Security for future advances.—A security for the payment or repayment of money to be lent, advanced, or paid, or which may become due upon an account current, either with or without money previously due, is charged, where the total amount secured or to be ultimately recoverable is in any way limited, with the same duty as a security for the amount so limited. Where such total amount is unlimited, the security is available for such an amount only as the ad valorem duty impressed thereon extends to cover ; but where an advance or loan is made in excess of the amount covered, by that duty the security, for the purpose of stamp duty, is deemed to be a new and separate instrument, bearing date on the day on which the advance or loan is made. No money, however, is reckoned as forming part of the amount in respect whereof the security is chargeable with ad valorem duty, which is :—advanced for the insurance of property comprised in the security against fire ; or for keeping up a policy of life insurance comprised in the security ; or for effecting in lieu thereof a new policy ; or for the renewal of a grant or lease of property comprised in the security upon the dropping of any life whereon the property is held.
Exemption in favour of benefit building societies.—The old-standing statutory exemption from stamp duty in favour of benefit building societies does not extend to any mortgage made after the Slst July 1868, except a mortgage by a member of a benefit building society for securing the repayment to the society of money not exceeding five hundred pounds.
Eights during subsistence of the security.—Generally.—The mortgagor is entitled to possession of the property notwithstanding he has conveyed it to the mortgagee, but during that possession he must not only pay the interest and observe and perform the covenants and conditions con tained in the mortgage, but also have regard to certain restrictions im posed by statute upon his dealing with the property. He has, for example, only a restricted right to grant leases, as to which particular reference will be made presently. As a rule, however, he can exercise all the rights of ownership, sue for rent, and recover damages for trespass, for examples. But these rights only exist as incidental to his characteristic right to redeem the property, and consequently when that right is lost the in cidental and collateral rights have gone also. This right to redeem, or equity of redemption as it is more technically termed, is expressed in the mortgage deed by the proviso that if the principal and interest are paid in accordance with the covenant, the property mortgaged shall, at the request and cost of the mortgagor, his heirs or assigns, be re conveyed to Idni or them. It is really a right to call for a reconveyance of the property upon payment of the principal and interest. And even though he has further encumbered the property, the mortgagor can re quire the mortgagee, instead of reconveying, to assign the mortgage debt and convey the mortgaged property to a third person. And each further encumbrancer has the same right ; but a requisition by an encumbrancer prevails over one by the mortgagor, and, as between encumbrancers, a requisition of a prior encumbrancer prevails over a requisition of a subs sequent encumbrancer.
No mortgage can by any stipulations between the parties be made irredeemable. "Once a mortgage, always a mortgage" is an old-standing and inflexible principle of equity. "Whenever," said Lord-Justice Bowen, "a transaction is in reality one of mortgage, equity regards the mortgage property as security only for money, and will permit of no attempt to clog, fetter, or impede the borrower's right to redeem." No mortgage deed is allowed to provide that the property mortgaged shall become, in any event whatsoever, an absolute purchase by the mortgagee. Such a stipulation would be said to "clog the equity of redemption," and would accordingly be of no effect. This rule, however, would not in validate a bond fide conveyance on sale containing a provision conferring upon the vendor a right to repurchase within a limited time. But the Court would regard the instrument very carefully in order to see that the transaction was not really a mortgage. It would even allow the person claiming to be mortgagor to give parole evidence as to the true nature of the transaction. A mortgagor may be bound by a covenant not to pay of the mortgage within a specified but limited period of time, "for although the law will not allow a mortgagor to be precluded from redeeming altogether, yet he may be precluded from redeeming for a fixed period, such as five or seven years." Twenty years has been dis allowed by the Court. The mortgagor is also entitled from time to time at reasonable times, to inspect and make copies or abstracts of, or extracts from, the documents of title relating to the mortgaged property in the custody or power of the mortgagee ; but he can only do this at his own cost, and on payment of the mortgagee's costs and expenses. He is entitled to redeem any one mortgage without paying any money due under any separate mortgage made by him, or by any person through is hom he claims, on property other than that comprised in the mortgage which he seeks to redeem. But this right can be excluded by covenant in any of the mortgage deeds. A mortgagee may make a deduction from the amount advanced, as a bonus, commission, or consideration for the peculiar nature of the particular transaction. But such a deduction would seem to be subject to review by the Court. And so subject would be any unusual stipulations for profit to the mortgagee beyond his principal and interest. And it may be taken as fairly certain that the Court would disregard and set aside any stipulation conferring upon the mortgagee a collateral advantage beyond his principal and interest. If for example a mmtgagor obtains an advance from a mortgagee who is an auctioneer, and the deed contains a stipulation in consideration of the advance that the mortgagee alone shall be entitled to sell the pro perty and receive his commission for so doing, that mortgagor can safely disregard the stipulation and employ whom he pleases. It is only by virtue of the Mortgagees' Legal Costs Act, 1895, that even a solicitor, who is himself the mortgagee, can obtain under the mortgage any profit costs in respect of his professional labour in the matter.