property; a delivery is essential to a pledge, while a mortgage of goods is valid without a delivery.'

§ 177. Pledging property as a security for the payment of a debt, has been practiced from time immemorial, among communities having no common source or chain of history; and therefore nothing can be gained by searching for the origin of the custom in the history of remote nations. Our mortgage, derived from the civil law, accomplishes the same thing, with a variation of remedies; in a general sense, it pledges the property covered by it for the payment of a debt; its name is significant; it was termed a mortgage, the French translation of the vadium mortuum, or dead pledge, because it carries in itself no means for its redemption derived from the rents and profits of the property, and because on a failure to pay the debt it was in law lost or dead to the mortgagor; and also so called in contrast with the vivum vadium or living pledge, a grant of lands under which the mortgagee took possession of the premises and received and applied the rents and profits upon the debt, until the same was paid; the property thus working out its own redemption.2

Equity has wrought many changes in the common law; and we are not surprised to find in the recent act of Parliament reorganizing the English courts, a provision that where the rules of equity come in conflict with, they shall prevail over the strict rules of law; a provision which in express terms continues in force this transforming element in our laws. Among the changes wrought through its agency, that which has passed upon the mortgage on real estate, is not the least conspicuous. From a conditional estate, ripening into an absolute estate on the failure of the grantor to pay the sum specified in it on the day named, it has come to be deemed and practically enforced as a security; it does not now create an estate in the land, it merely gives a lien upon the property.3

1 Cortelyou v. Lansing, 2 Caines' Cases, 200; an opinion not delivered. Barrow v. Baxter, 5 John. R., 258, 260; but cited and approved until it has become the highest authority; West v. Beach, 3 Cowen, 82; Romaine v. Van Allen, 26 N. Y., 309; Roberts v. Sykes, 30 Barb., 173.

2 Powell on Mortgages, Chap. I., and 2 Black. Comm., 157.

3 Kortright v. Cady, 21 N. Y., 343; Kellogg v. Smith, 26 N. Y., 18, 20. The earlier writers speak of anything given as a security for a debt as a pledge. "A loan, says Glanville, is sometimes made on the security of a pledge, and the pledge may consist of chattels, lands or rents. Sometimes possession is immediately given of the pledge, on receipt of the loan, and sometimes it is not. Sometimes the thing is pledged for a term, and sometimes without. When a chattel is pledged and possession is given, and for a certain term, the creditor is bound to keep the pledge safely, and not to use it to its detriment. If it be

§ 178. In a general sense the owner by giving a mortgage upon his real estate, pledges it to secure the payment of a debt or the fulfillment of some obligation; and it is the remedy provided by law which fixes the nature of the instrument. It must be foreclosed in order to render it available. On the other hand, by giving a mortgage upon his goods or chattels the owner transfers them; the transfer to be void on payment of the money or on performance of the duty or obligation thereby secured. There is no real difference between the two instruments, in respect to the terms employed in them; there are formal words of transfer in each; and there is a condition embodied in each, on the fulfillment of which the instrument is by its terms rendered void; and there is also in each a power to sell the property and apply the proceeds to the payment of the debt secured. The difference between the two is found in the remedies given by law; it is not found in the instruments themselves.2

Under the strict rules of law, a mortgage of lands was held to convey the title; and after a forfeiture the mortgagee was allowed to recover the premises by an action of ejectment. By degrees the right of redemption was established in courts of equity; and at length it has become settled and familiar law, that the title does not pass on the execution of the mortgage, nor on a failure to pay the sum secured on the day it becomes due.1 There must be either a sale of the premises on notice, under the power contained in the mortgage, or a foreclosure by suit. In either of these ways the title will pass and the right of redemption be cut off.5

§ 179. A mortgage of goods or chattels is something more than a se

agreed that in case the debtor should not redeem the pledge at the end of the term, the pledge shall remain with the creditor as his own property, the agree ment must be observed. But if there be no such agreement, and there be a fixed time of redemption, and the debtor make delay in payment, the creditor may quicken the redemption by a writ (of which he gives the form), and which requires the debtor, without delay, to redeem the pledge. On return of the writ, if the defendant confessed the pledge, he was commanded to redeem in a reasonable time, and on default the creditor hal license to treat the pledge as his own. But if the pledge was made without any particular term, the creditor might demand his debt at any time and the debt being discharged, the creditor was bound to restore the pledge without any deterioration." Glanville, Lib. 10, c. I., p. 59; 1 Reeves, 161, 162.

1 Stewart v. Hutchins, 13 Wend., 485; affirmed, 6 Hill, 143.

2 The forms now in use in this State show this close resemblance.

3 Jackson v. Dubois, 4 John. R., 216.

4 Stoddard v. Hart, 23 N. Y., 556, 559; Williams v. Townsend, 31 N. Y., 411. Brown v. Frost, 10 Paige, 243. One who is not notified or not made a party, may redeem; he is not affected; Gage v. Brewster, 31 N. Y., 218; Tuthill v. Tracy, 31 N. Y., 157; Cheney v. Woodruff, 45 N. Y., 98.

curity; it is a sale, and operates as a transfer of the legal title to the mortgagee, subject only to be defeated by a performance of the condi tion; and his title becomes absolute at law on the mortgagor's failure to pay according to its terms. If by the terms of the mortgage the mortgagor is entitled to the possession until the day of payment arrives, he has a possessory interest in the goods and a right of redemption; the property may therefore be sold on an execution against him, and the purchaser will acquire his interest and the right to redeem. When the instrument defines the circumstances under which the right of possession is to vest in the mortgagee, the inference is that in the mean time the possession is to remain with the mortgagor; and in such cases also the mortgagor has a possessory interest in the goods, until default is made in the payment. And when the mortgage, besides defining the circumstances under which the mortgagee has the right to take possession of the property, contains a clause authorizing him to take the possession at any time when he deems himself unsafe, the mortgagor's interest remains until default is made in payment, or until the mortgagee takes possession in good faith for his own safety. The purchaser under a sale subject to the mortgage, acquires the exact interest of the mortgagor; he does not become personally bound to pay the debt secured by the mortgage."

5

§ 180. The right of property draws after it the right of possession; and when there is no provision in the chattel mortgage giving the possession to the mortgagor, the mortgagee, having the right of property until defeated by the performance of the condition, has as an incident thereto the right of possession, and may therefore take the goods into his own custody, or maintain trespass or trover for them against any one who takes or converts them to his own use. The danger clause

'Butler v. Miller, 1 Comst. (N. Y. Rep.), 495; Bissell v. Pearce, 28 N. Y., 252; Shuart v. Taylor, 7 How. Pr., 251; Coles v. Clark, 3 Cush., 399; see Bordwell v. Collie, 45 N. Y., 494.

2 Burdick v. McVanner, 2 Denio, 170; Fuller v. Acker, 1 Hill, 473; Brown v. Bement, 8 John. R., 96; Ackley v. Finch, 7 Cowen, 290; Langdon v. Buel, 9 Wend., 80; Hudsen v. Walter, 34 How. Pr., 385; 39 Barb., 606.

3 Hull v. Carnley, 11 N. Y., 501; S. C. 17 N. Y., 202; Goulet v. Asseler, 22 N. Y., 225.

Hall v. Sampson, 35 N. Y., 274.

Hathaway v. Brayman, 42 N. Y., 322.

6 Hamil v. Gillespie, 48 N. Y., 556. As against creditors the mortgage must be refiled within the year; Porter v. Parmly, 52 N. Y., 185.

7 Coles v. Clark, 3 Cush., 399; Shuart v. Taylor, 7 How. Pr., 251; see Mattison v. Baucus, 1 N. Y. (1 Comst.), 295; and Butler v. Miller, 1 N. Y., 496; Chadwick v. Lamb, 23 Barb., 518; 13 N. Y., 556, 565; Hall v. Sampson, 35 N, Y., 274; S. C., 19 How. Pr., 481.

is to be construed by itself; the mortgagee's right of possession under it, does not accrue until he takes action under it; nevertheless its insertion in the mortgage implies an understanding between the parties that the mortgagor is to retain the property until the mortgagee deeming himself unsafe takes the possession.'

§ 181. In equity the mortgagor has a right to redeem, even after a default has been made; he retains the right until it is cut off by a foreclosure or sale under the mortgage. And he may enforce this right by an action in equity;3 and in this action he is entitled to an account of the rents or reasonable hire of the property, with a view to ascertain the true amount due; and he ought to be accountable for the reasonable expenses incurred in the keeping of the property, where these exceed its rental value.* Asking to redeem on equitable grounds, he must do equity; and he should tender the amount due with interest, including all reasonable charges, before he brings his action. To avoid the payment of costs, he must offer all that equity can require of him in the premises.5

The mortgage usually states the true amount to secure which it is given; and sometimes it is given to secure contingent liabilities up to a certain amount; in this case the mortgagor is entitled to redeem on paying the liabilities particularly specified."

§ 182. The mortgagee is not obliged by law to take any action by way of foreclosure; he may take possession and hold the property; after forfeiture, no further act is necessary to give him the legal title. Though the mortgage contains a power of sale, he is not bound to act under it; but if he takes and retains the goods, and they are in value equal to his demand, he cannot afterwards maintain an action for the debt.8

§ 183. Payment of the debt extinguishes the mortgage; made after, it is a waiver of the forfeiture, and will extinguish the mortgagee's

1 Hall v. Sampson, supra; Huggins v. Fryer, 1 Lansing, 276.

2 Charter v. Stevens, 3 Denio, 33; 12 Wend., 61.

3 Pratt v. Stiles, 17 How. Pr., 211, 221; Hinman v. Judson, 13 Barb., 629, 630; West v. Crary, 47 N. Y., 423.

4 Mickles v. Dillaye, 17 N. Y., 80; a suit for redemption by the mortgagor of real estate.

5 Brockway v. Wells, 1 Paige Ch. R., 617; Vroom v. Ditmas, 4 Paige Ch., 526, 535; Archer v. Cole, 22 How. Pr., 411.

6 Beers v. Waterbury, 8 Bosw., 396.

7 This is a clear inference from the adjudications; Miller v. Lockwood, 32 N. Y., 293, 299.

Burdick v. McVanner, 2 Denio, 170; Case v. Boughton, 11 Wend., 106; Stoddard v. Denison, 2 Sweeny, 54.

9 Monnot v. Ibert, 33 Barb., 24.

title.1

2

A part payment or a new security given to the mortgagee, does not impair his rights under the mortgage. A tender of the amount due after a forfeiture, does not take from the mortgagee his legal title; 3 and yet it is clear that his acceptance of the money does deprive him of his title to the goods. And where he sells a part of them under the power, and realizes from the sale sufficient to pay the debt, his mortgage is satisfied and he has no title to or interest in the remainder : he has acquired all that the instrument was designed to give him. On the reason of this rule, he cannot at any time safely refuse a tender of the amount due; he certainly cannot without subjecting himself to an action in equity to redeem. Besides, why should a mortgage of goods and chattels be treated differently from a mortgage upon real estate? Only prudential reasons can be assigned for the different remedies given under them.

§ 184. The form of chattel mortgage now in general use authorizes the mortgagee, on a default in payment, to take possession of the property and sell it at public or private sale, and apply the proceeds to the payment of the debt. Under this power it has been held that a fair sale, in good faith, for a reasonable price, will foreclose the mortgagor's right to redeem; and it cannot be denied that such a sale is within the terms of the authority. In the case of a pledge, one object of the sale is to transfer the title; under the mortgage, the title is already perfect in the mortgagee; and the object of the sale is to convert the property into its equivalent in money, and apply it on the debt. This being done in the manner agreed upon between the parties, no ground is left for an action in equity to redeem, the only remedy left to the mortgagor.5

The sale must be made pursuant to the terms of the power; if the authority be, to take and sell at public auction, the sale must be made in that manner, or it cannot be effectual as a foreclosure: there must be the usual auction sale, on reasonable notice." On a sale in this manner, conducted fairly, the mortgagee may purchase the property; as he may on a foreclosure sale of real estate.

1 West v. Crary, 47 N. Y., 423; Park v. Hall, 2 Pick., 206, 210; Barry v. Bennett, 7 Metc., 354.

2 Patchin v. Pierce, 12 Wend., 61; Miller v. Lockwood, 32 N. Y., 293.

3 Brown v. Bement, 8 John., 96.

4 Charter v. Stevens, 3 Denio, 33.

5 Chamberlain v. Martin, 43 Barb., 607, and cases there cited; see Ballou v. Cunningham, 60 Barb., 425; S. C., 4 Lansing, 74; and Stoddard v. Denison, 2 Sweeny, 54; 39 How. Pr., 296; 7 Abbott's Pr., N. S., 309.

6 Charter v. Stevens, 3 Denio, 33.

"Olcott v. Tioga R. R. Co., 40 Barb., 179; S. C., 27 N. Y., 546.