Court Opinion

ID: 7999608
Source: CourtListenerOpinion
Date Created: 2022-09-09 01:48:10.17956+00
Date Added: 2024-06-11T16:35:40.231748
License: Public Domain

Leonard, Judge,
delivered the opinion of the court.
1. In Hargrave and Butler’s notes on Coke’s First Institute, (205, a, Note 96, Book 3,) it is said : “ It may be laid down generally, and subject to very few exceptions, that, wherever a *328conveyance or assignment of an estate is originally intended as a security for money, whether this intention appear from the deed itself or any other instrument, it is always considered in equity as a mortgage, and redeemable even though there is an express agreement of the parties that it shall not be redeemable, or that the right of redemption shall be confined to a particular time, orto a particular description of persons.”
By the English law, a conveyance of property as security for the payment of money, is a redeemable mortgage, no matter what the parties intend in reference to the right of redemption. This right is inseparably incident to such a conveyance, and can only be extinguished by a judicial sentence of foreclosure or a sale pursuant to the agreement of the parties. The equity of the moi’tgagor is said to be part of the law of the land, so that it cannot be provided against or controlled by the contract of the parties ; and every effort that has been made to create an irredeemable security for money, by a conveyance of property, has been met and frustrated by the courts. ( Seton v. Slade, and Hunter v. Seton, 7 Ves. Rep. 272. 1 Hilliard on Mcrtg. ch. 4, sec. 1, and cases there cited.)
We learn that creditors under the Roman law, in the time of Justinian, attempted to restrain the right of redemption by providing that the conveyance should be absolute unless the money was paid at the day ; but that emperor declared, on the ground of public policy, that all such stipulations should be void as originating in, and tending to, oppression. (1 Spence Equit. Jurisdiction, 600.)
Undoubtedly, a party may make a sale of his property, with the privilege of repurchasing it at a specified price, or, as it is usually termed, a conditional sale; but he cannot, under the color of such a transaction, create an irredeemable security for money. It is said by Ruffin, Justice, in Poindexter v. McCannon, (1 Dev. Eq. Rep. 375, 376 :) “A mortgage and a conditional sale are nearly allied to each other. The difference between them is, that the former is a security for a debt, and the latter is a purchase for a price paid, or to be paid, to be*329come absolute on a particular event, or a purchase, accompanied by an agreement to resell upon particular terms. The only difficulty is to ascertain the character of the transaction. When it is once ascertained to be a mortgage, all the consequences of account, redemption, and the like, follow, notwithstanding any stipulations to the contrary; for the power of redemption is not lost by any hard conditions, nor shall it be fettered to any point of time, not according to the course of the court.”
2. The present transaction, according to the defendant’s own account of it, was a security for money; and it is quite immaterial that there was no written obligation or express undertaking on the part of the debtor to pay. A debt was contracted by the purchase of the warrant.
The defendant, (we confine ourselves to his own statement of the matter,) sold the warrant for one hundred and twenty-five dollars, upon credit, payable in two instalments, and, to secure the payment of the money at the times agreed upon, took from the defendant an absolute conveyance of the land located by the warrant, and of an additional forty acre tract that belonged to the plaintiff, and gave him his verbal promise to recovery, if the money was paid as it fell due. It may be admitted that the defendant refused to take a mortgage, and that it was expressly agreed between the parties that there should be no re-conveyance of the land except upon the condition of punctual payment at the times indicated; yet, the conveyance was given and taken as security for money to be paid, and therefore for that very reason is, by the law of the land, a mortgage — a redeemable conveyance, and it was not in the power of the parties to make it otherwise.
The defendant expressly admits in his answer that the land was conveyed to him to secure the payment of the price of the warrant, and this, of course, is sufficient, without any thing more ; but the transaction itself was most manifestly of that character upon the defendant’s own showing of the matter. There was here no conditional sale of the property ; the plain*330tiff did not go into the market to raise money upon a sale of his land, reserving to himself the privilege of repurchasing at a specified time, but, according to the substance of the transaction, made a purchase, and then conveyed the land, bought with other land, to the vendor, as a security for the price to be paid.
We have nothing to do here with the question of the admissibility of parol evidence to convert an absolute conveyance into a mortgage. The obligation to reconvey, if the money was paid on the day, being admitted in the answer, no question of that character arises here. Nor have we any thing to do with the moral propriety or impropriety of the plaintiff’s conduct, in withholding the payment of the money, it may be vexatiously ; and then insisting, after a considerable lapse of time, upon his right to redeem, contrary to his express contract. It is enough for us that the transaction was a security for money, and, therefore, of necessity, a mortgage — a redeemable conveyance — and that, upon the admission of the defendant, Drum-rite, it is our duty so to declare.
The result is, the judgment must be reversed, and the cause remanded. The transaction must be decreed as against the defendant, Drumrite, upon the admission in his answer to be a mortgage; but as he has conveyed a part of the mortgaged premises to his co-defendant, Yaughn, who is found to be a purchaser, for value, without notice, Drumrite must account for the value of the land sold, and reconvey the residue to the plaintiff upon the payment of what shall be found to be due upon a settlement of the account between the parties.
The judgment is accordingly reversed, and the cause remanded.