MORTGAGE. A conveyance of real estate or assignment of personal property, without parting with the possession in either case, by way of hypothecation as security for the Performance of some act, usually the pay ment of money, and treated at law as a con veyance or assignment, but in equity as a lien.
The conveyance of an estate by way of pledge for the security of debt, and to be come void on payment of it. 4 Kent 136.
An estate created by a conveyance abso lute in its form, but intended to secure the performance of some act, such as the pay ment of money, apd the like, by the grantor or some other person, and to become void if the act is performed agreeably to the terms prescribed at the time of making such conveyance. 2 Washb. R. P., 5th ed. *475.
A conditional conveyance of land design ed as a security for the payment of money, the fulfilment of some contract, or the per formance of some act, and to be void upon such payment, fulfilment or performance., Mitchell v. Burnham, 44 Me. 299.
A contract by which specific property is hypothecated for the performance of an act without the necessity of a change of pos session. Sandmeyer v. Ins. Co., 2 S. Dak. 346, 50 N. W. 353. It is a mere security for a debt or obligation ; Cook v. Bartholomew, 60 Conn. 24, 22 Atl. 444, 13 L. R. A. 452 ; Cleveland, P. & A. R. Co. v. Pennsylvania, 15 Wall. (U. S.) 322, 21 L. Ed. 179.
"A concise definition of mortgage which should embrace both its equitable and its le gal character is virtually impossible. . . . These attempted definitions are all errone ous upon any theory of the instrument ; they do not go beyond the literal import of the language in which a mortgage is usually expressed, and they utterly ignore all the equitable elements which are, as much Saud as truly constituent parts of the mortgage as the legal elements. Any true definition bas ed upon the original common law and equi table system must embody and express all the double features of the mortgage—that it is both a lien in equity and a conveyance at law." Pomeroy, Eq. Jur. § 1191.
The first definition, supra, is an attempt to do what Pomeroy here says is "virtually impossible." It is, however, to be noted that advantage has been taken of his criticism of the definitions generally, and an effort made to supply what he pointed out as their deficiencies.
Scientific legal writers reckon among proprietary rights "jura in re aliena," i. e. rights of dominion over tangible things of which the fundamental prop erty right is In another. Of such rights the most important is Pledge, which, in this sense, covers those legal relations in which a right in rem Is conferred by a debtor upon a creditor ae security for a right in personam, i. e. for the debt or other personal obligation of the debtor ; Holland, Jurispr. ch. xi. Practically we distinguish these securities as Mortgage, when the debtor transfers the title to the res to his creditor, retaining the possession of it, and Pledge, when he retains the title but trans fers the possession. See PLEDGE.
Mortgage is the translation of radium mortuum dead pledge, so named because the land was turn ed over to the mortgagee or lender of the money, who received the profits or revenues of It without applying them in satisfaction of his debt, and the land thus became dead to the mortgagor or borrow er who derived no benefit from it. This Was' re garded as In the nature of usury on the part of the lender and was looked upon with disfavor, in modern pharse as contrary to public policy. In contrast to this was radium vivum, or live pledge, under which the borrower continued in possession of his property, receiving the profits or revenues of it. Another explanation of the words Is that in the radium mortuum the pledge was dead to the borrower If he failed to redeem, but in, the other was alive to him until the lender secured posses sion of it on default ; I Coate, Mortg., 4th ed. 6;
Co. Litt, 206. (In the case of Welsh mortgages, now disused, the mortgagee entered into possession, taking the rents and profits, but applying them on account of the debt.) In attempting to avoid the difficulty lenders devised the plan of taking from the borrower a conveyance of the property to be come absolute upon the failure of the borrower to redeem. Later, the plan was adopted of taking an abeolute conveyance, with an agreement on' the part of the lender to re-convey on payment of the debt, the transaction being in form an absolute sale of land with an option to buy it back by pay ment of the loan at a fixed time. Another form was to convey the land to a trustee who was to hold to the creditor's use, and on default was to sell it for the payment of the debt. All these de vices were intended to protect the lender by en abling him to secure the land on his debtor's de fault. All of them were or softened by the 'courts refusing to allow the forfeiture or to treat the transaction as other than a methcid of pledging the land as security for the debt, the debtnr re taining what came to be known as the equity of redemption, and being protected against the strict enforcement of his contract ; H. W. Chaplin, in 4 Harv. L. Rev. 1. See EQUITY OF REDEMPTION. In modern times although the old forms are still followed, it is everywhere recognized that the real owner of the land is the mortgagor, and the mort gage is a mere security for the debt or obligation, giving the mortgagee a chattel interest which pass es to his personal representatives and not to his heirs. Some of the states have abrogated the old rule and declared by statute that the effect of a mortgage shall be merely to give a lien and not to pass an estate to the mortgagee. But in England and in most of the states the old rule remains nominally In force, and in courts of law the mort gage is recognized as conveying an estate, while equity treats it as merely conferring a lien. Orig inally this was burdensome, since there was an actual distinction between the rules applied in the different jurisdictions, and redress had to be sought in equity against the severities of the law, but the principle adopted in Pennsylvania in the eighteenth century, of administering equity through common law forms has been gradually making its way until it reached its most signal triumph in the adoption of the Judicature Act of 1873 in England providing that where "there is any conflict pe tween the rules of equity and the rules of common law, the rules of equity shall prevail." To-day it may be safely said that the equitable doctrine has completely supplanted the legal, but as the form of the transaction is still the same, some confusion exists, and doubtless always will exist, in the defi nitions given of mortgage. Some of these have been quoted supra. See a discussion of the relations of mortgagor and mortgagee by Lord Selborne, in 6 Q. B. D. 345. • A mortgage on real estate in New York* is merely a chose in action and gives the mort gagee merely a lien on the property ; In re Kellogg, 113 Fed. 120; and it "is now al most universally regarded as a mere secur ity for the payment of the debt"; ReaSoner v. Edmundson, 5 Ind. 393; but, per contra, it was said to be "a conveyance of an estate or property by way of pledge for the security of a debt, to become void on payment there of"; Poarch v. Duncan, 41 Tex. Civ. App. 275, 91 S. W. 1110. Any transfer of prop erty as security, regardless of the form of characterizing the same, creates the relation of mortgagor and mortgagee ; Beebe v. Loan Co., 117 Wis. 328, 93 N. W. 1103.