28 Ala. 226 | Ala. | 1856
A mortgage is essentially a security for a debt. When no debt exists, a mortgage is impossible. — -Conway v. Alexander, 7 Cranch, 218; Chapman v. Hughes, 14 Ala. Rep. 218.
When a conveyance is made -in satisfaction of a precedent debt, it cannot take effect as a mortgage, although containing a redemption clause; for, the previous debt being extinguished, and no new one created, one of the essential attributes of a mortgage is wanting. — Poindexter v. McCannon, 1 Devereux’s Eq. Rep. 373; Holmes v. Grant, 8 Paige, 243; Robinson v. Cropsey, 6 Paige, 480; same case, 2 Edw. Ch. Rep. 138; McKinstry v. Conly, 12 Ala. Rep. 678; Freeman v. Baldwin, 13 Ala. R. 246; Goodman v. Grierson, 2 Ball & Beatty’s Ch. Rep. 274.
When a deed is made for a consideration paid at the time, whether the payment is made in cash, or by the surrender and satisfaction of a precedent debt, — it will not lose the character of a conveyance, by an agreement on the part of the vendee, to allow the vendor to re-purchase at a future day, for the same price, or for an advanced price. — Glover v. Payne, 19 Wend. R. 518; Brown v. Dewey, 2 Barb. Sup. Ct. Rep. 28; Williams v. Owen, 5 My. & Cr. 303; Flagg v. Mann, 14 Pick. Rep. 467.
The fact that the party executing a conveyance, absolute in its terms, intended and considered it as a mortgage, is not. sufficient to make it a mortgage. To produce that effect,
Inadequacy of price or consideration, alone, will not convert an absolute conveyance into a security for the repayment of money. — Conway v. Alexander, supra; Holmes v. Fresh, supra; Lane v. Dickerson, 10 Yerger, 373; Moss v. Green, 10 Leigh, 251, and cases therein cited by Parker, J.
The transaction which the complainants allege 'to be a mortgage, occurred on the 26th June, 1847, between the de-féndant, Hendrix, and the complainant Sarah, who was then unmarried and known by the name of Sarah Smith. The debt, which it is alleged was intended to be secured by the transaction, was a debt for $53 71, due to Hendrix by John C. West, by account. Hendrix receipted the. account as follows, “ Rec’d the above fifty-three dollars and seventy-one cents, in full, of J. C. West, pr. Sarah Smith. J. M. Hendrix, 26 June, 1847.”'
The account, thus receipted, was surrendered to' Sarah Smith; and she executed the absolute deed to Hendrix, and received from him an instrument, a copy of which is shown in ‘ Exhibit A’ to the bill. There was no debt between Sarah Smith and Hendrix, and no loan.
After this transaction, we cannot see from the evidence, how Hendrix could have compelled payment, either from Sarah Smith or John C. West. The evidence is insufficient to authorize us to say that the debt of John 0. West to Hendrix was not satisfied by this transaction, or that any new debt was created. The rule is, that when there is a deed absolute in its terms, and the right of redemption is denied by the answer, a court of equity will not treat it as a mortgage, unless the proofs are clear, consistent, and convincing, that it was not an absolute purchase, and that the object of the transaction in its original construction, as understood by both parties, was to create a security for money. — Chapman v. Hughes, supra; Freeman v. Baldwin, supra; Bryan v. Cowart, 21 Ala. Rep. 92; Brantley v. West, 27 Ala. Rep. 552; Franklin v. Roberts, 2 Iredell’s Eq. Rep. 560; Lane v. Dickerson, 10 Yerger, 373; Moss v. Green, supra.
The decree of the chancellor is affirmed, at the cost of the appellants.