Page images
PDF
EPUB

601. COVENANT of MORTGAGEE to PRODUCE DEEDS.

THAT, in case the said (mortgagor) shall at any time enter into any contract or agreement for the sale or mortgage of the mortgaged property, the said (mortgagee) will, at the expense of the said (mortgagor,) supply him with abstracts of the title-deeds, and permit the intended purchaser or mortgagee to compare the same with the originals.

602. No WARRANTY by STATUTE in the words "GRANT" and "EXCHANGE."

"NEITHER the word 'grant' nor the word 'exchange,' in any "deed, shall have the effect of creating any warranty or right of re"entry, nor shall either of such words have the effect of creating

[ocr errors]

any covenant by implication, except in cases where, by any act in "force in Upper Canada, it is or shall be declared that the word ""grant' shall have such effect." 12 Vic., c. 71., sec. 6.

SEMBLE that no such act is in existence.

Revised Statutes, 1859, CAP. LXXXIV., p. 878.

603. AN ACT respecting MORTGAGES of REAL ESTATE.

Her Majesty, by and with the advice and consent of the Legislative Council and Assembly of Canada, enacts as follows:

erty, &c., may

(1.) Any mortgagee of freehold or leasehold prop- Mortgagee of erty, or any assignee of such mortgagee, may take freehold propand receive from the mortgagor, or his assignee, a re- receive, release of the equity of redemption in such property, or lease, &c., may purchase the same under any power of sale in his without mergmortgage, or any judgment or decree, without thereby er of debt. merging the mortgage debt as against any subsequent mortgagee or registered judgment creditor having a charge on the same property. 14, 15 V., с. 45, s. 1.

(2.) In case any such prior mortgagee, or his assignee, When prior takes a release of the equity of redemption of the shall take remortgagor, or his assignee, in such mortgaged property, lease of equity or purchases the same under any power of sale in his of redemption, mortgage, or any judgment or decree, no subsequent &c., subsequent mortgagee, or his assignee, or registered judgment entitled to creditor, shall be entitled to foreclose or sell such foreclose or property, without redeeming or selling subject to the sell property

mortgagee

mortgagee not

without redeeming, &c.

rights of such prior mortgagee, or his assignee, in the same manner as if such prior mortgagee, or his assignee, had not acquired such equity of redemption. 14, 15 V., c. 45, s. 2.

Priority of mortgage and judgment (3.) This act shall not affect any priority or claim under registry which any mortgagee or judgment creditor may have act not to be under the registry laws. 14, 15 V., c. 45, s. 3. affected by this

act.

mortgage aс

(4.) On any proceeding for foreclosure by, or for redemption against, an assignee of a mortgagee, the In proceedings statement of the mortgage account, under the oath of for foreclosure, such assignee, shall be sufficient primâ facie evidence &c.. state of of the state of such account, and no affidavit or oath count may be shall be required from the mortgagee, or any interproved prima mediate assignee, denying any payment to such mortjacie by state- gagee, or intermediate assignee, unless the mortgagor, or his assignee, or the party proceeding to redeem, mortgage. denies the correctness of such statement of account by oath or affidavit. 14, 15 V., c. 45, s. 4.

ment on oath of assignee of

Executors of

(5.) When any person, entitled to any freehold or deceased mort- leasehold land by way of mortgage, has departed this life, and his executor or administrator is entitled to the money secured by the mortgage, or has assented to a mortgaged in bequest thereof, or has assigned the mortgage debt,

gagees may convey or re

lease the lands

certain cases.

such executor or administrator, if the mortgage money was paid to the testator or intestate in his lifetime, or on payment of the principal money and interest due on the said mortgage, may convey, release, and discharge the said mortgage debt, and the legal estate in the land; and such executor or administrator shall have the same power as to any portion of the lands, on payment of some part of the mortgage debt, or on any arrangement for exonerating the whole or any part of the mortgaged lands without payment of money, and such conveyance, release, or discharge shall be as effectual as if the same had been made by the person having the legal estate. 14, 15 V., c. 7, s. 8.

238

CHAPTER V.

OF CONVEYANCING SECURITIES.

NOTES.

BONDS.

604. A bond given as an original security for the payment of a certain sum of money is a very simple one; but, if the bond be given as a collateral security, the original security should be recited at the end of the condition for payment, so as to show that the sum secured by both is identical, and also the date, parties, &c., to the original should be set out; but, if the money is to be repaid by installments, the loan should be recited immediately after the exordium, and the manner in which it is to be paid, with a condition for avoiding the bond if such installments are duly paid.

605. Where the bond is by more than one obligor, or sureties, they should be severally as well as jointly bound; for, if only jointly bound and one of the obligors should die, his representatives would be wholly discharged at law, and in most instances in equity too.

Equity will however consider the intention of the parties: and therefore, if a joint and several bond was intended, and the parties were ignorant of the distinction between the two instruments; or if a joint bond is given for a partnership debt; or if it relates to transactions in which all the parties bound have been individually benefited, as where a joint bond is given to secure a banking account upon which several persons may receive advances; such bond will be sustained as joint and several, though on the face of it a joint bond only.

WARRANTS of ATTORNEY.

a

606. A warrant of attorney empowers certain attorneys to enter up judgment in double the amount intended to be secured, with defeasance that no execution shall be sued out until default made by the debtor. Where the warrant is given as a collateral security, a recital of such security should precede the defcasance.

POST OBIT BONDS.

607. Post obit bonds are generally accompanied by a warrant of attorney, in which the bond is recited. The bond itself has the usual exordium and penalty; then follows a recital of the agree

239

ment that, in consideration of $1000 now paid, the obligor is to pay the obligee, say, $2000 in the event of the obligor surviving some person named, on whose decease he is to succeed to property, with a condition for avoiding the bond if the obligor survives the person named and pay the $1000, or shall die in the lifetime of such person. In the latter event the obligee will lose his money.

The defeasance declares that it is given as security for payment to the obligee of the money secured by the bond in case the obligor should outlive the person upon whose decease it is to become payable, but that no execution shall issue unless that event take place, or if the obligor shall in such event pay the sum thereby secured and then payable.

If such obligation is given for the release of a pre-existing debt, the amount and nature of the debt should be set out, and the inability of the obligor to discharge it during the lifetime of the party upon whose decease the post obit payment is to be made, with the agreement of the obligee to release the obligor from the debt upon his executing the post obit bond, and also recital that such release has been given with a condition for avoiding the bond on payment of the money thereby secured within a certain time after the death of the person named, or by the decease of the obligor in his lifetime.

608. A power to redeem a post obit is sometimes reserved; and, as it is not easy to settle what may be an adequate sum for that purpose, the best way is to leave that to be determined by an actuary, thus:

"In case the said (obligor) shall at any time during the lifetime "of the said (person designated) be desirous to redeem the said "expectant sum of dollars, or any part of the same, and "shall give days' previous notice in writing to the said "(obligee,) his executors, administrators, or assigns, or leave the "same at his or their last or usual place of abode or business in "Upper Canada, and shall, at the end of days after such "notice shall be given, well and truly pay or cause to be paid unto "the said (obligee,) his executors, administrators, or assigns, such "sum or sums of money as the actuary for the time being of the society shall deem a reasonable price for such total or "partial redemption, as the case may be, at the time of such redemp"tion; and also if, in the event of any such total or partial redemp"tion as aforesaid, the said (obligor,) his heirs, executors, or admin"istrators, shall, within six calendar months next after the decease "of the said (person designated,) well and truly pay unto the said "(obligee,) his executors, administrators, or assigns, so much of the "said sum of dollars as shall not have been redeemed as "aforesaid; THEN, or in either of such cases, the above written "bond to be void, &c."

[ocr errors]

609. If the bond is to be kept sealed until the death of the party designated, unless redeemed before, and to be kept in the meantime in the custody of a third party, a written memorandum should set forth the terms of the deposit, and that the amount redeemed, if any, shall be indorsed upon the bond.

610. Further charges should never be taken without first ascertaining that no incumbrances have affected the property since the mortgage was executed. And, if more property be added by way of additional security, it is generally desirable in such case to take a power to redcem in parcels.

And, if household furniture, &c., is thus taken as additional security, care must be taken to comply with all the conditions of the statute. 20 Vic., cap. 3.

TRANSFERS of MORTGAGES.

611. The right of transfer is incidental to a mortgage, nor will the express dissent of the mortgagor have the slightest effect upon such transfer. Still it is better to have the concurrence of the mortgagor as a party, to prevent questions being raised at a future day as to the amount of money really due from him on the mortgage at the time of its transfer; for a mortgagor may set off any payments made by him on account of the mortgage against any transferree who, without his consent, takes a transfer of the mortgage; and even payments made after the transfer may be thus set off if the mortgagor has no notice of the transfer at the time of such payments. Nor will the fact of registering a deed of transfer be sufficient to fix a mortgagor with notice in England; but in Canada registration is notice in equity, by 13, 14 Vic., c. 63, s. 8.

612. Mortgagee is bound to account for the rents and profits as well after as before the transfer, if he assign without the concurrence of the mortgagor; and, therefore, if his assignce becomes insolvent, he will have to answer for those matters. If, however, the concurrence of the mortgagor cannot be had, every possible inquiry should be made to ascertain whether the whole mortgage debt is still due, and he should have notice of the transfer as soon as possible.

613. When the mortgagor does not concur the original mortgage should be recited, and that default has been made in payment, [if so,] and the amount remaining due. If the interest has been paid by third parties, or in any particular manner, that should be stated; as by tenants under notice from the mortgagee, or by representatives of a deceased mortgagor, and the same if any part of the principal has been so paid.

614. The claim of mortgagor's heir or devisee to have the mortgage debt discharged out of the personal estate was abolished in England by 17 and 18 Vic., c. 114. Formerly, if mortgagor himself created the debt, his personalty was charged with it; but, if

« EelmineJätka »