This section is from the book "The Law Of Real Property and Other Interests In Land", by Herbert Thorn Dike Tiffany. Also available from Amazon: A Treatise on the Modern Law of Real Property and Other Interests in Land .
Since the debt is, in the view of a court of equity, the principal, and the security upon the land merely the accessory, a transfer of the mortgagee's rights, an "assignment of the mortgage," as it is usually termed, is in effect a transfer of the debt, with its attendant security. The expression "assignment of mortgage" is therefore hardly accurate, since the mortgage security cannot be assigned apart from the debt.80 It is true that, in states in which a legal title to the land is vested in the mort76. Cooke v. Prindle, 97 Iowa, 464, 66 N. W. 781.
77. Old Alms House Farm v. Smith, 52 Conn. 434; Home Life Ins. Co. v. Elwell, 111 Mich. 689, 7C N. W. 334; Cottrell v. Shepherd, 86 Wis. 649, 39 Am. St. Rep. 919, 57 N. W. 983. See Biddell v. Briz-zolara, 56 Cal. 374.
78. Biddle v. Pugh, 59 N. J. Eq. 480, 45 Atl. 626; Harper v. Edwards, 115 N. C. 246, 20 S. E. 392.
79. Murdock v. Waterman, 145 N. Y. 55, 27 L. R. A. 418, 39 N. E. 829; Mack v. Anderson, 165 N. Y. 529, 59 N. E. 289.
80. Post, Sec. 628(c).
Choses in action being, at the present day, ordinarily assignable at law as well as in equity, and a debt secured by mortgage being, like a debt not so secured, merely a chose in action, such a debt is assignable, and the assignment of the debt, the principal, carries with it the benefit of the mortgage security, the accessory.81"82 In other words, as it would ordinarily, though somewhat inaccurately, be expressed, a mortgage is, as a general rule, freely assignable. Not only may a fixed and certain debt be assigned, carrying with it the mortgage security, but a contingent debt secured by mortgage, such as an obligation to indemnify another, may be transferred, with the effect of transferring the benefit of the mortgage security for the payment of the debt or other performance of the obligation secured.83 But the assignment of a debt secured by mortgage, as of one not so secured,84 may be restrained by a provision in the instrument evidencing the debt.85
Since a contract by one person to support another is necessarily of such a personal nature that the benefit cannot be assigned, and since a mortgage security cannot be transferred separately from the obligation secured, it would seem to follow that the benefit of a mortgage given to secure the performance of a contract to support the mortgagee cannot be transferred, and it has been so decided.86 In one state, however, it has been decided that the benefit of such a mortgage could be transferred by the mortgagee, the the beneficiary of the contract, to another person who, after the execution of the mortgage, and with the consent of the mortgagor, assumed the burden of the mortgagee's support.87
81-82. Post, Sec. 628(a), note 5.
83. Camp v. Smith, 5 Conn. 80; Stewart v. Preston, 1 Fla. 11, 44 Am. Dec. 621; Carper v. Munger. 62 Ind. 481; Murray v. Porter, 26 Neb. 288, 41 N. W. 1111; Bancroft v. Marshall, 16 N. H. 244; Waller v. Oglesby, 85 Tenn. 321, 3 S. W.
84. 5 Encyclopedia Law & Prar. 911.
85. See Houseman v. Bodine, 122 N. Y. 158, 25 N. E. 255; Hidden v. Kretzshmar, 37 Fed. 465; Myerstown Bank v. Roessler, 186 Pa. St. 431, 40 Atl. 963.
Since an assignment of a mortgage is in reality the assignment of the debt secured, the only person capable of making such assignment is, ordinarily, the beneficial owner of the debt. And so if the debt is secured by a deed of trust, the owner of the debt and not the trustee is the person to make the transfer.88
Upon the death of the owner of a debt secured by mortgage, the debt passes to his personal representative, with the benefit of the mortgage security,89 and he may transfer the debt, with its incidental security, to another.90 In states in which the mortgagee has the legal title to the land, the statute ordinarily invests the executor with such title for the purpose of assigning
86. Bryant v. Erskine, 55 Me. 153; Bethlehem v. Annis, 40 N. H. 34.
87. Ottaquechee Sav. Bank v. Holt, 58 Vt. 166, 1 Atl. 485.
88. McFarland v. Dey, 69 111. 419; Hatz's Appeal, 40 Pa. St. 209; Ryckman v. Canada Lite Ins. Co., 17 Grant's Ch. (Up. Can.) 550. But one who holds a debt, secured by mortgage in trust for another, can transfer the debt to the same extent as he could transfer any other property held by him in trust. Foster v. Dey, 27 N. J. Eq. 599; Field v. Schieffelin, 7 Johns. Ch. (N. Y.) 150, 11 Am. Dec. 441; Chicago Title & Trust or enforcing the security.91 In the absence of such a statute, the heir or devisee would hold the legal title in trust for the holder of the debt secured.92
Co. v. Brugger, 196 111. 96, 63 N. E 637.
89. 2 Woerner, Administration, Sec. 631. 11 Am. & Eng. Encyclopedia of Law, 840.
90. McCausland v. Baltimore Humane Impartial Soc., 95 Md. 741, 52 Atl. 918; Williams v. Ely, 13 Wis. 1; Pryor v. Wood, 31 Pa. 142. In Cook v. Parkam, 63 Ala. 456, an assignment by the heirs or devisees of the mortgagee was upheld, on the theory, apparently, that they were the distributees or legatees, to whom the personal representative had presumably transferred the mortgage debt and security.
The person to whom the debt, with the benefit of the mortgage security, is transferred, "the assignee of the mortgage," has ordinarily the same remedies, by foreclosure or otherwise, as his assignor had,93 and if the assignor was entitled to the possession of the mortgaged land, the assignee would ordinarily be so entitled,94 unless, it seems, the right of possession is dependent on the acquisition of the legal title, and the transfer is insufficient to pass this. And the transfer of the debt entitles the transferee to the benefit not only of the mortgage security, but also of any other security to which the transferor was entitled.95
The assignor of a chose in action is usually regarded as warranting the existence and validity of the claim,96 and this rule has been applied in connection with a debt secured by mortgage.97 And the one who in terms transfers a mortgage with the debt secured by it has been held impliedly to warrant that the instrument is genuine and not forged.98 In those states in which the assignor of a debt is regarded as warranting the payment thereof,99 he will no doubt be so regarded when the debt is secured by mortgage as well as when it is unsecured.1 And conversely, in those states in which no such warranty is implied in the case of an unsecured claim, it will not be implied in the case of a secured claim.2
91. Douglass v. Durin, 51 Me. 121; Smith v. Dyer, 16 Mass. 18; Baldwin v. Timmins, 3 Gray (Mass.) 302; Pierce v. Brown, 24 Vt. 165.
92. Smith v. Dyer, 16 Mass. 18; Demarest v. Wynkoop, 3 Johns. Ch. (N. Y.) 129, 8 Am. Dec. 467; Baldwin v. Hatchett, 56 Ala. 461; Coote, Mortgages (4th Ed.) 1036.
93. Hunt v. New England Mortg. Co., 92 Ga. 720, 19 S. E. 27; Kilgour v. Gockley, 83 111. 109; Howard v. Handy, 35 N. H. 315; Hoitt v. Webb, 36 N. H. 158; Dewing v. Crueger, 7 Wash. 590, 35 Pac. 393. That he is entitled to sue on the assumption of the mortgage debt by the mortgagor's transferee, see Fitzgerald v. Barker, 85 Mo. 113. That he cannot do so in his own name, see Gable v. Scarlett, 56 Md. 169. The assignee may take advantage of a clause giving the mortgagee an option to declare the whole debt due in case of default in interest. Welborn v. Cobb, 92 S. C. 384, 75 S E. 691; Lincoln Nat. Bank v. Mundy, 162 111. App. 138.
94. Fountain v. Bookstaver, 141 111. 461, 31 N. E. 17; Mason v. Davis, 11 N. H. 383; Jackson v. Minkler, 10 Johns. (N. Y.) 430. If an absolute conveyance is intended to operate as a mortgage, the grantee is not entitled to possession, and consequently his grantee is not so entitled. Shimerda v. Wohlford, 13 S. D. 155, 82 N. W. 393.
95. Parsons v. Fairbanks, 22 Cal. 343; Longfellow v. McGregor, 61 Minn. 494, 63 N. W. 1032; Philips v. Lewistown Bank, 18 Pa. 494 The assignment of a mortgage was construed to include the right of action against a previous assignor on a covenant as to the validty of the mortgage. Byles v. Lawrence, 35 Mich. 458.