that the plaintiff is entitled to judg- ment. The Solicitor-General for the defendant. Dunning and Cowper for the plaintiff. The ride discharged. MOSS v. GALLIMOKE. [1 Douglas 2:9—1779.] In an action of trespass, which was tried before Naees, Justice, at last Assizes for Staffordshire, on not guilty pleaded, a verdict was found for the plaintiff, subject to the opinion of the Court, on a case reserved. The ease stated aa-follows : One Harrison, being /'seised in fee, on'ffieTs't of January, 1772, demised certain premises [ to the plaintiff for twenty years, at the rent of £40, payable yearly on the 12th of May; and in May, 1772, he mortgaged the same j premises, in fee, to the defendant, Mrs. Gallimore. Moss con- / tinned in possession from the date of the lease, and paid his rent / regularly to the mortgagor, all but i28, which was due on and before the month of November, 1778, when the mortgagor became a " bankrupt, being, at the time, indebted to the mortgagee in more than that sum for interest on the mortgage. On the 3d of January, 1779, one Harwar went to the plaintiff in behalf of Gallimore, showed him the mortgage deed, and demanded from him the rent then remaining unpaid. This was the first demand that Gallimore made of the rent. The plaintiff told Harwar that the assignees of Harrison had demanded it before, viz., on the 31st of December; but, when Harwar said that Gallimore would distrain for it if it was not paid, he said, he had some cattle to sell, and hoped she would not distrain till they were sold, when he would pay it. The plaintiff not having paid according to this undertaking, the other defendant, by order of Gallimore, entered, and distrained for the 137 rent. The question stated for the opinion of the Court, was, whether, under all the eireumstances, the distress could be justi- fied. AsHHUiiST. Jusi'ICB: Tlie statute of Queen Anne has riU'-eredat- I tomment unnecessary in all eases, and the only question here arises < upon the circumstances of the notice of the mortgage not having been given till after the rent distrained for became due. Where the mortgagor is himself the occupier of the estate, he may be con- Jsidered as tenant at will; but he cannot be so considered, if there is an untlertenant; for there can be no such thing as an under- ( tenant to a tenant at will. The demise itself would amount to a 'i determination of the will. There being in this case a tenant, in pos- ' session, the mortgagor is. tlierefore, only a receiver of the rent for the mortgagee, who may, at any time, countermand the implied ; authority, by giving notice not to pay the rent to him any longer. Ktli i:a. Justick: There is in this i ase a plea ol' the general issue, wliich is given liy statute, bur if tlie justification appeared upon the record in a special plea, the distress must be held to be legal. ]5efon' the act of Queen Anne, in a special justiticaiion. attornment must have been pleaded. But since that statute, it is never averred in a declaration in covenant, nor pleaded in an avowry. In the case of Keech v. Hall, referred to by Mr. Wood, the Court did not con- sider the mortgagee as tenant at will to all purposes. If my mem- OTj does not fail me, my Lord distinguished mortgagors from ten- ants at will in a very material circumstance, namely, that a mort- gagor would not be entitled to emblements. E.xpressions used, in particular cases are to be understood with relation to the subject- matter then before the Court. Jones v. Clark. — [20 Juhns, .51 — 1822.] Spencer, Ch. J., delivered the opinion of the Court. The points made by the counsel for the plaintiff in error, are : 1. That there was no sufficient evidence that Jones held under Clark and Stewart. 2. That Howel was an incompetent vidtness. 3. That the matters shown by the defendant below were a com- plete defense. The first and second points may, at once, be disposed of. There was complete evidence of the hiring of the premises by Jones for the second year. Howel was a competent witness to show that he had no beneficial interest in the expired lease, though the fact itself was no wise material. The cause depends on the third point ; and it presents this ques- tion, whether a tenant of the mortgagor in possession, and who be- came sucITsubsequent to the giving of the mortgage, can,_in J/..suit by his landlord, the mortgagor, set iip as a legal defense, that after In^o the mortgage became forfeited, he attorned to the mortgagee, and i took a lease from him, during the continuance of the lease from the yV mortgagor. This case has probably been decided in the Court be- '' low, on the authoritv of the case of McKircher v. Hawley, (16 Johns. Rep., 289). The principle decided in that case was this: 128 Ihat a mortgagee could not distrain for rent beeoniing due under a lease made by the mortgagor subsequent to giving tire mortgage, because their was no privity of estate or contract between the mort- gagee and such a tenant ; and we held, that, to enable a party to dis- train for tlie rent he must have a concurrent right to maintain an action for the rent, and if there was no privity of contract or estate, an action could not be maintained. When the plaintiff in error attorned to the mortgagees, and took a lease fro mthem, their title to enter under their mortgage was complete; for, the day of payment having passed, the condition, was broken, and the estate of the mortgagees was absolute at law. This case, then, presents a very different question from the one de- cided in McKircher v. Hawley. There, the point was, whether the mortgagee could distrain, or, in effect, sue for the rent. Here, it is, whether the tenant of the mortgagor could not, by his own act and consent, become the future tenant of the mortgagees, without any disloyalty to the mortgagor. "At common law," says Mr. Butler, (in note 272 to Co. Lift., 309, a.) "attornment signified only the consent of the tenant to the grant of the seigniory; or, in other words, his consent to become the tenant of the new lord." He goes on to show the operation of the statute of quia emptores, and the statute of uses, and the statute of wills; and observes, that the ne- cessity and efficacy of attornments have been almost totally taken away by the statutes of 4 and 5 Anne, c. 16, and 11 George II, c. 19. These two statutes have been re-enacted here. The former does not relate to the case, but the latter has an important and decisive bear- ing upon it. The 28th section of the statute concerning distresses, rents and the renewal of leases, (1 N". E. L., 443), after reciting that the possession of estates is rendered precarious by the frequent and fraudulent practices of tenants attorning to strangers, by which means landlord and lessors are turned out of possession, and put to the difficulty and expense of recovering possession by suits at law, enacts, that every such attornment shall be null and void, and the possession of the landlords or lessors shall not be deemed to be, in any wise, changed by any such attornment; with a proviso, that nothing therein contained should extend to vacate or effect any at- tornment made pursuant to and in consequence of any judgment at law, or decree or order of a court of equity, or made with the privity and consent of the landlord or lessor, or to any mortgagee after the mortgage is become forfeited. The mischief which the statute was intended to remedy, was the attornment by tenants to strangers claiming title ; and without the proviso, the construction of the enacting part of the statute would have admitted of no doubt. But to remove every doubt, the Legis- lature have declared who were not strangers, and to whom the tenant might lawfully attorn ; he may attorn to a mortgagee after the mort- gage is forfeited. The reason of this is obvious. The mortgagee, as between him and the mortgagor, has the right of entry, and is entitled to the possession of the premises. If, then, the tenant will do voluntarily what the law will coerce him to do, yield up the possession to the mortgagee, it is not an act injurious to the just 129 Jl rights of the mortgagm-, nor disloyal towards him. Indeed, the rights of the tenant also require that he should be allowed to do so; for if he refuses to attorn, he at once subjects himself to evic- tion, and the payment of costs. The statute . makes nodiltVinice between a tenant to the mortgagor, who becomes so before or after the execution of the mortgage. It applies to every tenant of the mortgagor, without reference to the time when h bcame tnant. The reason is the, same in both cases, and they are both embraced by the proviso of the statute, and neither of them are within the mis- chiefs intended by the enacting part of the statute. Judgment reversed, and a venire de novo to be awarded in the court below. HALL V. DOE d. SURTEES. [5 B. & A. 687—1822.] This was a writ of error brought to reverse a judgment obtained in ejectment in the Court of Pleas at Durham. The declaration was on a demise by W. Surtees, on the 8th July, 1817, of an undi- vided third part of certain premises habendum from 7th July, 1817, for seven years, &c. A special verdict was found, stating the .following facts : On the 1st May, 1780, one Thomas Labourn being seised for the tenements in question ,in fee, mortgaged them to Auburn Surtees, in fee, for the sum of £800, with the usual proviso for reconveyance, if Labourn sould pay A. S. the £800, with inter- est on the 3d. November, 1780, and that Labourn should occupy the premises until default. A default having been made, A. S. thereby became seised in fee by law of the premises, but never en- tered, and Labourn continued to occupy them until his death. A. Surtees, on the 30th September, 1800, died intestate, and the right to the premises in question descended to W. Surtees, his heir at law. Thomas Labourn died on the 30th June, 1804, and the estate descended to J. Labourn, his son and heir at law, who entered and occupied part of the premises in question, until 1807; the residue being occupied by his mother till her death, in 1813. J. Labourn, in October, 1806, conveyed the premises for a valuable consideration to Michael Hall, the defendant below, and on the 8th October, 1806, a fine was levied with proclamations in the Court of Pleas, in the county palatine of Durham, of the premises in question, to the use of Michael Hall. M. Hall, on the 1st August, 1807, entered and occupied one messuage part of the premises in question, into which Joseph Labourn had entered upon the death of Thomas Labourn, and continued to occupy the same ; and immediately after the death of Elizabeth Labourn, in September, 1813, Michael Hall entered into possesssion, and occupied the residue of the premises in qustion. W. Surtees, on the 13th July, 1813, demanded of Michael Hall the possession of the same, which he refused to deliver up. Abbott, C. J. : Upon this finding, I am of opinion that this /must be considered as an occupation by the permission of the mort- gagee ; and if so, there was no adverse possession, and the statute of limitations does not apply. The payment of interest would have 130 been conclusive e\idt'iR-e of a eontimuiiu' tenancy. 'J'hat fact is not found by the jury: but that is not the only ground upon wliich the Court can proceed, if tlierewere any circ-unistances from which the jury might have presumed timt the premises were not occupied by the permission of the mortgajiee. they ought to liave found that fact. Here, however, is nothijig to justify us in presuming that this occupation was not by the permission of the mortgagee. The judg- ment, therefore, must be for the plaintiff. Baylet, J. : I am of the same opinion. The argument proceeds on the ground, that the mortgagor was in possession by wrong; but as the special verdict does not find a wrongful possession, we ought not to presume it. The statute of limitations cannot attach, unless it is shown that the mortgagor held in opposition to the will of the mortgagee. It is clear the fine cannot operate to displace or divest the right of the mortgagee, and does not, therefore, require an entry to avoid it. Holroyd and Best, Js., concurred. Judgement afhrmed. GRAY V. GILLESPIE. [59 .V. //. 4(i9— 1879.] Writ of entry on a mortgage. Plea, the general issue with a brief statement that the condition of the mortgage has not been broken. Motion to reject the brief statement. Bingham, J. : It_is_.prQvided by Gen. Laws, c. 232, s. 12, that in actions on mortgages the judgment shall be conditional, that if the /mortgagor pays to the mortgagee the sum the Court shall adjtfdge ; due, within two months after judgment rendered, with interest, the .^judgment shall be void. The defendaj it,-claims. that this provision applies to all actions upon mortgages, and that;^ if nothing is due on the mortgage debt, no action can be maintained because no judg- ment~eah be rendered. This statute, almost in its present form, has existed in this State for a longer period than is covered by our re- ported eases. We are unable to find an instance in which the Court has intimated such a construction as the defendant claims. A mortgage vests the seisin of the estate in the mortgagee, and he maTiTany time enter upon the mortgagor, and take and retain pos- session of the premises for the purpose of receiving the rents and profits until the condition is performed. Brown v. Cram, 1 N. H., 169 ; Hartshorn v. Hubbard, 2 ¥. H., 453 ; Hunt v. Stiles, 10 N. H., 466; Dearborn v. Dearborn, 9 N". H., 117; Ellison v. Daniels, 11 ISr. H., 274; Smith v. Moore, 11 N. H., 55, 61 ; ChelHs v. Stearns, 22 N. H., 312. In an action brought to foreclose a mortgage, the judgment must be conditional. But in this case, the mortgagee, being entitled to the possession of the premises in order that he may take the rents and profits, can maintain his action. Hobart v. Sanborn, 13 N. H., 226. r'fl.sp discharged. Allen, J., did not sit ; the others concurred. 131 Mass. Pub. Stat. Ch. 181. § 10. Nothing contained in this chapter slaall prevent a mortgagee or any person claiming under him from entering on the premises or from recovering possession thereof before breacli of the condition of the mortgage, when there is no agreement to the contrary. Vermont Stat., Sec. 1498 : Every mortgagor shall, until condi- tion broken, have, as against the mortgagee, the legal right of pos- Bession to the mortgaged premises, unless it is otherwise stipulated m the mortgage deed. New York Code Civ. Proc, Action to Eecover Real Property, Sec. 1498 : A mortgagee, or his assignee or other representative, cannot maintain such an action, to recover the mortgaged premises. , HUBBELL V. MOULSON. [53 New York, 225—1873.] Appeal from judgment of the General Term of the Supreme- Court in the fourth judicial department in favor of defendants, entered upon an order denying motion for a new trial and directing a judgment on verdict. ' This action was ejectment to recover possession of the undivided haix of a lot of land situate in Brighton, Monroe county. The facts appear sufficiently in the opinion. The court directed a verdict in favor of defendants which was rendered accordingly. Exceptions were ordered heard in the first instance of General Term. Francis Kernan for the appellant. Payment of the mortgage or tender of the amount due discharges the lien of a mortgagee. (3 R. S., 3d ed., 599, 850; 4 Kent's Com., 11th ed., 169; note 4; Ed- wards V. Farmers' Ins. Co., 21 Wend., 467; S. C. in error, 26 id., 541; Arnott v. Post, 6 Hill, 65; Kortright v. Cady, 21 N. Y., 343; Waring v. Smith, 2 Barb., Ch., 119, 135). After payment or tender of the amount (hie an action of ejectment will lie. ( 21 Wend., 467; 26 id., 541; 6 Hill, 65). W. F. Cogswell for the respondents. Denfendants were mort- gagees in possession, and an action of ejectment could not be main- tained 'against them. (Van Duyne v. Thayer, 14 Wend., 233 ; Phyfe V. Reiley, 15 id., 248; Chase v. Peck, 21 N. Y., 581; Hubbell" et al. v. Sibley, MS.). Andrews, J.: The plaintiffs claim title under Alfred Hubbell, the mortgagor, to the undivided half of premises mortgaged by him to Hiram Sibley, December 1, 1846, to secure the payment . of $7,000. The action is ejectment, and it was necessary for the plain- tiffs, in order to recover under their complaint, to show that they were entitled, as against the defendants, to the possession of the premises at the time of the commencemnt of the action. The de- fendants are the grantees of Sibley, the mortgagee, under a deed IZ'2 dated June 7, 1849, and are in possession, claiming under that •deed. They stand, by reason of that conveyance, in privity witli the mortgagee, and their right to the possession is the right of the mort- gagee, and the right of the plaintiffs depends upon the same prin- ciples as if Sibley was in possesssion and the action had been brought against him. (Jackson v. Mueller, 10 J. R., 479 ; Jack- son v. Bowen, 7 Cow., 13; Robinson v. Ryan, 25 N^. y., 320). The plaintiffs on the trial offered to prove that the mortgage debt had been paid by the receipt by Sibley, before the commencement of tlie action, or rents and profits from the land sufficient to satisfy it. The evidence was excluded. If the mortgage was in law sub- sisting and unsatisfied when the action was commenced, then it cannot be maintained, as t he auth orities are decisive that eject- ment will not lie by a mortgagor against a mortgagee in possession. (Van Duyne v. Thayre, 14 Wend., 233; Phyfe v. Reiley, 15 Wend., 248; Pell v. Ulmar, 18 N. Y., 139). Leaving out of view the al- egedl title under the statute foreclosure, the question arises, whether 7 the receipt by a mortgagee in possession"of"Fents and profits, sufB- cient to'satisfy tTie mortgage debt, does ipso facto extinguish it and j discharge the lien of the mortgage. If it does not, then the evi- dence was properly excluded. If admitted, it would not have shown a right in the plaintiffs to the possession of the premises when the action was brought. It is^the settled doctrine in this State tliat a, mortgagee has by virtue of his m ortg age a lien only, and not .an estate in the land mt)rtgageT (Runyan v. Mersereau, 11 J. R., 537; Jackson v. Craft, IS^id., 110 ; Jackson v. Bronson, 19 id., 325; Kortright v. Cady, 31 N. Y., 343; Stoddard v. Hart, 23 id., 560). In harmony with this view it was held in Kortright v. Cady that a tender of a mortgage debt after it became due discharged the lien of the mortgage and prevented a subsequent foreclosure. And it was h^ld in Edwards v. The Fireman's Fire Ins. and Loan Co., (21 Wend., 467; 26 id., 541 ) , that upon a tender after default by a mortgagor of the mort- gage debt, ejectment would lie in his favor upon the refusal of the mortgagee to surrender the possession. But while no title in a strict sense vests in the mortgagee of land until foreclosure, yet liis in- terest is, in some cases ,treated and regarded as a title, for the pur- pose of protecting and enforcing the equities between parties. An instance of this is found in Mickles v. Townsend (18 N. Y., 575) where it was so held for the purpose of applying to the doctrine of estoppel by deed against a person claiming as assignee ofa mortgage, which existed at the time of his prior conveyance of the mortgaged premises with warranty, but which was assigned to him afterward. And in Van Duyne v. Thayre (19 Wend., 162) the relase of the equity of redemption by the mortgagor to the mortgagee was held to inure as an enlargement of the estate of the mortgagee so as to prevent the plaintiff's recovering dower at law, in disregard of the equity of the defendant to have the mortgage first satisfied out of the land. (Cowen, J., 21 Wend., 485). It is easy to see that where the English doctrine prevails, that the mortgage conveys a le-yal title to the morf.gaged premises, the: right of the luortgagor to an account of the rents and profits of the land received by the mortgagee is purely exclusively of equitable, cognizance. At law, the mortgagee is the owner of the estate, and takes the rents and profits in that character. In equity, the mort- gagor is regarded as the owner until foreclosure, and his right to an account is incident to his right of redemption. (2 Wash, on Eeal Property, IGl, 205; Seaver v. Durant, 39 Vt., 103; Parson v. \\'elles, 17 Mass., 419). But the necessity to resort to an account- ing in equity, in order to have the rents and profits applied to the satisfaction of the mortgage, is not obviated by the fact that here the mortgagor retains the legal title. The mortgagee in possession takes the rents and profits in the quasi character of trustee or bailiff of the mortgagor. (2 Pow. on Mort., 94(), a; 2 Wash., 205). They are applied in equity as an ecjuitable set-off to the amount due on the mortgage debt. ( Ifuckman v. Astor, 9 Paige, 517). The l aw does not apply tlieni as recei\ed to the payment of the mortgage. It depends upon the result of an aeeoui^ in g up on equitable prin- ciples, whether any part of the rents and profits received shall be so applied. The mortgagee is entitled to have them apiplied, in the first instance, to reimburse him for taxes and necessary repairs made upon the premises ; i^or sums paid by him upon prior incumbrances upon the estate, in order to 'prof ect the title, and for costs in de- fending it; and if he has made permanent improvements upon the land, in the belief that he was the absolute owner, the increased value by reason thereof may be allowed him. So he may be charged with rents and profits he might have received, if his failure to re- cover them is attributable to his fraud or willful default. (3 Powell on Mort., 957, note ; 4 Kent, 18.") ; 2 Wash., 218 ; Cameron v. Irwin, 5 Hill, 272; Mickles v. Dillaye, 17 N. Y., 80). In many cases com- plicated equities must be determined and adjusted before it can be ascertained what part, if any, of the rents and profits received is to be applied upon -the morigfage debt. In the absence of the agree- ment between the parties there is no legal satisfaction of the'mqrt- gage by the receipt of rents and profits by a mortgagge in possession to an amount sufficient to satisfv it, and his character as mortgagee in possession is not divested until they are applied bv the judgment of the court in satisfaction of the mortgage. These considerations leaa to an affirmance of the judgment without considering the ques- tion of the validity of the statute foreclosure. The plaintiff's claim to recover upon the allegation of a right to the possession of the premises when the action was commenced. The defendants were in possession, claiming under the mortgagee whose mortgage was outstanding and unsatisfied. The action is not for a redemption or of an accounting, and the plaintiffs are not in the attitude or resisting an attempt loy the mortgagee to enforce the mortgage. The judgment should be affirmed, with costs. All concur. ■Judgment affirmed. * Accord. T ownnhcnd v Thf^jr^ann 139 N. Y.. 1.53, (1«93). But see Chase v. Peck, 81 N. T 581, 580; mpcfTTTTm. 134 (c.) Dower and Guiicsy. NASH Y. PEESTON. (3 Croke, 11)0.-1631.) A bill in chancery was referred to Jones, Justice, and nij'self, to consider whether one should be relieved against dower demand- ed, &.c The case appeared to be that J. S., being seised in fee, by in- denture enrolled, bargains and sells to the husband for one hundred and twenty pounds, in consideration that he shall re-demise it to him and his wife for their lives, rendering a peppercorn ; and with a condition that if he paid the hundred and twenty pounds at the end of twenty 3'ears, the bargain and sale shall be void. He re- demised it accordingly, and dies : his wife brings dower. The question was, whether the plaintiff shall be relieved against this title of dower? We conceived it to be against equit}', and the agreement of the husband at the time of the purchase, that she should have it against the lessees; for it was intended that they should have it re-demised immediately to them, as soon as they parted with it ; and it is but in nature of a mortgage; a ndupon a mortgas^e. if land be re deemed. t he wife of the mortgagee shall not have dow er. And if a husband take a fine snr cognisance de droit come ceo, and render arrear, al- though it was once the husband's, yet his wife shall not have dower; for it is in him and out of him cjiuaiy the last cited case. (See also Eafon V. Simonds,'l4 Pick. 98.) It follows that in anv view the charj;e of the circuit judge was altogether unobjectionable on the part of the plaintiff^. I enter- 146 tain no doubt that liu would have been right in putting the matter to the jur}' without regard to the entry being under the mortgage. The ease is ail wliieli it was when liere before. Mr. Justice Nelson then said: "I liave no doubt it was competent for the heirs to set Qp tlieir possession as representing the legal estate in the mort- gaged premises." I add, such a right in the heirs is made stronger — it is not necessary to say precisely how much stronger — by the deed which the plaintiff now insists upon. A new trial must ie denied.* (d) ^^'afi^e and Repair. KING V. SMITH. [2 Hare, 239.-184:3.] W. Smith conveyed and surrendered certain freehold and copy- hold estates to the use of J. Eeid and his heirs, by way of mortgage, to secure £2,700, and interest. W. Smith, by his will, gave all his real and personal estate to the defendant, S. Smith (who was also his heir-at-law, customary heir, and sole executor), "in hopes that he might be able to pay his (the testator's) just debts, and find a surplus for his trouble." J. Reid devised his legal interest in the mortgaged premises to the plaintiffs, and appointed them his ex- ecutors. The plaintiffs, by their bill, charged that the mortgaged premises were a "scanty security" for the principal and interest due, and that the plaintiffs w^ere entitled and claimed to be spe- cialty creditors upon the general estate of the mortgagor for the deficiency; and that, to ascertain the same, the mortgaged premises ought to be sold. The bill prayed an account of the mortgage debt — a sale accordingly — and payment out of the proceeds ; and, if the same were insufficient, that the plaintiffs might be declared to be specialty creditors upon the estate for the deficiency ; that, if neces- sary, the suit might be taken as being on behalf of the plaintiffs, and all other the unsatisfied creditors of W. Smith, and the personal and real estate duly administered and applied. After appearance, and before answer, the pla,intiffs filled their supplemental bill, stating that, since the original bill was filed, the defendant had felled, and was proceeding to fell and carry away large numbers of timber and timber-like trees, which were growing on the mortgaged premises ; that many of such trees were lying upon the lands, and had been advertised for sale ; and praying an account of the trees felled, and of the monies produced by the sale, and an injunction to restrain the felling and sale of trees from the mortgaged premises. The plaintiffs moved for the injunction, according to the prayer. Vice Ciiaxcellor Wigeam : The cases decide that a mortgagee out of possession is not of course, entitled to an injunction to restrain the mortgagor from cutting timber on the mortgaged property. If the security is suf- ficient, the Court will not grant an injunction merely because the » Accord. Eyeraon v. McMuIlen, 113 N. Y., 898, 1889. 147 mortgagor cuts, or threatens to cut, timber. There must be a spe- cial case made out before this Court will interpose. The difficulty I feel is in discovering what is meant by a "sufficient security." Suppose the mortgage debt, with all the expenses, to be £l,Oi.)0, and the property to be worth £1,000; that is, in one sense, a sufficient security; but no mortgagee, who is well advised, would lend his money, unless the mortgaged property was worth one-third more than the amount lent at the time of the mortgage. If the jjroperty consisted of houses, which are subject to many casualties to which land is not liable, the mortgagee would, probably, require mm'c It is rather a question of prudence than of actual value. I thiiilc the question which must be tried is whether the property the mort- gagee takes as a security is sufficient in this sense — that the security is worth so much more than the money advanced — that the act of cutting timber is not to be considered as substantially impairing the value, which was the basis of the contract between the parties at the time it was entered into. I have read the affidavit, and I cannot find that either the rental or income of the property appears ; but it seems that the substantial part of it consists of houses, which might make it a more serious question, whether the Court should permit the mortgagor to cut the timber. The supplemental bill which states the circumstances with respect to the timber, and prays the injunction, contains no case with reference to the insufficiency of value, nor does the plaintiff, by his affidavit, take any such case. The bill and affidavit appear to proceed on the supposition that the mortgagor has no right to cut the timber under any circum- stances. In the valuation which is attempted to be shown, I am not told the quantity of the land or the rental ; nor can I discover of what class the houses are, or whether they are tenanted or not, or what is the nature of the property generally. It is stated, on the defendant's affidavits, that he did not cut any of the trees with the intention of injuring the estate, but, on the contrary, he did it in the due and proper course of husbandry and management. What is meant by felling twenty-one large elm trees in due course of husbandry, I cannot comprehend. It is ob- vious that the defendant is using language of which he does not know the effect. There being, however, no abstract_right J3n_th8,| part of a mortgagee to saylihat'the mortgagor shalTnot cut timber, I am satisfied that there must be clearer evidence of the value he- fore me, or I cannot grant the injunction. Let the motion stand over, with liberty to apply. If the defend- ant proceeds to cut more timber the plaintiff can renew his appli- cation, and bring before me a case upon which I can adjudicate, and then the costs of this motion will be disposed of. I should be very reluctant to decide it vrithout knowing what is the actual value of the security which has been accepted by the mortgagee, or whether he is really secured or not. CAMrBELL V. Macomb.— [4 Johns. Ch., 534. — 1820.] TiiE Chancellor (Kent). I__cannot make it a condition oj the order, staying the sale, that tTTe defen3ahT~~shouT3^ repair I!'! the da m. This would be a very extraordinary and dan- gerous interference with the exercise of the rights of a mortgagor, and is, in practice, unknown. Suppose, the most valuable part of the mortgaged premises should consist of buildings, and they should accidentally be destroyed by fire, can the mortgagor be compelled immediately to rebuild? Is it not rather incumbent on the mortgagee, or the surety, to provide for such a case in the contract, or by insurance? It would bring dis- tress and ruin upon a mortgagor, to charge him with burdens and duties, not within the contemplation of his contract, and, therefore, not within his provident foresight. How far the court could, or ought to interfere, in a case of negligent, or permissive waste, rapid- ly impairing the security, is a question which need not now be dis- cussed; for the relief, if any, would not be by directing the mort- gaged premises to be sold for a debt not due, or, under a decree of " sale, to give an order to repair, a reference to assess damages. The necessity of any interference, of any kind, in cases of mortgages, is exceedingly diminished by the consideration, that the mortgagee can, if he pleases, relieve himself, by obtaining possession of the land, and make, at his own expense, the requisite repairs, for which he would be allowed, in account, when the mortgagor came to re- deem. It is also stated, in this case, that the present owner of the equity of redemption is in the act of repairing the dam ; and it is so evidently his interest to do it, and his payment of the interest due on the mortgage, together with the costs, is such decisive evidence, that the property is considerede to be worth more than the debt charged thereon, that I should infer there was little or no founda- tion for the alarm discovered in the petition. Motion denied, with coxts. COOPER V. DAVIS. [15 Conn., 556.— 1843.] Waite, J. The defendant claimed title to the millstones in ques- /tion, by virtue of a mortgage made to him of certain real estate, upon which was situated a grist-mill. He had obtained against the mortgagors a decree for a foreclosure, and a judgment for the pos- cession, in an action of ejectment. But before the expiration of the ] time limited for the foreclosure, and before he had taken actual I possession, the mortgagors severed the stones from the mill, and / sold them to the plaintiil. The defendant, having afterwards ( found them, took possession of them as his own property. The question arising upon these facts was, whether the plaintiff had thus acquired, as against the defendant, a valid title. Upon the trial in the court below, it was supposed that, after a decree for a foreclosure had been passed, and a judgment rendered in an action of ejectment for the possession, the mortgagors might be considered as trespassers, in removing the fixed machinery, and disposing of it, in the manner stated in the motion. The law, recognized- in the ease of Hodgson v. Gascoigne, was thought to be applicable to the present, o B. & Aid. 81. 7 E. C. 110 L. 35. It was tiiere holdeii, that after a landlord had recovered judgment against his tenant, in an action of ejectment for the pos- eession of the demised property, the tenant ceased to have ^ny in- terest in the growing crops, and the. sheriff had no right to levy an execution upon them. But, upon consideration, we are all satisfied that the principle, laid down in that case, does not apply to the present. There, the question was, as to tlie relative rights of a landlord and tenant; here, as to the rights of a mortgagor and mortgagee. By repeated decisions, it is now fully established, that a mort- gagor, before his right of redemption is foreclosed, continues the owner of the real estate mortgaged ; that he is not accountable for the rents and profits, nor liable, in action at law, for waste com- mitted while in possession. The mortgagee has merely a lien upon the property for the seenrity of his debt, by virtue of which he may obtain possession, and appropriate the pledge in payment of his debt. The mortgagor has, indeed, no right, Ijv the commission of waste, (to render the security inadequate. But the appropriate remedy for ,such conflict is, by way of injunction. If the secitrity is impaired, by cutting and carrying away the wood and timber, the mortgagee lias no power to seize them, after they have been severed and car- /ried away; but his duty, in such case, is, to restrain the mortgagor (from such acts liy an injuiu-tion. These gcjieral principles are not denied. But it is claimed that the rights of the defendant ha\e been varied by the judgment in his favor for the |)ossessioii. But we do not see that circumstances can make any material difference. He had not taken actual pos- session; nor had his title to tlie property become absolute by the decree. He stood, simply, in the character of mortgagee out of . possession. His further proceedings in relation to the mortgage, might, at any time, have been arrested, by paying him his debt. His interest in the property continued to be but a lien. The mort- gagors continued in possession, and, as such, were the owners. The mill-stones, after they had been severed from the mill, removed and sold, could not be reclaimed, by the defendant, by virtue of his mortgage. And although the design of the mortgagors probably was to impair the defendant's security, and prevent him from col- lecting the full amount of his debt, yet we cannot say that he is entitled to relief in the manner in which he has sought it. His duty was to have protected his rights, by an application for an in- junction. Upon this ground, therefore, without adverting to the other questions, which we do not consider it necessary to examine, we think a new trial must be granted. In this opinion the other Judges concurred. New trial to he granted. Peterson v. Clakk.— [15 John., 30."i. — 1S18.] Per Curiam. There can be no doubt but that the deed from A' an Camp to Clark, and defeasance given back, amounted only > to a mortgage, and the simple question then is, whether a mort- , ^'^150 gagee can maintain an action of waste against the mot rj;a,iior, before the forfeiture of the mortgage; for tlie waste alleged toliave been committed in tins ease, was before tlie expiration of the time lim- ited for the payment of the money secured by the mortgage. In- deed, the present suit was eommeneed before "that time. Waste is an injury done to the inhi-ritance, and the action of waste is given to him who has the inheritance in expectancy, in remainder, or re- version ; but it is expressly laid down l)y Blackstone (3 Bl. Com. 225), that he who hath the remainder for life only, is not entitled to sue for the waste, since his interest may never, perhaps, come into possession, and then he has suffered no injury. So, likewise, with respect to the mortgagee, especially when the mortgage is not for- feited, his interest in the land is contingent, and may be defeated by payment of the money secured by the mortgage ; and it must fol- low, as a matter of course, that he has not such interest in the tim- ber as to sustain an action of trover. The judgment of the court below must be revei-sed. STOWELL V. PIKE f-i Grcenhaf. 287. — 1823.] In an action of trespass quare clausula f regit, the ease was thus : The plaintiff, by his deed dated September 15, 1819, bargained and .sold the close described in the writ to one Bickford, in fee, taking from Bickford, at the same time, a mortgage of the same land, to secure the payment of the purchase money, for which Bickford also gave his notes of hand to the plaintiff, amounting to three hundred and thirty dollars, payable at different periods in the course of the two years and a half, with interest. In the course of the Spring fol- lowing, Bickford paid his first instalment; and in December, 1820, he sold all the timber then standing on the premises, to the value of two hundred and thirty dollars, to the defendant. Pike, and others, who, with the other defendants in their employment, without li- •oense from the plaintiff, c?ut it down and converted it to their own use, for which cutting this action was brought. Bickford con- tinued in possession of the premises from the date of his deed till after the cutting of the timber, when the plaintiff entered upon him for condition broken, the residue of the purchase money being still due. Upon these facts, the parties submitted the cause to the decision ■of the court, the defendants waiving any objection to the form of action. Mellbn, C. J., delivered the opinion of the court, as follows: If A. mortgage lands to B. in fee, the legal estate is considered to be in B. as between him and A. and those claiming under A., but as to all the world but B., A. is considered as seised of the legal estate, and so may convey to C, subject, however, to the mortgage. Blaney V. Bearee (3 Greenleaf, 132). For this reason, B. may maintain tres- pass against A. and those claiming under him, because A.'s posses- sion is in soibmission to B.'s title, and is, in fact, the possession of B. In Newall v. Wright. 3 Mass. 138, Parsons, C. J., delivering 151 the opinion of the court, sa}-s : "It is ver^^ clear that, when a nian^ seised of lands in fee, shall mortgage them, if there be no agreement that the mortgagor shall retain possession, the mortgagee may enter immediatel}', put the mortgagor out of possession, and receive the profits ;_and if the mortgagor refuses to quite the possession, the mortgagee maj consider him as a trespasser, and may maintain an action of trespass against him, or he may, in a writ of entr\', re- cover against him as a disseisor." There is nothing, then, in the relation between mortgagor and mortgagee, inconsistent with the' nature of an action of trespass by the latter against the former; and surely a mortgagor, or one claiming under him, is not less liable- for an injury to the mortgagee by cutting him down and carrying- away timber and wood from the premises, than he would be by merely withholding the possession, and receiving the rents and profits to his own use. Union Bank v. Emerson, 15 Mass. 159. Bro. Tr. 55, 363. 5 Kep. 13. Cro. Eliz. 784. We need not, how- ever, rely on these cases, or decide on the form of action, as the parties have waived all objections to form, if any exist. But on these principles we decided the case of Smith v. Goodwin, cited for the plaintiff, and, on the same principles, we think the action main- tainable, unless the alleged usage and general understanding with respect to felling trees and clearing wild lands, though mortgaged' to secure payment of the purchase money, should be considered as preventing the application of those principles to a case like the present. It was urged, by the defendant's counsel, that such usage and general tacit understanding are equal to a license from the mortgagee to the mortgagor or his assignee, to do the acts which are charged in this action as a trespass. The facts in the case do not present this question. We have no means of knowing whether any such usage and general understanding exist. The argument of the counsel, therefore, cannot avail, as it does not apply. If such usage and understanding existed at the time of the transactions of which we have been speaking, and were considered as amounting to a li- cense, and pleadable as such against the deed in question, they should have been disclosed in the form of a special plea, and the- question arising thereon left to the decision of the jury. As the case stands, the plaintiff must have judgment for the value of the timber and costs, according to the agreement of the parties. SEAKLE, Hxec. v. SAWYER. [127 Mass., 491.— 1879.] MoBTOiSr, J. This is an action of tort for the conversion of a quantity of wood and timber. It appeared at the trial that one Warren, being the owner of a lot of wood-land, mortgaged it to the plaintiff's testator; and that, after the condition of the mortgage was broken, but before the mortgagee had taken possession, Warren cut the wood and timber in question and sold it to the defendant. The presiding justice of the Supreme Court ruled that, "If the defendant bought of the mortgagor wood and timber cut from the mortgaged prem- 153 ises, and exercised such acts of ownership over the same as would amoimt to a conversion then he wowld be liable to the mortgagee for the value of the same, without any previous demand, and al- though he bought the same in good faith and without anv notice or knowledge of any claim upon the same." To this ru'lino- the defendant excepted. Upon the question whether, if a mortgagor commits waste by removing buildings, wood, timber, fixtures or other parts of the realty, the mortgagee out of possession can follow the propertv after it has been severed, and recover it or its value, there have been con- flicting decisions in different jurisdictions. In New York and Connecticut, it has been held that a mortgagee out of possession cannot maintain an action at law for waste committed by the mort- gagor; and that he has no property in wood or timber cut and re- moved, so as to enable him to maintain trover for its conversion. Peterson v. Clark, 15 Johns. 305. Cooper v. Davis, 15 Conn. 556. On the other hand, it has been held in Maine, ISTew Hampshire, ermont and Rhode Island, that timber, if wrong-fully cut and re- moved by the mortgagor, remains the property of the mortgagee otut of possession, and he may recover its value of the mortgagor or a purchaser from him. Gore v. Jenness, 19 Maine, 53. Froth- ingham v. McKusick, 24 Maine, 403. Smith v. Moore, 11 X. H., 55. Langdon v. Paul, 22 Vt., 205. Waterman v. Matteson, 4 R. I., 539. We are not aware that this precise question has been adjudicated in this State, but the previous decisions of this court in regard to the rights of mortgagees and the nature of their interest in the mortgaged estate, are such as to lead to the conclusion that a mort- gagee out of possession is entitled to timber, fixtures and other parts of the realty wrongfully severed, and may recover them, or their value, if a conversion is proved. In Pay v. Brewer, 3 Pick., 203, it was held that a mortgagee in possession, but before foreclosure, could maintain an action on the case in the nature of waste against a tenant for life, for cutting down trees on the mortgaged land before he took possession, and the court in the opinion comment on the ease of Peterson v. Clark, 15 Johns., 205, as not being of au- thority here, "since the law of mortgage in Xew York is so different from our own." In Page v. Eobinson, 10 Cush., 99, it was held that a mortgagee, after condition broken, though not in actual possession, could maintain trespass against the mortgagor, or one acting under his authority, for cutting and carrying away timber- trees from the mortgaged premises, without license express or im- plied from the mortgagee. In Cole v. Stewart, 11 Cush., 181, it was held an action at law would lie by a mortgagee not in posses- sion against one who, under authority from the mortgagor, removed a building from the mortgaged land. In Btitler v. Page, 7 Met., 40, a second mortgagee sold to the defendant a building standing on the mortgaged land, who took it down and removed the mate- rials. It was held that the administrator of the mortgagor could not maintain trover for the materials, as the fee of the mortgaged 153 premises «as in the mortgagees, and tlie removal of the building vested no property in the materials in the mortgagor's representa- tive. In Wilmarth v. Bancroft, 10 Allen, Ills, a house standing on mortgaged land was partially destroyed by fire. The mortgagor sold to the defendant such materials as were saved, and brought this action to recover the price agreed to be paid. It was held that the fact that the mortgagee had claimed the agreed price, and for- biddn the defendant to pay it to the mortgagor, was a good de- fence. The opinion is put upon the ground that the partial burn- ing of the house, and the consequent severance of the unbumt ma- terials, "did not terminate or affect the mortgagee's interest in the fixtures." So it has been held in se\'eral cases that a mortgagee out of possession may maintain an action at law against the mortgagor or a stranger for removing fixtures and thus impairing the se- cjurity. G-ooding v. Shea, 103 :\[ass., 360. Byroni v. Chapin, 113 Mass., 308. King v. Bangs, 120 Mass., 514. The fair result of these authorities is that, under our law, a mortgagee is so far the o^vIler in fee of the mortgaged estate that, if any part of it is wrongTally severed and converted into personally by the mortgagor, his interest is not divested, but he reniains the owner of the personally, and may follow it and recover it or its value of any one ■\\"ho has converted it to his own use. Stanley v. Gaylord, 1 Cush., -j.TG. Eiley v. Boston Water Power Co., 11 Cush. 11. But the severaaice must be wrongful, and, where it is made by the mortgagor or one acting under his authority, whether it is wrongful or not will depend upon the question whether a license to do the act has been expressly given, or is fairly to be implied from; the relations of the parties. The true rule is as stated in Smith v, Moore, 11 N. H. 55, and approved in Page v. Robinson, 10 Cush 99, that acts of the mortgagor in cutting wood and timber, or other- wise severing parts of the realty, are not wrongful when from th( circumstances of the case the a.ssent of the mortgagee may be rea- sonably presumed. The relation between a mortgagor and mort- gagee is a very peculiar one. The mortgagee takes an estate in fee, but the sole purpose of the mortgage is to secure his debt. Usually in this state the mortgage contains a provision that the mortgagor may retain possession until condition broken. The object of this is that mortgagor may have the use and enjoyment of his property, and it implies a license to use it in the same manner as such prop- erty is ordinarily iised, and as will not vinreasonably impair the ade- quacy of the security. If- a mortgage be of a dwelling-hoiuse, the mortgagor may do many acts, such as acts of repair or alteration, which may involve the removal of parts of the realty, which would not be wrongful because within the license implied from the rela- tions of the parties. If a farmer mortgages the whole or a part of his farm, with a clause permitting him to retain possession as was probably the case at bar, it is within the contemplation of the parties that he is to carry on his farm in the usual manner, and a license to do so is implied. In such case, it is clear that he is en- titled to take the annual crops, and wood for fuel. Woodward v. 154 Pickett, S Uray, 617. And wc do not think that the implied license IS necessarily limited to the annual crops, but that it extends to any acts of carrying on the farm which are usual and proper in the course of good husbandry. If, in carrying on similar farms, it is u^ual and good husbandry to cut and carry to market wood and timber to a limited extent, a license to do 'this might be implied from the relation of the parties. The bill of exceptions furnishes us with so meagre and imperfect a history of the ease, that we are unable to say how far these con- siderations are applicable in the case at bar. But the ruling of the presiding justice seems to have been general, that the defendant would be liable if the wood and timber were cut from the mort- gaged premises, and to have excluded the question whether, under the circumstances of the case, the assent of the mortgagee thereto could fairly be presumed by the jury. We are of opinion that this question should be submitted to the jury, and, therefore, that a new trial must be ordered. Exceptions sustained, VAN PELT V. McGEAW. ' [4 N. Y., 110.— 1850.] Van Pelt sued Southward and McGraw in the Court of Commons Pleas of Tompkins County and declared in case for wrongfully and fraudulently removing rails, timber, &c., from certain lands on which the plaintiff held a mortgage, thereby injuring his secu- rity, &c. It was proved on the trial, that in May, 1840, Almeron Baily and William E. Baily, being the owners of 119 acres of land in Dryden, Tompkins County, execeuted a bond and mortgage covering the same to Harvey A. Rice, to secure the payment of $500, one-half payable in May, 1841, and one-half in May, 1843. In August, 1842, Eice sold and assigned the bond and mortgage to the plaintiff ,who instituted a foreclosure suit thereon, and ob- tained the usual decree for the sale of the premises in August, 1844. The amount then due on the mortgage, including the costs of the foreclosure suit, was nearly nine hundred dollars. The mort- gagors were insolvent, and the premises were an inadequate security for this sum. On the sale under the decree, which took place in October, 1844, the premises produced only the sum of $575. Short- ly before the sale, and while the advertisement was runnings, the defendant, McGraw, who had become the owner of the equity of redemption by conveyance from the mortgagors, avowing that he would "strip the land," proceeded to draw off rails, and to cut down and draw off valuable timber, &c. The premises were thereby con- siderably lessened in value. These acts were done by McGraw, and by Southworth aiding and assisting him, with full knowledge of the plaintiff's mortgage, and of the insolvency of the mortgagors. The defendant's counsel requested the court to charge the jury that McGraw having the fee of the land, and being in possession, had a right to take off the fences and timber, and that these acts being lawful could not he deemed to have been done wrongfully or fraudulently. The court charged that the acts were lawful if they did not prejudice tiie plaintiff.s" rights or impair his security, but if the defendants had impaired that security with a knowledge of the lien then their acts were wrongful and fraudulent. The de- fendants" counsel also requested the court to charge, that inasmuch as the plaintiff had alleged in his declaration that the defendants ■did the acts fraudulently and with a design to injure the plaintiff, he was bound to prove these allegations by other evidence than mere removal of the rails and timber for their own emolument. The court refused to so charge. To the charge as delivered and to the refusal to charge as requested, the defendants excepted. The jury found a verdict of $150 in favor of the plaintiff. The judg- ment entered thereon was affirmed in the Supreme Court on error brought. The defendants appealed to this court. Pkatt^ J. There is no doubt but that an action on the case will lie fo ran injury of the character complained of in this case. It forms no objection to this action that the circumstances of the case are novel, and that no case precisely similar in all respects has pre- viously arisen. The action is based upon very general principles, and is designed to afford relief in all cases where one man is in- jured by the wrongful act of another, where no other remedy is provided. This injury may result from some breach of postive law, ■or some ^'iolation of a right or duty growing out of the relations existing between the parties. ( 1 Cow. Treat. 3.) The defendant ]\IcGraw, in this case, came into the possession •of the land subject to the mortgage. The rights of the holder of the mortga.ge were therefore paramount to his rights, and any at- tempt on his part to impair the mortgage as a security, was a viola- tion of the plaintiff's rights. But the case is not new in its cir- cumstances. The case of Gates v. Joice (11 John. 136), was pre- cisely like the case at bar in principle. That action was brought by the assignee of a judgment against a person for taking down and removing a building from the land itpon the judgment was a lien. The plaintiff's security was thereby impaired. The court in that case sustained the action. The decision in that case was referred to and approved in Lane v. Hitchcock (14 John, 213), and in Gardner v. Heartt (3 Denio, 234). Xor is there anything in the case of Peterson v. Clark (15 John., 2i(5), which conflicts with tlie principle of these cases. That was an action bv a mortgagee in the usual form of an action for waste. The declaration alleged seisin in the plaintiff, upon which the defendant took issue. There was no allegation that the mortgagor was insolvent, or the judg- ment as a security impaired. The only issue to be passed upon was that in relation to the seisin. It is quite clear that itpon such an issue the mortgagee must fail. N"ow this action is not based upon the assumption that the plaintiff's land has been injured, but that his mortgage as a security has been impaired. His damages, there- fore, would be limited to the amount of injury to the mortgage, however great the injury to the land might be. It could, therefore, be of no consequence whether the injury occurred before or after forfeiture of the mortgage. The action is clearly maintainable. It only remains, therefore, to be considered whether there was 156 any error iu the charge of the court. In order to eoniu to a correct ■conclusion upon this point, it becomes necessary to examine the •exceptions to the charge in connection witli the undisputed testi- mony in the cause, and the propositions upon whicli tiie court were required to charge. It had been proved that the defendants knew •of the mortgage, that the mortgagors were insolvent, and that the property had been advertised for sale by virtue of the mortgage. They were forbid to remove the fences and timber, for the reason that the security would thereby be impaired. It was also proved that the value of the mortgage had been impaired liy such removal. Under this state of facts the defendants' counsel asked tlie court to charge the jury, that McGraw having the fee of the land, and being in possession, had a right to take off the fences and timber; that the acts being lawful, could not be deemed to have been done wrongfully or fraudulently. The court charged that the acts were lawful if they did not prejudice the plaintiff's rights or impair his security, but that if they had impaired the security, knowing the plantitj's lien, they were liable. As an answer to the propositions of the defendants' counsel, the charge was correct. Acts may be harmless in themselves, as long as they injure no one, but the con- sequences of acts often give character to the acts themselves. It is upon this distinction that the maximum is based, sic vtere tuo vf ■dlienum iion lacdus. As I have before observed, the lien of the plaintiff upon the land was paramount to any interest which the ■defendants possessed therein, and any wilful injury of that lien by them was a violation of the plaintiff's rights, for which an action womld lie. The defendants' counsel also asked the court to charge that the plaintiff having alleged in his declaration that the defendants did " the acts fraudulently and with a design to injure the plaintiff, he was bound to prove the allegations by evidence other than the mere act of removing the timber for the emolument of the defendants. The court refused to so charge, to which there was an exception. This proposition is somewhat obscure, but I understand it to mean that the plaintiff should prove that the primary motive of the de- fendants -was to cheat the plaintiff. If the defendants knew that by taking off the timber the value of the plaintiff's mortgage as a security would be impaired, they would be legally chargeable with a design to effect that object, although their leading motive may have been their own gain. .V man must be deemed to design the necessarv consequences of his acts. If, therefore, he does a wrong- ful act knowing that his neighbor will be thereby injured, he is liable. It is upon this principle that persons are often chargeable with the intent to defraud creditors, or to commit any other fraud. The immediate motive is oftentimes self-interest, but if the neces- sary consequence is a fraud upon his neighbor, the actor is legally chargeable with a design to effect that result. Upon the whole, therefore, although the charge is not quite so explicit as it should be, vet taken in connection with the propositions presented to the court, I think it was substantiallv correct. The judgment of the Supreme Coairt should be affirmed. Judgment affirmed. 157 WILSON V. MALTBY. [.39 X r., 126— 1874.] Appeal from order of the General Term of the Supreme Court in the third judicial department, affirming an order of Special Term denying a motion for a new trial. This action was brought for the foreclosure of a mortgage made by the defendant George Hubbard and wife. Plaintiff sought to recover of defendants, C. S. Maltby and Thorn J. Houston, in case the mortgaged premises should not realize, upon sale, sufficient to pay the mortgage debt, the value of certain wood cut upon the mortgaged premises, the complaint alleging fraud and collusion be- tween them and the mortgagor. Hubbard purchased the promises in question, being mostly wood- land, of plaintiff's intestate, in 1867, subject to a mortgage thereon held by one Knapp, giving the mortgage in suit for part of the purchase money. In 1871, Hubbard entered into a contract with Maltby and Houston, by which he sold to them the wood growing on the mortgaged premises, the same to be cut by the purchaser, meas- ured and paid for March 1, 1871. Plaintiff, learning that the wood was being cut, called upon Hubbard, and threatened to stay the cutting by injunction; but upon Hubbard agreeing to pay over the money received for the wood on the Knapp mortgage, he abandoned the intent. On the 27th of February, 1871, after the wood was all out, plaintiff, being apprehensive that Hubbard would not do as he agreed, notified the purchasers of the wood of his lien, of the agree- ment with Hubbard, and communicated to them his fears, request- ing them to delay paying over the purchase money; this they de- clined to do, but paid the same to Hubbard, as agreed, on the 1st of March. Up to the time of such notice they had no knowledge that there was any mortgage upon the premises, and the allega- tions of fraud were not proved. Hubbard did not pay it over, as agreed, but absconded therewith. The mortgaged premises were insufficient to pay the mortgages. Andkews, J. The contract for the purchase of the wood was made by the defendants, Maltby and Houston, with Hubbard, the owner of the land from which It -n-as taken. Hubbard was in pos- session of the premises, and, by the contract, the defendants were to cut the wood and to pay Hubbard a certain price per cord on the 1st of ]\raTch, 1871. The defendants did not know until on or about the 24th of February, 1871, of the plaintiff's mortgage, or that there was any incumbrance on the land. The wood had been cut and nothing remained to be done by the defendants under the contract, except the payment of the purchase price. There can be no doubt that the title to the wood vested in the defendants upon its sever- ance from the land. They were the owners of the wood by piirchase from the owner of the land, and were debtors to Hubbard for the agreed price. The fact that the land was mortgaged when the con- tract was made, or when the wood was cut, did not affect the de- fendant's title to the severed property, and although the cutting of the wood impaired the security of the mortgage, the defendants 158 were not responsible to the mortgagees for the resulting injury, un- less they cut the wood, knowing of the lien, and with intent to injure the pailntiS in respect to his security. (Van Pelt V. McGraw, 4 Comst., 110.) There is an additional reason in this case why the plaintiff is precluded from treat- in the act of the defendants, in cutting the wood, as tortious, ceed upon the promise of Hubbard that he would apply the money he should receive from the defendants upon the Knapp mortgage. The promise was made in December, and it was not until the following February that he notified the defendants of his claim on the premises, and at that time they had completed the work under the contract with Hubbard. This transaction op- erated as a license to Hubbard to sell the wood to the defend- ants, and estopped the plaintiff from questioning their title. The question then comes to this: Could the defendants lawfully pay their debt to Hubbard, against the protest of the plaintiff, after being informed that Hubbard threatened to violate his agreement to apply the money on the prior mortgage? There can be but one answer to this question: The defendant's contract was with Hub- bard alone, and their debt was owing to him. The promise of Hub- bard to apply the amount he should receive from the defendants on the Knapp mortgage did not make the plaintiff the assignee of the debt. It gave to the plaintiff at most a right as against Hubbard to intercept the payment upon proceedings taken, based upon evi- dence that he threatened to dispose of the money in violation of his agreement. We express no opinion whether such an action could be main- tained, but we think it is clear that until prevented by the order of the court, the defendants could lawfully pay the debt to Hub- bard, and that if they had refused, he could have maineained an ac- tion to recover it. The defendants were neither parties or privies to the agreement between Hubbard and the plaintiff, as to the application of the fund, and they owed no legal duty to the plaintiff to defer the payment of their debt at his request. That agreement recognized Hubbard's right to receive the payment, and no legal proceedings having been taken to prevent it, the payment to him was a valid discharge of their obligation. In view of the finding of the jury, it cannot be claimed that col- luded vnthHubbard in the transaction, or misled the plaintiff, or induced him to institute legal proceedings against Hubbard, upon the promise to retain the money until an injunction should be pro- cured. The judgment should be affirmed. Judgment affirmed. Walmslby v. Milne, 7 C. B. (N. 8.) 115 (1859). Eeported also I Gray Cas. Prop. dpf. Climie v. Wood, L. R. 4 Ex. 328 (1869). Reported also i Gray Cas. Prop. 70(5. 159 EiCHAKUsox V. C'ui'KLAXD. 6 dray 336 (1856). Keported also i Graij Cas. Prop. J31. Clary v. Owen, 13 Gray 322 (i860). Reported also i Gray Can. Prop. 74(5. Bkennan v. Whitaker, 15 Oh. St. 446 (1864). Reported also I Gray Cas. Prop. 131. Davexport v. Sjiaxts, 43 T7. 346 (i8ji). Reported also i Gray Cas. Prop. J62. TIFT V. HORTOX. [53 .V. Y., 377— J8T0.J Appeal from judgment of the General Term of the Superior Court of Buffalo, affii-ming a judgment in favor of the plaintiffs, entered upon the verdict of a jury. Tli[s action was brought to recover damages for the alleged con- version of a boiler and engine. The ])lainl:iffs. under a written cf)utract, manufactured the engine and boiler in question, with other iiiaehiiiery, for Mrs. Jane Coombs Brown, to be put up and used in a new elevator which Mrs. Brown was building, in the city of Buffalo. By the terms of the contract Mrs. Brown was to give. For a portion of the purchase price of the boili'i', engine and other machinery, her two promissory notes, to be secured by a moi-tgagc on the boiler and engine. The notes and mortgages were to be executed ;ind delivered so soon as the engine and boiler were complete in the plaintiff's shop, ready to be put up at the elevatoi'. The boiler and engine and other machinery were completed according to the contract; and, while in the plaintiff's slio]i, the mortgage was given as provided in the con- tract. It was provided in the mortgage that the engine and boiler jhould be and remai n perso nal property until the notes mentioned In it were fully paid, notwitlistanding the manner in which they should be placed in the elevator. The mortgage recited the fact that the engine and Imiler were made to he put up in the elevator of Mrs. 'Brown, pursuant to the agreement above mentioned, and authorized the plaintiffs, in case of a breach of its condition, to enter the elevator and take and carry the boiler and engine away. Mrs. Brown failed to pay the second note secured by the mort- ;?age. The boiler and engine were not put in the elevator building, but on a foundation made for them, outside of the building; and a building, called the engine-house, was built over them after they were set up. After the mortgagor failed to pay the note, plaintiffs went to take thiTioiler and engine, and, finding the defendants in possession, demanded thehi. The defendants claimed to own them, and refused to let the plaintiffs have them. The defendants- clainie.d title^to the engine and boiler througli three real estate mortgages, executed hv "Mrs. T?rown before \\\^ boiler and engine were set up on the premises. These mortgaces had been foreclosed, and the prem- ises sold under judgments obtained in the foreclosure actions, and 160 the premises bid off by and eonvfyed tii tlie delVndanls. 'L'Ir' rigiits of the parties, by stipuhxtion Ijefore sale, were not to be att'eeted by the sales on the judg■men;•^ in the foreclosure actions. The de- fendants asked the court tt) decide, as a matter of law, that there was not any evidence of a conversion, by the defendants, of the boiler and engine. This the court declined to do. The defendants re- quested the court to decide that the boiler and engine were a part 01 the realty, as between the parties to this action, notwithstanding the written agreemeiit. The court refused so to decide. The jury rendered a verdict in favor of the plaintiffs I'or tlie sum of .$.3,l-ti.88, and Judgment was t'ntered thereon. FOLGEK, J. It is well settled that chattels may be annexed to the real estate and still retain their character as personal property. (See Voorhees v. McGinnis, t,S X. Y., t^TS. and cases there cited.) Of the various circumstances which may determine whether in any case this character is or is not retained, the intention with which tiiey are annexed is one; and if tiie intention is that they shall not bv annexation become a part of the freehold, as a general rule they will not. The limitation to this, is where the subject or mode of annexation is such, as that the attributes of personal ])ro|)erty cannot be predicated of the thing in controversy (Ford v. f'obb, 20 X. Y., 344), as where the property could not be removed without practi- cally destroying it, or where it, or part of it, is essential to the sup- port of that to which it is attached. (Id.) It may in this case be conceded tliat if there were no fact in it but the placing upon the premises of the engine and boilers in the manner in which they were attached thereto, they would have be- come fixtures, and would pass as a part of the realty. But the agreement of the then owner of the land and the plaintiff is ex- press, that they should be and remain personal property until the notes given therefor were paid ; and by the same agreement, power was given to the plaintiffs to enter upon the premises in certain contingencies and to take and carry them away. TMiile there is no doubt but that the intention of the owner of the land, was that the engine and boilers should ultimately become a part of the realty, and be permanently affixed to it, this was subordinate to the prior intention expressed by the agreement. That fully shows her inten- tion and the intention of the plaintiffs, that the act of annexing them to the freehold should not change or take away the character of them as chattels, until the price of them had been fully paid. And as parties may by their agreement expressing their intention to do so. preser^'e and continue the character of the chattels as per- sonal property, there can be no doubt but that as between themselves the agreement in this case wa,« fully sufficient to that end. But it is contended that where in the solution of this question the intention i« ;> criterion.it must be the intention of all those who are interested in the lands ; and that here the defendants, prior mortgagees of the real estate were interestd, and have not expressed nor shoivn such intention. It is not to be denied that, a.s a general rule, all fixtures put upon the land hv the owner thereof, whether before or after the execution of a mortgage upon it, become subject 161 to the lien thereof. Yet I do not think that the prior mortgagee of the realty can interpose, before foreclosure sale, to prevent the car- rying out of such an agreement as that in this case. Had the mort- gagees taken their mortgage upon the lands, after the boilers and engine had been placed thereon under this agreement, they would have had no right to prevent the removal of them by the plaintiffs, on the happening of the contingencies contemplated by it. The rights of a subsequent mortgagee are no greater than those of a subsequent grantee, and he, it is held, cannot claim the chattels thus annexed, and must seek his remedy for their removal by virtue of such an agreement, upon the covenants in his conveyance of the lands. (Mott v. Palmer, 1 N. Y., 564; and see Ford v. Cobb, supra.) A prior mortgagee, who certainly has not been induced to enter his relation to the lands by the presence thereon of the chattels in dispute subsequently annexed thereto, has no greater right than a subsequent mortgagee. Neither could claim as subject to the lien of his mortgage, personal property brought on to the premises with permission of the owner of the lands, and not at all affixed thereto. Nor can either claim personal property as so subject, from the mere fact of the affixing, where, by the express agreement of the owner of the fee and the owner of the chattel, its character as personal property was not to be changed, but was to continue, and it to be subject to a right of removal by the owner of the chattel on failure of performance of conditions. The language of the authorities is that the chattel in such case is personal property, for which an action of trover for the conversion of it may be maintained. (Smith v. Benson, 1 Hill, 176 ; Mott v. Palmer, suprn : Farrar v. Chauffe- tete, 5 Den., 527; Ford v. Cobb, supra.) Another consideration makes it clear, I think, that in this case, the absence of a concurrent intention on the part of the prior mort- gagees is of no weight. As above stated, as a general rule, all fix- tures put upon lands by the owner thereof become a part thereof, and subject to the lien of a prior mortg-age ; but sometimes it is doubtful if they have been so annexed as to so become. And then, it is said, the question may be decided by the presumed intent of the party making the annexation of the chattels. (Winslow v. Mer. Ins. Co., 4 Mete, 306.) The law makes a presumption in the case of anv one making such annexation, and it is different as the inter- est of the person in the land is different, that is, whether it is temporary or permanent. The law presumes that because the in- terest of a tenant in the land is temporary, that he affixes for him- self, with a view to his own enjoyment during his term, and not to enhance the value of the estate*, hence, it permits annexations made by him to be detached during his term, if done without injury to the freehold, and in agreement with known usasres. The law pre- sumes that because the interest of the vendor of real estate, who is the owner of it. has been permanent, that he has made annexations, for himself, to be sure, but with a view to a lasting: enjovment of his estate, and for its continued enhancement in value. So the mort- gagor of land is the owner of it, and has a permanent interest 162 therein, and the law- presumes that improvements which he malces thereon, by tlie annexation oi cxiatceis, ne maliets for iumself, for prolonged enjoyment, and to enhance permanently the value of his estate. (Winslow v. Mer. Ins. Co., aupra.) These are presumptions of the intention of the tenant alone, the vendor alone, and of the mortgagor alone; nor are they ordinaril}' concerned at all, with the relation to the lands, or with the purpose of the landlord, or the vendee, or the mortgagee; though there may be cases in which the intention of both parties may be of effect, as where a mortgagee has loaned money with the understanding that it shall be applied to enlaance the value of the estate by the addition of chattels in such manner. And the\- are but presumptions, which in all cases may be entirely done awav with by the facts. (Lancaster v. Eve, 5 C. B. — X. S.— *71?.) So m Elliott v. Bishop (10 Exch., 496; s. c. in ■error, 11 Exch., 113), it is recognized that the express agreement of ■a tenant may prevent him from the exercise of his right to detach his annexations, which is the same as to say that his agreement hav- ing shown that it was not his intention to remove them, the pre- -sumption of contrarj- purpose, which would otherwise arise, is re- j)elled. So in Potter v. Cromwell (40 N". Y., 287, and cases cited), it is conceded that if the intention of the vendor of lands be to retian, in chattels annexed thereto, their character as personal property, such intention will prevail. So in \''oorhees v. McGinnis (supra), it is conceded that if the intention of the mortgagor of lands had been that chattels annexed were to be removable, the prior mort- gagee could not have held them auainst the receiver of the goods, ^&e., of the mortgagor. (See also C!rane v. Brigham, 11 N. J., Eq. ; [3 Stockton, 29, 3.5] ; Teaff v. Hewitt, 1 Ohio St.— [McCook— 511- 531.] The general rules governing the rights of parties in chattels thus annexed to the real estate, rest, as it appears, upon the pre- sumptions which the law makes of what their purpose is in the act of annexation. This JDresumption grows out of their relation to and interest in the land, and not from the relation or interest in it of ■others wliieh may be opposite. And as the presumption of their pur- pose grows alone out of their relation and interest, it is repelled by whatever signifies a purpose different: not a different purpose in those holding a relation which mav become hostile, but their own different purpose. Hence, I conclude that the asreement of the owner of the land with the plaintiffs, as it did fully express their distinct purpose that these annexations of boiler and engines should not make them a part of the real estate, was sufficient to that effect, without any concurring intention of the defendants as prior mort- gagees. Though the defendants became the purchasers of the land on the foreclosure of the mortgages, and were the owners of it in fee, and probably in actual possession of it, and of the boilers and engines an- nexed to it, before this action was brought or demand made of them for these chattels, yet they are to be considered in this case only as prior mortsracees of it. vSuch is the effect of the stinulation made by them that the sale upon the decrees should not in nnv manner change the legal rights of the plaintiffs in this action ; hut for thia, 163 it would have beea necessary to have deterniined the effect upon the rights of the parties of tlie sale on foreclosure, and the change of title and possession of the lands, and the application to that state of facts of the princiijle laid down in Lane v. King (8 Wend., 584), and kindred cases. It appears that the boilers and engine cannot be removed with- out some injury to the walls built up about them, and which are apart of real estate; yet this fact will not debar the plaintiffs. The chattels have not became a p>art of the building; the removal of them will not take away or destroy that which is essential to the support of the main building, or other part of the real estate to which they were attached; nor will it destroy or of necessity injure the chattels themsehes ; nor will the injury to the walls about them be great in extent or amount. So that the limitation hereinbefore stated does not apply. It is proper to add, that the English case cited and much relied upon by the defendants has not been overlooked. (Walmsley v. Milne, 7 C. B. N. S.,* 115.) I do not gather from it that the decision was placed upon the ground (as the defendants claim), that the mortgagee of the land did not expect or understand that the chattels annexed wore rem()\-able or to lie removed. The opinion of the court seems summed up in the cnucluding sentence: "Wc think, there- fore, that fl'hen the mortgagor (who was the real owner of the in- heritance), after tlie date of tlic mortgage, annexed the fixtures in question for a iieviuanvnt purpose and for the better enjoyment of his estate, he thereby made them a part of the freehold which had been vested by tlie laorff/ni/e deed in the mortgagee." It is to be borne in mind, too, that in England and in Massacliusetts the rights of a mortgagee of land in the mortgaged premises are greater than in this state. He is regarded as the owner, and the mortgagor in the light of a tenant. So that things annexed to the land become fix- tures upon the land of the mortgagee, as it were. (See case last cited, page *]33 : Butler v. Page. 7 ]\retc., 40.) The judgment should be affirmed with costs to the respondents. All concur. ■Judgment affirmed. In this section Uave been included only cases dealins: with waste by tlie mortgagor. The eflEect of similar acts committed by the mortgagee are considered in connection with his liability to account post p. 183 H seq. 1«4 CHAPTER II. EgUlTY RELATIOXS. (a) Once a Mortgage, Alicatjs a Mortgage. NEVVCOMB V. BONHAM. [1 Yern. 7, 214, 232—1681-1683.] A man being seised of lands in fee, makes an absolute convey- ance thereof to the defendant Bonham; but by another deed of the same date the lands are made redeemable upon payment of £1,000 and interest at any time during the life of the grantor ; and in case the lands should not be redeemed in his lifetime, then he covenants that the same should never be^redeemed. The grantor dies before the lands are redeemed, and liis h ax at law exhibits a bill to hav e a redemption . It was in proof in the cause that the mortgagor had a kindness for the mortgagee, as i)eing his near relation, and did intend him the lands after his death, and that the clause of redemption was put in onh' upon the acco'unt that the mortgagor was then a bachelor, ana so might marry, and have issue; but that his full in- tent was, that in case he died without issue the mortgagee should have the lands absolutely without redemption; and also that the said one thousand pounds was really the full ^alue of the estate at the time of the conveyance, but it afterwards happened to be a good bargain, it being a re^'ersion after two lives, and the two lives hap- pening to die within a short time; arid it was urged that the mort- gagee ran hazard enough, for that as it happened to be a good bar- gain, it might have been a bad one, and yet he had no covenant nor any other remedy to compel the repayment of his money, for the mortgagor had time to redeem during life ; and suppose the mort- gagor should have lived thirty or forty years after the mortgage made; and then had come to redeem, as he might have done, there had been all the interest upon interest thereby lost, which comes tr> more than the principal. The Lord Chancellor Xottingham was of opinion, that although the mortgagor had time to redeem during life yet the mortgage'^ might have compelled him to redeem, or have foreclosed him ; and said that it was a general rule, once a mortgage, and ahirn/s a mort- qage : and in resard the estate wa.s expressly redeemable in thf^ mortgao-or's lifetime, it must continue so afterwards, and there- fore decreed an account and a redemption. I"-) This case came now before the court upon a demurrer to a bill of review to reverse a decree made in this cause by the Lord Chan- cellor Nottingham; and the error assigned was tnat the defendant Newcomb ought not to be admitted to a redemption against his ex- press agreement in the mortgage deed to redeem within a certain time, or otherwise that the estate should be irredemable. it was argued for the demurrer. 1st. That an estate could not be a mortgage at one time, and afterwards become an absolute purchase, by one and the same deed. 2d. That the mortgagee in this case had a proper remedy, and might have made his estate absolute in a legal course, viz., by ex- hibiting a bill to foreclose the mortgagor of the equity of redemp- tion; and they cited the case of Yieldmington and Gardiner, where the mortgagor was to redeem during life onli/j and yet his heir ad- mitted to the redemption; and Sir Robert Jason's case, where an estate was to go to his wife and her heirs, unless a sufficient jointure were settled within such a time limited m the deed, and the case of Howard and Harris. But as to that case, it was answered, though there was a Qualified redemption, yet there was an express covenant for repayment of the mortgage money, ana so it was in thi power of the mortgagee to make it a mortgage at any time. But the Lord Keeper inclined to reverse the decree, for that modus L't co.nventio viiicunt legem j and all conditional purchases or bargains must not be turned into mortgages ; and said, that where there is a condition or covenant, that is good and binding in law, equity vrill not take it away. This cause coming on to be heard de integro before the Lord Keeper, he adhered to his former opinion : that there ought to be no redemption in this case; and principally, because it was proved in the cause, that the intent and design of the mortgagor was to make a settlement by this mortgage, and that he intended a kindness and benefit to the mortgagee, in case he should not think fit to re- deem this estate in his lifetime; and that there being an express covenant that the mortgagor might redeem at any time during his life, he thought he could not in equity have been debarred of that privilege ; for by a bill to foreclose a man, you shall only bar him of his equitable title when the estate in law is become forfeited ; but where he has a, continuing title at law, as in this case, an express proviso that he might redeem at any time during life, he thought equity could not debar him of that privilege ; and, therefore, being the mortgagee in the present case could not have compelled the mortgagor to redeem, and he might have lived so long as to have made it an ill bargain ; and now, when by a oontinaency it hapnens to be a good bargain, there is no reason to raise an equity from thence to take the estate from the morts^agee: especiallv in this ease there being a kindness and benefit intended him bv the mort- gagor; and therefore rover=!ed the Lord 'N'ottingham's decree and clismissp rl tlio original bill for a red^najrtion.* * Beu. L'b., IWSi.— A., Folio4S9 And this diBtnission was afterwards, t J'av. 16'<9, affirm erl in Pari. Jour. H. of L., 14 vol. VJd. Bonliaus v. Newcomb, 2 Vent, 365 and 19.S. 166 \'1LLA v; liODElGUEZ. [i.2 Wall. 323, 336— 187U.J Mr. Justice Swayne delivered the opinion of the court. This is an appeal in equity from the decree of the Circuit Court of the United States for the District of California. The appellant was the com- plainant in the court below. The decree was against him. He seeks to redeem the premises in controversy according to the prayer of his bill. The defendant, llodriguez, claims an indefeasi- ble estate in them as regards the complainant and those from whom he derives title. The other defendants claim under a contract of purchase made with Eodriguez. The validity of the complainanc's title, if his grantor had anything to convey, is not questioned. Nor is the original title of his grantor and of those who conveyed to him , denied. But the defendants insist tha.t the titl p nf all thnsa-^Mn4^pg. r was vested absolutelYinEo driguez by deeds duly made a nd recorded ( before Llie co nveyan ces_tq 'the complainant and h is grantor we ra \ ■executed: The_cQnigIainant insists that Eodriguez, after, as before, liiisylegai ti^le was conveyedrio Iiimrj reld"The"~premises onl^as s£ r I ■earit)' for a delate This isThe_Hhge of tjig_co ntroYers Y between the \paxties.~ ^ • I The entire tract, of which the premises in controversy form a part, was conveyed by Jose Maria Villavicencia on the 13th of April, 1852, to his seven children. He died in 1853. The widow and £ve of the children conveyed to Fulgencio, also one of the children, on the 16th of December, 1867. On the 36th of the same monih Fulgencio conveyed to the complainant. By virtue of this convey- ance he claims si.\-sevenths of the tract. That propor is his if his title be valid. The widow is the sister of the defendant, Rodriguez. On the 4th of December, I860, she and three of the children, the other four Ijeing under age, executed to Eodriguez, for money then borrowed, a note for four thousand dollars, payable a year from date, and bear- ing interest at the rate of two per cent, a month, payable at the end of each six months thereafter; the interest, "if not so paid, to be added to the principal and draw interest at the same rate, com- pounding in the same manner." A mortgage upon the entire tract was given at the same time by the maimers of the note to secure its payment. Thg— mo- rtgagQ contai n er! a . provision , that ^ a def a ul t ofthe pavm£Jii-<»f-tbe-inte rest as stipu]ated,_ _tb£- Pfincipal sho uld become due and payable at the option o f_the^mortga^^ee^a.nd that the~mortgage~might thereupon be toreciosedand the premises sold to satisfy the mortgage debt, and that out of the nroceeds of the sale the mortgagee shorild be authorized to retain, besides his debt and costs, a counsel fee of five per cent, upon the amount found to be due. The mortgage contained a further provision that the mort- g-agee might pay all taxes and incumbrances on the property, and that the amount of such advances should be secured by the mort- gage, and should also bear interest at the rate of two per cent, per month. Eodriguez subsequently paid $1,172 to redeem the property from a sale for taxes. On th e 29th of April, 1864. the widow and 167 live children conveyed to him by a deed absolute in form. It is re- ■ cited in the deed that the debt secured by the mortgage then, amounted to about $10,UU0. On the l?th of February, Ibtio, one of the children, who was a minor when this deed was executed, and hence had not joined in it, also conveyed to Itodriguez. Nothing was paid to the grantor. On the 20th of May, 1865, the other and seventh child, who had then become of age, executed a like convey ance. The consideration paid was $100. On the 23d of July, 1866, Rodriguez demised the premises so conveyed to him to his co-defendants, Edgar W., Isaac C, and Rensselaer E. Steele. The defendant, George Steele, subsequently became interested in this contract by an arrangement with the les- sees. The leasehold term was for five years from the 1st of August, ensuing its date. Rodriguez stipulated that at the end of the term or within five days thereafter the lessees might purchase by paying him $2.5,000 in gold, and upon such payment being so made he covenanted that he would, by a sullicient deed, release and quit claim to the lessees or their heirs and assigns, free from all incumbrances created by him, all the right and title which he then had to the premises or which he might thereafter acquire from the United States or from any of the heirs of Jose Maria Yillavincencia. The lessees and their assigns insist that they are bona fide pur- chasers without notice. This proposition cannot be maintained. The contract gave them the option — it did not bind them — to buy at the time specified. That time had not arrived when this bill was filed. Xon constat that they would then exercise their election affirmatively and pay the stipu- lated price. But this point is not material. The doctrine invoked has no application where the I'ights of the vendee lie in an ex- ecutory contract. It applies only where the legal title has been con- veyed and the purchase money fully paid. The purchaser then holds adversely to all the world, and may disclaim even the title of his vendor. This contract calls for a quit-claim deed. The result would be the same if such a deed had been executed and full payment made, with- out notice of the adverse claim. Such a purchaser cannot have the immunity which the principle sought to be applied gives to those en- titled to its protection. This contract may, therefore, be laid out of view. It is no impediment to the assertion of the complainant's rights, whatever they may be. It does not in any wase affect them. The law upon the subject of the right to redeem where the mort- gagor has conveyed to the mortgagee the equity of redemption, is well settled. It is characterized by a jealous and salutary policy. Principles almost as stern are applied as those which govern where a sale by a cestui que trust to his trustee is drawn in question. To give validity to such a sale by a mortgagor it must be shown that the conduct of the mortgagee was, in all things, fair and frank, and that he paid for the property what it was worth. He must hold out no delusive hopes ; he must exercise no undue infliience : he must take no advantage of the fears or poverty of the other party. Any indirection or obliquity of conduct is fatal to his title. Every doubt will be resolved against liiiii. Wliere confidential relations ajid the means of oppression exist, the scrutiny is severer than in cases of a different character. The form of the instruments em- ployed is immaterial. That the mortgagor knowingly surrendered and never intended to reclaim is of no consequence. If there is vice in the transaction the law, while it wlil secure to the mortgagee his debt, with interest, will compel him to give back that which he has taken with unclean hands. Public policy, sound morals, and the protection due to those whose property is thus involved, require that such should be the law. The terms exacted for the loan by Kodriguez we^e harsh and oppressive. The condition of the widow and orphans might well have touched his kindred heart with sympathy. It seems only to have whetted his avarice. Two per cent, a month — and this, if not paid as stipulated, to be compounded — was a devouring rate of in- terest. It was stipulated that the further advances should bear in- terest at the same rate. He demanded an adjustment when, from the failure of the crops and other causes, the property was greatly depressed, and he knew the widow and her children had no means of payment. The alternatives presented were an absolute convey- ance of the property or a foreclosure and sale under the mortgage. He was anxious to procure tlie deed, and exulted when lie ant it. The debt advances, with the interest superadded, were much less that the value of the property. The note and mortgage were exe- cuted by three of the children and the widow — the deed by the widow and five of the children. The other two children conveyed at later periods. The consideration of the conveyance by the four chil- dren not parties to the note and mortgage was such that if an abso- lute title passed, their deeds must be regarded as deeds of gift, of their shares of a valuable estate. Dana, who took the acknowledg- ment of the deed executed by the widow and five children, testifies that the widow inquired whether the deed contained all the agree- ments between her and Rodriguez. Dana translated it to her. She complained that the agreements were omitted. Rodriguez insisted that they were in the deed, and added "that they onght not to dis- trust him, as he was taking all these steps for their interest." The widow and children then executed the deed. Dana, speaking of a subsequent conversation with Eodrigiiez, on the same day, ''which was altogether unsolicited," says : "He stated to me that his object in getting the Yillaviceneia family to execute the deed aforesaid was to secure his money, money which he had loaned or advanced to them, and save the property for the benefit of his sister and his familv, while if it remained in their hands he might lose his money, and his sister and her children would lose the whole property. He said they had done wisely in trusting him, as he intended to deal justly by his sister." Rodriguez was examined as a witness. Re- ferring to a period shortlv preceding the execution of this deed, he says ; "Afterwards I had with them further conversation, and told them, I don't wish to speculate upon you, because you are my rela- tions, and you have treated me well. If T can sell the ranch for enough to reimburse myself for my outlays as well as interest, I ]fi9 will return you the surplus luoney, if any; and^ also, if 1 can sell a portion of tne ranch, or enough to reimburse myself for my advance, 1 will do the same, and return to you the unsold portion of the ranch, but if 1 have baa luck and cannot sell it, i will lose my money." Elsewhere, m the same deposition, he says : "1 stated at the ranch, and again stated to my sister atterwaras, that i would return the surplus money, but it was no obligation of mine. It may be that I said 80 to Charles Dana at that time." He made the same admissions to other persons who are in no wise connected with this litigation. Their testimony is found in the record. It is unnecessary to extend the limits of this opinion by accumulating and commenting upon it. The widow and five of the children, all who have been examined, testify that they understood the deeds to be only security for the deljt. 'i'his explains the trans- action as to those who were not parties to the note and mortgage. There is no other way of accounting for their conduct. The testi- mony of Kodriguez alone is sufficient to turn the scale against him. he cannot repudiate the assurances upon which his grantors were drawn in to convey. To permit him to do so would give triumph to iniquity. The facts indisputably established bring the case clearly within those principles by the light of which, in determining the rights of the parties, the judgment of this court must be made up. The complainant stands in tlie place of those from whom he derives title. He is clothed with their rights, and is entitled to redeem six- sevenths of the premises upon paying that proportion of the mort- gage debt and interest. The former must be held to include the amount advanced, as well as that represented by the note, and the latter be settled by the terms of the contract and the law of Cali- fornia. The rents, issues and profits, and improvements made upon the premises must also be taken into the-account. The decree is reversed and the cause will be remanded to the Cir- cuit Court with directions to enter a decree and proceed in conform- ity to this opinion OnEU- V. MOXTROSS. [68 ^\ Y. 499— ISTT.] Appeal from judgment of the General Term of the Supreme Court in the first judicial department, in favor of defendant, en- tered upon an order reversing a judgment in favor of plaintiff, en- tered upon a decision of the court on trial at Special Term and directing judgment for defendant. This action was brought to have a deed, absolute on its face, de- clared a mortgage, and for an accounting and reconveyance on pay- ment of amount due. The court found, in substance, that in July. 1865, plaintiff, being indebted to defendant for moneys loaned and advanced, executed to said defendant a deed of the premises described in the complaint, which deed was absolute on its face, and purported to convev the fee, but that it was executed as and intended as a security for the sairl indebtedness then existing, and what might thereafter accrue, 170 and it was agreed and intended by the parties that plaintiff, upon payment, should have the right to redeem and should be entitled to a reconveyance. That in September, 1866, defendant paid to the plaintiif, at his request, the sum of fifty dollars, and plaintifE then and there signed and delivered to the defendant a paper, of which the following is a copy, viz. : "ISTew York, Sept. 17, 1866. "Eeceived from William Montross fifty dollars, in full satisfac- tion for all claims and demands whatsoever as to the conveyance of property, or otherwise, up to this date. "Thomas B. Odell." That such payment was made and received, and such receipt signed and delivered with the intention of the parties that the same should be a full settlement of all claims of plaintifE to said lands and premises, and of all claims to any reconveyance thereof. As conclusions of law the court found, that the deed was to be con- sidered as a mortgage ; that the payment of the fifty dollars and the receipt given therefor did not operate to change the nature of the deed from a security to an absolute conveyance, nor to release plain- tiff's right to redeem, and that upon payment of the sums due from plaintiff to defendant and the sums paid out by the latter, plaintiff was entitled to redeem; and judgment was directed adjudging that upon payment of such sums within thirty days defendant should reconvey, and in default of such pay:uent that the premises be sold, as in foreclosure sales. Judgment entered accordingly. Allen, J. Prior to the transaction of the 17th of September, 1886 when the defendant upon the payment of fifty dollars to the plaintiff took an unsealed paper signed by him acknowledging the receipt of the fifty dollars "in full satisfaction for all claims and demands whatsoever as to conveyance of property or otherwise, up to this date," the relation of the parties in respect to the lands now sought to be redeemed was that of mortgagor and mortgagee with all the incidents of that relation. (4 Kent's Com., 143.) The plaintiff had conveyed the premises to the defendant by deed absolute in terms, but the conveyance was not intended as a sale, but as a security for the payment of money, and although there was no defeasance in writing, the intent could be and was shown by parol evidence, and the deed was but a mortgage. Parol evidence is admissible to show that an absolute deed was intended as a mortgage, or that a de- feasance has been destroved by fraud or mistake. (Dev v. Dunham, 2 J. Ch. R., 182: Clark v. Henry, 2 Cow., 324; Marks v. Pell, 1 J. Ch. R., 594: Home v. Kettletas,'46 N". Y., 605.) A conveyance ab- solute in terms given as a security, is a mortgage vrith all the inci- dents of a mortgage and the rights and obliffations of the parties to the in.stniment are the same as if the deed had been subject to a defeasance expressed in the bodv of the instrument, or executed simultaneously with it. (4 Kent Com., supra.) It must be recorded as a mortgage and not as a deed. CDev v. Dunham, supra.) This case was reversed in 15 Johnson's Reports, 555, but this principle was recognized by the appellate court that reversed the decree of the chancellor. The reversa,] was on the ground that the subsequent 171 pureiiast'i- clainung achersely to the deed was not a purchaser in good faitli, and so not within the protection of the recording acts. (James v. Johnson^ 6 J. Ch. E., -ilT ; 2 Cow., 249.) In White v. Moore (1 Paige, 551), the chancellor lield that the fact that there was no defeasance in writing did not take the instnanent out of the effect of the statute, requiring all mortgages to be recorded as mort- gages. The estate remaining in tlie inortgagor after the law day has passed, before foreclosure, is popularh' but erroneously called an equity of redemption, retaining the name it had when the legal estate was in the mortgagee, and the right to redeem existed only in equity. Although a misnomer it does not mislead. The legal estate remains m the mortgagor and is subject to dower and curtesy, to the lien of judgments, may be sold on execution and may be mortgaged or sold as any other estate in lands, while the mortgagee has but a lien upon the lands as a security for his debt and the land is not liable to its debts, or subject to dower or curtesy, or any of the in- cidents of an estate in lands. (2 Wash: E. P., 152 and seq. ; Jackson V. Willard, 4 J. 1!.. 41 ; Powell on Mortgages, 258, X. L.) The mortgagor is possessed of an estate in the land in virtue of his for- mer and original right, and there is no change of ownership. So far as the entire estate is concerned, there is but one title, and this is shared between the mortgagor and mortgagee, the one being the general owner and the other having a lien which, upon the foreclos- ure of the right to redeem, may ripen into an absolute title, their resi)ectivo parts, when united, constituting one title. A mortgagor/ ^ ancl mortgagee may, at any time after the creation of the mortgage and before foreclosure, make any agreement concerning the estate they please, and the mortgagee may become the purchaser of the right of redemption. A transaction of that kind is, however, re- garded with jealousy by courts of equity, and will be avoided for fraud, actual or constructive, or for any unconscionable advantage taken by the mortgagee in obtaining it. It will be sustained only when bona fide; that is, when in all respects fair, and for an ade-.. quate consideration. (Trull v. Skinner, 17 Pick., 213 ; Patterson v.'/ Yeaton, 47 Maine, 306 ; Ford v. Olden, L. E. 3 Eq^ Cases, 461 ; Kald- ridge V. Gillispie, 2 J. Ch. E., 30 ; Wash, on Eeal Prop., ch. 16, sec. l,pl. 24.) The defendant claims to have extinguished the right of redemp- tion and acquired the entire estate by the payment of the tifty dol- lars, and in virtue of the written acknowledgment of its payment for the purpose named in it. The paper is in its terms ambiguous. It does not purport to convey or transfer anv propertv or estate in lands, but is declared to be in full of all claims and demands what- soever as to eonvevance of property or otherwise. It is but a parol admission of a satisfaction for the right mentioned. The apparent meaning- of the in.«trument is to admit a satisfaction of all claims against the defendant, claims and demands that mav be enforced whether such claim" are of a rieht to a eonvevance of pronertv or any other matter. Thf plaintiff required no conveyance of the lands from the defendant. tTpon the payment of the mortgage debt he 172 would liiMfc h("-ii i-oiiivei=tud witli the uniiiciuubL'R'd title wilhout convejaiHi ur lewasL li;)iii the defendant. As evidence of his title he mighl have ri>«)Mirtd n reeouveyanee or a satist'aetion of the mort- gage, and I hat the comt.-- vvo:ild "have eouipelled. Hut his right of •redeniplii.il wjs nut. in any sen.se, a "claim or demand as to con- veyance ol jimppTiy 01 oiherwise." The receipt liad upon its face, and without e.xplauatiou. respect to jiersonal claims and demands against ttie defendant But tlie transaction was explained upon the trial, and shown to have been intended as a full settlement of all claims of the plaintili" to the lands and premises and of all claims to a reconveyance thereof. If this payment and receipt did operate to change the nature of the deed from a mortgage to an alisolute conveyance, and is a release of the right to redeem so that the mort- gagee became seised in fee simple by a union of the estates of tlie mortgagor and mortgagee discharged of the mortgaoc. the differ- ence to the action is perfect. It cannot he claimed that the written paper ex proprio figure, could have that effect. It does not profess to release the right of redemption, or to convey any lands or in- terest in lands. Xo lands in particular are referred to. Xo agree- ment can be spelled out of the instrument which could be spe- cifically performed, and it could not be aided and made a perfect contract to release or convey lands by ])arol proof. The Avhole force of the transaction, as affecting the rights of the plaintiff, is in the payment and receipt of the fifty dollars with intent to extinguish the title of the plaintiff'. This cannot operate as an estoppel or take the case out of the statute of frauds. The mere ])ayment of money will not entitle a purchaser to a specific performance of a parol con- tract for the purpose of an interest in lands. That can be repaid with interest, and no damage ensues from the non-performance of the contract. The purchaser can be made good for the use of his money-, which is all that he has lost. Had the defendant, acting upon the faith of this transaction, entered into possession of the premises and incurred expenses, and substantiallv changed his situa- tion so that he could not be placed in the same situation in which he was before, it might have estopped the plaintiff from takins: shelter Tinder the statute of frauds, or alleging the insufficiency of the writ- ten inistrument to carry out the agreement and intent of the par- ties. But there are none of the elements of an equitable estoppel in the case as presented by the record. The plaintiff having a recognized legal estate in fee, he could •only be divested of it (except by wav of estoppel which does not exist) bv some instrument which would be valid under the statute of frauds, and in compliance with the statute prescribing the mode and manner of conveying lands. The statute of frauds (3 E. S., 135, Sec. 8) is verv explicit, and needs no interpretation in its ap- plication to this case. It declares that everv contract for the sale of any lands, or anv interest in lands, shall be void, unless in writ- ing, and subscribed by the party by whom the sale is to be made. The whole contract, that is, the aa-reement to sell and the description of the lands or the interest in lands agreed to be sold, must bey in -nTiting and subscribed bv the party. The other statute referred 173 to (1 K. S., 13s, Sec. 137) is equally applicable to this case. To hold that the plaintifl: had not a tee would be to overthrow the well-establishea relation of mortgagor and mortgagee, and reverse their respective positions m respect of the legal estate in the lands mortgaged. The statute declares that every grant in fee or of a freehold estate, shall be subscribed -and sealed by the person making the grant, or his lawful agent. If a seal only was wanting to make the instrument relied upon by the defendant valid for the purposes- intended, it is possible that the court might compel the sealing,. but that would not supply the intrinsic defects of the paper-writing itself. What is said in Stoddard v. Whiting (46 N. Y., 633) of the na- ture of the estate of a mortgagor, and the bearing of the statutes- quoted upon a conveyance of his estate, was not necessary to the de- cision of the case, or necessarily adjudged by the court. The plain- tiff there, who was enforcing an equity of redemption, which was re- sisted, claimed under a written but unsealed assignment (a parol writing) from the mortgagor, and that was held sufficient to give- him a standing in court, and enable him to maintain the equitable action to redeem. The decision is not in conflict with the views here expressed. The defendant could have acquired the estate and interest of the plaintiff either by a deed-poll as a release, or a grant in any form sufficient in terms and mode of execution to con- vey an estate in lands. Mr. Powell, in his treatise on mortgages- (Vol. 1, p. 260), in speaking of the methods by which a mortgagee- may acquire the interest of the mortgagor, says that it may be by indenture with . covenants, or a release by deed-poll, for by that means the estate of the mortgagor and mortgagee will become merged, and the mortgagee will be owner in fee of the whole estate. The right-s of the mortgagor and his estate can only be foreclosed' by due process of law, or a release by deed in proper form, or a con- veyance sufficient to pass the title to an estate in fee. The defend- ant has not purchased the equity of redemption or acquired the estate of the plaintiff by any proper release or conveyance. ISTo in- justice will be done the defendant hj the result to which this con- elusion leads. He will receive his money and interest, and will be fully indemnified, and he is not entitled to speculate in his dealings with his mortgage-debtor. The judgment of the Special Term might have directed a re- demption, upon the proper terms, within a specified time, or in de- fault thereof the plaintiff be foreclosed. That, I thinlc, would have been the proper judgment. But as no fault is found with the terms of the judgment at Special Term, the judgment of the General Term should be reversed and that of the Special Term affirmed. All concur, except Eapallo, J., not voting. Judgment according! i/ . HUGHE8 V. HAELAN^ ^ 7 Appellate Divisionf^T899. Appellate Division, First Department.- — Appeal by defendant from interlocutory judgment rendered at Special Term after trials 174 Plaiutiti's testator, Albert E. Hughes, exeeaited and delivered to the defendant a written instrument by which certain personal property, including a formula for the manufacture of '"Albert's Eheumatie and Gout fiemedy," was transferred to the defendant subject to the condition that if the testator paid his promissory note for $3,000, payable to the order of the defendant, then the transfer should be- come null and void. The instrument, however, provided that if the testator died before the note was paid, then the transfer was to be unconditional and absolute. At the time the instrument was exe- cuted the plaintiffs testator was, and until his death which oc- durred a feu- days later, he continued in possession of tiie property transferred, when the defendant took possession. The plaintifE was appointed administrator with the will annexed and a tender having been made of the amount remaining due upon the note, accom- panied with a demand for the possession of the property which de- fendant refused, this action was brought to compel, among other things, the defendant to deliver to the plaintiif the formula for the remedy. The defendant by his answer denied substantially all the allegations of the complaint and alleged that upon the death of plaintiff's testator before the payment of the note, the formula be- came his sole and aljsolute property. The trial court held that the instrument was a chattel mortgage, and that the plaintiff had the right to redeem the property cov- ered by it, subject to the payment of any indebtedness to the de- fendant which might be found due upon an accounting. Judgment was entered to that effect, from which the defendant has appealed. ArcLALTinLix, .T., after stating the facts above, said: The con- elusion reached hy the trial court was correct. The instrument was not a bill of sale. It was a cliattel mortgaijo and nothing else. It was given as collateral security for the payment of the note, and expresslv provided that it was to become absolutely null and void upon such payment. The provision inserted in it that if the pay- ment was not made during the lifetime of the mortgagor that the transfer should then become unconditional and absolute, did not change the character of the instrument in any respect. Default in the payment of the sum secured by the mortgage occurred when the testator died, and then the legal rights of the parties were ex- actly the same as though default had been made bv the testator in his lifetime. The title to the mortgaged property then vested at law in the defendant, and nothing was left to the plaintiff except an equitable right to redeem (Charter v. Stevens, 3 Den., 33 ; Stoddard V. Dennison, 38 How. Pr., 239), which did not depend upon any agreement of the parties. It was something independent and irre- spective of the parties to the mortgage, which the law g^ave, and which it would not permit them, even by agreement, to take from the mortgagor. (Jones on Chattel Mortgages, sec. 682; Henry v. Davi« 7 Johns Ch. 40 ; Clark v. Henry, 2 Cow., 330 ; Bunacleugh v. Poolman, 3 Daly, 237; Baily v. Baily, 71 Mass., 505; Neweomb v. Bonham 1 Vem.. 7.) . . • Neweomb v. Bonham (supra) is directly in point. There an absolute conveyance was given, with a defeasance upon the payment of £1,000 during the lifetime of the 175 grantor, and the grantor agreed that the preiiiii-es conveyed should never be redeemed after his death. The grantor died before pay- ment, and in proceedings by liis representatives to redeem, tlie Lord CUiancellor held that such a right existed, and a decree was entered to that effect. "Under the authorities cited it is clear that the plaintiff had a right to redeem. It is, however, urged by the appellant's counsel that the complaint cannot be considered as one to redeem, and that it is insufficient for that purpose. . . . The facts alleged in the complaint were sufficient to show in the plaintiff a right to re- deem, and the action was properly treated by the trial court as one instituted for that purpose (Casserlv v. \Vitherbee, 119 X. Y., 632; Rogers v, X, Y. and T. L. Co., 134 X. Y., 21i>). The Judg- ment, therefore, was rijj'ht." Affirmed. All concur. WILLIAMS V. TOWNSEXD. [31 N. Y. 411—1865.] This was ^an^aetion to enjoin the sale of mortgaged premises under a statutory foreclosure. Davis^ J. By the condition of the bond and mortgage the de- fendant undoubtedly had a right, after failure by the plaintiff to pay the taxes assessed on tlio mortgaged premises, to pay and discharge the same, and thereupon to collect the amount so paid by suit upon the bond or by foreclosure of the mortgage. And the princi- pal question in this' case is, whether the purchase of the premises at the tax sales and the taking certificates of such purchase under the provisions of the charter of Buffalo, were a discharge of the as- sessments and taxes, within the true construction of the bond and mortgage. ^ ' - By section 20 of title 5 of the charter of the city of Buffalo, as revised by the laws of 1856, it is provided that there owner of any real estate sold for taxes may at any time before a declaration of sale is granted, as elsewhere provided by the charter, redeem the same by paying to the city treasurer, for the benefi^t of the holder of such certificate, the amount paid by him with the addition of 15 per cent, per annum on such amount. The certificates are transferable ; and it cannot always be easily ascertained who the holder is. Hence the statute has provided that the redemption may be made by paymlent to the city treasurer. In all cases of sales for taxes the owner of the land is clothed by law with this right of redemption ; and the tax together with the expenses of the sale remain a lien on the premises assessed, with an addition thereto of fifteen per cent., until the redmption or pay- ment to the treasurer is made. The effect of the sale is therefore merely an assignment of the lien of the tax and the expenses then in- curred, enhanced by the additional percentage ; and this lien con- tinues till the owner of the land makes the redemption, or the holder of the certificate takes title to the property in the prescribed form. Tt is therefore clear that the tax or assessment is not discharsred by the sale and certificate. In this ca?p the purchase at the tax sale was 176 made by M. E. Viele, and the certificates of the cuiiiptroller were made to him, as he says, "for convenience of transfer."' He was in fact the agent of the defendant, but there wdn nothing in the man- ner of sale or form of the certificate to indicate that fact. The legal rights of the parties are perhaps the same as though the certificate had been made to the defendant; but it would certainly be very embarrassing to titles of real estate if the owner's right of redemption were dependent upon some undisclosed relation of agency between the apparent purchaser and the incumbrancer of the land. There would be no safety for him if he were not allowed to redeem; because the ostensible purchaser could transfer the cer- tificate to a bona fide holder and subject him to great embarrass- ment and perhaps to the loss of his land. A mortgagee, who desires to pay off taxes or assessments and charge them on the mortgaged premises has a very plain course to pursue. At any stage of the pro- ceedings he can step forward in his character of mortgagee and pay the assessment or redeem from a sale before the purchaser's title has actually ripened by a conveyance under the law. It is no hardship to require him to do this in a plain and distinct manner, so as not to embarrass the title of the mortgagor or ovnier. When, however, he purchases at a tax sale and takes a certificate as pur- chaser, that is an election on his part to occupy the relation of pur- chaser, with all the rights, and incidents which the law attaches to it. He becomes then the 'Owner of an undischarged lien, which the owner of the land may discharge in the manner pro\'ided by law. But it is insisted that the purchase and taking of the certificate by a mortgagee, who has the right by the terms of his mortgage, or under the general statute, to pay off taxes and add the amount so paid to the lien of his mortgage, is by operation of law, ipso facto, an extinguishment and discharge of the tax. To support this prop- osition the familiar principle that a person who is placed in a situa- tion of trust or confidence in reference to the subject of the sale, or has a duty to perform which is inconsistent with the character of a purchaser, cannot be a purchaser on his own account. ( Torry v. The Bank of Orleans, 7 Paige. 649 ; Van Epps v. Van Epps, 9 Paige, 257; Burhans v. Van Zandt, 3 Seld., 523.) But this principle has never been carried so far as to prevent a junior mortgagee from purchasing the subject matter of the mort- gage at a sale under a prior lien ; nor has it been held that a title fairly purchased at such sale was held for the benefit of the mort- gagor. A mortgage is a mere security for a debt ; and there is no such relation of trust or confidence between maker and holder of a mortgage as prevents the latter from acquiring title to its subject matter, either under his own or any other valid lien. The defendant had no duty to perform to the plaintiff or toward the mortgaged premises that precluded her from buying at the tax sale. She was under no obligation to pay the taxes. The plaintiff had cove- nanted that she might do so at her option, and thereby acquire cer- tain riffhts ; but she had not undertaken to do it nor subjected her- self to f>ny burthen or oblig-ation whatever in respect to the assess- ment of taxes. She might pav them or not, as she chose, or she 177 might stand upon her general rights and purchase at the tax sale, as others could do, for the purposes of investment or protection. But if this were not so, all that the principle sought to be invoked would require is that as the purchaser she should take a redeemable interest only, which never could ripen as against the mortgagor into a greater one, and not that the lien she purchased should be discharged or extinguished, leaving her to no remedy except the possibly inade- quate one under the covenants of the bond and mortgage. It is my opinion, therefore, that the purchase at the tax sale did not operate to discharge the assessment and deprive the plaintiff of his right of redemption under the statute. But it is urged that the failure of plaintiff to pay the tax was a breach of the condition of the mortgage, and gave defendant a right to foreclose and collect the whole amount secured. There is no clause of the mortgage making the whole sum due on failure to pay the interest, or on breach of any condition. The clause which au- thorizes the retention by the mortgagee of the whole amount secured after a sale of the premises, does not have the effect claimed for it, nor do I think it would countervail the provision of the statute which requires a sale in parcels, when that is practicable, and pro- hibits a sale of more than sufficient to pay the amount actually due with the expenses of sale. (3 E. S., 5th ed., p. 860, sec. 6.) But no right to foreclose would accrue upon a simple failure of the mort- gagor to pay the taxes; to g'ive that right it is essential that the holder of the mortgage sliall have paid off and discharged the as- sessment or tax, otherwise no money has become due which the mort- gagee is entitled to retain on a sale. The language of the mortgage settles this, for it provides that "such assessments, taxes and charges as shall have been paid by them" may be retained. Besides, in my judgment, a mere naked breach of such a covenant in the condition of a mortgage, without the payment of any amount, would give no right to commence a foreclosure vmder the statute, but this it is not necessary to determine. I think the judgment should be affirmed. ■Judgment affirmed. Tex Kyck v. Craig— 62 N". Y. 420 (1875). Action to redeem: Andrews, J. — ' ~ It is claimed that Craig was disabled from purchasing the Con- gress Hall property at the sheriff's sale, and holding it adversely to Stewart and Sanger, under the rule just adverted to. There are two grounds upon which this claim is based : First, that Craig at the time was mortgagee in possession ; and, second, that the rela- tion of trustee and cestui que trust, in respect to the property, was created between Craig and Stewart by the instrument of April 24, 1860, which precluded him from purchasins; for himself, or other- wise than as a trustee for Stewart, or his grantee. Assuming that the learned counsel for the plaintiff is correct in the position that Craig, at the time of the sheriff's sale, stood in relation to' the premises, in the character of mortgaq-ee in possession tj ie questi on arises whether a mortgagee in possession can buy the mortga-gor's 178 title on an exfcutiou sale^ upon a judgment in fa\or of a third per- son against lUe niorcgagor, and set up a titie under tlie sale, as defense to an action uy the mortgagor to redeem. Another mode of stating the question is : Is a mortgagee in possession a trustee for the mortgagor, so that he will not be allowed to bu}- m the equity of redemption on a sale upon an independent lien held by a third per- son ? Unless the mortgagee in possession is a trustee for the mortgagor, there is no ground upon which he can be precluded from purchasing. It is clear that no trust relation between the mortgagor and mort- gagee is created by the execution of the mortgage, unaccompanied by possession. The mortgage under our law is a security merely. The mortgagee lias, bv virtue of his mortgage, no estate in or title to the land, or the right of possession, before or after the mortgage debt becomes due. He owes the mortgagor no duty to protect the equity of redemption. The power of sale which usually accompa- nies a mortgage is given to enable liim, by an adverse proceeding, to sell the equity of redemption for the paymnet of the mortgage debt. The objection that he could not become the purchaser at his own sale under the power has been removed by the statute when the foreclosure is by advertisement (2 E. S., 546, Sec. 7) ; and a provision is inserted in every decree for sale of mortgaged premises, unless otherwise specially ordered, that the plaintiff may become the purchaser. (Rule 73.) .\nd he may buy in any outstanding title and hold it against the mortgagor. (Cameron v. Irwin, 5 Hill, 280; Williams v. Townsend, 31 N. Y., 415; Shaw v. Bunny, 13 Week. E., 374 : s. c, 2 DeG., J. & S., 468.) There is, in truth, no relation analogous to that of trustee and cestui que trust between the mortgagor and mortgagee created by the execution of the mortgage. The mortgagee is not a trustee of the legal title, because, under our law, he has no title whatever. (Kortright v. Cady, 21 N. Y., 342, and cases cited.) He may deal with the mortgagor, in respect to the mortgaged estate, upon the same footing as any other person ; he may buy in incumbrances for less than their face, and hold them against the mortgagor for the full amount; he may do what any other person may do, and his acts are not subject to impeachment, simply because he is mort- gagee. (Darcy v. Hall, 1 Vern., 48 ; Knight v. Majoribanlcs, 3 Mac^T. & G., 10 ; Chambers v. Waters. 3 Sim., 42 ; 3 Sug. on V. and P., 237.) 'Not is the mortgagee converted into a trustee by taking posses- sion as mortgagee of the mortgaged property, so as, in general, to prevent his purchasing an outstandinfr title, or under another lien. Under the English law he has the right to the possession because he has the legal title to the land. Under our law he cannot obtain pos- session until foreclosure, excent by the consent of the mortsragor, because until that he has no title. A mortgagee is often called a trustee, and in a very limited sense this character raav be attributed to him. There mav be a dutv resting uoon a mortgagee in posses- sion to discharge a particular claim aaraiust the land. If in such a case he omits to do it, and allow the land to be sold on such a claim, 173 and becomes the purchaser, he would hold the title in trust for the mortgagor. A mortgagee in possession is allowed, and it may be his duty to pay taxes on the land out of the rents and profits. If he\ suffers the land to be sold for taxes in violation of his duty, and] purchases on the sale, he would upon general principles be deemed/ to hold the title as trustee. So, if a mortgagee is allowed to take possession and undertakes to pay the interest on other lines out of the rents and profits and fails to do so, he could not purchase the land for his o"n'n benefit in hostility to the mortgagor on a fore- closure of an incumbrance for non-payment of interest which he was bcmnd to pay. A mortgagee in possession is bound to account for the rights and profits ; and in that respect, as was said by Shaw, C. J., in King v. Insurance Co. (7 Cush., 7), he may be denominated a trustee. But, except in some special sense, that is not the relation he bears to the mortgagor.* HALL V. WESTCOTT. [15 R. I. 373—1886.] Bill in equity to redeeni_ajnortgage and for an account. DuEFEE, C. J. The bill states that on October 23, 1873, Walter J. Reynolds, being the owner of a lot in Providence, mortgaged it for $800 to Stephen H. Williams; that subsequently the lot passed by mesne conveyances to Charles W. Adams, who, December 30, 1874, gave two mortgages thereon to Hiram C. Pierce, to-wit : one for $3,350 and one for $500, subject to the mortgage for $3,350; that the mortgage for $3,350, though taken solely in Pierce's name, belonged equally to him and the complainant, Harriet Hall ; that Pierce assigned the mortgage for $3,850 to the defendant, Charles A. Westcott, who thereupon, January 33, 1875, gave the complain- ant Harriet Hall a writing in which he declared that he held said mortgage as to one-half in trust for her; that said Pierce subse- quently assigned said mortgage for $500, and his interest in said mortgage for $3,350 to said Harriet, and that said mortgage foi^ $500 contained a power of sale, under which, in January, 1883, said Harriet duly sold the estate, buying it herself under notice as au- thorized by statute. The bill alleges that the defendant is in pos- session, and contains other allegations. It asks for an account artd for leave to redeem. The defendant sets up several defenses. The third defense is that the mortgaged lot was sold for the non- payment of taxes, and bought by and conveyed to the defendant. This raises the question whether a mortgagee or his assignee, out of possession, can become a purchaser at a tax sale with the same effect, as against the mortgagor and other mortgagee, as if he wore a stranger to the estate. There is some conflict of authority on this point. All the cases agree that there are persons who stand in such relations to the estate that they cannot purchase as if thev were strangers. No person whose duty it is to pay the tax can be per- »Trimm v. Marsh, B4 N. Y., 599; su'jra p. 116. ISO mitted to purchase at a sale for its non-payment, and acquire a good title as against others who are interested in the estate, since to per- mit him to do so would be to permit liim to profit by his own default. Under this rule mortgagors, mortgagees in possession, life tenants, and tenants obligated by contract to pay taxes, are incapacitated to become purchasers. The incapacity has likewise been held to extend to tenants in common, for, if the estate is sold for ta^xes to one of the tenants, it is sold for his default as well as for the default of his co-tenants. (Page v. Webster, 8 Mich., 263 ; Butler v. Porter, 13 Mich., 293; Cooley v. Waterman, 16 Mich., 366; Cooley on Ta.xa- tion, 346, 347.) So a person who occupies a fiduciary relation as re- gards the estate, cannot purchase it for himself. The trust in the one-half of the mortgage for $3,250 is protected under this rule. And there are eases which enounce, or at least presuppose, a still broader doctrine, which may be stated thus, namel\- : that a pur- chaser who has an interest in the estate, such as would entitle him to redeem it if sold to another, will be presumed to have purchased it for the protection of that interest, or to save it from sacrifice, and will be required to hold it, even after the statutory period for re- demption has expired, simply as security for his reimbursement. We find this doctrine nowhere more clearly asserted than in Fair v. Brown, 40 Iowa, 209. The defendant there was interested in the estate by judgment lien and as a second mortgagee. He bought cer- tificates of sale for taxes, and subsequently took the tax deed. The court held that the prior mortgage was not defeated. "The land," says the court, "is a common fund for the payment of the plain- tiff's," — i. e., the prior mortgagee's — "mortgage and the defendant's liens. Defendant was authorized to redeem from the tax sale. Equity will not permit him to acquire the title for an inconsiderable sum when he was authorized to remove the trifling incumbrance by redemption. Though not bound to pay the tax, yet it was his right to do so to protect his liens. He cannot obtain that protection by pursuing a course that will deprive the mortgagee of his security, and leave the mortgagor tO' sustain the weight of the liens, which are personal judgments, after being deprived of his property by tax title." (Garrettson v. Scofield, 44 Iowa, 35; Porter v. Lafferty, 33 Iowa, 254; Stea.rs v. Hollenbeck, 38 Iowa, 550.) In Middletown Savings Bank v. Bacharach, 46 Conn., 571, the defendant, having had an undivided eighth of an estate subject to a mortgage, set out to him under an execution, purchased the estate at a sale for taxes assessed before he became interested in it, and the court held that he could not set up the tax title to defeat the mortgage, he being en- titled to redeem the mortgage, which yet he could not do, if the mortgagee had paid the taxes, without reimbursing him. The court also said that the mortgagee was similarly incapacitated, because he could pay the tax and add the amount of it to the mortgage debt. In Connecticut Mut. Life Ins. Co. v. Bulte, 45 ^rieh., 113, the court lays down the doctrine that where a mortgagee, or oue of two or more mortgagees, purchases the estate at a tax sale, the purchase may be treated as payment. "It is as just and as politic iiefe/" sa^s the court, "as it is in tlie case of tenants in common, to hold that the purchase is a payment of the tax." In the later case of Maxfield v. Willey, 46 2Iich., 352, the court affirms the doctrine. "When the mortgagee/' says the court, "instead of malcing payment of the taxes, makes a purchase of the land at tax sale, we have no doubt of the right of ttie mortgagor to have the purchase treated as a pay- ment, and to compel the cancelment of the certificate or deed on refunding the amount paid with interest." The opinions in these cases were delivered by Judge Cooley, who, in the preparation of his ■book on Taxation, iiad occasion to make the subject a special study. The most recent case -ivluch we have met with is Woodbury v. Swan, 59 X. H., 22, in which the Supreme Court of New Hamp- shire decided that the holder of a mortgage cannot defeat a prior mortgage by acquiring a tax title. The court rest their decision on the following reasons, as declared by Bingham, J., in deliver- ing the opinion of the court : "Mortgagor and mortgagee have a unity of legal interest in the protection of their titles against sale for non-payment of taxes, and against outstanding tax titles; and it is not equitable that either of them should act adversely to the other in the acquisition and nse of such titles. Therefore, the mortgage contract comprises an implied agreement that, while cither party may buy a tax title for the preservation of his right in the mort- gaged property, neither of them will buy a tax title for the extin- guishment of the title, in the maintenance of which they, as well as partners and tenants in common are in law jointlv concerned. The common interest of these parties in the mortgaged property creates a relation of trust and confidence." Other cases may be cited which support the same view, though not always for the same reasons. (Moore v, Titman, 44 111., 367; Harkreader v. Clavton, 56 Miss., 383 ; Haskell v. Putnam, 43 Me., 244; Bassett v. Welch, 22 Wis., 175; Whitney v. Gunderson, 31 Wis., 359, 379; Chiekering v. Failes, 26 111., 507; McLaughlin v. Green, 48 Miss., 175.) In California it is held that a person who is under any obligation, either moral or legal, to pay the taxes, can- not become a purchaser. (Moss v. Shear, 25 Cal., 38; Christy v. Fisher, 58 Cal., 256.) Other cases adopt a narrower view, and maintain that any per- son can become a purchaser who is not under any legal duty to pay the taxes. (Williams v. Townsend, 31 IST. Y., 411; Waterson v. Devoe, 18 Kans., 233; Bettison v. Budd, 17 Ark., 546; Ferguson v. Etter, 21 Ark., 160.) Our conclusion is that a mortgagee, either in possession or out of possession, is not entitled to purchase the estate at a tax sale, and set up the tax title as against the mortgagor or the other mort- gagees. They all have a common interest in the preservation of the estate, and thorefore, if either of them purchases the estate at a tax sale, it should be presumed in favor of the others that he made the purchase for the common protection. We think a case is shown which entitles the complainants to relief. 183 (b). Moi hjiKjre's Ijiabilii// iu Account. HAX'SOX V. DEHRV. \-i ]'i'nioii 3;)-.^— K(MI.| Tile bill being to redeem a Diortgage, on the hearing an ac- count was decreed, and £-;40 reported due; to which report the plaintiff had talceu exceptions. The cause, thus standing in court, the Lord Keepbh, on a motion and reading affidavits, that the de- fendant had burnt some of the wainscot, and committed waste, ordered the defendant to deliver up possession to the plaintiff, who was a pauper, giving security to abide the event of the account. * EU8SELL V, SMITHIES, [1 Anstruther, ;i(J— l?i)2.] On a bill of foreclosure, it was referred to the Deputy Remem- brancer to take an account what the mortgagee had received from tne rents, &e., or might have received, without wilful neglect in her. It appeared that the premises (malt house, etc.,) had been al- lowed to fall so much out of repair that the rent fell from £22 to £18. Plaintiff' had done some repairs and had held 40 years. Graham & Stanley argued that the mortgagee in possession, being only a trustee till foreclosure, is bound to keep the premises in the same repair as if he was owner; ,2 Vern. 392; 3 Atk. 518; and that the diminution in value should have been charged on the plaintiff, as she might have received the difference if she had repaired. Br THE Court: The mortgagee has done some repairs ; and, as the only proof of tliese repairs being insufficient is the diminution in Talue, we must confirm the report; for it cannot be supposed that, after 40 years possession, the mortgagee is bound to leave the prem- ises in as good condition as he found them. "Wkagg v. DEXHAii, 2 Y. & Coll. 117 (1836). On a bill for re- fUemption the mortgagee was charged with bad husbandry and non- repair of the mortgaged premises. Alderson, B.: — p Then comes the important question, whether I ought to charge / , the defendants with the deterioration in the value of the premises ■'since the period when Clarke took possession. It is clear that a mortgagee ought not to be charged with deterioration arising in the ordinary way, by reason of houses and buildings of a perishable mature decaying by time, which was the case in Anstruther. There, the mortgagee was in possession of the premises for forty years ; and during so long a time the decay would naturally take place, even supposing the premises to be repaired in the meantime in the ordi- nary way. I think, also, that a mortgagee ought not to be charged * "So, where a morteagee in fee in possession commits waste by cutting down timber, and the money arising by the sale of the timber is not applied in sinking the interest and principle . of his mortgage, the court, on a bill broceht by the mortgagor to stay waste, and a certificate thereof, will grant an injunction.'' Per Lord C'h. Hardwicke, in Farrant v. Lovel, 8 Atk., TgS. / . (1750.) 't 188 exactly with the same degree of care as a man is supposed to take who keeps possession of his own property. But if there be gross negligence., by which the property is deteriorated in. value, the morT- gagee who is in possession is trustee. for the mortgagor to that ex- tent that he ought to be made responsible for that deterioration dur- ing the time of his possession. It is not necessary to go the length of showing fraud in the mortgagee ; gross negligence is sufficient. The question, therefore, is whether the fact of gross negligence is sufficiently established in this ease to enable me to direct the inquiry asked for by the plaintiff. Uppn that point I should like to -look more minutely into the evidence, because if the Master be directed to make that inquiry, there would be considerable additional ex- pense. If upon examination of the evidence I should come to the conclusion that prima facie case of gross negligence is made out, I must direct the inquiry. If, on the other hand, I should be of opinion that there is not sufficient evidence of that fact, of course the principle of law will not apply. On the following day His Lordship said that he had looked through the evidence, and upon the whole he thought he ought to direct an inquiry as to whether the deterioration in the value of the premises had arisen from the gross negligence in the mortgagees for want of proper repairs and proper cultivation. Decree accordingh/. Dexter v. Arnold^ 2 Sumner, 108 (1834). Bill in equity to re- deem a mortgaged estate. The opinion of the court, per Story, J., is in part as follows : The fourth exception is on account of the Master's having made a deduction of the supposed rent, upon the ground that the premises were out of repair, and partly untenantable, while in possession of' the mortgagee and his representatives. The argument seems to pro- ceed upon the ground that the mortgagee was bound to keep the premises in good repair; and therefore ought to be accountable for such rents, as might have obtained if he had done his duty in regard to repairs. We know of no universal duty of a mortgagee to make all sorts of repairs upon the mortgaged premises while in his pos- sion. He is bound to make reasonable and necessary repairs-. But what are reasonable and necessary repairs must depend upon the particular circumstances of the ease. If a house is very old and dilapidated, he is not bound to go to extraordinary expenses to put it into full repair, if those expenses will be greatly disproportionate to the value of the estate, or to his own interest therein. Certainly it cannot be pretended that he is bound to make new advances on the estate. In Godfrey v. Watson (3 Atk., 518), Lord Hardwicke said, that a mortgagee in possession is not obliged to lay out money further than to keep the estate in necessary repair. In Russell v. Smith (, 1 Anst., R., 96) , it was decided that a mortgagee, after long possession, was not bound to leave the premises in as good a condi- ■ tion as he found them. The fact, also, that there has been a diminu- tion of the value of the rents was there declared not to be sufficient proof of a want of proper repairs. It is quite a different question 1^4 whether, if the mortgagee lays out money in proper permanent re- pairs for the benefit of the estate, he may not be allowed tot uiiinan allowance therefor. That is a point dependent upon other consider- ations. But where a mortgagee is guilty of wilful default or gross neglect as to repairs, he is properly responsible for the loss and dam- age occasioned thereby. That was the doctrine asserted in rlughes V. Williams (19 Yes., 495). And there is the stronger reason for this doctrine, because it is also the default of the mortgagor himself, if he does not take care to have suitable repairs made to ])i-cserve' his own property. In the present ease, however, the point does not a.rise, for there is no evidence in the blaster's report which estab- lishes any fact of wilful default or gross negligence in the mortga- gee. These remarks dispose also of the fifth exception, which is founded upon the supposed dilapidations of the buildings, while in possession of the mortgagee. There is no proof whatever that these were caused by his wilful default or gross negligence ; but they were the silent effects of waste and decay from time. MOOEE V. CABLE. [1 Johns, Gh., 385—1815.] Bill for the redemption of a mortgage. On the 26th of February,. 1789, William Brown being seised of the premises, lot No. o-l, in Smith & Graves's patent, conveyed the same to Joseph Eoe, who, for seciiring the purchase money, reconveyed them to Brown, by mortgage, dated the 27th of Febraary, 1789, and conditioned for the^ payment of £40, with interest, on the 1st of May, 1790. On the- 28th of October, 1794, the mortgage was assigned to the defendant for the consideration of £30, by the brother of Brown, as his at- torney. The heirs of Eoe, on the 1st of August, 1807, sold and conveyed the premises to the plaintiff, with eonvenants and war- ranty. It appeared that the defendant entered into actual possession of the premises, by his tenants, in 1800, but had, previous to that time, exercised acts of ownership. He continued in possession until 1808, when he, in conjunction with one C'orbin, took a lease from the heirs of Eoe. C'orbin being in as tenant of the defendant, consented to let in the plaintiff with him; and the defendant brought an action of ejectment, and recovered judgment in 1813, and has since continued in possession, and made improvements, bv clearing part of the land, and has received the rents and profits. The plaintiff did not know, until the trial of the ejectment in 1813, that the defendant held under a mortgage, and had in 1807 offered to purchase his interest. The r'HAXCELLOR — Two questions are presented by this case: 1. Is the plaintiff entitled to redeem ?* 2. The next question is, whether the defendant, standing in the place of the mortgagee, can be allowed for what the case states as improvements in clearing part of the land. Such an allowance ap- pears to me to be unprecedented in the books, and it cannot be ad- * The opinion on this point is omitted. 185 niitted eonsistcntly with established principles. The defendant was, in this ease, a volunteer. Instead of calling upon the debtor, or foreclosing the mortgage, he elected to enter ujjon uncultivated lands, and to exercise acts of ownership b}' clearing a part. To make the allowance would be compelling the owner to have his lands cleared, and to pay for clearing them, whether he consented to it or not. The precedent would be liable to abuse, and would be increas- ing difficulties in the way of the right of redemption. Many a debtor may be able to redeem by refunding the debt and interest, but might not be able to redeem under the charge of paying for the beneficial improvements i^hich the mortgagee had been able and willing to make. The English courts have always looked with jeal- ousy at the demands of the mortgagee, beyond the payment of his debt. In French v. Baron (2 Atk., 130), the Chancellor would not allow the mortgagee anything more than his principal and interest, though there was a ]irivate agreemejit between the mortgagor and mortgagee for an allowance for the mortgagee's trouble in receiving the rents and profits of the estate. The same thing was repeated in the case of Godfrey v. Watson (3 Atk., 517), and Lord Hard- wieke there said ,that a mortgagee in possession was not obliged to lay out money any further than to keep the estate in necessary repair : but if the mortgagee had expended money in supporting the title of the mortgagor when it had been impeached, ho would allow it. The same doctrine was maintained in the case of Bonethon v. ITockmore (1 Vern., 316), in which it was declared that no allow- ance was to be made to a mortgagee or trustee for their care and pains in managing the estate. I shall, accordingly, direct a master to compute the principal and interest due on the mortgage, down to the 1st of Januarv last, and that, in taking the account, he charge the defendant with the net amount of the rents and profits received, except such as shall appear to have exclusively arisen from his own expenditures in improve- ments ; and that he allow for the expense of necessary reparations, if anv, but not for improvements in clearing part of the land ; and that he report with all convenient speed ; all the other questions are in the meantime reserved. JDecree acrordingly .* "Lord Chancellor (Hardwicke) said that a mortgagee in pos- session is not obliged to lay out money any further than to keep the estate in necessary repair ; but if a mortgagee has expended any sum of money in supporting the right of the mortgagor to the estate, where his title has been impeached, the mortgagee may cer- tainly add this to the principal of his debt, and it shall carry in- terest. He also said a mortgagee shall not be allowed for his trouble in receiving the rents of his estate himself, but if an estate lies at such a distance from the place of his residence, as he must have employed a bailiff, if it had been his own, he shall then be allowed such sums as he has paid to a bailiff, to receive the rents of this estate." (Godfrey v. Watson, 3 Atk.. 517—1717). * Accord, Moulton v. Oornish, 61 Hun.. 438 (1891). 186 SHEPARD V. JONES. [■-'1 tVi. !>., 469— 188-2.] B}- an indenture of transfer of mortgage, dated the 31st of Jan- uary, 187-4, the Victoria Brewery and other hereditaments at Wrex- ham were conveyed to the defendant, Edward Jones, for securing £2,000, subject to redemption by Thomas Manby. By subsequent deeds further sums of money were charged on the same premises. On the 10th of October, 1878, Thomas Manby was adjudicated bankrupt, and the plaintiffs, H. Shepard and H. Davies, were ap- pointed trustees of his estate. On the 18th of February, 1879, the defendant offered the mort- gaged property for sale by auction under the power of sale in his mortgage, but no bidding was made for it. Several persons also in- spected the brewery with a view of purchasing it by private contract, but declined to do so, alleging as their objection to it the inadequate supply and inferior quality of the water in the well on the premises. In August, 1879, the defendant took possession of the brewery, which was then vacant, and placed a person in it to take care of it, but did not himself occupy it. In the early part of the year 1880 the defendant commenced boring operations to deepen the well, and eventually obtained a good supply of water. The defendant alleged that this was done with the knowledge and acquiescence of the plaintiffs. On the 12th of May, 1880, the defendant again put up the mort- gaged premises for sale by auction, when it was bought by David Johnson for £5,000, one of the conditions being that the sale should be completed on the 29th of September following. At that time the principal sum of £4,000 and a considerable arrear of interest was due to the defendant. The defendant let the purchaser into possession of the brewery ■ soon after the sale, without requiring any rent from him, but the purcha.se was not completed nor the purchase money paid on the 20th of September. The purchaser was not a brewer, but a manufacturer of zoedone, and used the premises after taking possession as a storehouse for his goods. The defendant tendered to the trustees £509 18s. 4d., which he considered to be the balance due to them, but they declined to accept it. They claimed in addition rent for use and occupation from the time when the defendant took possession till the 29th of Septem- ber, 1880, and they also refused to allow the expense to which the defendant had been put to in deepening the well, amounting to about The plaintiffs then brought this action against the defendant, claiming the balance of the purchase money, and asking for ac- counts against the defendant as mortgagee in possession. The de- fendant paid £544 17s. 2d. into court. At the trial the above mentioned facts were proved, but there was a conflict of evidence whether the plaintiffs had notice of and acquiesced in the deepening of the well, 187 ■Jessel, M. B. My present opinion is that the appeilaut is entitled to succeed on ■Dotia tne points in this case. 1 have always understood that occu- pation rent is onl}' charged against a mortgagee wlio occupies* With regard to the otner point, it is one oi more general interest. 1 have always understood tlie practice to be quite settled. If upon the hearing of a redemption suit the mortgagee, having charged in his pleadings that he 'has laid out mone}' in lasting improve- ments, produces general evidence that he has laid out money in lasting improvements — that is, produces evidence of the laying out of the money, and that the worKs are prima facie improvements — that is sufficient for an inquiry. If he proves uiore — that is, if he not only proves that he has laid out money in permanent works, but they are realh' improvements and have improved the property to the extent of the money laid out — he will tlien get not only an inquiry, but an account of the sums laid out in the lasting improve- ments. But, of course, to get the account he must prove a good deal more than to get an inquiry. Upon that point I will quote some of the words of Lord Langdale in the case of Sandon v. Hoop- er, although Sandon v. liooper went too far on another point, and ■was varied on appeal ; but on this point there has been no appeal. Lord Langdale says this: "Now, in this case it has also to be con- sidered whether it is a matter of course to direct an inquiry whether any mone_\- has been laid out in lasting improve- ments. Many such inquiries have been directed where the fact of any money having been laid out has been proved and brought to the attention of the court. I quite agreed with the argument that has been used on this occasion, that it was not necessarj^ for the deiendant to prove the items of sums of money laid out in perma- nent improvements alleged to have been made." Then he goes on : "He may have done something towards the improvement of the ■estate, and if he had entered into any general proof without going into the items, it is very probable that the proof might have been such as would have induced the court to direct an inquiry upon the subject." That is, you want general proof of monev laid out, and you want general prima farie proof that it has been laid out in last- ing improvements. That beinsr so, we have only to consider whether there was in this case proof of both those facts. There was not only general proof, but, as I understand, there was detailed proof as to the monev laid out. There is no dis]iute about that. The money laid out was £100 ; but was it proved generally and prima facie to be laid out in lasting improvements? Now it stands in this way: the money was laid out in boring for water. That was not at first productive, and they laid out more money, which was productive, and the quantity of water was largely increased. Whether or not that was an increase which added much to the saleable value of the property would be a matter for inquiry, but they did satisfy the two things laid down by Lord Langdale, namely, that they laid out money, and that the money was prim.a facie a la,sting or permanent improvement. It was lasting and permanent, and it was prima facie * The diecusBion of this point ie omitted. - 188 an improvement; because it very much increased the quantity of the water in the well, whether we look on it as a brewery property or even as a property not used ajs a brewer}', because it appears that a supply from the water company was no longer required. I think there is sufficient for inquiry, even if there were no special circum- stances, in this case to distinguish it from the ordinary redemption suit. Of course, a mortgagee takes the inquiry at his own risk, as to what may be the result of the inquiry. But there are very special circumstances in this case which, I think, distinguish it from an ordinary redemption suit, which puts the right of the mortgagee to the inquiry upon higher grounds. This is not a redemption suit at all. It is a suit brought by the mortgagor for an account from the mortgagee, who has exercised his power of sale of the application of the proceeds of that sale and a claim for the balance. If it should turn out that the mortgagee has done something to the property at his own expense which in- creased its saleable value, I think it is plain on ordinary principles of justice, that that increase should not go into the pocket of the mortgagor without his paying the Bum of money which caused the increase. It distinguishes it from the ordinary case of improve- ments. The increase may have been an increase which did not come under that denomination, but which increased the selling price. It seems to me that wherever there is a case of that kind where the mortgagee can prove that the selling price was increased by reason of the outlay, then to the extent to which that selling price has been so increased the mortgagor cannot get the benefit of it without pa}-ing for the outlay. Of course the mortgagor could not be made to pay more than the increase ; but to that extent it seems to me in ordinary justice the mortgagee is entitled to say, ''You shall not get that increased benefit caused by my outlay without paying for that outlay." There is another observation I wish to make on the supposed necessity of notice, and there are some words in the judgment of Lord Langdale in Sandon v. Hooper, which I have always declined to read literallv, and w'hich do not appear to me to be warranted by the judgment of Lord Lyndhurst. That is, as to notice. I am by no means prepared to say that Lord Langdale did not mean ex- actly what I am going to say ; I rather think he did, but it was im- perfect! v expressed either by himself or by the reporter. As I un- derstand it. notice is not necessary if the improvement is a reasona- ble one and produces a benefit. The mortgagee cannot be deprived of that benefit because he did not tell the mortgagor of it. If, on the other hand, it is an unreasonable one, and produces no advan- tage, I do not see why the mortgagor should be charged with it be- cause the mortgagee gives him notice of it. He could not prevent it, the mortgagee being in possession. That being m, it seems to me that the real doctrine as to notice is, that where the mortgagee gives the mortgagor notice of the expenditure, and the mortgagor agrees to it, then, of course, it is unnecessary for the mortgagee 'to show that 'the expenditure was reasonable. It is a contract. If the mortgagor does not actually agree to it, but docs such acts as in the 189 view of a court of law amount to a tacit consent, or, as it is some- times called, "acquiescence," that will also put the mortgagee in an equally advantageous position. But if the' mortgagor simply does nothing, it appears to me that notice cannot affect the rights of the parties either way. I think that is the true explanation of what was intended by Lord Langdale in Sandon v. Hooper, and I think that is the real view of the law on the subject. Under these circumstances, I think the appeal must be allowed. As regards the costs there is an ample fund, and you can add the costs to the mortgagee's costs of this suit.* / 7 •: -V MICKLBS v. DILLAYE. [17 A. r., 80—1858.]' Appeal from the Supreme Court. The action wa.s for the redemp- tion of certain premises in the city of Syracuse, mortgaged to Philo D. Miekles. The trial was before a referee, who found that the mortgaged premises were, in 1840, conveyed to Philo D. Miekles by one Fitch. There was then outstanding a mortgage upon the prem- ises, executed by Pitch to David Hall. Philo D. Miekles conveyed to the plaintiff, with warranty, March 8th, 1841, for the price of $4,000, to secure $2,000 of which the plaintiff executed the mort- gage which in this suit he sought to redeem. This mortgage and the bond collateral thereto were, in April, 1841, assigned by Phiio D. Miekles to John Townsend. Philo J). Miekles purchased the Fitch mortgage on September 33d, 1843, and on the 6th of November, 1843, assigned it to John Townsend, without the knowledge or con- sent of the plaintiff, so far as the evidence showed. Townsend, on the 83d of September, 184(), sold the premises to Charles A. Wheaton for $1,750, upon a foreclosure of the Fitch mortgage, of which no notice was served on the plaintiff. At the time of this sale, Wheaton was the owner, by assignment from Townsend, of the mortgage for $3,000, executed by the plaintiff to Philo D. Miekles. Wheaton took possession of the premises, and conveyed the same, with warranty, December 19, 1846, to John A. Eobinson, who conveyed, November 19th, 1853, to Henry A. Dillaye, also with warrant}''. The only ' question in dispute in this suit was as to the allowance to be made to Dellaye for improvements after he took possession under the deed from Eobinson; the effect of the purchase by Philo D. Miekles of the Pitch mortgage being the subject of litigation in another suit. P. D. Miekles was in possession of the premises at the time he conveyed them to the plaintiff, and when he received the mortgage now sought to be redeemed. From that time until the sale under the attempted foreclosure he continued to rent them in his own name and to receive the rents, without disclosing the interest of the plain- tiff.. They were assessed to him. Wheaton, the purchaser, went * Tn Pemipylvania the cost of uermaTieTit improvements "neceppary and heneficial for the proper use of the property " will be allowed in an action of " equitnhle ejectment " brought by a mortgagor against a morteagee in possession. Wdlf v. Tan DyTce. 109 Pa. S' . 33fi. Tn Mnpsacbu«etts. bv ptntnte (T>iLh. Sitaf' flu 1st eg??i. — " All sums expended in reasonable repairs and improvementp" are allowed. ^i^eNerTianiy. gagor will want a slate quarry. The amount is in this instance in- considerable, but the principle would reach the case of a mine. The mortg-agee, therefore, having engaged in this speculation, must speculate at his own hazard. The first exception was overruled and the second was allowed. Parkinson v. Hanbury, L. E. 3 H. L. 1 (1867). Bill of ac- count charging defendants as mortgagees in possession. Defend- ants offered to account as agents, having purchased the property, supposing themselves to have a good title. The opinion of Lord Cranworth, in the House of Lords, was in part as follows: Then comes the other point, whether or not the accounts which were directed in respect of the occupation of the Eoyal Oak public house ought to have been directed, charging the defendants both with the receipts and witli that which, without wilful default, they might have received. It is meant to charge the resnondents with being in receipt as mortgagees upon two grounds. That which was 19.5 • insisted upon mainly was this: That their title, wihch they ac- quired under Chambers on the 9th of October, 1834, although sup- posed by them to give them a title as purchasers, really was a title which only put them in the place of Chambers, and Chambers was merely a mortgagee. j^think_that-it is perfectly clear law that when a person becomes possessed of a property, though erroneously supposing that he is a purchaser, if it afterwards^turns out that he is not to be treated as a purchaser, but only as a person who has a sort of lien upon the property, that does not make him a mortgagee in possession within the meaning of that rule which charges him with wilful default. What was the origin of that rulel do not know, and 'if is not very clear or very distinctly laid down in the cases, but it seems to me to depend upon this, that the party taking possession must have known that he was in possession as mortgagee. That seems to me to be essential to the rule. Whether it would be correct to say that,. under those circumstances, a person who entered into possession, not as a mortgagee, may not afterwards become mortgagee in possession, with all the liabilities of a mortgagee in possession, is a proposition which need not be laid down now. It is possible that, by distinct circumstances, it may be shewn that there was an intention to alter the character from the one to the other. But nothing of the sort ap- j pears here, and it is perfectly clear that, although these respondents, were properly treated as parties who had not a valid title as pur-* chasers, because there was nobody who would give a consent to the! sale on behalf of the representatives of Parkinson, yet they treated.! themselves as purchasers, having a valid title and supposed that- they were in possession as purchasers, and were, therefore, liablel to account only in the ordinary way for the rents. LoED Westbury: My Lords, 1 have felt some anxiety in this case, by reason of the form of the decree, to account for the rents and profits, and certainly that is a point which deserves some attention on the part of the House. I take the law to be this. It is undoubtedly settled in the Courts of Equity that if a mortgagee, in that character, enters into receipt of the rents and profits, he will be bound to account, not only for what he has received, but for what, without wilful default, he might have received. It is difficult, perhaps, to ascertain the origin of the rule, but I take it to be this — that when a mortgagee, by vir- tue of his mortgage, claims to receive the rents and profits, he is re- , garded in a Court of Equity as the bailiff of the mortgagor. Now, an account against a bailiff was, both at common law and in equity, given with wilful default. This is almost the only case, save in cases of fraud or breach of trust, where wilful default is infused into the form of the account. And if the mortgagee is regarded as in the nature of a bailiff to the mortgagor, then it would be proper to give the decree against him, as it is always done against a bailiff with wilful default. But if that ground is referred to ns the foundation of the prac- tice, it must of necessity foll'OW that the party receiving receives in 190 the character to which that relation of bailiff and principal may be properly imputed, and consequently it would follow that if the mort- gagee takes in another character, more especially if he receives in a character adverse to the right of the mortgagor, then it would be impossible to ascribe to him, by any inference of law, tlie conclusion that he intended to take possession or to receive the rents as the bailiff of the mortgagor, or that that relation could properly be im- puted to him. Supposing that to be the origin of the rule, it will, therefore, not be applicable to any case where the conclusion of the defendant being in receipt of rent as mortgagee is a conclusion consequential only on your having reduced and set aside some other pretended or alleged title, in respect or by virtue of which he had actually received the rents and profits. The ease here is clearly this : The present respondents claimed the Bo.Ya LOak. not in the character of mortgagees, but in the char- acter of purchasers of the property from Thomaa Chambers, by virtue of his power of sale. In that capacity they entered and en- joyed, and you have to remove that title by decree before you can fasten on them anything like that state of circumstances which would bring them within the character of mortgagees in possession. MOERIS V. BUDLONG. (78 Xeiv York, 543—1879.) Plaintiff being greatly embarrassed and her farm about to be sold in foreclosure, defendant agreed to bid it in for the benefit of plaintiff, to purchase various outstanding claims against her and tojholdjthe f arin "to secure him for such moneys as he should pay out in carrying into effect this agreement, and give her one__year in which to redeem by repaying him the moneys he should pay out ni carrying into effect the agreement, and that Mrs. Morris should also pay him all expenses, and for his time and trouble in connec- tion therewith." Budlong thereafter purchased the claim above referred to, took a deed of the Morris farm from the sheriff, and on the 23d day of March, 1860, purchased the premises in ques- tion on the foreclosure sale, paying therefor in money and by his bond and mortgage, $11,290.87. To raise the money for these purposes, Budlong was obliged to go to Wisconsin to get in some investments which he had there, thus incurring expenses, and an absence from home of three or four weeks. That he should do so was agreed upon at the time the above arrangement was made. Immediately after the mortgage sale Budlong entered into posses- sion of the farm, cultivated it, and received the profits thereof, ex- cept such portion a.s was received by the Morris family, until about March 31, 1866. During the first three years that family occupied the whole of the farm house, and during the remainder it was oc- cupied bv them, and the family of Budlong. The time for pay- ment bv Mrs. Morris under the above agreement expired and was extended one vear. The money was not paid, but no further exten- sion was given. ^97 I In an acl iou for an accounting it was claimed in behalf of plain- ' tiff, that defendant held the farm as mortgagee in possession and was chargeable not only with the rents and profits actually received by him, but with the full rental \alue of the farm, which, it was alleged, had not been worked to its fullest capacity. Danfokth, J. : — * Second. — An account rendered upon an application to redeem would properly charge the estate with the money advanced by Bud- long and interest, with the expenses and compensation provided for by the agreement, and would credit the estate with whatever had been received from it by sales or rents and profits as incident to the right of redemption, and an equitable offset against the amount due on mortgage, after deducting taxes, repairs and other necessary expenses incurred on account of the estate. (Ruckman v. Astor, 9 Paige, 517.) It would include, therefore, the proceeds of timber sold and rents and profits actually received. ThaLthe farni^as_ not worked to its fullest capacity furnishesno grouni under the cir- cumstances of this case' for an enlarged liability. A provident owner might not do that, and there is no fact stated from which the wilful default of Bud long in this restiect could be found. Nor has it been. He is in no sense a wrongdoer. Iie,went . into possession under the legal title, taken with the knowledge of Mrs. Morris and continued under circumstances which might well have induced a belief that he was in fact the owner of the estate, subject only to an agreement to sell. He was not technically at any time a mortgagee in possession. There was no mortgage. The character is cast upon him by the ap- plication of equitable rules to an oral agreement easily susceptible of two constructions, of which the one chosen is in direct contradic- tion o'f the written instruments which display his title, and he is, therefore, chargeable only with what he has received and not with what he might have received. "I think," says Lord Cranworth, in Parkinson v. Hanbury (2 L. E. ( Eng. and Irish App.),l), "that it j is perfectly clear law that where a person comes possessed of a prop- ; ertv through erroneously supposing that he is a purchaser, if it ' afterwards turns out that he is not to be treated as a purchaser, but , only as a ])prson who has a sort of lien upon the nroperty, that does ' not make him a mortgagee in possession within the meaning of that rule w^hich charges him with wilful default." In 1 Story Eq. Jur. (s 514 a. (10th ed.), it is said: "Where the estate is thrown upon one in the necessary enforcement of his legal rights, or comes to his possession as trustee, he should onlv be required to act in good faith and to account for what he in fact realizes ;" and so in Moore v. Cable (1 .T. Chv., 384), Chancellor Kent directed the defendant to be chare-ed onlv with rents and profits received. In Harper's Appeal (14 P. F. Smith, 315), it is declared that "whatever the rule on ac- countins: mip"ht he, where the partv charged was a mortgagee under an ordinary formal mortgase it ought not to be the same, when, bv the exT)rpss agreement of the party seeking equitable relief, he took and held possession as absolute owner." In the case before us * Only so much of the opinion as relates to the point nnder examination i? !»iven. 198 there was not only a title taken by the defendant, by the plaintiffi's wish, but there is alleged against it only an oral promise to convey at a certain time, upon payment of certain moneys, and no agree- ment to account in the meantime. There is nothing to show any want of good faith on the part of the defendant in his management of the property, nor that he did not act prudently and according to his best judgment in the matter. The omission of Mrs. Morris to redeem at the end of the time limited, the year or at the end of the second year ; her omission to arrange for further time to do so ; the continued occupation of the premises by Mr. Budlong, apparently as owner, with no demand for an account of rents and profits, all bear upon this question, and, with the considerations before adverted to, show that the referee erred in measuring the profits for which Mr. Budlong was liable by the rental value of a farm worked to its full capacity rather than by what he actually received. SIDENBERG v. ELY. [90 .Y. Y. 257— 188--?.] Miller, J. This action was bro ught for the foreclosure of a mort- gage made by one William G. Ely, deceased, in 1825, to the ^tna Insurance Company to secure the sum of $3,000. It contained no clause in reference to taxes and assessments. In 1872 the ^tna In- surance Company assigned the mortgage, together with the bond accompanying the same, to the Excelsior Life Insurance Company. This company paid, while it held the mortgage as assignee, certain taxes, assessment.'; and water rates upon the mortgaged premises, and to redeem the same from tax sales, which together amounted to the sum of $1,640 or thereabouts. In the year 1875 the Excelsior Life Insurance Company assigned the bond and mortgage, with the whole amount due hj reason of the payment for taxes, etc., to the plaintiff, who purchased at the request of the mortgagor and under an agreement to extend the payment of the principal until Septem- ber, 1878, previous to which time this action was commenced. Sub- sequent to his purchase the plaintiff paid certain taxes and assess- ments, amounting to the sum of $925. At the time of the assign- ment to the plaintiff the sum of $934.78 was due for interest. The defendant, Catherine Ely, is the widow and executrix of the mort- gagor, who died, leaving a will, by which he devised her the estate for life, with remainder over in fee to the children of his brother James, who are defendants in this action. Upon the trial the court allowed for the taxes, assessments and water rates paid by adding them to the mortgage, which, with the prineinal and interest found due to the plaintiff, amounted to the sura of $7,365.70. '" The most material question upon this appeal arisas in regard ,/ to the rights of the plaintiff to the amount of taxes and assessments f paid by him and his assignor and to collect the same out of the mort- gaged property. The rule seems to be established by abundant au- thority that, when the owner of mortgaged property refuses or ne- 199 gleets to pay taxes and asseiisments or liens of a like nature, which are imposed upon the mortgaged premises, the mortgagee has a iright to pay Uie same in order to protect his security, and the amount so paid may be added to and become a part of the mortgage debt, which may be enforced upon a foreclosure of the mortgage. Willard, in his work on Equity Jurisprudence, at page 446, lays down the rule that taxes paid may be added to the mortgage debt, and he adds : "So money paid by the mortgagee to redeem the prem- ises from a tax sale becomes part of the mortgage debt in equity." Jtie further says, at page 448 : "With regard to the amount to be pkid on redeeming, it may be said that, as taxes are a legal charge upon the estate, they may, if necessarily paid by the mortgagee, be added to the mortgage debt." The same rule is upheld in Thomas on Mortgages, at pages 86 and 276, and in Jones on Mortgages, at section 77 and 1134. In the last authority it is laid down that this is so, although there be "no tax clause in the mortgage." Numerous cases in the reports sustain this doctrine: Eagle Fire Ins. Co. V. Pell, 2 Edw. Ch., 631; Burr v. Veeder, 3 Wend., 412; Brevoort v. Eandolph, 7 How. Pr., 398 ; Faure v. Winans, Hopk. Ch., 283; Marshall v. Davis, 78 N. Y., 414; Eobinson v. Kyan, 25 id., 320; Williams v. Townsend, 31 id., 414. These eases are criticised by the counsel for the appellant, and it is claimed they do not sustain the doctrine contended for. While all of them do not entirely cover, yet they tend to the support of the principle that a mortgagee, who, to save his mortgage and to protect his security, is under the neces- sity of paying the taxes and assessments to prevent the property from being sold, should be allowed for the same as a part of his mortgage. Wliether the doctrine of tacking, as claimed by the coun- sel for the appellants, has any application is not important to con- sider, if the principles we have stated can be invoked to save the mortgagee from the sacrifice of the property by reason of unpaid taxes or assessments. In accordance with the authorities already cited, it is not neces- sary that the premises should be sold prior to the payment of the taxes or assessments before the mortgageee is authorized to pay the same and add the amount paid by him to his mortgage. (See Eagle Fire Ins. Co. v. Pell, and Williams v. Townsend, supra.) 200 CHAPTER III. DISCHAKGE OF THE OBLIGATION. (a.) Tender and Payment. Lit., Sees. 334, 335, 339; supra, pp. 4, 5, 6. Co. Lit., 308; supra. EMAXUEL COLLEGE v. EWENS. (1 Reports in Chancery, 18. — 1625.). That the Earl of Huntington, seised in fee of the Manor of North-Cabury, with advowson appendant, and for payment of debts by way of mortgage, 25 Eliz., made a lease for 500 years of the said manor, with appurtenances, not mentioning the advowson by express name, with a clause of redemption, and for advancement of learning and religion, of his free disposition in 2S Eliz. by deed granted the said advowson to Sir Francis Hastings, and others, and their heirs, to the use of the said Earl for life, remainder to the blaster Fellows, &e., of the said college, and their successors, for- ever; and shortly after in the same year paid his said debts. And this court coneerved the laid lease, being^ but_a security, and that money paid, the said lease being void, as well agarnif the said col- lege as against any other; and though the money not paid at the day, but afterwards, the said lease ought to be void in equity as well as on a legal payment, it had been void in law against them. COKER V. BEAVIT. (1 Report.'^ in Chancery, 253. — 1625). The plaintiff hath a decree for the redemption of a mortgage, and the time for the performance is elapsed, of which the defendant would^iake advantage, the decree being signed and enrolled. It appearing that this court having very often in such like, cases of inevitable necessity, and no wilful default appearing in the party, have enlarged the time as to the performance of decrees, notwith- standing such decrees have been signed and enrolled, and this being also now matter subsequent to the decree ; this court declared the plaintiff was capable of relief, and decreed to go to an account. 201 MANNING V. BURGES. (1 Cases in Chancenj, 29. — 1663.) A MOETGAUE WAS i'EFEiTED; the mortgagor afterwards meeting the mortgagee, said, "I have monej^s; now I will come and redeem the mortgage."' The mortgagee said to him, he would hold the mortgaged premises as long as he could; and then when he could hold tl; em no longer, let the devil take them if he would. And af- t-txwards the mortgagor went to the mortgagee's house with money more than suflBcient to redeem the mortgage, and tendered it there; te nder was niafe to hinil and it was decreed a redemption and the. ieiendant to have no interest from the. time of the tender, because of his wilfulness. LUTTOX V. EODD. (2 C«ses in Chanceri/, 206. — 1675.) A deed in nature of a mortgage and covenant to reconvey in pay- ment: the money was tendered at the day and place, and refused: Decreed the.money.wittio]lt interest from, the time of the tender, and to reconve}-, though that the plaintiff ought to make oath that the money was kept and no profit made of it. WILTSHIEE V. SMITH. [3 Atkyns 89—1744:.] A_bilLwas brought to redeem amortgage on the 8th of May, 1743, in which the plaintiff insists upon a redemption on paying the prin- cipal money only, for that the interest ought to end the 20th of February, 1741, because the plaintiff had given six months' notice to pay off mortgage, and on that day tendered the principal and in- terest and a deed of assignment, but the defendant absolutely re- fused to take the money. The def endant swears that he offered to take the money, provided he might have time to consider of it and to advise upon the deed of assignment, as there are covenants in it on his part, upon which, as he is not of the profession of the law himself, it is reasonable he should ask the opinion of some attorney whether they were such as he might safely execute. Lord Chancblloh: There is not one case in twenty upon the fact of an absolute re- fusal after a tender that is ever made out, for they are generally attended with circumstances that explain the refusal, and are noth- ing more than causes cooked up by country attorneys to make them- selves business. The plaintiff did not, as he ought to have done, send a draught of- the assignment to the defendant any time before the money was tendered. The plaintiff insists that the defendant absolutely refused to talce his money or execute the deed of assignment. If this had been the 203 fact ,it would have been unconscionable and unreasonable in the de- fendant. But the person who was taken an assignment of the mortgage swears that the defendant desired further time or to that effect. The question is, Who w as in the wrong 'i The pla intiff certainly was." _Z°?J^-^6re there are covenants on the part of the mortgagee, itjs very reasonable that he should have some time to look them over; and the plaintiff's attorney ought to have left the deed for a week with the defendant that he might have an opportunity to advise upon it, and the plaintiff's attorney should have appointed a time to pay the money after the defendant had been allowed a sufficient time to advise ; or, as I said before, he should have sent a copy or the engrossment of the assignment. But the subsequent transaction and what passed before the filing of the bill explains it. Did ever a mortgagor, as is the case here, after he was put under this difficulty, lie by a year and a quarter without bringing a bill to redeem ? What could be the reason ? Why, the plaintiff, the mortgagor's attorney, told him you have made a tender of your mortgage money, and the defendant's refusal has forfeited his interest, for that you may keep the money, and by a bill compel the defendant to take the principal, without interest, from the time of the tender. I LoED Hardwickb ordered that it be referred to a master to take an account of what was due for principal, in trest and costs on the mortgage, and on the plaintiff's paying the defendant what the Mas- ter shall certify to be due within six months after he has made his report, it was decreed the defendant should assign the mortgaged premises, as the Master should direct ; but in default of the plain- tiff's paying as above directed, it was ordered the plaintiff's bill do stand dismissed. MAYNAKD v. HUNT. [5 Pick., 240—1837.] Wri t of entry. The demandant declared upon his seisin in fee and in mortgage and a disseisin by the tenant. The tenant pleaded : First, nul disseisin. Secondly, that Nathaniel Maynard, the mortgagor, assigned the premises to the tenant, with warranty against all incumbrances, and that the tenant, after condition broken, but before the action was brought, tendered -$400 for the discharge of the mortgage. The demandant took issue on the tender. Thirdly, that in consiredation that the tenant would forbear to make the tender, the demandant promised that the tenant should hold the land, discharged of the mortsfage, and that he (the de- mandant) would resort to Nathaniel Maj-nard for payment of the note, which was secured by the mortgage. Issue was taken on this plea. 303 Fourthly, a plea like the second, except that it alleged a tender of $450. l8«ue was taken on the tender. The cause was tried before Putnam, J., and a verdict was found for the tenant upon all the issues. The demandant thereupon moved in arrest of pudgment, because the three last issues were immaterial, and the first issue was found only for form's sake and as a consequence of the finding on the other issues. He further move that if any of these three issues should be 'ad- judged immaterial, the court would grant a new trial, because no evidence had been introduced sufficient or proper to maintain either •of them on the part of the tenant, and because all the evidence in the case, the three. last pleas and the admission of the tenant's coun- sel showed that the finding of the first issue for the tenant was a consequence of finding the other issues in his favor, and that if that issue had stood alone, it would have been found for the demandant. ( At the trial J. W. Hunt, the brother of the tenant, testified that, at the tenant's request, he called on he demandant and inquired how much was due upon the note. The demandant replied $400. The -witness asked him if he intended to call upon the tenant for the land, if Nathaniel Maynard (who was the defendant's son) should be unable to pay the note. He answered in the affirmative. The wit- ness said he would pay him $400 ; that he came for the purpose of settling with him ; that he had the money with him in bank bills, and that he would get the specie if it would make anv difference. The demandant said it would not. He also said that if he took the money, the tenant would immediately sue Nathaniel. The witness told him that he could expect nothing else. The demandant then said that he would not take the money; he would rather it should lie as it was on interest : he was secure ; but he assured the witness that his brother should not be hurt. The question whether this evidence was sufficient to warrant the finding of the jury was reserved for the determination of the whole court. Parker, C. .T. It is very clear that all the issues except the first are immaterial, and that the first was found for the defendant against all the evidence in the case which could legally bear upon it. The mortgage deed produced bv the demandant entitled him to a verdict on the first issue, there being no payment or tender of pay- ment of the money due, according to the condition, until four years after the condition broken, so that the demandant's title at law was perfect, subject only to be defeated, by a process in equity, founded upon payment or tender of payment after condition broken and be- fore foreclosure. If judgment should be rendered on the verdict in favour of the tenant, the demandant would be entirely deprived of his security and probably of his debt, without any consideration or equivalent, for we cannot consider that the loose conversation testified to by the brother in regard to his claims has proved anv intention to give up his securitv, or that it can have the effect of a release or dis- charge of the mortgage in law or in equity. 304 ffliethera tender or any fact equivalent was proved is wliolly un- important, as the tenant s right at that time subsisted wholly in eqiiity, and he could not otherwise enforce it than by a bill jn equity. Tne tenant's counsel has reminded us since the argument that no ■objection was taken at the trial to the tiuie of the supposed tender, and he refers us to the case of iVrms v. Ashley (4 Pick., 71 ), to show that it could not afterwards be raised. But the cases are wholly dif- ferent. In the case cited the point was that a fact capable of proof, but omitted to be proved or called for at the trial, was on the hearing of the questions reserved stated as a ground objection to the verdict. In this case the point on which the cause turns appears on the record and in the proceedings, and, from the tenant's own showing, no other evidence touching it could have been produced had the ques- tion been made at the trial, for the tenant's right to tender did not exist until long after the tender could have defeated the demand- ant's title at law. Admiited that payment tendered and received after condition broken and before foreclosure would be a sufficient defense to an action brought by the_ mortgagee for possession, it would not follow that a tender not accepted would be. The firsi, might operate as a discharge QjLthe_debt_^nd waver^of tKe breach •oTTJhe con3ition7 and it might be unreasonable to allow the mojt- gagee to recover possessTon, when, by another' suit, he would bejm- mediately obliged to surrender it. Biit the case of a tender is differ- eat.; The debt isjiot discharged, and it is only in equity that the mortgagor can avail Himself of it. The proper course in this case is for the plaintiff to recover the conditional judgment, as in the case of mortgage, unless the tenant has a better defence than is shown by the report of the case. Ver'dict set aside and new trial granted. KORTEIGHT v. CADY.* [21 N. r. 343—1860.] Appeal from the Supreme Court. Action to foreclose a mortgage. The defendant, Cady, was a subsequent grantee of the equity of re- iiefflpRonnTF averred in his"answer and proved oQ the trial that, after the money secured by the mortgage had become due and^the stipulated day for payment had pass.ed, 'he tendered to the pTamtifE the amount due for principal and interest.' The_glaintifp i-efused to , receive it unless Ca;4y. would also pa;y certain taxes upon the mort- , gaged premises, which the plaintiff had discharged. It was held i that Cady was for reasons unnecessary to be stated, under no obli- j^ gation to pay the taxes, and the case stood upon the naked tender. Cady did not, in his answer, allege a readiness still to pay the mortgage debt, or that it was paid into court, nor did he offer to bring it into court ; and it did not appear, from the finding of facts or otherwise, that he in any way kept the tender good. The plaintiff had the usual judgment of foreclosure and for a sale of the * ODinion of Davies, J. and Welles J. fthe latter dissenting), and portions, of opinion of Chief Justice are omitted. All of the Judges except Wrlles concurred. 205 mortgaged premises. Upon appeal by the defendant, Cady, thi& judgment was affirmed at General Term in the First District, where- upon he appealed to this court. CoMSTOCK^ C. J. After the suit was commenced to foreclose the mortgage Cady, who had become the owner of the land, tendered the amount due, with the costs, which, being refused, he set up the tender in his answer in bar of the further maintenance of the action. • The only question in the case is whether a tender, made after a i mortgage is due by the owner of the lands mortgaged, discharges- k the lien. Forty years ago tliis question was fully determined by the Su- preme Court of this State in the case of Jackson v. Crafts (18 John.,, 110.) Mt. Justice Woodworth, in delivering the opinion of the- court, observed : "From the nature of the interest the mortgagee has, there is no necessity for reconveyance by him to the mortgagor after the mortgage has been paid. When that is done the mortgagee- has no title remaining in him to convey, and consequently, by our laws,, on payment of the money, he is not deemed a trustee, holding the legal estate for the benefit of the mortgagor. Tli,p onlv question, then, is whether tender and refusal are equivalent to payment."' Having thus truly stated^the^ relation between moftgagor 'a5d mort- gagee, according to the law as. it was then and has bgen ever since well settled in this State, he cited some of the early English authori- ties, holding that a tender of the money due discharged the land from the lien. Such being, as I think, the clear result of the authorities, a re- newed discussion of the question may seem to be unnecessary. I cannot help saying, however, that a decision by this court in opposi- tion to the rule laid down in the cases referred to, would introduce into the law of mortgage an inconsistency too plain to escape ob- servation. In the early history of that law, the courts of equity, departing from the letter of the contract, but adhering to the inten- tion of the parties, adopted the just and liberal doctrine that a mort- gage was but a pledge of security, always redeemable until fore- closure. The courts of law followed in the same direction. As Lord Eedesdale observed (Mitf., 428:) "The distinction between law and equity is never in anv country a permanent distinction. Law ana equity are in continual progression, and the former is constantly gaining upon the latter. A sfreat part of what is now strict law was formerly considered as equity, and the equitable decisions of this age will unavoidably be ranked under the strict law of the ne^t."' Such, pre-eminentlv, has been the course of jurisprudence on this subject. The doctrines originating in the courts of equity, respect- ing the rights of mortgagor and morto-affee, have been incorporated into the code of the common law, m that there is now no difference between the two pvstems. This has been true in substance for nearly a eenturv past. Tn "Martin v. Mowlin (2 Burr., 9781 , decided b^^ the English Kipcf's Bench in 1760, it was held that whatever words in a will would carrv the monev actuallv due upon a mortgage would earrv the interest in the land. Lord Mansfield said : "A mortea?e is a charge upon the land, and whatever would give the money would' 206 carry the estate m the land along with it. The estate iu the land is the same thing as the money due upon it. It will be liable to debts ; it will go to the executor ; it will pass by a will not made and executed with the solemnities required by the statute of frauds. The assignment of the debt or forgiving it will draw the land after it as a consequence; nay, it would do it, though the debt were for- given only by parole." So, in The King v. St. Michaels (Doug., 632), it was said, by the same judge that "a mortgagor in possession gains a settlement, because the mortgagee, notwithstandiug the form has but a chattel, and the mortgage is only a security." To the same eeet is The King v. Eddiugton (1 East., 288), and such is the uniform tenor of the English authorities. (See 6 Conn., 159.) In this State the rules of law and equity in regard to mortgages have never differed in any degree, it being the doctrine of both sys- tems that a mortgage is iDut a personal interest. This proposition, in its full length and breadth, was determined in Eunyan v. Mer- sereau (11 Johns., 534), where the question arose in the most direct manner whether the freehold was in the mortgagor or mortgagee. The plaintiff, deriving title under the mortgagor, sued in trespass for cutting timber, the defendant justifying under a license from the mortgagee. It was held that the action \v:is maintainable, the decis- ion being placed explicitly on the ground that the former was the real o\^Tier of the land, while the latter had a chattel interest only. So it has been held in repeated decisions that the mortgagee cannot, in any way, convey, devise, mortgage or incumber the land, while the mortgagor can do all these things : that judgments against a mortga- gee, which are a lien nn all leL;al estates, do not affect his interest in the lands mortgaged ; that such an interest does not descend to his heirs, but goes to the personal representative as a chose in action ; that it is not subject to dower or courtesy : that it passes by a parol transfer, and liy any transfer of the debt, and, finally, that it is ex- tinguished bv pavment, or bv whatever extinguishes the debt. (3 Johns., ras.,'32f)-. 1 Jr.. 590 \ i id., 43 : 7 id., 278 : 15 id., 319 ; fi id.. 290 : 2 Paige. fi8. 58fi : 5 Wend., 603 ; 2 Barb. Ch.. 119.) But it has been said that the mortgagee could maintain ejectment against the mortgagor until our Eevised Statutes abolished that remedv in such a case, and that even since those statutes, the mort- gaai'ee. being in possession, may retain it until the debt is paid. .Ml this is true, but it presents no anomaly or inconsistency in the law. The Mortgagee's right to bring ejectment, or, being in possession, to defend himself against an ejectment bv the mortgagor, is but n right to recover or to retain the possession of the pledge for th'> purpose of paving the debt. (Ci Oonn., 163.) Such a right is but the incident of the debt and has no relation to a title or estate in the lands. Any contract for the possession of lands, however transient or limited, will carrv the right to recover that possession, and such was deemed to be the nature and construction of a morigage. it being considered that the parties intended the possession of the thing hvpothecated should go with the contract. Ejectment was not, in fact, a real action at the common law. That remedv, in its origin, was onlv to recover possession according to some tenipornry 207 right, and it was only by the use of fictions tliat the title was at length allowed to be brought into controversy. (3 BL, 199, 200.) Vvnen the Legislature, by express enactment, denied this remedy to mortgagees, they undoubtedly supposed they had swept away the only remaining vestige of the ancient rule of the common law which regarded a mortgage as a conveyance of the freehold ; yet I s6e noth- ing inconsistent or anomalous in allowing the possession, once ac- quired for the purpose of satisfing the mortgage debt, to be re- tained until that purpose is accomplished. When that purpose is attained, the possessory right instantly ceases, and the title is, as before, in the mortgagor, without a reconveyance. The notion that a mortgagee's possession, whether before or after default, enlarges his estate, or in any respect changes the simple relation of debtor and creditor between him and his mortgagee, rests upon no founda- tion. We may call it a just and lawful possession, like the posses- sion of any other pledge, but when its object is accomplished, it is neither just nor lawful for an instant longer. There are terms of the ancient law which have come down to us, having long survived the principles of which they were the appro- priate expression. Thus the words "law day" once, and very ex- pressively, marked the time when all legal rights were lost and gone by the mortgagor's default. There is now no such time until fore- closure by a judicial ;f fhe> nmnpy f]i] P. iipon the said bond and mortgage was made by the plai ntiif to tlie defendant after the first • liar v o f A pi il . iab8. and Detore the commencement of this action, whlcli tender the de fendant refused to accept. Tho plainUif ilsked the court to find, as a fact, that a legal tender of all the money due and owing on the said bond and mortgage was made by the plaintiff to the defendant after the 1st day of April, 1868, and before the commencement of this action, and, upon thae fact, to give judgment for the plaintiff, on the ground that said tender extinguished and terminated any and all right the said de- fendant might have previously had to hold possession of the said land, by virtue of said mortgage. And the plaintiff, by his counsel, also asked the court, in case the plaintiff should be in error as to his asking in regard to the effect of the said lease, to permit an amendment of the declaration to be made, so as to state that the plaintiff's right to the possession accrued at the time when the said tender was made. The court did find, as a fact, that a legal tender of all the money due upon the said bond and mortgage was made by the plaintiff to the defendant after the 1st day of April, 1868, and before the com- mencement of this action ; but the court refused to adjudge that said tender extinguished and terminated the right of the said defend- ant to liold possession of the said land, by virtue of said mortgage, and did adjudge that said tender having been made after the day named in the said bond for the payment thereof, did not extinguish or terminate the right of the said defendant to hold possession of said land, by virtue of said mortgage, notwithstanding the making of said tender, to which refusal and judgment of the court the plaintiff, by his counsel, excepted, and he prayed that his excep- tion might be sealed, and it is sealed accordingly. The opinion of the court was delivered by Defue, J. The bills of exception sealed at the trial raise two questions : First. Whether the defendant, being the tenant of prem- ises under the plaintiff, could, at the expiration of his lease, make title under his mortgage without first yielding and surrendering the possession to the plaintiff.* And , _secoTid, whether a tender bv t he r mortgagor of the money sec ured 13V a mortgage, which is not ac- cepled^ tlie mortgagee, made after the day of payment named in tiTti Condi tion, Lei'lUlliates the estate of the inortgagee m the mor t- ga gSa pi'emises. ana exmfruishes the lien of tfae jnortgage on th e land. "^ The extinguishment of the lien of the mortgage, by the unaccent- ed tender of the mortgage money after the day named in the condi- tion, was contended for by the plaintiff's counsel with much earnest- ness. A mortgage, at common law, is a conveyance absolute in its form, granting an estate defeasible by the performance of a condition subsequent. The estate thus created was strictly an estate on enndi- * The opinion on thi- point in omitted. 210 tiou, aud m a court of law « as Ireated as subject lu be defated only by the perxonuaiicu oi ttic coudition iu the manner and at the time stipulated lor ni the deleusauce. If made on condition that the conveyance should be void on payment of a delinite sum of money on a given daj-, and the condition was performed according to its terms, the estate reverted back to the mortgagor without any re-coii- veyajice, by the simple operation of the condition. A tender at the time^ and place and in the manner prescribed in the instrument itself, was equivalent to performance, and operated to determine the estate of the mortgagee, and revest it in the mortgagor. Lit., § 335; Co. Lit. 207, a.; 4 Kent, 193; Coote on Mortgages 6; Merritt V. Lambert, 7 I'aige 3i4. But when the condition was discharged by failure to comply with its terms, the estate of the mortgagee be- came absolutv in law, and the title of the mortgagor was completely divested and gone, and a re-conveyance was necessary to restore him to his original estate. Lit., No. 333 ; 2 Black. Com. 158 ; Coote on Mortgages 9. So inflexibly was this harsh rule of the law adhered to, that it was remarked b}- a learned writer, thart if the debtor had no greater mercy shown to him than a court of law will allow, the smallest want of punctuality in his payment would cause him for- ever to lose the estate he had pledged. Williams on Eeal Prop. 333. The rigor of this rule was somewhat abated by the statute of 7 George II., eh. 20 (1 Evans' Statutes 243, re-enacted in this State December 3d, 1794, Xix. Dig., 4th ed., 608), which permitted a mortgagor, when an action was brought on the bond or ejectment on the mortgiige, pending ihe suit, to pay to the morigagee the mort- gage money, interest, and all costs expended in any suit at law or in equity; or in case of a refusal to accept the same, to bring such money into court where such action was pending which moneys so paid or brought into court were declared to be a satisfaction and discharge of such mortgage ; and the court was required, by rule of court, to compel the mortgagee to assign, surrender, or re-convey the mortgaged premises unto the mortgagor, or to such other person a,^ he should for that purpose nominate and appoint. In cases strictly within the terms of this statute, the English courts of law have exercised an equitable jurisdiction, to enforce a redemption on pay- of the mortgage debt after defavilt in payment, according to the condition, by compelling a re-conveyance. Execpt in cases within this statute, the doctrine of the English courts is in accordance with the ancient common law, that at law, a' failure to pay at the day pre- scribed forfeits the estate of the mortgagor under the condition, leaving him only an equity of redemption, which chancery will lay hold of and give effect to, by compelling a re-conveyance on equi- table terras. f In the United States, the prevailing doctrine in courts of law, /as well as in courts of equity, is to consider the mortsrage as merelv laneillarv to the debt, and to hold that the estate of the 'mortgage is /annihilated by the extinguishment of the debt secured bv it, after the day of pavment named in the condition. 2 Greenl. Cruise 91 ; note 1 1 ; 4 Kent 193. In fact, the latter conclusion will necessarily fol- low, whenever the mortgage is regarded not as a common law con- 211 veyanee ou condition, but as a security for the debt, the legal estate being considered as subsisting only for that purpose. In this State this is the generally received aspect in which a mortgage is regarded,, as a mere security for debt. Per Chief Justice Green in Osborne V. Tunis, 1 Butcher G51; per Justice Southard, in Montgomery v. Bruere, 1 South. 279, whose dissenting opinion in the Supreme Court was adopted in the Court of Errors in reversing the judgment of the Supreme Court. 3 South. 865. Consequently, payment after the day will convert the mortgagee into a trustee of the legal estate for the benefit of the mortgagor. In Harrison v. Eldridge, 2 Halst. 407, Chief Justice Kinsey, speaking of payment after the law-day, says : "When the debt is discharged according to law the mortgagee has the legal seisin in trust for the mortgagor, and the court will never permit the trustee of those claiming under him to set up this legal estate in him or them, to defeat the possession of the cestui que trust. This principle is settled in Armstrong v. Peirse, 3 Burr, 1898. The same doctrine being applicable to all trustees, the court would not permit a recovery upon a merely formal title, when the cestui que trust could have compelled a re-conveyance immediately, and thus have acquired the legal title." The seventh section of the act of June 7th, 1799 (Eev. Laws 463; Nix. Dig., 4th ed., 611, § 11), which authorizes satisfaction to be entered on the registry of the mortgage, in discharge of the mortgage, gives a legislative sanction to this effect of payment in the case of a mort- gage which has been recorded. Tjnf. a. tender, though it is equivalent to performance, where the question is whether the party is in default, is not a satisfaction o r extinfniishment of a deb t. T ender of the mortgage debt on th e day named as p pT-form nnpp r>f f he condition, and by force of the terms of the conditi on, determines the estate of the mortgagee, an d thec ondition being oompJied with, the land reverts to the mortgago r FytEe~simi3le operation of the condition^ The courts of the State of New York have given the same effect to a tender, without pay- ment, after the day prescribed for payment. This doctrine was first asserted in Jackson v. Crafts, 18 J. E. 110, on a misapprehension of a passage from Littleton. Lit., § 335, 338. It was denied by the Chancellor in Merritt v. Lambert, 7 Paige 344, and re-affirmed in the Supreme Court in Edwards v. The Farmers' Fire Insurance and Loan Company, 21 Wend. 467 ; and in the Court of Errors, in the same case on error, 26 Wend. 541 ; and by the Supreme Court in Amot v. Post, 6 Hill 65 ; and again denied by the Court of Er- rors in reversing the last mentioned case. Post v. Amot, 2 Donio 344. Finally, in Kortright v, Cady, 21 N. Y. 343, the question was set at rest in the courts of that state by reaffirming the rule laid down in Jackson v. Crafts, and it seems now to be the settled law in that stato t hat a tender of the money due upon a mortgag e at any time before foreclosure, discharges the lien without paymen t. thougn made after the law-day . T do not find that the rule. a« final Iv estabhshed m the courts of New York, has been adopted by the courts of any other state. In Massachusetts the decisions have been to the cont^a^\^ Maynard v. Hunt, 5 Pick., 240 ; Currier v. 212 Gale, 9 Allen 552. In an early case in New Hampshire ( Swett v. Horn, 1 New Hamp., 332), the court held, under a statute declar- ing that all real estate pledged by mortgage might be redeemed by paying all costs, &c., provided such payment or performance or tender thereof be made within one year after the entry of the mort- gagee for condition broken, that tender more than a year after breach of condition, where no entry had been made by the mort- gagee, discharged the lands. In a subsequent case the same court qualified the ruling of this case by denying this effect of the tender unless the money was brought into court. Bailey v. Metcalf, 6 New Hamp., 156.) It may. with safety be said that the doctrine of the New York courts originating in error, and maintained against the opinion of some of the most eminent jurists that have occupied the bench of that state, is without the support of any judicial tribtinal in this country ; and it is impossible to perceive upon what principle of law or equity it can be rested. As already observed, tender on the day named determinates the estate of the mortgagee, because it is performance of the condition. Eegarding the mortgage as remain- ing after default, only as a security for the debt, payment thereafter, by a necessary sequence, operates as extinguishment ; the debt being the principal and the security the accessory. Whatever discharges the debt extinguishes the security. No reason, founded in principle, can be assigned for giving that effect to a tender after forfeiture. The a ppropriate office of a tende r is tn reUpvo tlio »^AKtnv frnm ^nK. sequentlY accruing i nterest, and the costs of enforcing, bv a suit, the ob ligati on which by the tender of p avmne t he was willing t/v ppr - fofni; 'J 'he debt still remains. In the case of a common money bon57 before the statute 4 Anne, Ch. 16, Sec. 12, re-enacted in this state (Nix. Dig., 631, Sec. 9), payment after the day would not be pleaded without an acquittance by deed. ( 2 Saund., 48, c, note 1 ; Eosencrantz v. Durling, 5 Dutcher, 191.) The statute only applies to payments actually made, and a tender after the day cannot be pleaded. (2 Saund.^ 48, b, note i.) And if the tender is made on the day, it can only be made available by plea, accompanied by payment into court. (Co. Lit., 207, a.) Where, as in this case, the mortgage is accompanied by a bond, to hold that a tender, after default, extingnished the mortgage, for the reason that after such default it remains onlv a security for the debt, will lead to the incongruity of giving to the tender an effect with respect to the security, which by the rules of pleading and established principles of law, the court must deny, in an action on the bond, which is the immediate evidence of the debt. If the form of the instrument which evidences the debt is overlooked, and the question is viewed in the aspect in which the indebtedness imme- diately arose, the tender does not pay or discharge the debt ; and though it will avail to arrest the accuring of interest and to free the debtor from costs, it will be deprived of that efficacy of a subse- quent demand and refusal. If legal analogs- is to be pursued, it could lead no further than to deprive the mortgage of operation beyond the amount due when the tender was made, leaving the 213 question of subsequently acci-uiug interest and costs to be varied by tiie subsequent demand and refusal. The instances in which a tender and refusal amount to payment, and \\dll operate as an extinguishment, are those in which the obli- gation is in the nature of a gratuity, without any precedent debt or duty, and the discharge is an accidental and not a necessary conse- quence of the tender and refusal, there being no debt or duty re- maining "liereon to ground an action. (6 Bac. Abr., 456, title Ten- der, &c., F. ) If there is a precedent debt, as a loan of money, which the debtor secures by a mortgage on his land, conditioned for pay- ment, though bv- a tender made on the day the land is freed, and the offer may enter according to the condition, the debt is not thereby discharged, and may be recovered by action of debt. (Co. Lu., 209, a.) The effect of a tender on the day in terminating the estate of the mortgagee cannot be denied, because it is a legal inci- dent of his estate. Another legal incident of that estate is the ex- tinguishment and discharge of the condition by a failure to comply with its terms. Upon this, courts of equity raised an equitable estate in the mortgagor, called an equity of redemption, which con- .sisted in his right to have the estate of the mortgagee continued as a security for the debt, notwitlistanding the default. In equity, a tender will stop the accruing of interest, and will, in some eases, cast upon the mortgagee the costs of a suit for redemption. But until the mortgagee is actually paid off by his own consent, or by the de- cree of the court, he retains the character of the mortgagee, with all the rights incident to it. (Giiigeon v. Gerrard, 4 Younge & Coll., Exch., 119-128.) When a court of law undertakes to deal with this equitable estate, it must do so upon the principles of equity, and keep in view the relief which wooald be afforded in equity, and protect the rights of the parties accordingly. The recognition of this equitable estate has been obtained in courts of law by the fiction of regarding the mortgagee, after his debt is satisfied, as a trustee of the legal estate for the motrgagor. Until the debt is paid, the legal seizin of the mortgagee is not a mere formal title, and no trust will be raised for the benefit of the mortgagor until the purpose for which the mortgage was made is answered. It was stated on the argument that the money due on the mort- gage was brought into court at the trial. The fact does not appear in the bills of exceptions. It is not necessary, therefore, to decide whether a court of law could enforce redemption in cases within the equity, though not within the strict letter of the statute. The Eng- lish courts of law have given a strict construction to the correspondr ing statute of 7 George II., Ch. 20, and have held the circumstances of the litigation meiitioned in the preamble and in the statute to be .iurisdictional facts, which the court is not at liberty to disregard. '(Doe V. Clifton, 4 Ad. & El„ R09 : Good-title v. TSTo-title, 11 Moore, 491 : Sutton v. Rawlings, 3 Exch.. 407.) The statute should be strictlv construed, and is not applicable to anv case in which the mortgagor is himself the actor. It was designed to apply only in -certain cases mentioned in its preamble and in the introductory 214 •words of the statute, and was not intended tu supplant bills for re- demption. The subject is one that falls peeuliarl)- within the juris- diction of courts of e(iuity. The remedy there is complete bv bill for a redemption, and relief may be speedily obtained bv the exercise of the undoubted power of the court,by tfte writ of assistance to carry into ett'ect its decree, by putting the mortgagor in possession, where the mortgagee has obtained under the mortgage. (Yates v. Humbly, 2 Atk., 363: Green v. Green, 2 Simons, 399, 406 ; Bacon's Ordi- nances in Chancery. 9; Valentine v. Teller. Hopk. C. E., 422; De- vancene v. Devancene, 1 Edw. C. E., 272; Kershaw v. Thompson, 4 Johns. C. K., 609; Schenck v. Conover, 2 Beas., 231; Fackler v. Worth, lb., 395; Thomas v. DeBaum, 1 McCarter, 37 ; 2 Dan. Chan. Prac., 1280.) It is not, therefore, essential to the administration of justice that courts of law should, in the absence of the imperative requirements of a statute, entertain a jurisdiction that pertains to the courts of ■equity, in the exercise of which equities may arise that a court of law- may be incompetent to deal with. There is no error in the rulings of the court below, and the judg- ment should be affirmed. TUTHILL V. MOEEIS. [81 N. r. 94—1880.] Appeal from judgment of the General Term of the Supreme Court, in the Second Judicial Department, affirming a judgment in favor of plaintiff entered upon a decision of the court on trial with- out a jury. This action was_broughtJ;o j;estrain_thedefendant from selli ng ■certai n premises in statutory proc eedings to foreclose^ two mort- ga ges thereon and to ha ve the^sameadju dged to be extinguished and to requi re defendant to cancel the ^ame of record, on the groun d t hat th e amount~of the mortgage was duly tendered and ref used. The mOTtgages were execiitedliy plaintrfE The mortgagees com- menced proceedings to foreclose the same by advertisement under the statute. Pending the proceedings they assigned the mortgages to defendant. Defendant requested one Steers, an attorney, to attend the sale for him. The circumstances and the nature of the employment, together with the occurrences out of which the alleged cause of action accrued, are set forth in the opinion. RapaLLO, J. T he UTicontrovprtpr l Pvii^pnfP ghnwa t hat Mr. SteerSj to w hom the tender relied upon by the plaintiff was made. \y a, s not {ne attorney m the foreclosure proceedings nor connected with such attorney, nor the agent of Mr. Morris, except for the specific pur- pose for which he was employed : tha t his first and only connection with Mr. Morris or the foreclosure was that he was requested, on be- half of Mr. Morris, to go to the place of sale and engage an auc- tioneer, and to attend the sale and see that it was properly con- ducted. It may also be inferred from the testimony that he was instructed that the sale should be for cash. It is conceded by the 315 respondent's points that Mr. Steers had no express authority to _rs.- oeive a t ender and t hat none was thought o f. Mr. Steers did not know nor was ne miormed of the amount due for principal, interest or costs, beyond such information as was afforded by the notice of sale, nor does it appear that he had any means of ascertaining the amount of the costs. He was not empowered to receive the pur- chase money, for this would be payable only on the execution of the deed of mortgage. When he arrived at the place appointed for the sale he was presented with a summons, complaint and order of in- junction in an action by the plaintiff against Mr. Morris, but de- clined to receive or admit service thereof on behalf of Mr. Morris, on the ground that he was not his attorney. The injunction order was then read to him. It ordered that the sale be upon the terms, among others, that not more than 10 per cent, of the amount bid be paid down. He stated, as testified to by the plaintiff's attorney, that he was instructed to sell for cash, and said that if he could not do that, he should adjourn the sale, and accordingly instructed the auctioneer to adjourn the sale for thirty days. After he had announced his intention to adjourn the sale, but before he had in- structed the auctioneer and as he was about doing so, the alleged tender was made by Mr. Tuthill, one of the plaintiff's attorneys, in the following manner, as testified to by Mr. Tuthill: Mr. Tuthill testifies that he tendered to Mr. Steers a quantity of greenbacks, amounting, in fact, to $6,300, and said to Mr. Steers that he ten- dered the money in behalf of the plaintiff for the whole amount due. That he did not state how much money there was, but tendered it, and said to Mr. Steers : "I want to pay the whole amount if you will let me know how much it is," and Steers replied that he did not know. Witness then said : "Will you take this money ?" and he said he would not, and asked what witness wanted to pay for, and witness said that he wanted to pay for the notes, interest and costs. Immediately after this conversation the auctioneer, under the instruction of Mr. Steers, announced the adjournment of the sale for thirty days. Mr. Steers testified that in declining to receive the money he stated that he was not authorized and that the sale was adjourned. We perceive nothing the course pursued by Mr. Steers indicating any purpose to oppress or take any undue advantage of the plaintiff. By the adjournment of the sale the plaintiff was relieved of all im- mediate pressure, and ample time was afforded, if he, in good faith, decided to pay off the mortgages, to seek the proper party and have the amount of interest and costs ascertained. It is apparent that the tender made was a complete surprise, and that even if Mr. Steers had authority to receive payment of the mortgages, he was not in a situation to do so at that time or place. It is by no means clear that a person, not the attorney in the proceeding, but merely casually employed to superintend a mortgage sale and see that it is properly conducted, is by such employment authorized to receive the principal of the mortgage; but, irrespective of that point, when he announces that he is ignorant of the amount due for principal, interest and costs, and it is evident that he has not the means of in- 216 formation at hand as to the exact amount, it would be in the highest degree unreasonable to hold that a person thus situated is bound to talce the rsponsibility of accepting or refusing a tender, and that his refusal discharges the lien of the mortgage. Insisting upon the im- mediate acceptance of a tender under such circumstances, and when the sale is about to be adjourned, indicates rather a design on the part of the mortgagor to take an unfair advantage of the mortgagee than to relieve himself from oppression. Furthermore, th ere is no evide nce in the case showing th at the - sum tendered was the fu ll amonnt of principal, interest and cost s. The sum tendered is said to have been $6,300. The amount of prin- cipal and interest, according to the notice of sale, was $6,150 and upwards. What was the amount of the costs in no manner appears in the case. To the point it is answered that Mr. Steers did not object that the amount tendered wwas insufficient, and that the plaintiff was ready to pay whatever amount was due. But ]\Ir. Steers did state that he was ignorant of the amount, and he did not occupy such a relation to the case that it could be presumed that he knew or that it was his duty to know the precise amount. Neither does it appear that any specific amount was tendered. The plaintiff's witness, Mr. Tuthill, exhibited a quantity of bills, but he admits that he did not name the amount, though he asked Mr. steers to count them, and, taking the whole evidence, it is not clear that Mr. Tuthill offered to pay the whole amount he had in his hand, if it exceeded the amount due. When asked what he wanted to pay, he replied, "the notes, interest and costs." He had pre- viously said that he wanted to pay the whole amount if Mr. Steers would let him know how much it was, and Steers had told him that he did not know. The fair construction of this testimony is that he desired to pay the amount due only, and, before paying, desired to be informed of the amount, but that the person to whom the per- son applied had not the means of giving the information / We are of opinion that the plaintiff failed to make out a tender ) to the defendant and a refusal which discharged the lien of the / mortgage. In view of the serious consequences resulting from the ( refusal of such a tender, the proof should be very clear that it was / fairly made and deliberately and intentionally refused by the mort- I: gagee, or some one fully authorized by him, and that sufficient op- ' portunity was afforded to ascertain the amount due. At all events, ( it should appear that a sum was absolutely and uneonditionallv tcn- ' dered sufficient to cover the whole amount due. The burden of that ; proof is on the party allegeing the tender. But even if a .sufficient tender had been made out, this action (could not, in our judgment, be maintained. Although the authori- ' ties cited sustain the proposition that when a tender has been duly made o f the full amount due it will discharge the lien and be a good detense a gamsi its enforcement, without the tender being kept ^od , ■ ^t we a rec learlv of opininn that it should be kept good in ordentfl mtitle tlie" lnortgagor tn the affirmative relief which he seeksin thi s action and which the judgment awards hm? ,viz., the_extinguishme nt of the mortgaged A party commg into equity for affirmative relief 217 must himself do equity, aud tliis would require that he pay the debt secured by the mortgage, and the costs and interest at least up to the time of the tender. There can be no pretense of any equity in de- priving the creditor of his security for his entire debt by way of penalty for having declined to receive payment when offered. The most that could be equitably claimed would be to relieve the debtor from the payment of interest and costs subsequently accruing, and to entitle him to this relief he should have kept his tender good from the time it was made. If any further advantage is gained by a tender of the mortgage debt it must rest on strict legal rather than on equitable principles. The circumstances that a security has be- come or is invalid in law, and could not be enforced, even in equity, does not entitle a party to come into a court of equity, and have it decreed to be surrendered or extinguished, ivithout paying the amouut equitably owing thereon. Even securities void for usiury would not be cancelled by a court of equity, vpithout payment of the debt with legal interest, until, by statute, it was otherwise provided. This statute does not change the general principle of equity, but on the contrary recognizes it, by excepting cases of usury from its operation. On this ground, even if the alleged tender could be sus- tained, the plaintiff was not entitled to a decree for the uncondi- tional extinguishment of the mortgage. We are of opinion, however, as already stated, that no sufficient L tender was shown, and that on both grounds the judgment should I pe reversed and a new trial ordered, costs to abide the event. .y All concur. Judgment reversed. NELSON V. LODEE. f]33N. Y. 288—1892.] This was an action to compel the assignment of a bond and mort- gage and to restrain defendant from prosecuting an action to fore- close the same. On the 18th of October, 1880, Thomas Nelson called on Sarah E. Loder, exhibited to her his mortgage, and tendered to her a sum suf- ficient to pay the amount due on her mortgage, with costs of the foreclosure then accrued, and demanded that she assign her bond and mortgage to him, which she refused to do. The tender was nn ¥. kept good, but the money was deposited by the plaintiff in his gen- eral account in a bank. FoLLET, Ch. J. Whether the defendant is entitled to interest on the debt secured by her bond and mortgage to the date when she ' shall be paid by the plaintiff, or only to October 18, 1880, the date J of the tender, is the only question involved in this appeal. In case j the whole amount secured by a mortgage is due, the tender of thei sum unpaid by the owner of the mortgaged premises extinguishes the lien of the mortgage, though the tender is not kept good, but it does not discharge the promise or covenant to pay the debt for which the debtor remains liable. ( Kortright v. Cady. 21 N. Y. 318 343; Werner V. Tueh, 127 id. n: ; Mitchell v. Eoberts, 17 Fed. Kep. 776, 783; Haynes v. Thorn, 28 N. H. 386, 400; Chitty on Contracts (13th ed.), 787; Jones Mort. 886.) If a debtor wishes to extinguish his liability for subsequ ently ac- crumglh terest, or aema nds some affirmative relief, he cannot ret ain the money Tsubject to his own use, but must devotelt to the speciSc purpose of paving the debt^ and put it within the power of the cred i- tor to receive it at any tim eT He must keep his tender goo d. (Tut- hill V. Morris, 8] N. Y. 94, 100; Harris v. Jex, 55 id. 431, 435; Gyles V. Hall, 3 P. Wms. 378; Bishop v. Church, 3 Ves., Sr. 371; Garforth v. Bradley, 3 id. 675; Stow v. Russell, 36 111. 18; Jones on Mort., § 892 ; Thomas on Mort., 399 ; Coote on Mort., 4th ed., 885. A subsequent lienor's right to redeem a prior security is derived from the owner of the mortgaged premises, and he is in this respect in no better position than the owner, and his tender, if he wishes to- stop interest or compel an assignment of the prior lien, must be as absolute and specific as that which the owner is required to make as a ground for affirmative relief or to stop the running of interest. The judgment should be affirmed, with costs. All concur. Judgment aMrmed. CHAMPNEY V. COOPE. (32 New York, 543.— 1865.) f Action to foreclose a mortgage for $5,000 , made by Jane Coope , to Lime T. James, on a farni m Ulster (Jounty. The money for which the mortgage was given was borrowed for the benefit of David Coope, the son of the mortgagor, who agreed to pay the debt. He paid the debt in instalments extending over several years. In the meantime he borrowed various amounts from the plaintiff's intestate, at the same time promising that when the mortgag-e debt ' to James was paid the mortgage should be assigned to her as se- curity for such loans. This was subsequently done. '' Davies, J. The primary debtor upon the bond and mortgage was Jane Coope, and in the first instance it was her debt to pay. David Coope was her surety, and not the original debtor. The payments made on account of the bond and mortgage, by David Coope, were all made after the death of Jane Coope, and it does not appear that they were made by him as her agent, or with her funds, and in support of the judgment, we may infer, if such inference is necessary to sustain the judgment, the negative of these two propositions whatever may be the equities between David Coope and Jane Coope, it is unnecessary to inquire or pass upon. Ifo notice of those equities was communicated to Miss Jacobs, and she took the mortgage direct from the original mortgagee, and it is not alleged that any equities existed as between the original parties to the mortgage, which impairs its validity, independent of the payments made by David Cooope. It is found as a matter of fact in the priman^ tribunal, and such finding is conclusive upon the court (the judgment therein not having been reversed upon gl9 ■a question of fact) that such payment was made, with the intent not to satisfy or extinguish said bond and mortgage, but with the intent of keeping the same alive and outstanding, and of trans- ferring them to the plaintiff as valid and subsisting securities. If, therefore, it be assumed that this payment was made by Jane Coope, or by David Coope as her agent, if made with this intent, aio merger took place, e\en though the bond and mortgage had been reassigned to her, and by her assigned to the plaintiff's intestate. These propositions are abundantly sustained by authoritiy. (James V. Moray, 2 Cowen, 246 ; Davis v. Chamberlain, decided in this court in June, 1860.) In the latter case a mortgage had been given by -one individual banker to the comptroller, to secure circulating notes. A deposit was made by the banker with the bank department, suf- ficient to meet the amount of the outstanding notes, and the banker having negotiated a transfer of the bond and mortgage to the Bank -of the Oapitol of the city of Albany, the bank department reassigned the bond and mortgage to the individual banker, and he then as- signed it to the Bank of the Capitol, which assigned it to the plaintifE in that action ; and in a suit to foreclose the mortgage, the court found that it was not the intent of the parties, by the payment to the bank department and the reassignment to the original mort- gagor, to extinguish and satisfy the bond and mortgage, but to keep them alive as valid' and subsisting securities, and tliis court affirmed the judgment of Supreme (Jourt, which held that no merger had taken place, and that the securities remained vailid and unaffected by the payment to the bank department of the amount for which it held them, and the reassignment to the original mortgagor. I am unable to see why the doctrine of that case is not decisive of the one now under consideration. But in this case there never was an union of the equitable and legal estate, there never was a confusion of rights, where the debtor and creditor became the same person. And even if there had been equity would preserve the rights distinct, according to the intent as found in this action. The principle is very clearly stated in Mickles V. Townsend (18 N. Y., 582), bv Denio,"Ch. J. ' He held the doc- trine of merger was inapplicable to that case. Merger, he said, in its relation to real estate, occurs when the legal and equitable estate are united. In such cases the equitable estate is merged in the legal title, and is extinguished at law, and generally in equity also, by the unity of seizin. But in that case there was no unity of the equity of redemption, and of the estate mortgaged in Philo. D. Mickies. He had parted with the equity of redemption long before he purchased the mortgage. He had also before that time assigned the mortgage of the equity of redemption, which he took back when he conveyed to the plaintiff, so there was nothing upon which to predicate the idea of merger. But if this were otherwise, and if P. D. Mickles had retained the equity of redemption until he had purchased the mortgage, it would, in the view of a court of equity, depend upon his intention when he did the latter act, whether the mortgage should be considered extinguished. By taking an assign- ment from Hall instead of a satisfaction, "and especially by selling 330 and assigning tlie mortgage to Townsend for a valuable considera- tion as an existing security he sufficiently manifested an intention not to extinguish it. In the case now at bar, we have all these indicia, which were regarded as so conclusive. We have in the iirst place the finding of facts, that David Coope, by the payment made, did not intend to satisf \- or extinguish the bond and mortgage, but meant to keep them alive as valid and subsisting securities, and this intention is confirmed and rendered unquestionable by his taking the assignment of the bond and mortgage in blank, instead of a sat- isfaction, and especially by selling and assigning the bond and mort- gage to the plaintiff's intestate for a valuable consideration. But we have seen that the doctrine is well settled by authority, in relation to mortgages; that i f the amount due thereon is p aid, the inten t of the parties in making such paymer t, whp<^bQi- in &t- tinguish or keep alive the secnritY ^_ w''H govern ^The Supreme ■Ijourt throws m another qualification, and which it doubtless thought material if not controlling, viz. : that if the money is ap- plied upon the instrument, though with the intent to have it sub- sequenly assigned and continued as a valid security, such intent was held to be unavailing. It is apparent from this, that the Supreme Court supposed, that in the present case, the payments made had been applied on the instruments, the bond and mortgage. No such fact is found by the referee, and by reference to the indorsements made on the bond, as set out in the case, it is seen that they are ■only indorsements of interest paid, and that no payment on account •of principal had been applied on the instruments. Such omission is a striking confirmation of the finding of the referee, that in mak- ing the payment it was not intended to satisfy or extinguish the amount due upon the bond and mortgage, in whole or in part. I arrive at the conclusion, therefore, that this bond and mortgage continued valid and subsisting securities, and that the plaintiff's intestate could rightfully collect the amount due thereon. BARNES V. MOTT. (64 .V. Y., 397.-1876.) Action to restrain the sale upon execution of certain premises in the city of New York owned by plaintifl', Henry M. Barnes, ajid to have the lien of the judgment upon said premises discharged; also to restore the lien of a mortgage upon said premises alleged to have been satisfied by mistake. The Judgment in question was obtained by one Orchard against defendant Britton and one Binninger on the 3d day of February, 1864. At that time Britton was the owner of the premises re- ferred to, which were subject to a mortgage, and the judgment be- came a lien thereon. In the latter part of 1864, Britton sold and conveyed the premises, with full covenants and warranty, subject to said mortgage, to one Burr, who purchased in ignorance of the judgment and paid the full value therefor. Burr died in the fol- lowing year and his devisees sold and conveyed the property to a 221 Mrs. Ludlam, one of tlie plaiutift's herein, who, in the year 1873^ sola and conveyed it to plaintiff Henry B. Barnes. Said devisees, prior to the conveyance to i\Irs. Ludlam, in ignorance of the judg- ment, paid off the mortgage and the same was satisfied of record. The sheriff levied upon the premises in question and advertised the same for sale, whereupon this, action was commenced. Upon said facts the court directed judgment reinstating the lien of the mortgage and declaring it prior and paramount to the judgment, and also adjudging the premises free and discharged from the lien of the judgment, and directing a perpetual stay of execution on said judgment as against said premises.. Allen, J. So much of the judgment as restores the mortgage upon the premises now owned by the plaintiffs, paid off and satis- fied by the devisees of Burr, the then owners, and reinstates the same as a lien upon the mortgaged premises, prior and paramount to the lien of the judgment recovered by Orchard and assigned to the defendant, is clearly right. Upon payment of the mortgage by the then owners of the premises, they were entitled to all the rights of the mortgagee, and to an assignment of the mortgage; and having caused the same to be satisfied under circumstances authorizing an inference of a mistake of fact, equity will presume such mistake and give the party the benefit of the equitable right of subrogation. To do so in this ease is to prevent manifest injustice and hardship, and interferes with no superior intervening equities. (Hvde V. Tanner, 1 Barb., 76; Runvan v. Stewart, 13 id., .5.'?7. per Weils, J.) BOGEET V. BLISS. [\4:8 N. Y. 194^1896] Andkews, Ch. J. The controversy relates to the disposition of surplus moneys arising on a foreclosure of a mortgage. One Eobert claims a prior lien thereon as assignee of a mortgage made by the defendant Striker to one Weil, dated May 15, 1891, payable June 18, 1891, for $1,000, recorded May 18, 1891. The mortgage was paid at maturity by Striker, the mortgagor and owner of the equity of redemption, to Weil, the mortgagee, who on the same day executed and delivered to Striker a satisfaction of the mortgage; together with the bond, but the mortgage was then in the register's office and for that reason was not delivered to Striker. The mortgage was paid in usual course, and at the time of the payment there was, so far as appears, no intention on the part of Striker, and no under- standing between him and the mortgagee, that the mortgage should be kept alive. Subsequently, on July 2nd, 1891, Striker applied to Robert (a partner of Weil) for a loan of $1,000, on the security of this extinguished mortgage, and the loan was made. Striker deliver- ing to Robert at the time the bond and the satisfaction, and stating that Weil would assign the mortgage to him. The assignment was subsequently made, but not as we infer until after the mortgage ex- ecuted to Bliss, the other claimant of the surplus. The Bliss mort- gage was executed by Striker to Bliss. August ^Sth, 1891, and cov- 223 ered the same premises embraced in the Weil mortgage, and was given to secure a loan of $1,500 made by Bliss to Striker, but in form was an absolute deed, and was recorded November 11th, 1891. Bliss when he took his mortgage made no search of the title and had constructive notice only of the Weil mortgage. The question is whether Eobert or Bliss is entitled to the surplus moneys. We think the conclusion of the General Term that Bliss is entitled to them is correct. The Weil mortgage was extinguished by payment before Striker applied to Eobert for a loan, and Eobert had notice that the mort- gage had been paid by Striker. Striker delivered to him the satis- faction executed by Weil, and there is no pretense that it did not represent the actual fact that Striker had paid the mortgage. What Striker undertook to do was to reissue the mortgage and the bond to secure amother loan equal to the amount of the mortgage. Eobert assented to this proposition, and made the loan on the faith of the proposed security. But there was no writing and no actual assign- ment of the mortgage until after Bliss has taken his mortgage. All that Eobert had until the assignment was made was the possession of the bond and the satisfaction of the mortgage and the verbal agreemeid; of Striker that the mortgage should be assigned. In this state a mortgage Is a lien simply, and the general principle is well settled that on payment the lien is ipso facto discharged and the mortgage extingnished. There are many cases where, for pur- poses connected with the protection of the title or the enforcement of equities, what is in form a payment of a mortgage, will be treated as a purchase, so as to preserve rights which might be jeoparded if the transaction was treated as a payment. But we know of no principle which permits a mortgagor who has paid his mortgage and taken a satisfaction, there being at the time ho equitable reason for keeping it afoot, subsequently to resuscitate and re-issue it as secur- ity for a new loan or transaction, and especially where the rights of third parties are in question. It would make no difference in our view whether the re-issue of the mortgage was before or after new rights and interests had intervened. We do not speak of the posi- tion of a subsequent grantee or mortgagee having actual notice of the re-issue of a satisfied mortgage before he takes hi? mortgage or deed. It is possible that the circumstances of the re-issue may be such as to furnish ground for a court of equity to intervene and compel the execution of a new mortgage, to accomplish the real pur- pose of the parties, and notice of such circumstances to be subse- quent grantee or mortgagee might, perhaps, under special condi- tions, subject his right to the prior equity. But the contention that a person having at the time notice that a mortgage had been paid by the mortgagor in usual course, can, by a verbal arrangement bcr tween himself an dthe mortgagor, give the extinct mortgage vitality again as security for a new loan, so as to give it priorityl over a subsequent conveyance or mortgage is not justified by the authorities in this State. The Statute of Frauds does not permit mortgage on land to be created without writing. The re-issue of a dead mortgage, if effect is given to the transaction, is in substance the creation of a new mortgage. If this was permitted it would furnish an easy way to evade tlie statute. The law wisel)' requires that instruments by which land is conveyed or mortgaged should be executed with sol- emn forms, and that their existence should be made known through a system of registry so as to protect those subseqeuntly dealing with the premises. I'ublic policy requires that dealings with land should be certain, and that transactions affecting the title should be open, and that secret agreements should not be permitted by which third persons may be misled or decicved. It would be a convenient cloak for fraud if a mortgagor, having paid a mortgage, could retain it in his possessio uncancelled of record and re-issue it at pleasure. A party taking from a mortgagor a re-issued mortgage has notice which should put him upon inquiry, and he takes at the peril that it has in fact been paid. In the present case, not only had the mortage been paid before Robert made his loan, but he knew the fact from incontestable evi- dence. If he had received an actual assignment before Bliss had taken his mortgage, he would not, we think, have been entitled to a preference. Cpon the facts actually existing he had merely an agreement for an assignment, which at most created an equity en- forceable by equitable action, and meanwhile Bliss had obtained a legal mortgage, having no notice of the agreement. Bliss had con- structive notice of the mortgage to Weil. His mortgage was subject to that incumbrance unless the mortgage had been paid. But he did not take subject to an arrangement between Striker and Robert to revive the mortgage, the lien of which had been extinguished by pay- ment. The case of j^fead v. York (6 N. Y., 449) is a direct author- ity upon the question. here presented. It was there held that a mortgage after being once paid by the mortgagor cannot be kept alive by a parol agreement as security for a new liability incurred for the mortgagor as against the latter's subsequent judgment cred- itors. (See also Cameron v. Irvpin, 5 Hill, 372; Jones on Mort- gages, section 943 and cases cited.) We find no case which sustains the claim that a mortgage paid by the mortgagor, not intended to be kept alive at the time of the pay- ment, can be thereafter re-issued by him to secure another loan, made by a party cognizant of the fapt, so as to give it validity as against a subsequent purchaser or mortga,gee. The order of the General Term should be affirmed. All concur, except VANN", J., not sitting. (&.) Other Discharge of Debt. BuTLEE V. Miller. 1 Corast., 49f5 (1848). JTTnTra T for horses, cattle and other property. Plaintiffs claim under 'a chattel mort- gage from Yandei"poel. Defendant, as sheriff of Columbia County, sold the property in question by virtue of an execution in favor of the Lafayette Banlc. Two days thereafter Vanderpoel con- 221 fessed judgment in favor of the plaintiffs on the mortgage debt, which consisted of notes for $500, and such judgment was immedi- ately entered and execution issued and levied on the property m question. Johnson, J. , The question of the bona fides of the mortgage was properly submitted to the jury, and their verdict in favor of the honesty and fairness of the transaction is conclusive according to all the cases since Smith v. Acker (23 Wend., u53). The circuit judge was requested to charge the jury that the sub- sequent judgment on the notes operated as a merger of the notes and consequently avoided the mortgage. The judge, however, charged that the judgment did operate as a merger of the notes and mort- gage unless it was satisfactorily shown that the judgment was taken as collateral to the mortgage, in which case it was not a merger. The charge upon this point was in strict accordance with the rule laid down by the Supreme Court (1 Denio, 407), when this cause was before it oh a former trial, and must be regarded as correct un- less that court ^as then in error as to the true rule upon the subject. It may perhaps well be doubted whether the judgment was a se- curity of a higher nature than the personal mortgage ; and even if it were, whether it would operate to extinguish the mortgage and di- vest the mortgagees of the title they had acquired under it. It will scarcely be contended that in case the notes in question had been secured by a mortgage upon real estate, a judoment upon them would have extinguished such mortgage. And yet a mortgage upon real estate is a mere security and incumbrance upon the land and gives the mortgagee no title or estate therein whatever. AVhereas a personal mortgage is more than a mere security. It is a sale of the thing mortgaged and operates as a transfer of the whole legal title to the mortgage, subject only to be defeated by the full performance of the condition. And if it be conceded that a judgment upon the orig- inal indebtedness would not extinguish collateral security for its pay- ment upon real estate, I do not see how it could divest a title to per- sonal property acquired by purchase. A vested legal title, whether in real or personal property, is the highest of all securities — certain- ly higher than the mere lien of a judgment upon land, or the right of a plaintiff to personal property acquired by levy under an execu- tion. Although it /is clear that the notes were mreged in the judgment by operation b'f law, it does not I think, certainly follow that all collateral securities would be extinguished. The debt is not yet satisfied. The notes may have been cancelled, but the debt was not, and until that is done it seems to me that all mere collateral secu- rities, whether upon real or personal property, should be allowed to stand; especially titles to property acquired under instruments where the parties stand in the relation of vendor and purcha'ser without fraud. The rule that securitv of a higher nature extin- guishes inferior securtities will be found. T apprehend, only to apnlv to the estate or condition of the debt itself, and means no more than this — that when an account is settled by a note, a note chano-ed to a bond, or a judgment taken upon either, the debt as to its original or 225 inferior condition is extinguished or swallowed up in the higher se-^ curity; and that all the memorandums or securities by which such interior condition was evidenced lose their vitality. It has never been applied, and 1 think never should be, to the extinguishment of distinct collateral securities, whether superior or inferior in de- gree. These are to be cancelled by satisfaction of the debt or volun- tary surrender alone. This most obvious and rational distinction seems to have been overlooked by the Supreme Court in the opinion, to which 1 Lave referred.* ' BUSH v. COOrEK. [26 Miss. 599—1853.] Mr. Justice Handy delivered the opinion of the court. This bill was filed by the appellee in the Superior Court of Chancery, to foreclose a deed in trust execeuted by the appellant on the 17th March, 1840, conveying certain real estate in the town of Port Gibson to trustees, to secure the payment of two promissory notes made by the appellant, and afterwards transferred to the ap- pellee. The facts neccssan' to bo taken into view, in considering the questions presented for determination, are as follows : The notes secured by the trust deed were due in January and February, 1841 ; and in November, 1843, a judgment at law was rendered upon them against Bush, which judgment and the deed in trust were afterwards transferred to the appellee, and remain un- paid. The deed, in conveying the property, contains the words, "grant, bargain, and sell," but contains no other covenant of war- ranty in express terms. The appellant was discharged as a bankrupt in February, 1843; and in October, 1844, he purchased the property embraced in the deed in trust at sheriff's sale, under an execution on a judgment rendered in June, 1838, against the appellant, and which was un- satisfied, for the sum of $1,033, by means acquired by him after his discharge as a bankrupt; and in virtue of their purchase he now claims to hold the property by title paramount to the lien of the deed in trust. On the contrary, the appellee claims that the property is subject to the payment of the debt secured by the deed in trust, not- withstanding the discharge of the appellant as a bankrupt, and that the appellant's purchase, under the prior incumbrance, cannot be. set up by him to defeat the security of the deed in trust. The first question to be settled is, whether the discharge of the appellant from the debt, by his certificate as a bankrupt, extin- guished the deed in tru.st. It is insisted, on his behalf, that the deed was but a mere incident to the debt, an'l thnt whatever dischargf>d the de^^t neoeosavilv de- stroyed the deed, because the security could not exist where the debt, which was its foundation and support, was discharged. This is un- doubtedly well siistained by modern decisions, as a general rule; hut * .Tiidgmcnt was rendered in favor of defendant, on tho ?round that the olaintiffa by their subsequent deali-iffs in relation to the property had conclusively elected to claim title by virtue of the levy and not under tbc mortgage. 226 it is not without exceptions. It is held to apply in all cases where the debt has been actually paid, or where it was not supported by a valid legal consideration, or where the debtor ex aequo et bono is dis- •charged from its payment. But it is held not to apply to a case where an action upon the debt has been barred by the statute of/ limitations, and that the creditor may proceed to foreclose his mort-/ gage, notwithstanding the bar of the debt by the statute. Miller v.' Helm, 2 S. & M., 697 ; Miller v. Trustees of Jefferson College, 5 ib. 650; Bank Metropolis v. Gultshtick, 14 Peters, 19; Thayer v. Mann, 19 Pick., 535. In addition to this, the objection is fully met by the second section of the bankrupt act of Congress of 1841, which provides that "noth- ing in the act shall be construed to annul, destroy, or impair any lawful rights of married women or minors, or any liens, mortgages, or other securities on property, real or personal," &c. From this it is manifest that, while the privilege was granted to the debtor to be personally discharged from the debt, any security which the creditor might have, consisting of a lien on property, was left in as full force as though the debtor had never been discharged from the ■debt, for -the security of which the lien was made. PEATT V. HUGGINS. [39 Barb. 277—1859.] HoGEBOOM^ J. The facts of this case lie within a narrow compass. The plaintiff by action commenced in 1855, seeks to foreclose a mortgage under seal, executed in 1835, for a debt falling due in 1836, which mortgage was accompanied by a promissory (unsealed) note to secure the same debt. The mortgage contains no covenant to pay, but the condition is that the instrument shall be void, if the above sum, with interest, is paid on the 1st of February, 1836, "in the manner particuarly specified in the condition of his (the mort- gagor's) certain bond or obligation bearing even date herewith." The mortgage was duly acknowledged and recorded. The answers interposed several defences; and, among others, the defence of pay- ment : and that the plaintiff's cause of action was barred by the statute of limitations, in consequence of its not accruing within six years before suit brought. The justice before whom the cause was tried, without a jury, came to the conclusion, upon the evidence, that there was an unpaid balance due on the note, and that he should have given judgment for the plaintiff, but for the fact that more than six years had elapsed since the said note became due, and the cause of action thereon accrued prior to the commencement of this suit; and for that reason he gave judgment for the defendants. The case therefore presents the question, whether a debt secured by a sealed mortgage and unsealed note can be enforced by a fore- closure of the mortgage, after the expiration of six but before the expiration of twenty vears from the time when the debt became due. As has been said, there is no covenant in the mortgage to pay the debt ; but at the same time the debt, its amount and the time of payment' are specified in the mortgage ; and it is provided that in 237 case "default shall be made in the payment of all or any part of the said principal sum of two hundred and fifty dollars, or the interest thereof, at the time or times when the same ought to be paid as aforesaid, that then, and in such case, the mortgagee may sell and dispose of the premises, &c. The true question, therefore, would seem to be, has the mortgage been paid ? Or, rather, in this case, is the lapse of six years since the maturity of the note, without any subsequent recognition or acknowledgement of the debt conclusive evidence of payment ? The justice trying the cause has come to the conclusion, upon the evidence, that a part of the debt is actually un- paid. Is there a legal bar to giving effect to that conclusion by ren- dering judgment for the plaintiff, in consequence of the lapse of time before mentioned. If this is substantially an action upon the note, then it is barred, for it is an action upon simple contract, and must be brought within six years. (Code, s. 90.) And the plain- tiff in such case fails, not because the debt is in fact shown to be paid, but because the law forbids the action. The remedy is taken away. But this is not in terms or effect an action upon the note. The mortgage would be good without the note. If there had been no note, but only the evidence of the debt recognized in the mort- gage, is there any doubt that the mortgage could have been enforced after the debt became due, and for twenty years afterwards ? The only question would be, was there a debt remaining unpaid — a se- curity upon real estate — and was the lien enforced during the period that the law gives it legal existence. The additional recognition of the debt, in the shape of a promissory note, ought not to detract from its force. It is said that the note is the principal, and the mortgage only the incident; that is, that is given only as a security for the note. In a eertaii^ sense, this is true. But in fact the debt itself is the principal thing, and the note is one form of security for, or evidence of, the debt, and the mortgage another. Suppose the mortgage contained a covenant to pay the debt, would it be any the less the principal thing than the note? True, the note (if nego- tiable ( would have some facilities for an easy transfer, and might be negotiated independent of the mortgage. If so transferred, it would in law carry the mortgage with it, and so would the mortgage carry the note with it. The payment of either would be the pay- ment of the other, except so far as a bona fide holder of the note for value is concerned, who might, under the law applicable to commer- cial paper, be protected. It is said that the note, from the lapse of time, is presumed to be paid. Not altogether so; for the law al- lows a suit upon it, and a recovery, unless the statute of limitations is pleaded. It is therefore, at most, but a presumption, suffered to be overthrown, it is true, only in one way, and that is, by proof of payment thereon, or recognition thereof, in the way pointed out in. the statiite. This, however, as before stated, only acts upon the remedy. It is an arbitrary and an artificial rule, not to be carried, I think, beyond the well defined limits of the statute itself. Gould, J. At the December term, 1858, this case was submitted upon briefs, without oral argument. And on that submission I wrote this brief opinion: 238 The mortgage is defuasible on condition that $250 be paid. The statute of Imntatious allVc-ts not tlie right to the money, but the remedy therefor. It says to tlie creditor, not "you are paid," but "you cannot call on a court of law to enforce payment."' And the defense m tliis case is. not that the mortgagor has' complied with the condition : but that, if lie were sued at law on the note, the statute of limitations could be interposed as a legal bar to a recovery. \'ery true; but he is not sued on the note; and the plea (by answer) does not pretend that he has performed the condition ; which, and which only, would defeat the mortgage-title, lie does not bring himself within the equity of defeasance; and the title remains good, under seal, it is asserted, within twenty years, and it can be defeated only according to the tenor of the defeasance. This view is sustained in Heyer v. Pruyn (7 Paige, 470), and is precisely and very satisfac- torily covered by the case of Thayer v. Jlann (19 Pick., 535). There should be a new trial. As this opinion was thought to overrule the case of Jackson v. Sackett (7 Wend., 94) my associates deemed it best to have a full argument before coming to such a result ; and on such argument it now comes up. My views remain unchanged ; and, though it is rather difficult to say what the 'case of Jackson v. Sackett did decide, still, if to order a new trial in this case that case must be reversed, I should order the new trial. That case founds its reasonings on the basis that the statute of limitations is a defense, because the law, from lapse of time, presumes payment. I do not so understand the statute of limitations. I understand mere lapse of time to be a full defense, because the statute says so ; "Ita lex scripta;" and there is 'need of no such presumption to help out an absolute rule. But that case departs from its premise, or presTimption of payment being merely the basis of a positive statute bar, when it says (at p. 100) : "But the presumption arising from lapse of time is but evidence to the jury, from which they may infer that the debt has been satisfied." This, thoiigh true on a question of fact (as to actual payment), cannot be said of a legal presumption arising from an admitted fact. The lapse of time was either a bar. or no bar. If, by the statue, a bar, it needed no help from presumption. If not, by the statute, a bar, no presumption could help it. But since my first opinion was written, there has been published a decision (given indeed in 1857, but not then printed), by which the Court of Appeals clearly takes the view that I did. (Walter- mire V. Westover, 4 Kern. 16.) At page 20, "Such statutes act npon the remedy merely, and not upon the debt." And at pages 31-2 ^'If statutes of limitation do not discharge the debt, but act ex- clusively upon the remedy, upon what principle of interpretation is it to be held that this statute which is in terms confined to the remedy by action, operates to annihilate a remedy by execution. The statute does not operate by producing any presnmption of pay- ment; but is a mere statutory bar, founded in principle of public policy." 23» In the case before us, the statute of limitations (where it speaks of the lapse of si^f. years as a bar) is in terms confined to an action, at law on the note; and cannot operate to annihilate a remedy on the mortgage, by which a court of equity cuts off the equity of re- demption. The decision in 4th Kernan is abundant authority for ordering a new trial in this case. The judgment of the Circuit Court should be reversed, and a new- trial ordered; costs to abide the event. Wright J., concurred. New trial granted* BOEST V. COEEY. [15 N. Y. 505—1857] On the tenth of August, 1837, the plaintiff and the defendant,. Samuel Newkirk, as executors of the last and testament of James Halliday, deceased, conveyed to the defendant, David P. Corey, a piece of land in Montgomery County for $1,600, subject, however, to- a mortgage thereon for about $635, and this action was commenced August 5th, 1847, in the Supreme Court, on the equity side, to ob- tain a sale of the premises, by virtue of the equitable lien, for the purchase price. The complaint in the action set forth the convey- ance of the premises by the exceutors, alleged that no part of the purchase price had been paid by the grantee except the amount of the mortgage, and asked for a decree that the premises be sold, and the purchase price and interest be paid from the proceeds of the Bale. The complaint further alleged that the executor, Newkirk, had refused to join with the plaintiff in the commencement and prosecution of the action, and was therefore made a defendant. The defendant, Newkirk, suffered the bill to be taken as con- fessed. The defendant Corey, by his answer, alleged that, prior to the delivery of the deed to him, he paid the purchase price of the land in full, except the amount of mortgage thereon, and had subse- quently paid the mortgage ; and that he had not, at any time within six years next prior to the commencement of the action, been in- debted to the executors of either of them, for or on account of the purchase price of the premises, or promised to pay the same ; and that no cause of action had accrued for the same within the six years. To this answer a general replication was put in. The action was tried before referees, and they found that more than six years had elapsed since the sale of the premises in question prior to the Commencement of the action; and decided that the plain- tiff be nonsuited, on the ground that the cause of action, to enforce which the suit was brought, was barred by the statute of limitations. No bond or mortgage, or other written instrument, was taken to secure the payment of the purchase price of the land, and it does not appear that any credit was given therefor. * Accora, Unlbett v. Clark, 128 N. Y., 295; contra. Pollock v. Maison, 41 111., 516. 330 Judgment having been entered on the report, the plaintitf ap- pealed therefrom; the Supreme Court, at General Term, in the third district, affirmed the judgment: and the plaintiff appealed to this court. BowEN, J. The puichase price of the land in question was due and payable on the conveyance of the land to the defendant Corey, and as this action was not commenced until more than six years after the conveyance and as no promise to pay was shown to have been made within six years, the statute of limitations would have been a complete bar to an action at law to recover the purchase price. (2 E. S., 396, Sec. 18.) _ This action, however, was one of equitable cognizance. At the time of the commencement of the action, the relief sought to be ob- tained in the maimer applied for, that is, by a sale of the premises under the equitable lien thereon for the purchase price, could have been awarded by a court of equity only. An action at law, if commenced at any time within six years after the conveyance, could have been maintained against the defendant Corey, in which a judgment against him personally would have been rendered. The object of such an action, and the relief sought for therein, would have been the recovery of the unpaid purchase price of the land. The same relief, and no other or different, is sought to be obtained in this action, and a court of equity was resorted to solely for the reason that courts of common law jurisdiction could not award relief otherwise than by a judgment against the defend- ant personally. The same facts which would constitute a defense to the action at law would also be a defense to this action, unless the statute of limitations be an exception. So, too, the cause of action, to wit, the non-payment of the pur- chase price of the land, is the same, whichever court is resorted to. It is true that, to sustain the suit in equity, the plaintiff must bring to his aid the equitable lien given by law, while the acton at law can be sustained without reference to such lien.. Biit the lien is merely an incident to, and must stand or fall with the debt. The debt is the basis or foundation of the lien. The latter cannot exist without or independently of the former. In the suit to enforce the lien the cause of action, and the only substantial cause of action is the debt. The forty-ninth section of the title of the Revised Statutes, en- titled "Of the time of commencing actions" (2 E. S., 301), provides that "whenever there is a concurrent jurisdiction in the courts of common law and in courts of equity, of any raufe of action, the pro- visions of this title, limitins: a time for the commencement of a suit for such raitftp of action, in a court of common law, shall apply to all suits hereafter to be brought for the samp ran^e in the Court of Chancery." I do not see whv this ea.sp does not come within the letter of the above provision. It certainly does, if I am right in supposing that the defendant's indebtedness for the purchase price of the land con- stitutes, in the language of the statute, tbe plaintiff's cause of ac- tion." 231 Prior to the lievised Statutes, there was no statute in this State limiting the time for commencing actions in co.urs of equity. Yet, previously- to the adoption of those statutes, it was frequently held that, in cases where there was a concurrent jurisdiction at law and in equity, time was as absolute a defence to the. action , in equity as to one at law ; not on the ground of expediency, or as a matter of discretion founded on analogy to the statute of limitations, as was the case in some actions of purely equitable cognizance, but in obedi- ence to the statute. (Rosevelt v. Mark, 6 John. Ch. R., 366; Kane V. Bloodgood, 7 id., 90; Murray v. Coster, 30 John., 576; Sawyer v. De Meyer, 3 Paige, 574; Humber v. Trinity Church, 7 id., 195; 24 Wend., 587; Story's Eq., Sec. 529.) I think this case comes within the principle established by the above authorities, and that, independently of the statutry provision, limiting the time of commencing actions in courts of equity, it should be held that the six years' limitation to actions at law consti- tutes a defence to this action. The provision of the Revised Statutes, limiting the time of commencing actions in courts of equity, was adopted as declaratory of the law as then existed, and not as intro- ducing a new rule. (3 R. S., 705, revisers' notes.) It would be an anomaly if the plaintiff could recover his debt by an action to enforce the lien given to secure the debt when no action could be sustained to recover the debt directly without reference to the lien. * There is no reason why the limitation should be appli- cable in the one ease and not in the other. It has, however, been held that, where a mortgage was given to se- cure the payment of a simple contract debt, the statute limiting the time for commencing actions for the recovery of such debts was no bar to an action to foreclose the mortgage. (Balch v. Onion, 4 Cush., 559; Thayer v. Mann., 19 Pick., 535; Elkin v. Edwards, 8 Geo., 335; Heyer v. Pruyn, 7 Paige, 465.) Bvit there is a material distinction between a mortgage and the equitable lien for the purchase price of land given by law, and also between an action to foreclose a mortgage and one to enforce such a lien. The action to foreclose a mortgage is brought upon an instru- ment under seal, which acknowledges the existence of the debt to se- cure which the mortgage is given; and, by reason of the seal, the debt is not presumed to have been paid until the expiration of twenty years after it becomes due and payable. The six years' limitation has no application to a mortgage. In fact, all instruments under seal are expressly excepted therefrom. No action at law can be pre- dicated upon the mortgage, to collect the debt secured thereby, un- less there is contained therein a covenant to pay the debt. A debt secured by deed is said to be of a higher natiire than one by simple contract. On the contrary, the equitable lien is neither created or evidenced I / bv deed, but arises by operation of law, and is of no higher nature / ' than the debt which it secxires. It must coexist with the debt and / cannot survive it. It is true, as claimed by the plaintiff's counsel, that the statute of limitations does not extinguish the debt; it only bars the remedy. 233 But the remedy by action at law is no less barred than that by suit in equity to enforce the lien. ^ Denio, C. J., delivered an opinion for affirmance upon substan- tially the same grounds as those stated by Bowen, J. All the judges except Brown, J. (who did not vote), concurring in this opinion. Judgment affirmed.*' * Followed in Trotter v. Erwln, 37 Miss. 772. But see Hulbert v. Clark, 128 N. Y. 295, 309 where it is said of Borst v. Cary that " ttie reaaoning by which the result was reached in that case is not altogether satisfactory." 333