CHAPTER IV.

MORTGAGES OF COPYHOLD OR CUSTOMARY ESTATES.

Mortgages of copyholds, how effected.] - Mortgages of copyhold estates are usually effected either by an actual surrender, with a condition or defeasance annexed thereto for avoiding the surrender on payment of principal and interest upon some appointed day, or by a simple covenant of the mortgagor to surrender to the mortgagee's use; added to which, a bond is sometimes given by the mortgagor by way of an additional or collateral security. But a copyholder cannot make a mortgage by demise, being unable to create such an interest without the licence of the lord; and his attempting to do so would be a forfeiture of his estate: (Mathews v. Wheaton, 6 Vin. Abr. 119.)

Advantages of an actual surrender.]—As the legal estate in copyholds can only pass by an actual surrender and admission, this mode of assurance necessarily affords the safest and most eligible security.

How and when surrender may be made.]—The surrender may be made either at a general, or a special, court; but the best plan is to call a special court, and effect the surrender there.

How surrender should be expressed to be made.]--The sur render should be expressed to be made upon condition to be void upon payment of principal and interest on a given day: (see the form 2 Con. Prec., Part V., Section IV., No. I., p. 195, 2nd edit.) The defeasance may be, and in fact often is, made by a separate instrument: (see the form 2 Con. Prec., Part V., section IV., No. V., p. 210, 2nd edit.) The disadvantage attending the latter plan is, that if the defeasance should happen to be lost, the mortgagor might find some difficulty in proving the condition, whilst

the surrender on the court rolls would appear upon the face of it to have been made absolutely.

very

Covenants and powers of sale usually contained in a separate instrument.]-The mortgage covenants, as also the powers or trusts for sale (if any), and any other matters connected with the mortgage, should be contained in a separate deed; for the court rolls ought not to be incumbered with entries of this nature: (see the form of a covenant of this kind 2 Con. Prec., Part II., Section IV., No. II., p. 197, 2nd edit.)

Mortgagee often satisfied to rely upon a covenant to surrender.]-But it often happens that a mortgagee is satisfied to rely upon a mortgagor's simple covenant to surrender, although it is open to the objection that, as such covenant is capable only of passing an equitable interest, the estate is not bound at law, so that, if the mortgagor was afterwards to make a surrender to the use of a subsequent purchaser or mortgagee for valuable consideration who had no notice of such prior incumbrance, the latter would be entitled to a priority on the ground of having both law and equity on his side: (Oxwick v. Plumer, 5 Bac. Abr. edit. Gwill: 43.) Its advantages are, that it saves some expenses to the mortgagor; as, upon the paying off the mortgage, evidence of such payment and redelivery of the mortgage deed will be sufficient to discharge the equitable claim upon the property, which was all that the assurance embraced; whereas, if a surrender had been actually made, and the mortgagee duly admitted thereupon, there must have been a resurrender, and a readmittance of the mortgagor, who must of course have borne the whole of these expenses.

Admission generally delayed upon surrender to mortgagee's use.]-But even where a surrender has been duly made, the mortgagor's admission is usually delayed with a view of saving expense, which a mortgagee may safely permit, as his security will not be prejudiced by a delay in obtaining admission, where a presentment has been duly made, any further than that, until he does actually get admitted, he has no legal title, and consequently is unable to maintain ejectment or the recovery of the mortgaged premises. But, although admission may be delayed without endangering the mortgagee's interest, the presentment of the surrender should be made immediately, lest it should be avoided by delay, and thus a new presentment become necessary: (Fawcett v.

Lowther, 2 Ves. 300.) But if the presentment be made in due time, both the lord and steward are fixed with notice of the transaction, and mesne and subsequent incumbrancers are thus deprived of their preference; for the admission on a duly presented surrender will relate back to the time when such surrender was made, and thus avoid all intermediate dispositions to the prejudice of the first surrenderee. And although an unadmitted mortgagee upon a conditional surrender is incapable of maintaining ejectment, he may nevertheless exercise a power of sale conferred upon him by the mortgage deed; nor will a fresh surrender be necessary in a case of this kind, as the purchaser, upon the power being exercised, will be in under the original surrender: (Beal v. Shephard, Cro. Jac. 199; Rex v. Lord of the Manor of Oundle, 1 Ad. & Ell. 283.) It appears, however, that in some manors a special custom prevails, by which the lord may compel the admission of the mortgagee, immediately after the condition is broken, for the purpose of exacting the fine.

How deed of covenant to accompany surrender should be penned.]-The deed of covenant to accompany a surrender, after setting out the date and description of the parties, recites the agreement for loan, and also the conditional surrender and agreement that the mortgagor should enter into the covenants thereinafter mentioned; the mortgagor then covenants to pay principal and interest, and all outgoings in respect of the mortgaged premises, with power of sale in default, followed by absolute covenants that he has good right to surrender; for quiet enjoyment and freedom from incumbrances, and for further assurance; and the mortgagee enters into the usual qualified convenants that mortgagor shall enjoy until default, and that mortgagee will not exercise power of sale without giving mortgagor due notice thereof: (see the form 2 Con. Prec., Part V., Section IV., No. II., pp. 197, 200, 2nd edit.)

How deed of defeasance should be penned where mortgagee has been actually admitted tenant.]-If the mortgagee has been actually admitted tenant to the mortgaged premises, the deed of defeasance, after describing the parties, should recite the surrender by the mortgagor to the mortgagee's use, and the admission of the latter to the mortgaged premises, and that such surrender was made by way of mortgage security. It must also be declared that the said surrender shall enure to the mortgagee's use, subject to redemption

upon payment of principal interest and costs, with power of sale in default of payment, and the other usual mortgage covenants, in the same way as where the mortgage is by way of conditional surrender only: (see the form 2 Con. Prec., Part V., Section IV., No. V., pp. 210, 211, 2nd edit.)

Where the mortgage is by way of covenant only.]—-Where the mortgage rests upon a simple covenant from the mortgagor to surrender, the previous surrender to the mortgagor's use, and his admission to the copyhold premises, is first recited; and then the agreement for the loan. The mortgagor next covenants to surrender to the mortgagee's use, and that in the meantime, until such surrender shall be perfected, the mortgagor will stand possessed of the mortgaged premises in trust for the mortgagee his heirs and assigns. Then follows a proviso for redemption; powers of sale in default of payment; with the same mortgage covenants as upon a mortgage where a conditional surrender has been actually made: (see the form 2 Con. Prec., Part V., Section IV., No. III., pp. 201, 206, 2nd edit.)

Where conditional surrender is accompanied by a bond.]— Where a bond is added by way of collateral security to a conditional surrender of copyholds, the instrument, after the usual exordium (in which the mortgagor binds himself in a penalty in double the amount of the money advanced upon the mortgage), recites the surrender to the mortgagee's use, and that the bond itself is to be given by way of collateral security, with a condition for avoiding the bond in case the mortgagor shall pay the principal and interest at the appointed time, and if he had good right to surrender; and if, in case of default, the mortgagee, after being duly admitted tenant, shall peaceably enjoy the mortgaged premises free from incumbrances, and the mortgagor shall execute such further assurances as the mortgagee shall require: (see the form 2 Con. Prec., Part V., Section IV., No. IV., p. 207, 2nd edit.) The covenant that the mortgagor shall enjoy until default must be left out, as it will be out of place in any part of the bond, but it may be inserted in the conditional surrender, unless the steward, as he may if he pleases, should refuse to permit this insertion; in which case the covenant must then rest on a tacit understanding of the parties, which will raise a species of tenancy at will, or by a declaration of trust, which in equity will be binding on all parties.

Where the mortgage is of an equity of redemption.]—If the mortgage is of an equity of redemption of copyholds, the proper mode of assurance is by deed of release of the mortgagor's equitable estate in the premises; for a mortgage of an interest of this nature in copy holds will pass by deed without any surrender: (Rex v. Lord of the Manor of Hendon, 2 T. Ř. 484.) The mortgage deed must also contain a covenant from the mortgagor that he will stand possessed of the mortgaged premises, subject to the pre-existing mortgage, in trust for the second mortgagee; and that, in case the first mortgage is redeemed, the mortgagor will surrender the mortgaged premises to the second mortgagee's use: (see the form 2 Con. Prec., Part V., Section V., No. IX., p. 226, 2nd edit.)