in Gray's Inn, in the city of London, and retained the possession till 1700, at which time a possession of part was delivered to the mortgagee, the mortgagor holding the remainder till 1708, leaving the plaintiff an infant. A bill was brought to redeem in 1726. A redemption was decreed, and it was said by Lord King, that nothing was more clear, than that, if the mortgagor was in possession of any part, he should be admitted to redeem the whole, as being in possession thereof.1 This, it will be observed, is in conformity to the rule before laid down, that the possession of part of an estate is a possession of the whole. 463. Again, where there is fraud in the mortgagee. Where any species of fraud has been practised by a mortgagee, at the time when the mortgage was made, a court of equity will interfere and give relief, notwithstanding a possession of twenty years.2 Thus in the before-mentioned case of Ord v. Smith, it was expressed that the redemption should be with the mortgagor's own money; and the Master of the Rolls said, that the words in the defeasance, however fettered, signified nothing, where the money was to be repaid; for the borrower being necessitated, and so under the lender's power, the law made a benign construction in his favor. But this, he held, was a fraud in its creation, and in such a case was redeemable after any length of time. 3 464. As persons claiming in remainder or reversion are not barred by the statute, until after the expiration of the time limited, from the time of such remainder or reversion falling into possession, it has been urged (on the common principle of equity following the law), that the same rule should be applied to successive limitations of an equity of redemption. But, it seems, that the contrary is the settled law on the subject. In a case before Sir William Grant, where the party claiming was entitled in remainder immediately after an estate for life, during the existence of which the mortgagee had entered, it was adjudged, that there could be no redemption after twenty years, in whatsoever way the estate might have been settled. The ground of this rule is the mischief to be apprehended from an unlimited power to redeem generally, and also that the previous right of the mortgagee, might designedly 1 Rakestraw v. Brewer, Sel. Ca. in Cha. 55; Marks v. Pell, 1 Johns. (N. Y.) Ch. 594. 2 2 Cruise, 161; Marks v. Pell, 1 Johns. (N. Y.) Ch. 595; Reigal v. Wood, Ib. 402. 3 Blake v. Foster, 2 Ball & Beat. 565, 575, et seq. Harrison v. Hollins, 1 Sim. & Stu. 471. be defeated merely by making a settlement of the property. Another ground is, that, although a remainder-man or reversioner of a legal estate cannot bring his formedon until the remainder falls into possession, yet a remainder-man or reversioner of an equity of redemption has a present right to redeem. 465. It is worthy of notice that, prior to the above determination of Sir William Grant, it had been adjudged that the existence of an estate by the curtesy was insufficient to prevent the presumptive bar of the remainder-man's right to redeem, arising from long possession. On the occasion alluded to, Lord Hardwicke remarked, that there would be no bounds to redemption if the excuse of a curtesy estate should prevail; that mortgagees would never be quieted in their possession; that it was of no consequence to them, to whom the right of redemption belonged; and that if the persons entitled did not make use of their right, it was only fitting they should be barred.1 And it was also held by Chief Baron Eyre, that the plaintiff might redeem, notwithstanding the tenancy by the curtesy, and that therefore his neglect shall bar him. But if the mortgagee's possession be attributable to a title under the husband, independently of that as mortgagee, his enjoyment during the husband's lifetime, however long, will not prejudice the right of the heir. As if the mortgagee becomes the party as well to pay as to receive the interest of the mortgage debt.3 And under these circumstances the right to redeem does not terminate until the end of twenty years from the time of the husband's death.4 466. It has been said that the mortgagee is a trustee to the mortgagor. But it is only in a secondary point of view, and under certain circumstances, and for a particular purpose, that the character of trustee constructively belongs to a mortgagee. There is certainly no trust expressed in the contract. It is only raised, therefore, by implication, and in subordination to the main purposes of the contract. The relation of the parties is a peculiar one, and perfectly sui generis. Under certain conditions the mortgagee becomes the purchaser of a security and pledge, to hold for his own use and benefit. He has acquired a distinct and independent beneficial interest in the estate; and, although his right is qualified and limited, it may eventually become absolute and per 1 Anon. 2 Atk. 333. 3 Same case, 3 Anst. 765. 2 Corbett v. Barker, 1 Anst. 138. manent, and may be enforced by suit against the mortgagor. It is a general rule, that a trustee is not allowed to deprive his cestui que trust of the possession, but a court of equity never interferes to prevent the mortgagee from assuming the possession. In this respect, it will be perceived, that there is a marked difference in the contract between mortgagor and mortgagee, and trustee and cestui que trust. A trustee is stopped in equity from dispossessing his cestui que trust, because such dispossession would be a breach of trust. A mortgagee cannot be stopped, because in him it is no breach of trust, but in conformity to his contract. On the same principle a mortgagee is not prevented, but assisted in equity, when he has recourse to a proceeding which is not only to obtain the possession, but the absolute title to the estate, by foreclosure. There is no resemblance, in this respect, to the character of a trustee, but to a character directly opposite; and it is in this opposite character that the mortgagee accounts for the rents and profits when in possession, and when he is not, receives the interest of his mortgage debt. The ground, therefore, on which a mortgagee is in any case and for any purpose considered to have a character resembling that of a trustee, is the partial and limited right, which, in equity, he is allowed to have in the whole estate, legal and · equitable. And hence, although as a general rule the statute will not apply to a direct trust, yet a mortgagee is allowed to set up lapse of time as a bar to the equity of redemption.1 467. Where the legal estate is barred, the equitable estate is also barred. In a case, which has been treated in this country as one of the highest consequence, an estate subject to a mortgage in fee, was in settlement with an ultimate limitation to the right heirs. of S. R. A, on the expiration of the previous estate, entered claiming to be entitled under the limitation; and he, and after his death, his son, continued in quiet possession, paying interest on the mortgage, for twenty years. It was first determined by Sir W. Grant, Master of the Rolls, that the lapse of time was no bar. But afterwards, when the case came before his successor, Sir T. Plummer, the latter delivered a most learned and elaborate judgment, tending to show, that wherever, in a claim to a legal estate, the remedy is barred in a court of law, by length of time, the 1 Cholmondeley v. Clinton, 2 Jac. & Walk. 1. 2 Cholmondeley v. Clinton, 2 Jac. & Walk. 1, as reported, also, in 2 Meriv. 173. 8 Cholmondeley v. Clinton, 2 Jac. & Walk. 1. remedy for an equitable estate, will be equally barred, by the lapse of the same period of time, in a court of equity. An appeal was taken to the House of Lords, and, in moving the judgment of the House, Lord Eldon adverted to the general principles adopted by courts of equity on the subject of length of time, and observed on "the vast difference between trusts, some being express, some implied; some relations formed between individuals, in the matter in which they deal with each other, and in which it could hardly be said, that one was trustee, and the other cestui que trust, and yet it could not be well denied, that for some purposes they were so. Of this kind, he took the relation between mortgagor and mortgagee to be. He concluded by stating his opinion to be, that adverse possession of an equity of redemption for twenty years was a bar to another person claiming the same equity of redemption, and worked the same effect as disseisin, abatement, or intrusion, with respect to legal estates." Lord Redesdale concurred, and the decree was affirmed. This decree received the approbation of the Supreme Court of the United States, in Elmendorf v. Taylor, which was a bill in equity, on appeal from the Circuit Court in Kentucky. Ch. J. Marshall thought, that the analogy of a bill in equity to actions founded on a right of entry derived some title to consideration from the circumstance that the plaintiff does not sustain his claim on his own seisin, or that of his ancestor, but on an equity not necessarily accompanied by seisin, whereas seisin is an indispensable ingredient in a writ of right. The case, however, he considered, must depend upon precedent; and, if one or the other rule has been positively adopted, it should be respected. 1 Cholmondeley v. Clinton, 2 Jac. & Walk. 189. 2 Elmendorf v. Taylor, 10 Wheat. (U. S.) 152. Chancellor Kent said: "It is a well-settled rule, that twenty years' possession by the mortgagee, without account or acknowledgment of any subsisting mortgage, is a bar to a redemption, unless the mortgagor can bring himself within the proviso of the statute of limitations." 3 Johns. (N. Y.) Ch. 129. [And where an absolute deed is given as security for a debt, when the right of action to recover the debt ceases, the right to redeem the premises will also cease. Espinosa v. Gregory, 40 Cal. 58. But see Williams v. Durst, 35 Texas, 421. See also ante, § 92.] CHAPTER XXXV. TRUSTEE AND CESTUI QUE TRUST. 468. It has been shown, in a former chapter, in treating of trustees of personal property,1 that the well-established rule, in regard to direct trusts, belonging exclusively to the jurisdiction of a court of equity, is, that so long as the trust subsists, the right of the cestui que trust cannot be barred or excluded by the trustee, by virtue of the length of time during which the latter has held possession. It is equally true, that, in cases of trusts of this description, of real estates, the possession of the trustee is the possession of the cestui que trust; and that if the trustee remain in possession, though he does not execute the trust, his possession is still that of cestui que trust; and that, if the non-performance of the trust be the only circumstance in his favor, such possession will operate nothing as a bar, it being in accordance with the title of the equitable owner.2 The possession is, in fact, the same as in the case of a lessee for a term, whose possession, although he may 1 Chap. XVI. § 166. 2 In addition to the leading authorities upon the subject, cited in the chapter just above referred to, see Howard v. Aiken, 3 M'Cord (S. C.), 467; Armstrong v. Campbell, 3 Yerg. (Tenn.) 201; Overstreet v. Bates, 1 J. J. Marsh. (Ky.) 370; Thompson v. Blair, 3 Murph. (N. C.) 583; Jones v. Persons, 2 Hawkes (N. C.), 269. [Martin v. Jackson, 27 Penn. St. 504.] An administrator in possession of lands, of which his intestate died seised and possessed, cannot acquire a title in his own right thereby, under the statute of limitations. North's Administrator v. Barnum, 12 Vt. 205; Goodhue v. Barnwell, Rice (S. C.), Eq. 198. A trustee cannot take advantage of the act of limitations against the cestui que trust, or of persons claiming under him. Redwood v. Riddick, 4 Munf. (Va.) 222; Wamburzee v. Kennedy, 4 Desaus. (S. C.) Eq. 479. [The trustees (in fee) intrusted to the cestui que trust, as beneficial owner, the management of the estate. The latter, without ever having had actual occupation, let C into possession, who occupied during the life of the cestui que trust for more than twenty years. Held that C had acquired a title by adverse possession under 8 and 4 Will. IV. c. 27, although no tenancy at will had been created between the cestui que trust and trustee. Melling v. Leak, 32 Eng. L. & Eq. 442. And it seems that if a religious society, whose meeting-house is held in trust by their prudential committee for maintaining a particular form of worship, vote to adopt and do openly adopt another form of worship, their possession becomes adverse. Attorney-General v. Federal Street Church, 8 Gray (Mass.), 1.] |