receive rent, or an acknowledgment of title, from his own tenant-a contingency undesirable in the interest of the mortgagor himself, as tending to diminish the mortgagee's security, and thus make him less willing to allow the mortgagor time for repayment of the loan.

Tacking.

CHAPTER XIV.

OF AN EQUITY OF REDEMPTION (continued).

In addition to those privileges of a mortgagee which have been mentioned in the previous chapter, there are two others, of a somewhat different nature, which will require a brief notice.

The first of these arises from the fact of the mortgagee's being the legal owner of the mortgaged estate. This is his right to "Tack;" that is, to annex to his original security another which he holds for a subsequent debt due in respect of the same property. If, for instance, A. has an estate conveyed to him by way of mortgage in the usual form, and subsequently, without notice of the existence of any other incumbrance on it, advances a further sum of money to the mortgagor on the security of the same estate, he will have a right to "tack" this last advance to his first, and claim payment of both before he re-conveys the property, even as against an incumbrancer who lent his money on the security of the equity of redemption, before A. made his further advance.

It will be obvious that this right to tack is a great advantage where the mortgagor is insolvent and the mortgaged estate is an insufficient security for all the money advanced on it by different persons. We will proceed, therefore, to consider the qualifications necessary to entitle a mortgagee to tack.

Before doing so, we may mention that the 7th

section of the Vendor and Purchaser Act, 1874 (a), for a short time did away with tacking in the case of any mortgage executed after the 7th August 1874. But the Land Transfer Act, 1875 (b), repealed this section as from the date at which it came into operation except as to anything duly done thereunder before the 1st January 1876.

gagee may tack,

The first requisite for tacking is that the person When a mortclaiming to exercise it must be in possession of, or Must have have the power to obtain the possession of, the legal legal estate. estate in the mortgaged property (c). For it is only in favour of a legal owner that an exception is made to the ordinary rule of equity, "that he who is first in point of time is to be considered as having the better right." The reason given for this exception is, that his right to be re-paid his further advance being equal (laying aside any question of priority) to the right of repayment of any other incumbrancer, Equity will not prevent him from availing himself, in order to obtain payment, of any advantage which he has in consequence of his possession of the legal estate in the mortgaged property. This reasoning cannot be called very satisfactory, and probably the best excuse that could be made for continuing the system of tacking is that given by a distinguished writer (d), namely that it has been so long established as to have become a rule of real property. It does not, as a rule, prevail in our colonies, even where the system of law is the same as our own; and in cases where it has been permitted, it would seem that the right to tack has been confined to the mortgagee himself (e), whereas our law (as we shall see presently) extends it to his assignee.

(a) 37 & 38 Vict. c. 78.

(b) 38 & 39 Vict. c. 87, s. 129.

(c) Brace v. Marlborough, 2 P. W. 490, 495.
(d) Story, Eq. Jur. § 414.

(e) Gordon v. Lothian, 2 Grant, 293.

Must have

made his

mortgaged pro

perty.

Next, the mortgagee must have made his advance advance on the on the credit of the mortgaged property. He will credit of the therefore, provided he possesses the other necessary qualifications, be clearly allowed to tack a subsequent advance if he has, at the time of making it, taken, by way of security, a second mortgage of, or further charge on, the same property. Before the passing of the present Judgment Acts (f) a mortgagee was allowed to tack, in like manner, a further advance secured by a statute or judgment given expressly for that purpose; for in such a case he was presumed, knowing that he had hold of the land by the mortgage, to have ventured his money upon a further security which, though it passed no present interest in the land, had the effect of a lien thereon (g). And his right to tack such an advance is still clearer if the judgment has been obtained since the passing of the Judgment Acts, and has been followed up by the measures required by those statutes, since such a judgment has the same effect as if the mortgagor had executed a written charge on the land (h). He may, if there are no other incumbrancers, tack advances secured only by bond, or by simple contract, against the mortgagor's heirs, or against his devisees beneficially interested (i), because these persons are liable for all the mortgagor's debts, to the extent of the value of his real estate. But bond, or simple contract, debts, since they give no peculiar remedy against the debtor's land, cannot be tacked against the mortgagor himself (), and still less against subsequent incumbrancers (k).

(f) 1 & 2 Vict. c. 110; 2 & 3 Vict. c. 11; 23 & 24 Vict. c. 38; 27 & 28 Vict. c. 112.

(g) Brace v. Marlborough, 2 P. W. 490, 493; Shepherd v. Titley, 2 Atk. 348, 351.

(h) 1 & 2 Vict. c. 110, s. 13.

(i) Coleman v. Winch, 1 P. W. 775; Rolfe v. Chester, 20 Beav. 610; Thomas v. Thomas, 22 Beav. 341; Carroll v. Robertson, 15 Grant, 173. (j) Archer v. Snatt, Str. 1106.

(k) Jones v. Smith, 2 Ves. 372, 376; and see Lowthian v. Hasel, 3 Bro. C. C. 161; Irby v. Irby, 22 Beav. 217.

securities in

Again, the mortgagee can only tack those securities Must hold which he holds in the same right. Thus (), where the same right. A. had advanced money on a leasehold estate, and B. subsequently made an advance on the equity of redemption of the same estate, and then died, leaving A. his executor: it was held that A., although both the securities were thus vested in him, could not tack them against incumbrancers whose rights had accrued between the time when A. and B. respectively had made their advances. The mortgagee's right to tack will not, however, be affected by the fact that the deed securing his further advance provided for the payment of other incumbrancers besides himself (m).

had notice of

Moreover, the mortgagee cannot tack if, at the Must not have time of his further advance, he had notice of the exist- subsequent inence of any intervening incumbrance; for his equit- cumbrance. able right to tack is expressly founded on the absence of such notice (n). And the right is lost, not only by actual notice (which must amount to more than a vague rumour (o)) given to himself, or his agent, by some person interested in the property (p); but also by constructive notice, such, for instance, as the knowledge obtained by his agent, counsel, or solicitor as such (q), provided such knowledge was acquired with reference to the same transaction (r), and that it was such as the agent or professional man might be expected to have communicated to him (s); including in this category knowledge of acts arising out

(1) Barnett v. Weston, 10 Ves. 130.

(m) Spencer v. Pearson, 24 Beav. 266.

(n) Brace v. Marlborough, 2 P. W. 490, 494.

(0) Wildgoose v. Wayland, Gould. 147; Jolland v. Stainbridge, 3 Ves. Senr. 478, 485.

(p) Barnhart v. Greenshields, 9 Moo. P. C. 18, 36; and see Natal Land, &c., Co. v. Good, L. R. 2 P. C. 121, 129.

(q) Le Neve, v. Le Neve, Amb. 436, 438; Atterbury v. Wallis, 8 De G. M. & G. 454. See also the Conveyancing Act, 1882 (45 & 46 Vict. c. 39, s. 3.)

(r) Warrick v. Warrick, 3 Atk. 290, 294; Re Smallman, Ir. R. 2 Eq. 34.

(s) Wyllie v. Pollen. 32 L. J. (Ch.) 782.