evidence in all Courts and proceedings without any further proof, Chap. XXX. and which entry shall have the effect of clearing the register or § 1 (vii). record of such mortgage, and the registrar or recording officer shall be entitled to a fee of two shillings and sixpence for making the said entry and granting the said certificate, and such fee shall in Ireland be paid by stamps and applied as the other fees of the Registry of Deeds Office and Record of Title Office are now by law directed to be paid and applied." A form of receipt is given in the schedule to the Act. Similar lan statutes. The question as to the effect of a statutory receipt has fre- guage of both quently come before the Courts for determination. It will be observed that the language of both statutes on this point is very similar, so that it would seem that decisions on cases arising under the Act of 1836 are generally applicable to cases arising under the later Act. statutory receipt as to It appears to be the settled rule that a receipt given under Effect of either of the Acts vests the legal estate in the person who in equity is best entitled to call for it, and not necessarily in the person who actually paid off the society. Thus, where there are successive equitable mortgagees, and the society is paid off by the mortgagor, the effect of the statutory receipt is to vest the legal estate in the equitable mortgagee who is first in point of time, unless the society is paid off by an equitable mortgagee who had no notice of prior incumbrances, in which case the legal estate vests in that mortgagee, notwithstanding that there are incumbrances prior to his in point of date (r). In Pease v. Jackson (s), a legal mortgage was made to a building society constituted under the Act of 1874, and the mortgagor subsequently gave a second mortgage to the plaintiff ; the defendants, at the request of the mortgagor, paid off the first mortgage; a receipt was accordingly indorsed on that mortgage, and the title deeds were handed over to the defendants, who had no notice of the plaintiff's charge; the mortgagor at the same time executed a mortgage of the property to the defendants to secure the amount paid by them to the society, together with a further advance to the mortgagor. It was held that the defendants had the better equity, and that, therefore, the rule "qui prior est tempore potior est jure" did not apply; and further, (r) Pease v. Jackson, L. R. 3 Ch. 576; and see Priestley v. Hopwood, 12 W. R. 1031; Re Page (No. 2), 32 Beav. 485; Marson v. Cox, 14 Ch. D. 140; Robinson vesting the property. Chap. XXX. that on the satisfaction of the first mortgage, the legal estate § 1 (vii). vested, by virtue of the statute, either in the mortgagor, or in the persons who had the best right to call for it, in either of which cases it passed to the defendants. Tacking further advances. Effect of statutory receipt as to vacating the debt. In several cases (t) it was also decided that a third person paying off a building society, who obtains a receipt and the title deeds, and takes a mortgage to secure the amount so paid and a further advance to the mortgagor, is not entitled to tack the further advance. But this part of the decisions referred to has been overruled by the House of Lords in Hosking v. Smith (u), in which the circumstances were very similar to those in Pease v. Jackson. It was held that the person who paid off the society, at the request of the mortgagor, and without notice of an intermediate charge, taking a fresh mortgage for the money paid and a further advance, had priority, by virtue of the receipt on the first mortgage, over the second mortgagee, not only in respect of the money paid to the society, but also in respect of the advance made to the mortgagor. It is to be observed, however, that sect. 5 of the Act of 1836 provides that the effect of the receipt shall be to vacate the "mortgage or further charge," but that by sect. 42 of the Act of 1874 the effect of a receipt under that Act is to vacate the "mortgage or further charge or debt." And, accordingly, in two cases arising under the earlier Act, it was held that a covenant in a mortgage given by an advanced member to pay subscriptions until every member should have realized a specified sum per share, was not put an end to by the indorsement on the mortgage of a statutory receipt (r). But, in a later case, where the society was incorporated under the Act of 1874, and an advanced member had mortgaged property to secure a loan and all further payments due from him to the society, it was held by the Court of Appeal that the indorsement of a statutory receipt, though given under a mistake, put an end to the covenant in the mortgage, not only as to the principal and interest, but also as to all payments in respect of shares, and precluded the society from saying that there was any debt due from the mortgagor (y). (t) Pease v. Jackson, L. R. 3 Ch. 576; (x) Farmer v. Smith, 4 H. & N. 196; Sparrow v. Farmer, 26 Beav. 511. (y) Harvey v. Municipal Building Soc., 26 Ch. D. 273, followed in London and County Building Soc. v. Angell, 65 L. J. Q. B. 194. The receipt may be delivered merely as an escrow, the society Chap. XXX. being entitled to show that they had in fact never been paid § 1 (vii). off (). There is a further difference in the language of the two Reconveyance by deed, statutes in that the Act of 1836 merely authorizes the giving of a receipt, the effect of which is to vacate the charge and vest the estate in the person entitled to the equity of redemption without necessity for a reconveyance; but the Act of 1874 empowers a society to indorse on or annex to the mortgage either a reconveyance or a receipt which is to operate to vacate the charge or debt, and vest the estate "without any reconveyance or surrender." And it further provides for the entry on court rolls, and the giving of certificates of satisfaction in the case of mortgages of copyholds. society, The trustees of an unincorporated society may still reconvey by unincorporated mortgaged property by deed instead of giving a statutory receipt but, if so, apparently, the reconveyance will operate under the ordinary law as would any other reconveyance, and the rights of parties will be regulated accordingly (a). So, also, if the trustees of an unincorporated society have been admitted to copyholds, it seems that a re-surrender will be necessary. If, however, an incorporated society executes a reconveyance by incorpoinstead of giving a statutory receipt, sect. 42 of the Act of 1874 rated society, requires the reconveyance to be made "to the owner of the equity of redemption, or to such persons and to such uses as he shall direct," and the effect will be to vest the estate in such person or persons, and in him or them only; the statutory reconveyance and the statutory receipt are alternative modes of attaining the same object, viz., the vesting of the legal estate in the same person, that is, the owner for the time being of the equity of redemption (b). after incor poration. If a mortgage made to the trustees of an unincorporated by society society which is subsequently incorporated, is paid off after incorporation, then, inasmuch as by sect. 27 of the Act of 1874 the property vested in the society on incorporation without transfer by the trustees, the indorsed receipt or reconveyance (z) Lloyds Bank v. Bullock, (1896) 2 Ch. 192. (a) Carlisle Banking Co. v. Thompson, 28 Ch. D. 398 (a case under the Friendly Societies Act, 1875); inf. n. (h). Chap. XXX. given by the society will effectually vacate the mortgage and vest the legal estate by virtue and in accordance with the statute (c). § 1 (vii). Registered land. Stamps. In the case of registered land, if the mortgage is retained by the society, the discharge may be effected by indorsing the usual statutory receipt and cancelling the charge at the registry (d). If the charge has been filed in the registry, the discharge may be effected by an instrument of discharge in the prescribed form (e). The statutory receipt appears to be in all cases exempt from stamp duty, whether the society is incorporated (f) or unincorporated (g), and a reconveyance by deed is also exempt (h). Repeal of former Acts. SECTION II. OF MORTGAGES TO FRIENDLY SOCIETIES. i. Power of Friendly Societies to lend on Mortgage.-The Friendly Societies Acts of Geo. IV. and Will. IV., referred to in the early part of this Chapter, were repealed by the Friendly Societies Act, 1855; and that Act was repealed by the Friendly Societies Act, 1875, which in turn was repealed by the Friendly Societies Act, 1896, whereby the law on the subject was consolidated and amended. The Friendly The powers of friendly societies to lend money on mortgage Societies Act. is now governed by the provisions of the Act of 1896. Vesting of property of society. Devolution on death, &c. of trustee. All property of a society is vested in its trustees for the time being; and the property of a branch is vested in the trustees of that branch, or in the trustees of the society if the rules of the society so provide (i). Upon the death, resignation, or removal of a trustee, the property vests in the surviving trustees either solely or together with any surviving or continuing trustees, and, until appointment of succeeding trustees, in such surviving or continuing trustees only, or in the executors or administrators of the last (c) See sect. 27, set out ante, p. 571; (g) 10 Geo. IV. c. 56, s. 37. (h) Old Battersea Building Soc. v. Inland Revenue Commissioners, (1898) 2 Q. B. 294. (i) 59 & 60 Vict. c. 25, s. 49. surviving or continuing trustee as personal estate (whether the Chap. XXX, same be real or personal) without conveyance and assignment, § 2 (i). except as regards stock and securities in public funds (k). In legal proceedings the property is to be stated to be the property of the trustees by name as trustees for the society or branch, without further description (1). Where a society is entitled in equity to any copyholds or Admittance customary lands absolutely or by way of mortgage, the lord is to copyholds. from time to time to admit the trustees (not to exceed three) of the society as tenants on payment of the fines and dues payable on admission of a single tenant (m). invest on The trustees, with the consent of the committee of manage- Power of ment or of a majority of the members of a society present and trustees to entitled to vote at a general meeting, may from time to time mortgage. invest the funds of such society or any part thereof to any amount (among other investments) upon any security expressly directed by the rules of the society, not being personal security, except as provided by the Act with respect to loans (n). With respect to loans to assured members it is enacted (0) that: "A registered society, and subject to the rules of the society a Loans to registered branch, may advance to a member of at least one full members. year's standing any sum not exceeding one-half of the amount of an assurance on his life on the written security of himself and two satisfactory sureties for repayment. The amount so advanced with all interest thereon may be deducted from the sum assured without prejudice in the meantime to the operation of the security." With respect to loans out of separate loan fund it is enacted (p) that: "A society may, out of any separate loan fund to be formed Loans out by contributions or deposits of its members, make loans to its of separate members on their personal security, with or without sureties, as may be provided by the rules, subject to the following restric tions: (a) A loan shall not at any time be made out of moneys contributed for the other purposes of the society; (b) A member shall not be capable of holding any interest in the loan fund exceeding two hundred pounds; loan fund. |