CHAPTER III. and on appeal to the House of Lords the judgment was affirmed; Time no bar but in that particular case a second mortgage had been made to the same party, by which the mortgagor had agreed to repay the whole debt at any time after eighteen months' notice, and it was admitted that the notice had long since been given; which reduced it to the case of a common mortgage. But in a later case, Lord Lyndhurst considered the decision in the last-mentioned case to have been made on the ground of the impossibility of taking the long and complicated accounts after the lapse of ninety years, and that the redemption suit had not been prosecuted with reasonable dispatch (m). In that case a reversion in fee, expectant on a life estate, had been demised for a term of 500 years, with a proviso for redemption on payment of the mortgage debt, but without any definite time fixed for payment, and the mortgagor covenanted to pay the mortgage debt on demand, and that until payment the mortgagee might enter and enjoy the premises. Lord Lyndhurst held this to be in the nature of a Welsh mortgage, and dismissed a bill filed for foreclosure (m). In a case where the transaction appeared to be in the nature to redemption. of a Welsh mortgage, Lord Eldon observed that time would be no bar to redemption, unless it were proved that the party had held over for the space of twenty years (now twelve years) after the debt was fully paid and satisfied; that if it was not a case in which length of time alone would operate as a bar to redemption, the question still remained whether there were not circumstances to raise the presumption of a release from the long possession of the mortgagee. The question was submitted to a jury, who found a verdict for the mortgagor, which was sustained ("). Although by s. 28 of 3 & 4 Will. IV. c. 27, as subsequently noticed (0), the right of redemption by a mortgagor was lost at the end of twenty years (now reduced to twelve) (p) next after the mortgagee takes possession, unless there has been some intermediate acknowledgment of right, yet it is conceived that this enactment cannot apply to the case of Welsh mortgages (in which the original stipulation is, that the mortgagee shall hold and receive the rents until his debt is satisfied) unless twenty (now twelve) years shall have elapsed from the period when, by (m) Teulon v. Curtis, Yo. 619. (0) See post, pp. 740 et seq. the receipt of the rents, the mortgage debt and interest might have been paid (g). In one case time was held to be no bar to redemption, although upwards of sixty years had elapsed since the mortgagee took possession (r). CHAPTER III. iii.—Rights and Liabilities of Parties under Welsh Mortgages. How far the -With regard to the personal liability of the mortgagor to mortgagor is personally repay the amount advanced, the effect would appear to be liable for different according to the form of the security adopted. In the payment. case of a Welsh mortgage proper, it is conceived that an action of debt for the principal would lie as in the case of an ordinary mortgage (s); though not apparently in respect of interest, the receipt of the rents and profits being, by the terms of the contract, in lieu and satisfaction of interest. In a case (t) of an ordinary mortgage, without any covenant to pay the debt, Lord Chancellor Talbot was of opinion that every mortgage implies a loan, and that every loan implies a debt, and that though there were no covenant or bond, yet the personal estate of the borrower remained liable to pay off the mortgage, and his lordship said that this was so in the case of Welsh mortgages, where no day certain is appointed for payment, but the matter is left at large. Where the security is in the nature of a Welsh mortgage in the form whereby the rents and profits are to be taken by the mortgagee until all that is due to him for principal and interest is satisfied, all personal liability of the borrower appears to be necessarily excluded by the nature of the agreement between the parties. And where it was agreed in writing that, in consideration of an advance, the borrower should let certain land to the lender for six years, the borrower to get back his lands on repayment of the advance, but there was no express agreement by the borrower to repay the money lent, it was held that there was no personal liability on the borrower to do so, and that an action of debt brought by the representatives of the lender after the expiration of the term could not be sustained (u). A further point arises in respect of the mortgagee's liability Mortgagee's (q) Fenwick v. Reed, 1 Mer. 114. (r) Orde v. Heming, 1 Vern. 418. (s) See ante, p. 10. (t) King v. King, 3 P. Wms. 361. liability to account. CHAPTER III. Where rents are taken in lieu of interest. Where rents taken are to be applied in reduction of principal. Determina tion of mort to account. This, again, would seem to depend upon the precise Where the mortgage is a Welsh mortgage properly so called, It is true that in some cases (x), where the accrual of rents and profits was equivalent to the payment of an excessive rate of interest, the Court has directed an account to be taken, and upon this it has been assumed that the Court would be willing to do so in every instance at the present day; it is to be observed, however, that the decisions referred to were all of them previous in date to the repeal of the usury laws (y), and it may be doubted whether they would now carry the weight attributed to them. Where, however the mortgage is of a kind requiring the mortgagee to apply the rents and profits in reduction of the principal sum advanced and interest, whether it be of the fee or for a term of years, it would seem that a direction that an account be taken would be incident to an action for redemption by the mortgagor, just as in the case of an action against a mortgagee in possession under an ordinary mortgage (z). Although in the case of a Welsh mortgage of the fee or for a gage for term. long term of years, the security will invariably be terminated by redemption on the part of the mortgagor, a Welsh mortgage for a short term of years may determine by effluxion of time, in which case the liability of the mortgagee to account would apparently depend upon the intention of the parties as expressed or to be inferred from the terms of the contract. Trustees may effect Welsh mortgage. It has been decided in an Irish case that a trustee empowered to raise money by mortgage may effect a Welsh mortgage (a); such mortgages appear, however, to have been formerly very common in Ireland (b). statutory Welsh mort The continuing right of redemption incident to a Welsh CHAPTER III. mortgage would apparently be sufficient to prevent the power of Whether sale given to mortgagees by sect. 19, sub-sect. (1) of the Con- powers of sale veyancing and Law of Property Act, 1881, from applying to apply to such a security. Having regard to the fact that the defini- gages. tion of "mortgage" in sect. 2 of that Act includes a "charge," it would seem that such powers and provisions of the Act relating to mortgages as are not inconsistent with the nature of Welsh mortgages will be applicable thereto. CHAPTER IV. Grants of repurchase by way of security. OF ANNUITY DEEDS. i.—Nature and Incidents of the Security.-A form of security able annuities for repayment of money advanced, which was formerly extensively used and is still adopted by some insurance societies, is that of a grant not of the estate itself, but of an annuity or rentcharge arising thereout, with a power of repurchasing the same on payment of a specified sum. Presumption in equity of right to redeem. Notice of intention to repurchase. Personal covenant for payment. The Courts of Equity were formerly strongly inclined to regard grants of annuities, where the power of repurchasing is given at the same time with the grant and as part of the same transaction, as being contracts not for absolute sale, but for securing a loan, and have therefore, as far as possible, disregarded any conditions as to time or mode of repayment, and treated the grants as liable to redemption in like manner as mortgages (a). A ground for this construction arises, when the deed contains a stipulation for notice to be given of the grantor's intention to repurchase, and for repayment of the original purchase-money, with all arrears of the annuity, and a half-year's payment in addition, so as to allow ample time to find out another hand to take the money, and to secure the interest in the meantime (b). The fact of there being an immediate remedy by covenant or otherwise against the person of the grantor, while there is no present remedy against the property (as in the ordinary power of distress and entry after default in payment for twenty-eight days), leads to an inference that the estate is only meant as a security (c). But, on the other hand, the express exemption of the grantor from all personal liability (which renders the case very similar to a Welsh mortgage) does not affect the right of (a) Longuet v. Scawen, 1 Ves. Sen. 404; Floyer v. Sherard, Amb. 18. See Secretary of State for India v. British Empire Mutual Life Ass. Co., 67 L. T. 434, C. A. (b) Verner v. Winstanley, 2 Sch. & L. 293; Lawley v. Hooper, 3 Atk. 278. (e) Bulwer v. Astley, 1 Ph. 422; Kenney v. Lynch, 2 J. & L. 330. |