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Conveyauce third part; after divers recitals, whereby (amongst other Gage"0wtith thing3) it appeared, that there was then due by the said Power Of W. T. to the said J. B. and J. W., the sum of £ (6):
'. It Was Witnessed, that in consideration of the sum of
£ , paid by the said A. B., by the direction of the
said W. T. to the said J. B. and J. W., and for a nominal consideration, the said J. B. and J. W. did release, and the said W. T. did grant, release, and confirm, and also, by virtue of every power and authority enabling him in that behalf, direct, limit, and appoint unto the said A. B., his heirs and assigns, the hereditaments therein mentioned, (including the hereditaments hereinafter particularly mentioned and intended to be hereby released), to hold the same unto and to the use of the said A. B., his heirs and assigns for ever, subject to the proviso thereinafter contained for redemption of the same premises, on payment by the said W. T., his heirs, executors, administrators, or assigns, to the said A. B., his executors, administrators, or
assigns, of the sum of £ , with interest for the same,
after the rate of 51. per cent, per annum, on the day
—with power of then next ensuing: And it was by the said in
denture declared, that in case default should happen to be
made in payment of the said sum of £ , or the interest
thereof, or any part of the same respectively, at the time and in the manner mentioned in the proviso lastly thereinbefore contained for payment thereof, contrary to the true intent and meaning of the said indenture, then it should be lawful for the said A. B., his heirs, executors, administrators, or assigns: [recites, verbatim, the power of sale, with the power for the mortgagee to give receipts, and the clauses
(b) The instrument recited in the text is a transfer of a mortgage. It is not essential to commence the recitals with the original mortgage, because the statements, that the debt was due from W. T. to J. B. and J. W., and that it was paid off by A. B., by direction of W. T., and that J. B. and J. W. conveyed, by the direction of W. T., coupled with the proviso for redemption, sufficiently shew that the equity of redemption belonged to W. T. As the sale is made by a mortgagee under a power, and the mortgagor does not join in the conveyance, it is needless to shew what has become of the equity of redemption, since the date of the mortgage.
Recital of transfer of mortgage.
exonerating the purchaser from seeing to the propriety of Conveyance the sale] (c): And Whereas, default having been made in „agee°with
payment of the said sum of £ (d), at the time in the Power Op
said indenture appointed for payment thereof, the said'
A. B., pursuant to the said power of sale given to him, as 1^0TM,"'purhereinbefore is mentioned, caused the said hereditaments suance of hereinafter particularly mentioned and intended to be here- power' by released, together with other hereditaments included
in the said indenture of the day of , to be
put up for sale, by public auction, on the day of
•, by a particular of sale, in four lots, the fourth lot
comprising the said hereditaments intended to be hereby released: And Whereas, at the said sale, the said C. D. —purchase at was the highest bidder for, and was declared the purchaser the auction; of, the said hereditaments, comprised in the said fourth lot, for the price or sum of £2,000, and immediately after the said sale paid the sum of £400 to or on accouut of the said A. B., by way of deposit, and in part payment of the said sum of £2,000: And Whereas the said purchase was —that purchase made by the said C. D., as agent for the said E. F., and aiTagem!by the said sum of £400, so paid by way of deposit as aforesaid, was money belonging to the said E. F.: NOW THIS Witnesseth.
(c) The purchaser's counsel will have satisfied himself, before he Manner of recomes to draw the conveyance, that the power of sale is effective- citing the The mortgagee takes the legal estate by the mortgage, and, of course, ^"mortgage16 can convey it to the purchaser; the question is as to defeating the equity of the mortgagor. For this purpose, it is chiefly essential to see that the mortgagee's receipt is made a valid discharge to purchasers, and that the purchasers are absolutely exempted from the necessity of ascertaining that money is due on the mortgage—that the required forms of sale (if any) have been complied with,—and that the sale is regular in every respect. All the clauses which protect the purchaser, and enable the power of sale to be effectuated, should be set forth literally.
(d) As the power of sale (when effective) frees the purchaser from the necessity of ascertaining whether default has been made in payment of the mortgage money, perhaps it is not right to recite that default has been made in payment. It is, however, usual to do so, and consequently the form has been suffered to remain.
BY MORTGAGEE, WITH POWER OF SALE.
Reference to power.
INDENTURE WITNESSETH, that, for effectuating the said sale, and in consideration of the said sum of £400 so paid by the said C. D. for and on behalf of the said E. F., by way of deposit, as hereinbefore is mentioned; and also in consideration of the sum of £1,600 at or immediately before the sealing and delivery of these presents, to the said A. B. paid by the said E. F., (the reeeipt of which said sums of £400 and £1,600, making together the said purchase-money, or sum of £2,000, he the said A. B. doth hereby admit and acknowledge, and of and from the same and every part thereof doth acquit, release, and discharge the said E. F., and also the said C. D., their and each of their heirs, executors, administrators, and assigns for ever, by these presents), and pursuant to (e) and in exercise and execution of the said power to him the said A. B. for this purpose given by the said indenture of the 21st day of March, 1835, as hereinbefore is mentioned, and of all other power or authorities in anywise enabling him in this behalf, he the said A. B., with the privity and consent of the said C. D., (testified by his being a party to and executing these presents), hath released, and by these presents doth release unto the said E. F., (in her actual possession, now being by virtue of a bargain and sale thereof to her made by the said A. B., in consideration of &c, [see Precedent XVI.]), and his heirs, All That, &c, [parcels, general words]: To Have And To Hold the said and hereditaments, and all and singular other the premises hereby released, or expressed and intended so to be, unto the said E. F. and her heirs, (freed and discharged of and from the said principal sum of £ , and every part there
(«) The words "by force and virtue," which are generally employed in referring to a proper power, (see ante, Precedents XVII. and XXI.), seem to be correctly omitted in this place. For the mortgagee conveys his estate by virtue of his legal interest, and does not appoint it under a power to declare new uses of it; and although it is by virtue of the power that the estate is discharged from the equity redemption, the difference in the mode of reference seems to be appropriate.
of, and all interest now due, or to grow due for the same or Conveyance
T -» B gY MORT"
any part thereof), to the use of the said E. F., her heirs GAGEE) WItH and assigns for ever (/): And The Said A. B. doth here- Power Of
by for himself, his heirs, executors, and administrators,
covenant with the said E. F., her heirs and assigns, that vendo*nthat he he the said A. B., hath not at any time heretofore made, j? not prevented done, committed, or executed, or knowingly or willingly * g'
permitted or suffered, or been party or privy to any act, deed, matter, or thing whatsoever, whereby, or by reason or means whereof [he is in anywise hindered or prevented from releasing] the said hereditaments and premises hereinbefore released or expressed and intended so to be, [unto and to the use of the said E. F., her heirs and assigns, in manner aforesaid, according to the true intent and meaning of these presents, or whereby or by reason or means whereof^), the said hereditaments and premises], or any of — against inthem, or any part thereof, are, is, can, shall, or may be cumbrances, impeached, charged, affected, or incumbered in title, estate, or otherwise howsoever. In Witness &c.
(/) In conveyances to femes sole, it has been usual to limit the estate to them in fee. But before the statute 1 & 2 Vict. c. 110, it would have been more correct to have given them a power of appointment, in order to overreach any judgments recovered against them. Even now, in some cases, the power would be useful; (see ante, Precedent XVII., p. 205, note (a) ). The limitation in default of appointment, would be to the purchaser in fee.
(ff) The words in brackets are not always used. (See ante, Precedent XXI., note (n) ). They are not of very much moment, for the subsequent words of the covenant are probably sufficiently general to include the meaning of those within the brackets. If this covenant is used when the conveyance is not in fee, for " unto and to the use of the said E. F., her heirs and assigns," should be substituted, " to the uses and."
CONVEYANCE by MORTGAGEE AND TRUSTEE, FOR SALE.
Recital of mortgage.
On keeping on foot incumbrances, for the benefit of a purchaser.
CONVEYANCE by a Mortgagee and a TrusTee for Sale of the Equity of Redemption; the Mortgage being Kept On Foot for the Benefit of the Purchaser (a).
THIS INDENTURE, made &c. Between A. B., of &c, [mortgagee], of the first part; C. D., of &c, [trustee for sale], of the second part; E.F., of &c., [purchaser], of the third part; and G. H., of &c, [trustee for the purchaser], of the fourth part: Whereas, by an indenture of release,
bearing date the — day of , grounded on a lease for a
year, and made or expressed to be made between M. N.,
(a) If there be two or more mortgages on an estate, and the owner of the first mortgage, or of any of the first mortgages, purchases and takes a conveyance to himself of the equity of redemption, he cannot afterwards set up his mortgage against any of the subsequent incumbrances of which he had notice. (Toulmin v. Steeve, 3 Mer. 210; Brown v. Stead, 5 Sim. 535; see, too, Smyth v. Phillips, 1 Keen, 694). But it seems that if a purchaser actually keep on foot a prior mortgage to which he may be entitled, or any mortgages which he may pay off, he will be entitled to the benefit of them against subsequent incumbrancers. (Party v. Wright, 1 Sim. & Stu. 369; S. C. 6 Russ. 142). The distinction, as Sir Edward Sugden observes, is a very subtle one, but being established, it becomes necessary for any purchaser who has reason to suspect the existence of incumbrances subsequent to any mortgages which he may pay off, to have these mortgages kept on foot for his protection. If he simply pays them off in the usual way, he loses the protection they afford.
Mortgages may be kept on foot in a variety of ways, but the manner in which the object is effected in the Precedent in the text is, perhaps, as good as any. The inconvenience is, that it leaves the legal estate outstanding in the trustee.
The legal estate might be limited to the purchaser in trust, in the first place, for securing the mortgage debt to the trustee, and subject thereto for the benefit of the purchaser himself.