111 N.W. 622 | N.D. | 1907
The plaintiff, claiming to have a lien upon the real property described in the complaint, brought this action to foreclose the same; and from a judgment in his favor defendants have appealed to this court for trial de novo.
The facts out of which plaintiff’s cause of action’arises, and which are necessary to a correct understanding of the questions involved, are as follows. On October 31, 1899, one Edgar G. Cady, being the owner of the property in question, entered into a contract to sell
'Counsel for appellant contend that the instrument above referred to was both in form and legal effect nothing more than a chattel mortgage upon the contract, and that it furnished no basis for the lien which the judgment fastens upon the land. We think this contention is clearly untenable. While the instrument does not in express terms mortgage the land, we think it clearly shows an attempt to do so; and the evident intention of the parties was that it should operate as security upon the real property for the amount due plaintiff as represented by such notes, and, this being true, equity will treat it as an equitable mortgage. We see no insuperable obstacle in the way of a court of equity giving effect to this instrument according to the clear intent of the parties. In fact, to our minds, under the facts disclosed by this record, it would be grossly inequitable, and would be a most flagrant perversion of the principles of equity jurisprudence, to deny to plaintiff the relief asked for. Authorities are numerous in support of our conclusion that the instrument in question should be held to be an equitable mortgage. Following are some of them: Ketchum v. St. Louis, 101 U. S. 306, 25 L. Ed. 999; 11 Am. & Eng. Enc. Law (2d Ed.) 123, and numerous cases cited; 20 Am. & Eng. Enc. Law (2d Ed.) 909, and cases cited; 3 Pom. Eq. Jur., section 1237; 2 Story on Eq. Jur., section 1231; 1 Jones on Mortgages, section 162.
In 11 Am. & Eng. Enc. Law, p. 130, it is stated that “as a general rule an assignment by the vendee of a contract for the purchase of land, made as a security for a debt, makes the assignee an equitable mortgagee.” In 3 Pom. Eq. Jur., section 1237, the rule is well stated as follows: “The form or particular natui-e of the agreement which shall create a lien is not very material, for equity looks at the final intent and purpose rather than at the form; and, if the intent appears to give, or to charge, or to pladge property, real or personal, as a security for an obligation, and the property is so described that the principal things intended to be given or charged can be sufficiently identified, the lien follows. * * * The intent to give a security being clear, equity will treat the instrument as an executory agreement for such security” — -citing numerous authorities. In Jones on Mortgage, supra, the author remarks: “In addition to these formal instruments which are properly entitled to the designation of mortgages, deeds and contracts, which are wanting in one or both of these characteristics of a common law mortgage, are often used by both parties for the purpose of pledging real property, or some -interest in it, as security for a debt or obligation, and with the intention that they shall 'have effect as mortgages. Equity comes to the aid of parties in such -cases, and gives effect to their intention. Mortgages -of this kind are therefore called equitable mortgages.” 1 Jones on Mortgages, section 162. We deem the rule to be too well settled to require further citations.
Nor was it necessary that plaintiff should have -asked to reform the instrument. Sprague v. Cochran, 144 N. Y. 104, 38 N. E. 1000; Love v. Sierra Nevada, etc., Co., 32 Cal. 639, 91 Am. Dec. 602; Cummings v. Jackson, 55 N. J. Eq. 805, 38 Atl. 763.
As respects the interests of defendant, Sarah E. Shockley, in the premises in controversy, it is sufficient to say that the evidence discloses that she took her title with notice of plaintiff’s rights, -and her title must therefore be 'held subordinate to such rights.
The judgment of the district court was in all things correct, and is accordingly hereby affirmed, respondent to recover his costs on this appeal.