Equitable Mortgage

A lien upon real estate of such a character that it is recognized in equity as a security for the, payment of money and is treated as a mortgage. A mortgage of a merely equitable estate or interest is also so called. Such a mortgage may exist by a deposit with the lender of money of the title Tdeeds to an estate; Story, Eq. Jur. § 1020; Bisph. Eq. 161; 1 Bro. Ch. C. 269; 17 Ves. 230; Mandeville v. Welch, 5 Wheat. (U. S.) 277, 5 L. Ed. S7; 20 Beav. 607. They must have been deposited as a present, bona fide security; 1 Washb. R. P. 503; and the mortgagee must show notice to affect a subsequent mortgagee of record; Hall v. Mc Duff, 24 Me. 311; 3 Hare 416; Story, Eq. Jur. § 1020. Such mortgages are recognized in some states; Hall v. Mc Duff, 24 Me. 311; Williams v. Stratton, 10 Smedes & M. (Miss.) 418; Hackett v, Reynolds, 4 R. I. 512; but under the usual system of the registration of deeds are of infrequent occurrence. The doctrine is repudiated in many jurisdictions; Lehman, Durr & Co. v. Collins, 69 Ala. 127; Pierce v. Parrish, 111 Ga. 725, 37 S. E. 79; Gothard v. Flynn, 25 Miss. 58; Bloomfield State Bank v. Miller, 55 Neb. 243, 75 N. W. 569, 44 L. R. A. 387, 70 Am. St. Rep. 3S1; Harper v. Spainhour, 64 N. C. 629; Hackett v. Watts, 138 Mo. 502, 40 S. W. 113; on the ground that it would tend to embarrass lands with secret trusts; Lehman, Durr & Co. v. Collins, 69 Ala. 127; as coming in conflict with the statute of frauds, which provides that all agreements for the sale of land, etc., should be in writing, etc.; Williams v. Stratton, 10 Smedes & M. (Miss.) 41S; and as being contrary to acts for the recording of mortgages,. and for recording liens for public information; Shitz v. Dieffenbach, 3 Pa. 233. In Georgia the code declares that the delivery of title deeds creates no pledge; Davis v. Davis, 88 Ga. 191, 14 S. E. 194. When, however, a written agreement accompanies the deposit of the title deeds, such agreement may become the basis for an equitable lien; Woodruff v. Adair, 131 Ala. 530, 32 South. 515. No particular formality is necessary in order to make a valid mortgage between the parties thereto; Frick v. Fritz, 115 la.

438, SS; N. W. 961, 91 Am. St. Rep. 165.

If the transaction resolves itself into a security, whatever may be its form, in equity it is a mortgage; Flagg v. Mann, 2 Sumn. 533, Fed. Cas. No. 4,847. A lien created by contract and not sufficient as a legal mortgage, will generally be regarded as partaking of the nature of an equitable mortgage; Kyle v. Belleuger, 79 the nature of the transaction, and give effect to it, as such, in furtherance of the ment of the parties, if there appears an intention to create a security; Wood v. Holly Mfg. Co., 100 Ala. 326, 13 South. 948. -if, Am. St. Rep. 50. The form of the writing is not important provided it sufficiently appears that it was thereby intended to create a security; Howard v. Iron & Land Co., G2 Minn. 298, 64 X. W. 896; and to the same effect, Higgins v. Manson.

11"; Gal 407, 58 Pac. 907, 77 Am. St. Rep. 192; Martin v. Rowen, 51 N. J. Eq. 452, 26 Atl. 823; Dulaney v. Willis, 95 Va. 006, 29 S. E. 324, 04 Am. St. Rep. 815; Hackett v. Watts, 138 Mo. 502, 40 S. W. 113.

To place in the hands of another a deed to real estate, together with a written memorandum stating that the property is pledged to secure the other against loss from i Ing a surety for the owner, will create an equitable lien enforceable against the owner's assignee for creditors; In re Snyder, 138 la.

553, 114 N. W. 015, 19 L. R. A. (N. S.) 206.

Such a mortgage has been said to exist in favor of the vendor of real estate as security for purchase-money due from the purchaser; in which case a lien is recognized in some jurisdictions; 15 Ves. 339; 1 Bro. Ch. C. 420, 424, n. It is occasionally spoken of as an equitable mortgage; Moreton v. Harrison, 1 Bland (Md.) 491, though it is doubtful if it is to be so considered. It is properly termed vendor's lien, which see. See also Lien.