Sec. 1. Ancient forms of mortgage, p. 1.

Sec. 2. Welsh mortgage, p. 4.

Sec. 3. Sources of modern law of mortgage, p. 5.

Sec. 4. Definition of mortgage, p. 6.

Sec. 5. The Conveyancing and Law of Property Act, p. 7.

Sec. 6. Fraudulent and voluntary mortgages, p. 11.

Sec. 1. Ancient forms of mortgage

The giving of land as a security for a debt was well known to early law, and the machinery adopted for effecting this purpose was very various (a).

When Glanvil wrote, in the twelfth century, two general rules might be stated. (1) The mortgagee was always in possession. A mere agreement that property should be security for a debt was not recognized by the king's court. (2) The transaction might be either mortuum vadium (mort gage, dead gage) or vivum vadium (vif gage, live gage). In the former case the profits of the land did not go in reduction of the debt; and though a creditor who made this bargain fell into the sin of usury, it was not prohibited by the law. In the latter case the profits went in reduction of the debt, and it was considered to be a fair and honourable bargain. In any case the creditor's interest in the land was a special one, as mortgagee, that is, in the nature of a charge which could be enforced only upon application to the court.

(a) This introductory historical sketch of mortgage at common law is based chiefly upon Holdsworth, History of English Law, vol. 3, pp. 110-114, and Pollock and Maitland, History of English Law, vol. 2, pp. 117-124 ("The Gage of Land"). See also H. D. Hazeltine, Oeschichte des englischen Pfandrechts, pp. 201 ff; Hazeltine, The Gage of Land in Mediaeval England, 17 Harv. L.R. 549, 18 Harv. L.R. 36, reprinted in Select Essays in Anglo-American Legal History, vol. 3, pp. 646-672.

The great defect of the transaction lay from the debtor's point of view in the fact that he lost possession, from the creditor's point of view in the fact that his possession was not protected by the assizes - if ejected, even by the mortgagor, he could not recover the land. It is probably due chiefly to the latter cause that the peculiar interest of the mortgagee, as defined by Glanvil, disappeared. He ceased to take a peculiar interest as mortgagee, and took instead one of the recognized estates or interests in the land. He must be tenant for years, or for life, or in fee. In the first case he obtained his rights under a demise for years and had the termor's remedies. In the other cases he must be enfeoffed and he had the freeholder's remedies.

Accordingly, when Bracton wrote, in the thirteenth century, there were three methods by which the creditor might take a security upon his debtor's land. (1) The debtor might give the creditor a lease at a nominal rent. The rents and profits of the land paid off the debt, and provided interest for the creditor, without suspicion of his committing the sin of usury. (2) The debtor might convey the land to the creditor for a term of years, with a proviso that if the debt be not paid at the end of the term the creditor should keep the land in fee. (3) The debtor might convey the land to the creditor in fee, with a proviso that if the debt was paid by a fixed date the land should be reconveyed; and this condition was strictly construed. Britton distinctly denies that there can be any equity of redemption. Both the second and the third forms were known to Littleton, but it is the third form which ultimately prevailed. It gained in popularity from the fourteenth century onwards; and, when the rules as to the creation of future estates in the land became more definitely fixed, the lawyers began to think that the second form of mortgage, according to which a term of years swells into a fee by the happening of an event, is legally impossible. Just as the rules of the king's courts as to the kinds of seisin protected by the assizes destroyed the twelfth century estate in mortgage, so the later rules of the common law as to the modes in which the estates of which men could be seised might be manipulated, limited to one type the interest of the mortgagee. He took an estate defeasible upon condition subsequent. His estate was, it is true, only a security for money lent, and Littleton recognised this, but, as a result of the strictness with which such conditions were construed, this feature of his estate was obscured till the Court of Chancery began to erect the elaborate superstructure of our present law of mortgage upon the basis provided by the medieval common law. The narrowness of this basis has necessitated the elaboration of the superstructure, and has caused the con-sequent complication of the law. That the basis was so narrow was due in part to the hasty generalizations of the lawyers of the thirteenth century, in part to the technical doctrines of the lawyers of the succeeding three centuries (b).

When Littleton wrote, at the end of the fifteenth century, the position of the mortgagee had become definitely fixed (c). Coke translates Littleton's language as follows: "Item, if a feoffment be made upon such condition, that if the feoffor pay to the feoffee at a certain day, etc., 40 pounds of money, that then the feoffor may re-enter, etc,. in this case the feoffee is called tenant in morgage, which is as much to say in French as mortgage and in Latine mortuum vadium. And it seem-eth that the cause why it is called mortgage is, for that it is doubtful whether the feoffor will pay at the day limited such sum or not: and if he doth not pay, then the land which is put in pledge upon condition for the payment of the money, is taken from him forever, and so dead." (d)

(b) Holdsworth, op. cit., vol. 3, pp.-111-112. Pollock and Mait-land (op. cit., vol. 2, p. 123), point out that if the Jews had not been expelled from England a simpler form of mortgage than the conditional feoffment might have been adopted by the common law from the form recognized by the Jewish Exchequer.

(c) Holdsworth, op. cit., vol. 2, p. 490.

It is to be noted that Glanvil and Littleton give different explanations of the term "mortgage." According to Glanvil the gage is "dead" when the profits are not working off the debt and interest. According to Littleton the gage is "dead" to the debtor if the debt is not paid to date. These different explanations are suited to the state of the law at the periods when these authors wrote respectively (e).