gagee, it was the same as if the mortgagee had let the estate to any other person, and therefore the profits received by the tenant for life with the mortgagee's permission, should be considered as if received by the mortgagee himself, and be accounted for accordingly, and that he might have his remedy over against the personal representatives of the tenant for life. On the same principle, where a creditor received from his debtor an assignment of a debt due from a third person as a security for his demand, and sued out execution upon the judgment, but by his neglect in levying, the debt assigned became irrecoverable; it was held that he must bear the loss, although the assignment contained the usual covenant for payment of his debt (p). On the like principle of trusteeship, equity holds, that if leaseholds be in mortgage, and the mortgagee renew, he will take the renewed lease, subject to the like equity as was subsisting in the old lease, even although there was only what is called a tenant right of renewal (q); and if an advowson be in mortgage, and the living become vacant, the mortgagor and not the mortgagee shall present (r), nor will equity permit the mortgagor to agree to the contrary (s), for the mortgagee shall have no benefit beyond his principal, intérest, and costs. If the mortgagee present, and his clerk be admitted, the mortgagor by bill in equity, compel him to resign, but the bill must be filed within six months after the death of the last incumbent (t). A further restriction on the estate of the mortgagee is, that he shall not be permitted (if in possession) to waste the estate (u); if he proceed to fell timber, an account will be decreed and the produce applied, first, in payment of the interest, and then in sinking the principal, and equity will enjoin him, unless the security prove defective, in which case the Court will not restrain him from felling timber, the produce being of course applied in ease of the estate (v). So if he unnecessarily pulls down buildings, and erects new buildings without the consent of the mortgagor, he is liable for any loss of rent which is thereby occasioned, and will not be allowed for lasting improvements and repairs, if the result of the whole is that the value of the property is not increased (w); and indeed, according to the judgment of the Master of the Rolls in the last mentioned case, he will not be allowed for substantial improvements, unless done with the consent of or acquiesced in after notice by the mortgagor (x). It may be almost superfluous to notice, that the mortgagee must take the estate subject to the acts of forfeiture, &c., committed by the mortgagor. If an authority for the position be requisite, the following (y) is in point:-an estate had, on marriage, been limited in strict settle Williams v. Price, 1 S. & S. 581. Gardiner v. Griffith, 2 P. Wms. 404; supra. (u) Hanson v. Derby, 2 Vern. 392. () Witherington v. Bankes, Sel. Ch. Ca. 31. (w) Sandon v. Hooper, 6 Beav. 246, affirmed on appeal, 14 L. J., Ch. 120, N. S.; et vide supra, Bk. 3, Ch. 4. (x) Sandon v. Hooper, supra; but see the same case on appeal. (y) Lady Whetstone v. Sainsbury, Pre. Ch. 591; sed vide Willis v. Fineux, ibid. 108. ment on the husband for life, with remainder to the wife for life, with remainder to their first and other sons in tail male. The husband concealed the settlement, and with his wife conveyed to a mortgagee in fee by lease and release and fine sur conuzance, &c. which was a forfeiture of their life estates. The mortgage was afterwards transferred to the plaintiff, and for further assurance a second conveyance and fine were executed and levied by the husband and wife. The husband died. The plaintiff filed his bill of foreclosure against the wife and eldest son, and to be relieved against the forfeiture. The son pleaded the settlement and insisted on the forfeiture by the fine, and the Court allowed the plea; but it ultimately appearing that the estates were equitable only, the Court held the fine to be no forfeiture, and ordered that the mortgagee should hold during the widow's life (z). It is a restriction also on the estate of the mortgagee, that he cannot compel the mortgagor to account for the past rents and profits. This matter has been already treated of(a); and in addition to the preceding remarks may be here noticed a case (b), the circumstances of which were, that a term of one hundred years, created to raise childrens' portions, had been assigned by the trustees by way of mortgage; the money was permitted to remain on the estate for many years. Under certain proceedings in Chancery distinct from the mortgage, a receiver had been appointed, and the surplus rents paid into Court. Part of the money was due when the term expired by effluxion of time; the mortgagee applied to the Court to be paid the remaining debt out of the fund in Court, but without success. And in a subsequent case, in which a receiver had been appointed in a suit in which the mortgagee was not a party, the latter applied for the rents paid into Court, on the ground that he was legally entitled to them. But his petition was dismissed, although he had given notice to the tenants to pay him the rents, which by reason of the appointment of the receiver was disregarded. The Court held, that his notice to the tenants could not devest the possession of the receiver, which was in fact the possession of those claiming under the mortgagor, and that for the purpose of devesting the possession of the receiver an application to the Court was necessary, which, it appeared, the mortgagee had some months before actually made, and had then obtained his removal. The petition was for the rents accrued between the time of the appointment of the receiver and his discharge. Against the decision, the mortgagee appealed to the Lord Chancellor, who dismissed the appeal with costs (c). A mortgagee has no right to shew the title of his mortgagor, and therefore cannot in general be compelled to produce the title deeds in the absence of the mortgagor (d); but it is otherwise on a bill of discovery filed in aid of an action at law brought against the mortgagee alone (e). And a mortgagor who has taken copies of the title deeds may be compelled to produce them in the absence of the mortgagee (ƒ). A mortgage by his client to an attorney for costs due and to become due, will be restricted to those actually due (g); but there is no objection to a security given to an attorney for a debt really due, or for a reasonable reward for services rendered (h). Nor is it unfair for an attorney to stipulate, on procuring money for his client on mortgage, that the security should cover the balance which should be found due to him on a settlement of accounts (i). And with respect to the rule as to future costs, a distinction may perhaps be drawn as to those cases where the client, being a trustee, stipulates that the attorney shall not make demand upon him personally, and agrees with him that, when funds are in hand, he shall be paid thereout such claim as he may have a right to make (k). Where a mortgage is to secure a floating account, but so that the principal monies recovered shall not exceed a certain sum, any money received by the mortgagee from the sale of parts of the premises, though the sale be made by the mortgagor with the mortgagee's consent, must go in reduction of the principal sum secured, and cannot be applied by the mortgagee in satisfaction of the general account (1). Where from the circumstances of the case, as on a mortgage from a son to his father without an indorsement on the deed of the receipt of the consideration money or memorandum of payment of interest, and without the usual covenants in the deed except for further assurance, the mortgage is construed to be not an absolute security for the sum expressed to be paid in the deed, but as a running security to that amount, the mortgagor, without evidence on the part of the mortgagce, can only be charged to the extent of his own admissions (m). (g) Williams v. Piggott, Jacob, 598. Pitcher v. Rigby, 9 Price, 79. (h) Creslyn v. Dalby, 2 Y. & C. 170. (1) Ibid. (k) Per Wigram, V. C., in Parsons v. Spooner, 5 Hare, 111. (1) Johnson v. Bourne, 2 Y. & C., N. R. 268. (m) Mellard v. Gray, 2 Y. & C., N. R. 199. B B BOOK THE FOURTH. CHAPTER I. OF NOTICE. THE doctrine of notice so materially affects the remaining part of our subject, that it will be requisite to direct our attention to it before we proceed further in our inquiry. Notice is express or implied; to which may be added, a third sort of notice, viz., notice by statutory enactment, which does not come within either of the first mentioned species: for express notice is an actual knowledge of a given fact, regularly and formally communicated; and implied notice is a conclusion of law from violent presumption, which the Courts will not allow to be controverted; but the third species arises neither from actual knowledge nor from legal presumption, but, on the contrary, would not be classed within either of those species, and is therefore made notice by legislative enactment. If a party having notice convey for a valuable consideration to one who has not notice, or if a party not having notice convey to one who has notice, the party taking the conveyance will not, in either case, be affected by the notice; for, in the first instance, he may defend himself by his want of notice (a), and, in the second instance, by the want of notice in the party through whom he claims (6). And, therefore, if A., having notice, sells to B., who has not notice, who sells to C., who has notice, B. is protected against the notice in A. by his own want of notice, and C. is defended by the want of notice in B. (c). Although in the case of charities within the 43 Eliz. c. 4, a purchaser of lands without notice is affected by notice in the person from whom he purchased (d). It is however laid down in Bacon's Abridgment (e), on the authority of a case in Vernon (f), that if one take a mortgage by assignment (a) Mertins v. Jolliffe, Ambl. 313. Ferrars v. Cherry, 2 Vern. 384. (b) Harrison v. Forth, Prec. Ch. 51; 1 Eq. Ca. Ab. 331. Sweet v. Southcote, 2 B. C. C. 66. Andrew v. Wrigley, 4 B. C. C. 125. M'Queen v. Farquhar, 11 Ves. jun. 478. (c) Lowther v. Carlton, 2 Atk. 139. Bradwell v. Catchpole, 3 Swanst. 78, note. (d) 3 Sugd. Vend. 945, 11th edit. (e) Vol. 5, p. 76. (f) Walley v. Walley, 1 Vern. 484. from a mortgagee affected with notice of an outstanding title, he will take subject to that title; for his assignor cannot transfer to him a better title than he has himself; and if such original mortgagee, in a bill filed by the person setting up an eigne title against the mortgagee and his assignee, and praying to be let into possession, and charging notice, confess by his answer that he had notice before the lending of the money, that confession of notice will bind his assignee; for though the mortgagee's answer cannot be read against the assignee as evidence, yet he must stand in his assignor's place, and his assignor's confession of notice will bind him. In this doctrine Mr. Powell acquiesces (g), and in support of it cites the case of Lord Pomfret v. Lord Windsor (h), in which an estate which was vested in trustees for raising a specific sum, was afterwards mortgaged with notice of that charge, and then a subsequent mortgage was made to one who had notice of the prior mortgage, but not of the antecedent charge, the Court held, the last mortgagee must take subject to the first charge. It is, however, submitted, that the case is not in point; for as the legal estate was outstanding, all the charges were alike equitable, and the question of notice did not, in fact, arise, and the reasoning of the Court on the point of notice (so far as it went), proceeded on a very different ground, riz., that as the persons having the equitable charge had a right to compel the first mortgagee who had notice of it to redeem them, then the first mortgagee, obtaining the legal estate from the trustees, would have a right to compel the second mortgagee to redeem both charges, or be foreclosed. Of this there could be no question; but to have rendered the case applicable to the point under discussion, the second mortgagee should have obtained an actual conveyance of the legal estate from the first mortgagee, and then, having the legal estate to protect himself, and having equal equity with the prior equitable incumbrancer, the question would have been fairly raised, whether, standing in the place of the first mortgagee quoad the legal estate, he was bound by the notice which his assignor had. To have decided this question in the affirmative, would apparently have been in contradiction to the well known equitable maxim, that, where equities are equal, the legal estate shall prevail, on which the doctrine of tacking, hereafter discussed, is chiefly grounded, and in opposition to many well considered cases in which that doctrine has been applied. A doubt, however, of a somewhat similar nature is said to have been thrown out by Lord Eldon in the case of Mackreth v. Symmons (i), before alluded to. In that case, Lord Eldon is reported to have put this question, whether there was any case in which a third mortgagee had excluded the second, if the first mortgagee, when he conveyed to the third, knew of the second. His lordship remarked, when the case of Maundrell v. Maundrell (k) was before him, he looked for, but could not find such a case, viz., that where there was bad faith on the part of the first mortgagee, that equity was applied. It is reported, that Sir Samuel Romilly answered, he did not believe that was ever decided, and there would be great difficulty in deciding it in favour of the third (g) 2 Powell on Mortg. 601, 4th edit. (h) 2 Ves. 485. (i) 15 Ves. jun. 335; supra, p. 210. (k) 10 Ves. jun. 246. |