Where property is transferred not in satisfaction of the claim but by way of pledge or mortgage for the winnings in a gambling transaction, or for other illegal consideration, it seems clear that the transferee can get no aid from the law in enforcing his claim by foreclosure.65 On the other hand, in the absence of a statute allowing him to recover what he has parted with, the mortgagor can get no aid from the court in seeking a cancellation of the mortgage;66 and if the mortgagee or pledgee has beein authorized by the mortgagor or pledgor to sell the security and apply the proceeds on the illegal debt, and does so, or if he can foreclose without the aid of the court, the mortgagor or pledgor can have no redress.67
60 See infra, Sec. 1679.
61 Steers v. Lashley, 6 T. R. 61; Burrus v. Witcover, 168 N. C. 384, 74 S. E. 11, 39 L. R. A. (N. S.) 1005.
62 Pearce v. Rice, 142 U. S. 28, 35 L. Ed. 925, 12 S. Ct. Rep. 130 (Illinois statute); Chapin v. Dake, 57 III. 295, 11 Am. Rep. 15; Pearce v. Foote, 113 11I. 228, 55 Am. St. Rep. 414; Commercial Nat. Bank v. Spaids, 8 111.
App. 493. And see for similar statutes, 1 Ames, Bills & Notes, 350, 352.
63 Under such a statute if the maker in good faith pays the indorsee, he is not discharged, since he has paid one who has no title, and must pay over again to the indorser - a party to the illegality. See Commercial Nat. Bank v. Spaids, 8 111. App. 493.
64 Rumping v. Arkansas Nat. Bank, 121 Ark. 202, 180 S. W. 749.
An intermediate case may be supposed where possession has been transferred but the mortgagee or pledgee has no power of sale, or ability to foreclose without judicial assistance, and the debtor seeks to reclaim his property without satisfying the debt. Since potior est conditio possidentis, he cannot do so.68 By virtue, however, of the statutes in many jurisdictions allowing the loser to recover what he has lost and avoiding obligations given by him he may have in such states whatever relief may be appropriate for avoiding a mortgage or pledge.69