notwithstanding a declaration of trust was executed of the charge for the owner in fee, it was held, under the circumstances, to be merged (o); but where a person so entitled sells the estate free from incumbrances, he is estopped from saying that there was no merger (p). The merger takes place whether the union is of a legal or equitable charge with the inheritance (7). In Knight v. Frampton (r), where A., having an equitable fee in one moiety of an estate, paid off a mortgage of the entirety that had been created by B., who held the estate in trust for himself and A., and took the conveyance of the legal estate subject to the existing equity of redemption, it was held that there was not such an union in A. of the legal and equitable interest in his moiety as to entitle his wife to dower. In a case where a lady was entitled to a charge upon her father's estate, to which she succeeded as heir, and then shewed an intention to keep the charge alive, by taking a conveyance of the legal estate as mortgagee, and by charging an annuity on the estate and the mortgage, and then died; it was held that the charge was part of the testatrix's personal estate, and as such liable to probate and legacy duty, but was merged by the effect of her will, by which she charged the property in question with the payment of her debts, and the settlement of her father's affairs; the V. C. said, "the sums secured by the mortgages were debts due from her father, and, therefore, they were debts which the testatrix directed to be paid. How can they be better paid than by releasing or merging them?" (s). The reasoning in the above case does not, however, appear very satisfactory, and one would suppose that it would lead to the contrary conclusion. Where in such case of union of the estate and charge in one person, the interest of the party himself, or of those claiming under him require it, the charge will clearly be kept alive (t). lunatics. There is no equity in this respect as between the real and per- In case of sonal representatives who must take as fortune has directed; and accordingly in the case of a lunatic becoming entitled to a charge on his estate, it was held, as between the heir and next of kin of the lunatic, that the charge was merged, though it would have (0) Pitt v. P. 22 Beav. 494; 2 Jur. N. S. 1010. (p) Bulkeley v. Hope, sup. (q) Astley v. Milles, 1 Sim. 298; Gower v. G. 1 Cox, 53; Wyndham v. Earl of Egremont, Amb. 755. (r) 4 Beav. 10. (s) Swabey v. S. 15 Sim. 106, 502. (t) Faulkner v. Daniel, 3 Ha. 199; and see Forbes v. Moffat, sup. In case of infants. Acts which keep charge alive. Merger by what acts. been otherwise, if it had been more beneficial to the lunatic to keep the charge alive, as if wanted for the payment of debts (u). Where a lunatic was seised of Blackacre er parte paternâ, and of Whiteacre, which was mortgaged ex parte maternâ, and the produce of timber cut from Blackacre was applied in discharge of the mortgage, it was held that this estate should not be recouped (x). It seems to have been considered by Lord St. Leonards (1), after an elaborate review of the authorities, that if the Court in the exercise of a prudent management ordered payment of the charge out of the lunatic's property, by means of savings out of the real estate, the heir ought to hold free from the charge; but where real estate, subject to a mortgage, descended upon a lunatic, and the mortgage was by an order in lunacy paid off out of the personalty, on the death of the lunatic the amount was directed to be raised out of the real estate, and paid to the administrator as personalty (~). And in the case of an infant portionist becoming entitled to the lands in fee and dying under twenty-one, the charge was held to be part of her personal estate and to pass to the legatee, that construction being more beneficial to the infant, as it gave her the disposition of it before twenty-one (a). And where debts of a testator have been paid by the Court out of the income of an infant tenant in tail, a merger of the charge cannot be presumed (). As to what acts by way of declaration of trust, assignment, or otherwise, will be sufficient to keep the charge alive or merge it, see (c). A merger was shown by a release by the tenant for life(d); by a disposition of the estate without mention of the charge by will (e); or by mortgage (f); or settlement (g); but not by separate receipts of land-tax from the tenant as a subsisting charge after it had (u) Lord Compton v. Oxenden, 2 Ves. 261; 4 Bro. C. C. 306. (x) Anon. cited by Lord Eldon in Exp. Phillips, 19 Ves. 123. (y) Lord Leitrim v. Enery, 6 Ir. Eq. 357; following Exp. Grimstone, Amb. 706; Exp. Hinde, ib. n. (z) Re Leeming, 3 De G. F. & J. 43; 7 Jur. N. S. 115; and see sup. p. 239. (a) Thomas v. Kemeys, 2 Vern. 348, cited in 2 Ves. jun. 264; but this reason now fails since the Wills Act. (b) Alsop v. Bell, 24 Beav. 451. (c) Bailey v. Richardson, 9 Ha. 734 ; Hatch v. Skelton, 20 Beav. 453; Lord Selsey v. Lord Lake, 1 ib. 146; Gunter v. G. 23 ib. 571; 3 Jur. N. S. 1013. (d) Clifford v. C. 9 Ha. 675. (e) Swinfen v. S. 29 Beav. 199; 7 Jur. N. S. 89. (f) Pitt v. P. 22 Beav. 294; 2 Jur. N. S. 1010. (g) Johnson v. Webster, 4 De G. M. & G. 474; 1 Jur. N. S. 145. been redeemed (); it was by a settlement of the estate which was subject to the charge, providing that it should not be raised, though the puisne incumbrancer benefited was not a party (i). There will be no merger if it would prevent the operation of a trust; thus an annuity charged on an estate for the separate use of a married woman will not merge in a life estate to her in the same property (k). It seems that parol evidence of intention as to merger may given (1). be Parol evidence. Limitations. Time does not run against tenant for life in possession who pays Statute of off a charge, but does not show any intention of keeping it alive, under the 3 & 4 Wm. IV. c. 27, s. 40 (m). common. When two persons are entitled to a charge in moieties, and are Tenants in also tenants in common of the land on which it is an incumbrance, either may elect to take his share of the land unburthened with the charge, so as to oblige the other, if he wishes to have a moiety of the charge, to raise it out of his own moiety of the land (»). (5.) Judicature Act. By the Jud. Act (o), it is enacted that there shall not, after the Jud. Act. commencement of the Act, be any merger, by operation of law only, of any estate, the beneficial interest in which would not be deemed to be merged or extinguished in equity. Previous to this enactment there were many cases in which there was a merger at law but not in equity (p). The law is now the same in all Courts. The rule in equity as to merger may thus be shortly stated:- and, if no intention is declared, then upon presumption 2. Where the owner of an estate has a charge on it, which is (h) Blundell v. Stanley, 3 De G. & S. 433; 13 Jur. 998. See Neame v. Moorsome, 3 Eq. 91, M. R. (i) Farrow v. Rees, 4 Beav. 18. 847. (1) Astley v. Milles, 1 Sim. 341. (m) Burrell v. Earl of Egremont, 7 Beav. 205; Countess of Shrewsbury v. (n) Smith v. Frederick, 1 Russ. 200, (0) 36 & 37 Vict. c. 66, s. 25, sub-s. 4. (p) Bulkeley v. Hope, 1 K. & J. 482; 1 Jur. N. S. 864. the charge is kept on foot or not, equity presumes the charge to be merged. 3. But no such presumption arises, if there is some intermediate charge between his own charge and his ownership in fee, or a purpose beneficial to the owner can be answered by keeping the charge on foot, or if the owner declares his intention to keep it alive (7). 4. The rule is adopted in favour of the creditors of the person in whom these interests centre (»). 5. Where the prior incumbrancer purchases the fee, or the owner of the fee purchases the prior incumbrance, the merger has the effect of letting in an intermediate incumbrancer, often contrary to the intention (s). 6. Care, therefore, should be taken to keep the prior incumbrance alive by express declaration; although, at this day, the above authorities may have to be reconsidered (t). (9) Forbes v. Moffatt, 18 Ves. 384; Will. on Ex. 688, ed. 7, 695, ed. 8; Anderson v. Pignet, 8 Ch. 188. (r) Powell v. Morgan, 2 Vern. 290. (s) Toulmin v. Steere, 3 Mer. 210; Parry v. Wright, 1 S. & S. 369; 5 Russ. 142. (t) Stevens v. Mid-Hants R. Co. 8 Ch. 1069. CHAPTER LVIII. ASSIGNMENT OF MORTGAGE. 719 IN equity, the mortgage debt is the principal, the land the accessary. An assignment of mortgage is, therefore, in equity, a transfer of a debt with its attendant securities; and as the accessary always follows the principal, it results that when the debt is satisfied, the security is determined. same position as the mort On this principle the Courts hold, that on an assignment of Assignee in mortgage without the concurrence of the mortgagor, the assignee, standing in the place of the original creditor, is subject in all gagee. respects to the like equities and settlement of accounts as the mortgagee himself would be (a). gagor does The mortgagor not concurring in the assignment is not bound When mortby the amount appearing due on the face of the assignment (b). not concur. This doctrine has been confirmed by Lord Eldon (c), and may be considered as settled, as well in respect to payments before and after the assignment as also on a running account. The concurrence of the mortgagor in the assignment of a mortgage consequently should, if possible, never be dispensed with; and in cases Notice of assignment. in which, from unavoidable circumstances, an assignment is taken. from the mortgagee only, the precaution should be had of obtaining a covenant from the mortgagee, that the money alleged to be owing is actually due; and notice of the assignment should be given to the mortgagor with the least practicable delay. But see (d). cannot be The mortgagor not being bound by the settlement of account Interest between the mortgagee and assignee, à fortiori he cannot be preju- converted into diced by any agreement between them to increase the amount of principal. (a) Earl of Macclesfield v. Fitton, Vern. 169; 1 Ch. Ca. 68; Matthews v. Wallwyn, 4 Ves. 118; Williams v. Sorrell, ib. 389; Bradwell v. Catchpole, 3 Sw. 79, note. (b) Williams v. Sorrell, sup. (e) Chambers v. Goldwin, 9 Ves. 254. (d) Jones v. Gibbons, 9 Ves. 410; Banfather's Case, 16 Ch. D. 187, V. C. Malins. |