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34

A Bill of Foreclosure.

The object of a bill of foreclosure is to enable the mortgagee to have the estate sold in order to get his mortgage money, interest, and expenses, or that the mortgagor may redeem it without delay, or in default thereof, to be for ever foreclosed from redeeming it, that is, of losing his equity of redemption.

The right to redeem a mortgage is carefully protected by courts of equity, and they will not suffer any agreement in a mortgage deed to prevail, that an es tate should become an absolute purchase in the mortgagor upon any event whatever; (a) and the reason is, because it puts the borrower too much in the power of the lender, who, being distressed at the time, is too inclinable to submit to any terms on the part of the lender. (b) The rule is, once a mortgage and always a mortgage. (c)

No agreement of the parties can affect the doctrine as to redemption in a court of equity, (d)" you shall not," says Lord Eldon, "by special forms alter what this court says are the special forms of that contract. "(e)

With respect to the foreclosure of a mortgage, it has been determined that a mortgagee may file a bill of foreclosure without taking possession. A mortgagee cannot be compelled to take possession; for by so doing he would subject himself to an account, which the court will not force him to do. (f)

After the death of the mortgagor, in case the personal estate of the mortgagor is deficient, a mortgagee may pray a sale of the mortgaged premises, in the first

F(a) 1 Mad. 415. See Howard v. Har.

ris, 1 Vern. 190.

(b) 1 Mad. 414. Tooms v. Conset, 3 Atk. 261.

(c) 1 Mad. 414. Newcombe v. Bon. ham, 1 Vern. 8. Howard v. Harris, 1 Aern. 33. James v. Oades, 2 Vern. 402.

(d)1 Mad. 415. See Floyer v. Laving ton, 1 P. Wills. 268.

(e) 1 Mad. 415. Seaton v. Slade, ? Ves. 273.

(f) 1 Mad. 419. Lord Perhyn v Hughes, 5 Ves. 106.

instance, where the heir and personal representative are the same person. (g)

If after a foreclosure and a sale, the mortgagee brings an action for the balance, this in general opens the foreclosure, (h) but where the mortgagee had taken possession a considerable time, and the balance was inconsiderable, a perpetual injunction was decreed, (i) see, Post, mortgages, and an order for the sale of mortgaged premises.

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On a bill for a foreclosure and sale, it is not a matter of course to order the whole of the premises to be sold. (j)

If the property mortgaged exceed the debt, and can be separated, no more ought to be sold than is sufficient to pay the principal, interest, and costs. (k)

Where money is loaned on mortgage, by the loan officers, pursuant to the act of the 14th of March, 1792, Sess. 15. Ch. 25. after a default of payment of interest by the mortgagee for twenty two days after the same is payable, all equity of redemption is for ever foreclosed, ipso facto, by such default; and the loan officers become vested with an absolute and indefeasible estate in the land, so that this court cannot regard any estate as existing in the mortgagor. (1)

Equity of Redemption.

Injunction granted to stay proceedings on power of sale on payment of costs by the plaintiff, and his paying.

(g) 1 Mad. 419. Daniel v. Shipwith, M. S.

2 Bro. C. C. 155.

(j) Delabigarre v. Bush, 2 Johns. Rep.

(4) 1 Mad. 421. Dashwood v. Blyth- 490.

way, Eq. Cas. Abr. 317.

(k) Ibid.

(i) 1 Mad. 421. Perry v. Barker, 8 Ves. (1) Jackson v. Voorhis, 9 Johns. Rep. 527. S. C. 13 Ves, 198. S. C.

129.

into court the amount reported to be due by the master. (m)

Possession by the mortgagee, for a period short of twenty years, will not bar the equity of redemption; the possession must be actual, quiet, uninterrupted possession for twenty years, or a period sufficient to toll the right of entry at law. (n)

No length of time is a bar to a redemption of a mortgage, where there is fraud in the transaction, or where by the agreement of the parties at the time, the mortgagee is to enter and keep possession until he is paid out of the profits. (o)

Where a mortgage is given to secure a sum, payable in instalments with interest, and in default of payment of the first instalment, a bill is filed by the mortgagee, the defendant will not be allowed to stay proceedings, on bringing into court the principal and interest due with the costs which had accrued, unless he also put in an answer, confessing the debt, &c. or consent to a decree of foreclosure, to remain subject to the further order of the court upon a subsequent default. (p)

(m) Hine v. Handy, 1 Johns. Ch. Rep. 6.

(n, Moore v. Cable, 1 Johns. Ch. Rep. 385.

() Marks and others v. Pell, 1 Johns. Ch. Rep. 594.

(p) Lansing v. Capron and others, 1 Johns. Ch. Rep. 617.

The Form of a Bill of Foreclosure.

To the honorable James Kent, Chancellor of the State of New York,

Humbly complaining, sheweth unto your Honor your Orator, A. B. of the city of New-York. That on or about the ninth day of March, in the year of our Lord one thousand eight hundred and fifteen, C. D. of the said city of New-York, Baker, was seised or pretended to be seised in fee of the one equal undivided fourth part of all the certain lots of land, messuages, and premises herein after mentioned: And your Orator further sheweth unto your Honor, that on the said ninth day of March, one thousand eight hundred and fifteen, the said C. D., by his certain bond or obligation in writing, under his hand and seal duly made and executed, became justly indebted unto your Orator in the penal sum of two thousand dollars, lawful money of the United States of America, with a condition there under written, to pay to your Orator the sum of one thousand dollars, lawful money aforesaid, on the ninth day of March, in the year of our Lord one thousand eight

Note. It is a general rule that all persons whose interests may be affected by the suit, must be made parties, complainants or defendants. Therefore subsequent purchasers or mortgagees of the premises, and judgment oreditors, must be made parties. If they are made defendants, they may either disclaim, or put in no appearance, and suffer the bill to be taken pro confesso. Should they disclaim, which they may do with safety, by entering an appearance and filing a disclaimer, when there appears no prospect of the mortgaged premises producing more than is sufficient to satisfy the principal, interest, and costs of suit, then the disclaim. ing parties are entitled to their costs out of the proeeds of the mortgaged premises; being made parties to the suit without any fault on their part. These costs may be very considerable, from the practice of judgment incumbrancers, (who are usually the most numerous class of creditors,) severing in their appearance; by which means each disclaimer becomes; entitled to his several costs, which may totally exhaust the mortgaged premises, and leave nothing remaining to satisfy the principal, interest, and costs of the suit.

hundred and sixteen, with the interest thereon, payable on the first days of May and November, and not before, as in and by the said bond or obligation now in the custody of your Orator and ready to be produced as this Honorable court shall direct, and to which, when produced, your Orator for greater certainty prays leave to refer, may more fully and at large appear.And your Orator further shews unto your Honor that the said C. D. and E. his wife, in order to secure the payment of the said principal sum of money, with the lawful interest thereof in manner aforesaid, in and by a certain Indenture of Mortgage, bearing date the same day and year last aforesaid, and also in consideration of one dollar, to them in hand paid by your Orator, at and before the ensealing and delivery of the said Indenture of Mortgage, did grant, bargain, sell, alien, release, enfeoff, convey and confirm unto your Orator, and to his heirs and assigns for ever, All those certain Lots, (take in the boundaries) Together with all and singular, the edifices, buildings, rights, members, privileges, hereditaments and appurtenances thereunto belonging, or in any wise appertaining. And also, all the estate, right, title, interest, dower, 'property, possession, claim and demand in law and equity of the said

In order then to preserve the proceeds of the mortgaged premises from the costs of such incumbrancers, it is important, that the complainant, before the filing of the bill, do tender to each of the incumbrancers a release of his claim upon the mortgaged premises, and the equity of redemption, for the purpose of having it executed by each individually, which being done, their interest will be at an end, and there is no necessity of making them parties to the suit. But should they refuse to execute the release, still the tender made for this purpose, will bar them from any costs of suit, which they might otherwise be entitled to, by virtue of their disclaimer.

This release recites the execution of the mortgage, and the obtaining the subsequent judgments, the insufficiency of the premises to satisfy the sum due to the mortgagee complainant, and the incumbrancers; and concludes with releasing to the complainant mortgagee, the incumbrancer's claims upon the premises—vide, PF of a Release.

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