MORTGAGE tinued. GRANTEE OF EQUITY con- MORTGAGE - - IN GENERAL Incident to the Debt-When. ation be not sufficient, or if the transaction be not clear of everything like unfairness or oppression, and especially where the relations of the parties are confidential; for instance, where the conveyance is from a widow and her children, the mortgagee is the widow's brother, the grantors are poor and ignorant, the consideration is insufficient, and the terms of the mortgage loan are very oppressive. Villa v. Rodriguez, 12 Wal. 323. 4. While a mortgagor may release the equity of redemption, if the transaction asserted as a release is denied by the mortgagor to have that effect, it will be closely scrutinized. A release is not to be inferred from equivocal circumstances and loose expressions, and it must be based on an adequate consideration. Where, therefore, the testimony of the parties is at variance as to essential particulars of the transaction, and the value of the equity was greatly in excess of the sum for which the alleged release was given, and the mortgagor retained possession, and the writings relied on by the mortgagee are inconclusive, a release is not to be inferred. Peugh v. Davis, 96 U. S. 332. 5. An agreement by the purchaser of land to take "subject to a specified incumbrance does not import an agreement to assume and pay the incumbrance. Elliott. Sackett, 108 U. S. 132. 6. A statute which, like the Illinois statute of July 1, 1875, declares valid mortgages on land in the state previously taken by foreign corporations to secure loans does not deprive of a vested right of property within the meaning of the fourteenth amendment one who purchased land subject to such a mortgage, agreeing with his vendor to pay the mortgage as part of the consideration, although, by the law in force when he purchased, such mortgages were invalid. In the absence of the statute the mortgagor, would be liable personally to the mortgagee, and would have a vendor's lien on the land for the amount of his liability. Gross v. United States Mortgage Co., 108 U. S. 477. continued. STATUTES, 51. MORTGAGE MERGER What operates.] Where a mortgagee becomes the owner of the equity of redemption, the mortgage will not be deemed merged if a merger is contrary to the apparent intent or the interest of the mortgagee. Factors' & Traders' Insurance Co. v. Murphy, 111 U. S. 738. 2. Where one signs his name on the back of a note for the accommodation of the maker, whether a joint maker, a guarantor, or an indorser, and takes a mortgage from the maker, as indemnity, and is compelled to pay, he may assign the note and mortgage, and his assignee may foreclose and take a decree for a deficiency, although the signer on taking up the note enters the sum paid in general account with the maker. Neither the mortgage nor the maker's personal liability is merged by such an entry. Bendey v. Townsend, 109 U. S. 665. Taking Time Mortgage from Principal as Collateral Security does not discharge Surety. See SURETYSHIP, 12. MORTGAGE — MORTGAGEE — Nature of Mortgagee's Interest. See pl. 1, 2. Right of Mortgagee to Possession, etc. See pl. 3-10. MORTGAGE - MORTGAGEE continued. Liability of Mortgagee of Leasehold on Covenants of Lease - Liability of Mortgagee for Rents and Profits To other Lienholders To Owner of Equity of Redemp tion. See pl. 11-15. continued. MORTGAGE-MORTGAGEE 8. If a mortgagor's covenant binds him to insure for the benefit of the mortgagee, the mortgagee, to the extent of his interest, will have a lien on the proceeds of a policy taken out by the Estopped to deny Prior Incumbrance of which mortgagor; and such is the rule in Louisiana. he had Notice. See pl. 16. Wheeler v. Factors' & Traders' Insurance Co., 101 U. S. 439. 9. And this is so, although the contract provides that, if the mortgagor fails to insure, the mortgagee may procure a policy at the mort 1. Nature of Mortgagee's Interest.] In Wisconsin, the legal title does not vest in the mortgagee on condition broken, but only on fore-gagor's expense. Ib. closure and sale. Russell v. Ely, 2 Black, 575. 2. In New Hampshire, the interest of the mortgagee is treated as realty so far only as may be necessary to preserve his security. Hutchins v. King, 1 Wal. 53. 3. Right of Mortgagee to Possession etc. To Rents and Profits - To Proceeds of Foreclosure Sale Proceeds of Insurance Policy.] A mortgagee lawfully in possession after condition broken will not be turned out until his debt is paid; but this rule will not protect a mortgagee who procures possession by a collusive arrangement with a tenant of the mortgagor, whose lease has expired, and without the mortgagor's consent, as such a possession is not lawful. Russell v. Ely, 2 Black, 575. 10. A mortgagee in possession, who obtains insurance and pays the premium, is not accountable for the money he receives for a loss, under the policy. Russell v. Southard, 12 How. 139. 11. Liability of Mortgagee of Leasehold on Covenants of Lease - Liability of Mortgagee for Rents and Profits - To other Lien-holders To Owner of Equity of Redemption.] Whether a mortgagee of a leasehold interest is liable as an assignee on the covenants in the lease, although he has never had possession, quære. Calvert v. Bradley, 16 How. 580. 12. A mortgagee who claims title under a foreclosure void for want of notice is not liable for rents and profits, where he has no such possession as gives actual enjoyment and pernancy 4. One entitled to a lot on a "town site on thereof. Bigler v. Waller, 14 Wal. 297. public land entered by the mayor under the act of March 2, 1867 (14 Sts. 541), has an equitable interest which may be the subject of a mortgage, and the mortgagee is entitled to the mayor's deed. Hussey v. Smith, 99 U. S. 20; Hussey v. Merritt, Id. 25. 5. A mortgagee is not entitled to rents and profits until he gets possession, although the mortgagor withholds possession contrary to agreement. And especially is this the rule in Oregon, where it is provided by statute that a mortgage shall not be deemed a conveyance such as to entitle the owner of the mortgage to possession without foreclosure and sale. Teul v. Walker, 111 U. S. 242. 6. A mortgagee of a part of a parcel of land embraced in a junior mortgage of the whole, cannot, by intervening in a proceeding to foreclose the junior mortgage, maintain a claim to any part of the proceeds of the foreclosure sale. His petition is properly dismissed without prejudice. Woodworth v. Blair, 112 U. S. 8. 7. Where a mortgagor of a building on land owned by a third person has obtained a decree against the owner of the land on his agreement to purchase the building, and there is no application of the interest on the decree until the court comes to make a final decree, so that there are two funds, the principal and the interest, the court, following the practice of courts of equity in marshalling securities, may direct payment to the mortgagee out of the interest, the mortgagee having been brought in by bill of interpleader. 13. Under a finding that the defendant's possession of certain land was under an instrument in fact a mortgage, although in form a deed, and a decree that the plaintiff might redeem on payment of the loan with interest, and that the defendant be charged a reasonable sum for his use and occupation of the premises, the defendant is chargeable with nothing on this score, his possession being constructive only and the land unenclosed without buildings, nor because, but for his claim of ownership, the plaintiff might have sold the land at a time when it had risen in value, but from which value it soon fell. Peugh v. Davis, 113 U. S. 542. 14. Where property, subject to mortgage and other liens, is sold by the first mortgagee, under a power, he becomes the trustee for the benefit of all concerned; but if he duly regard the interests of all and keep within the scope of his authority, equity will not hold him responsible for mere errors of judgment or results, however unfortunate, which he could not reasonably have anticipated. Markey v. Langley, 92 U. S. 142. 15. One who holds the strict legal title, with no right other than a lien for a given sum, on selling to an innocent purchaser, must account to the owners of the equity of redemption for all he receives beyond that sum. Shillaber v. Robinson, 97 U. S. 68. 16. Estopped to deny Prior Incumbrance of which he had Notice.] Where a mortgage is expressly subject to a prior mortgage for the security of negotiable bonds already in circulation, MORTGAGEE - continued. the junior mortgagee and all who claim under him are estopped from denying either the validity or the amount of the bonds in the hands of bona fide holders. Bronson v. La Crosse & Milwaukee Railroad Co., 2 Wal. 283. Lessee remaining in Possession—When deemed Mortgagee in Possession. See LANDLORD AND TENANT, 10. MORTGAGE PAYMENT What amounts to Not a Terre-tenant entitled to Notice on Payment - Effect of Payment on Property in Scire Facias to revive Judgment. See JUDGMENT ACTION, 5. Prior Mortgagee not Necessary Party to Bill to foreclose. FORECLOSURE, 17, 22, See MORTGAGE 24, 26. Release to Mortgagee in Possession may be valid, but subject to Close Scrutiny. GRANTEE OF EQUITY, See MORTGAGE 2-4. - Right to Insurance written for Mortgagor. See TRUST TRUSTEE, 8. MORTGAGE MORTGAGOR Power to deal with Mortgaged Property- - Estopped to deny his Seisin in Suit to foreclose - Power to maintain Ejectment against Mortgagee - Release by Election of other Remedies.] Until a bill is filed to foreclose, the mortgagor may deal with third persons, in regard to the mortgaged property, at his pleasure, subject to the terms of the mortgage, as, e. g., by leasing it or by confessing judgment. Bronson v. La Crosse & Milwaukee Railroad Co., 2 Wal. 283. 2. The mortgagor is estopped from denying his seisin in a suit to foreclose the mortgage. Bush v. Marshall, 6 How. 284. 3. A mortgagor having, as between himself and the mortgagee, an equitable title only, cannot, after a breach, maintain ejectment against the mortgagee in possession, or one in possession under him; nor can he, it seems, until he has redeemed, although he has paid or offered to pay the mortgage debt. Brobst v. Brock, 10 Wal. 519. 4. Where a creditor's bill was dismissed because there had been no judgment at law, etc., to found the jurisdiction, but the cause was retained for the closing of the receiver's accounts, and the debtors obtained a decree by which the receiver was adjudged to have received a mortgage belonging to the debtors, and was ordered to pay the amount thereof into court, and the debtors, on default of the receiver, making no claim against the mortgagor, took out sci. fa. against the sureties in the receiver's bond, it was held, the receiver having taken a new mortgage and transferred it to the creditors, that the debtors, by electing to charge the receiver, had Severed Timber - Presumption of Payment.] Where one, bound under an agreement, made on a division of land to pay a mortgage on the whole, borrows money on a mortgage of his portion, promising with it to procure a release of such portion, but puts it to other use, the lender, who afterwards takes money furnished by the borrower, and with knowledge of the original agreement pays the original mortgage debt and takes an assignment of the mortgage, cannot enforce the mortgage against the portion of the original The mortgage is paid; nor has the doctrine of subrogation any application to the case. Richardson v. Traver, 112 U. S. 423. Co-owner. 2. Where the mortgage debt is paid, the property in timber which has been severed without the consent of the mortgagee revests in the mortgagor or his assignee. Hutchins v. King, 1 Wal. 53. 3. Presumption of payment of a mortgage cannot arise, it seems, from lapse of time against a mortgagee or his assigns in possession, certainly where the mortgagor died insolvent before the debt fell due, and where the purchaser of his equity also became insolvent before it fell due, and removed from the state and never afterwards returned. Brobst v. Brock, 10 Wal. 519. Discharge by Executor on Payment in Confederate Currency, invalid. See EXECUTOR AND ADMINISTRATOR -- MORTGAGE - POWER OF SALE - - continued. fore the note became due, the note being referred to in the deed. Richards v. Holmes, 18 How. 143. 2. Where a deed of trust with power of sale is conditioned to secure the payment of money in several instalments, and provides that on default of payment of any one or part thereof the trustee may "enter upon all and singular the premises thereby granted, and sell and dispose of the same," and out of the proceeds retain the principal and interest due, rendering to the grantor the surplus, the trustee may enter and sell on the premises on the first default. Olcott v. Bynum, 17 Wal. 44. 3. A deed of trust to sell and pay a note, in case of an action brought thereon, may be executed, although the note has been turned into a judgment, and more than the time necessary to bar a debt under the statute of limitations has elapsed. Metropolis Bank v. Guttschlick, 14 Pet. 19. 4. A trust was created in favor of creditors under which any one of them might require a sale of the trust property and payment of the debts after a certain time, but no step was taken to that end for nineteen years after that time. It was held, the delay being unaccounted for, that although no statute bar existed, a claim to an execution of the trust was stale, and that equity would not interfere. McKnight v. Taylor, 1 How. 161. 10. Proceedings in the making of Sale Power to be strictly followed - Notice -Defects cured by Neglect of Mortgagor to object.] A sale under a power in a trust deed has no validity unless made in strict conformity to the prescribed directions. Shillaber v. Robinson, 97 U. S. 68. 11. Where a mortgage giving a power of sale provides that the trustee shall give certain notice, a sale without notice confers no title. Bigler v. Waller, 14 Wal. 297. 12. The description of the property in a notice of a sale is sufficient, if it describe the property with such reasonable certainty as to inform the public of the property to be sold. Newman v. Jackson, 12 Wheat. 570. 13. A trustee authorized to sell for the use of a creditor, after advertising the time and place of sale, may postpone the sale from time to time in the exercise of a fair discretion, if due notice be given of the postponement. Richards v. Holmes, 18 How. 143. 14. Where a sale is fairly made under the power given by a deed of trust, and the trustee's deed to the purchaser is defective, the sale will not be declared invalid, but the purchaser is entitled to have the defect remedied by the execution of a new deed, if necessary. Clark v. Freedman's Savings & Trust Co., 100 U. S. 149. 15. A sale of land, under the power given by a deed of trust to secure a debt, will not be set aside because the price brought was inadequate, the inadequacy not being such as to shock the conscience or raise a presumption of fraud or unfairness. Ib. 5. Where the premises consist of land with timber, water-power, and mines and furnaces for working the same, and are therefore such that a sale in parts cannot be made to advantage, the sale may be on the premises, and of the entire property, and not merely of enough to pay the sum due (the sum secured being payable in instalments), and wholly for cash, and not for payment in instalments maturing so as to meet the instalments of the mortgage debt, and the surplus remaining after payment of the sum due may be retained and applied as a court of equity 16. Where mortgaged property is sold under would apply it to the extinguishment of the a power, any mere defect in the sale is cured by debt; and it makes no difference that the prop-neglect of the mortgagor to object. Markey v. erty is large and valuable, and situated in a re- Langley, 92 U. S. 142. mote section unfrequented by buyers. Olcott v. Bynum, 17 Wal. 44. 6. A creditor, for whom a sale is made under a deed of trust, may become the purchaser on a bid left by him with the auctioneer, if the bid be the highest that can be obtained. Richards v. Holmes, 18 How. 143. 7. A sale will not be set aside because the land was bid off by a corporation of which the trustee was an officer, nothing appearing to show unfairness. Clark v. Freedman's Savings & Trust Co., 100 U. S. 149. 8. A sale of real estate, made under a power contained in a deed of trust executed before the civil war, to secure the payment of promissory notes, is valid, although the grantors were citizens and residents of an insurrectionary state, MORTGAGE 1. PRIORITY Priority as to other Priority as to other Mortgages.] In New York, a mortgage for a past indebtedness, if taken without notice of one for an indebtedness to be subsequently incurred, has precedence if first recorded. Genesee National Bank v. Whitney, 103 U. S. 99. 2. A mortgage of land taken and recorded without notice of an older unrecorded mortgage takes precedence thereof; and such was the rule in Utah, even before the passage of the statute of February 20, 1874, distinctly so declaring MORTGAGE - PRIORITY continued. such being the implication from prior statutes. Neslin v. Wells, 104 U. S. 428. 3. Where, to secure the payment of a promissory note, the maker executes a trust deed of land, the deed authorizing the trustees to release on payment of the note, which, before maturity, is transferred to an innocent indorsee for value, and after the transfer the trustees and the payee of the note execute a release, reciting that the note has been paid, and the release, like the deed, is recorded, the rights in the land of the payee of another note secured by another deed of trust, afterwards made to one having no notice other than that afforded by the record, are paramount to the rights of the indorsee of the first note. Williams v. Jackson, 107 U. S. 478. 4. Priority as to other Incumbrances.] A trust deed, valid under the law of the state in which the parties resided on its execution, and there duly recorded, held to protect the title from the subsequent creditors of the grantor in another state on removal of the grantor and the cestui que trust into that state to reside. United States Bank v. Lee, 13 Pet. 107. 5. A mortgagee, who might have taken possession of the mortgaged property, or filed a bill to foreclose and for a receiver of the income, will be postponed, as to his claim for such income received and unexpended by the mortgagor, to the claim of a judgment creditor of the mortgagor, who, after a return of an unsatisfied execution, seeks by bill in equity to reach such income; and this, although the mortgagee file his bill to reach the income before the creditor's bill is filed. American Bridge Co. v. Heidelbach, 94 U. S. 798. 6. Where A. and B., tenants in common of land, borrowed money, giving a deed of trust on the land to secure its repayment, and, payment being delayed, a sale was made at which B. bought the land, and gave another deed of trust to secure the debt, and an additional deed of trust to secure A.'s one-half part of the difference between the amount of the debt and the amount of B.'s bid, the deed of trust to A. not, however, being accepted or recorded, and the creditor having caused a sale to be had for a default in payment of the amount secured by the second deed, and all the parties, by their conduct, having acquiesced in the second sale, it was held that A. had waived any rights which he might have claimed under the first sale, and that therefore his claim must be postponed to the claim of the creditor, at least to the amount originally secured by the first trust deed. Mellen v. Wallach, 112 U. S. 41. 7. Where a state, having a mortgage on the property of a canal company, waives its lien so far as to permit the company to use so much of its revenues as is necessary for the expenses of maintaining the canal, a general creditor of the company who has notice of the facts will be restrained at the instance of the state from levying on earnings of the company deposited by it in continued. MORTGAGE - PRIORITY bank to meet necessary expenses. Macalester v. Maryland, 114 U. S. 598. 8. Priority as affected by Sale of Property.] Where real estate bound by a judgment or mortgage is alienated in parcels at different times to various persons, the parcels should be subjected to the satisfaction of the lien in the inverse order of alienation. National Savings Bank v. Creswell, 100 U. S. 630. 9. Where property subject to mortgage and to other liens is sold by the first mortgagee under a power in his mortgage, the several liens attach to the proceeds in the same manner and order and to the same effect as to the premises before the sale. Markey v. Langley, 92 U. S. 142. 10. Registration.] A provision of law requiring tacit mortgages to be recorded, in order to affect third persons, does not deprive of a right to property, within the meaning of the fourteenth amendment, a minor who, under the prior law, had such a mortgage on his tutor's property, ample time-nine months or more, for instance-being given for compliance therewith. Vance v. Vance, 108 U. S. 514. 11. The record of a mortgage being constructive notice to all the world, mere silence of a mortgagee respecting a mortgage duly recorded cannot be construed as laches precluding an assertion of the mortgage against a subsequent purchaser without actual notice. Dick v. Balch, 8 Pet. 30. 12. Under article 3333 of the Louisiana civil code, requiring reinscription of mortgages and privileges after ten years, it is the inscription, not the mortgage or privilege, that ceases to have effect if the reinscription be not made. Patterson v. De la Ronde, 8 Wal. 292. 13. The trustee and cestui que trust under a deed to secure a debt are deemed purchasers, and are not charged with notice of unrecorded claims on the land otherwise than as a purchaser would be charged. Kesner v. Trigg, 98 U. S. 50. Title of Purchaser at Execution Sale superior to that under Unrecorded Mortgage. See EXECUTION, 48. - REDEMPTION MORTGAGE Who may reWhen deem · Right to Rents and Profits.] One who, under a contract of purchase, is in the open, visible, and exclusive possession of mortgaged land, is entitled to redeem from a foreclosure sale had in proceedings to which he was not made a party. Noyes v. Hall, 97 U. S. 34. 2. To redeem property irregularly sold on foreclosure, the tender must be of a sum equal not merely to the amount paid by the purchaser, but to the mortgage debt. Collins v. Riggs, 14 Wal. 491. 3. If a junior incumbrancer would redeem property bought by a senior incumbrancer at a sale under the senior deed of trust, he is bound to pay the senior incumbrance, with interest, |