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 .
97. Cotterell v. Purchase, Cas. temp. Talb. 61; Jones v. Trawick. 31 Ala. 253; Inhabitants of Reading v. Weston, 8 Conn. 117, 20 Am. Dec. 97; Finlon v. Clark, 118 III. 32, 7 N. E. 475; Stinchfield v. Milliken, 71 Me. 567; Flint v. Sheldon, 13 Mass. 443; McClane v. White, 5 Minn. 178; Reilly v. Cul-len, 159 Mo. 322, 60 S. W. 126; Abbott v. Hanson, 24 N. J. L. 493; Webb v. Rice, 6 Hill (N. Y.) 219; Billingsley v. Stutler, 52 W. Va. 92, 43 S. E. 96.
98. Jackson v. Lodge, 36 Cal 28; Walls v. Endel, 20 Fla. 86; McAnnulty v. Seick, 59 Iowa, 586. 13 N. W. 743; Flynn v. Holmes, 145 Mich. 606, 11 L. R. A. (N. S.) 209, 108 N. W. 685; Swart v. Service, 15 N. Y. 374; Murray v. Walker, 31 N. Y. 399; Kent v. Agard, 24 Wis. 378. That such evidence is admissible at law when the title is not directly in issue, see German Ins. Co. of Free-port v. Gibe, 162 III. 251, 44 N. E. 490.
99. Walls v. Endel, 20 Fla. 86; Despard v. Walbridge, 15 N. Y. 374; Dobbs v. Kellogg, 53 Wis. 448, 10 N. W. 623.
1. Hawkins v. Elston, 58 Colo. 400, 146 Pac. 254; Woodson v. Veal, 60 Ga. 562; Gibson v. Hough, 60 Ga. 588; Shumate v. McLendon, 120 Ga. 396, 48 S. E. 10; Burdick v. Wentworth, 42 Iowa, 440; Baxter v. Pritchard, 122 Iowa, 590, 101 Am. St. Rep. 282, 98 N. W. 372; Wilber v. Sanderson, 43 Cal. 496; First Nat. Bank of Plattsmouth v. Tighe, 49 Neb. 299, 68 N. W. 490; First Nat. Bank of the legal title than has a mortgage in ordinary form.2 The former view is open to the criticism that it puts it in the power of the parties to a mortgage transaction to change its legal effect by employing the device of an absolute conveyance. So far as it may be asserted that, by the making of an absolute conveyance, an intention to convey the legal title is indicated, and that this intention should be given effect, the same might be said of a conveyance with a defeasance, a form of mortgage which is still frequently utilized even in jurisdictions in which the lien theory is adopted. It has, however, never been decided that the intention to convey the legal title, to be inferred from the use of the common law form of a defeasible conveyance, requires the legal title to be regarded as vested in the mortgagee.
David City v. Spelts, 94 Neb. 387, 143 N. W. 218. The California rule to this effect, as originally established (Hughes v. Davis, 40 Cal. 117; Espinosa v. Gregory, 40 Cal. 58), was subsequently changed by a statute providing that a mortgage shall transfer no title in spite of an agreement to the contrary. See Hyde v. Mangan, 88 Cal. 319, 26 Pac. 180; Brandt v. Thompson, 91 Cal. 458, 27 Pac. 763; Allen v. Allen, 95 Cal. 184, 197, 16 L. R. A. 646, 30 Pac. 213; Shirley v. All Night & Day Bank, 166 Cal. 50, 134 Pac. 1001.
In some states there is a statutory provision requiring a conveyance intended as security to be treated as a mortgage,3 and when this is the case the right to show the true character of the transaction can evidently not be confined to courts of equity.4
In New York oral evidence has been decided to be inadmissible to show that a conveyance absolute in form was intended as a mortgage, when a written instrument accompanying the conveyance appeared to contain the complete contract between the parties.4a In Georgia and Mississippi it is provided by statute that an absolute conveyance cannot, if the maker parts with the possession of the property, be shown to be intended as a mortgage, at the instance of either of the parties, unless fraud in its procurement is at issue.5 And in Pennsylvania it is provided that a deed absolute can be reduced to a mortgage only by a written defeasance, signed, sealed, acknowledged and recorded,6 though fraud in the procurement of the instrument in that form can, it seems, be shown.7 In New Hampshire evidence of this character is excluded by a statutory provision that no estate shall be "incumbered by any agreement, unless it is inserted in the condition of the conveyance, stating the sum of money to be secured or other thing to be performed."8
2. Fehringer v. Martin, 22 Colo. App. 634, 126 Pac. 113; Hulsman v. Deal, 90 Kan. 716, 136 Pac. 220; Flynn v. Holmes, 145 Mich. 606, 11 L. R. A. (N. S.) 209, 108 N. W. 685; Odell v. Mont-ross, 68 N. Y. 499; Barry v. Hamburg-Bremen Fire Ins. Co., 110 N. Y 1, 17 N. E. 405; Security Savings & Trust Co. v. Lowenburg, 38 Ore. 159, 62 Pac. 647; Vincent v. First Nat. Bank, 76 Ore. 579, 143 Pac. 1100, 149 Pac. 938; Mustar v. McComb, - S. D. -, 167 N. W.
232; Snyder v. Parker, 19 Wash. 276, 67 Am. St. Rep. 726. 53 Pac. 59; Dobbs v. Kellogg, 53 Wis. 448, 10 N. W. 623.
3. Florida, Comp. Laws 1917, Sec. 2494; Illinois, Hurd's Rev. St. 1917, ch. 95, Sec. 12; Idaho, Rev. Codes, Sec. 3391; Oklahoma, Rev. Laws 1910, Sec. 1156; South Dakota Comp. Laws 1910, Sec. 2044.
4. See German Ins. Co. of Free-port v. Gibe, 162 III. 251, 44 N. E. 490.
The admission of evidence for the purpose of showing an absolute conveyance to be a mortgage would appear to involve an exception to the rule which excludes extrinsic evidence to vary or control a written instrument, "the parol evidence rule," so called, and there has been considerable discussion as to the principle on which the admission of such evidence can be supported. In some cases the right to introduce such evidence is stated to exist only when the written defeasance has been omitted as the result of fraud, accident, or mistake.9 In others the attempt to utilize the absolute con4a. Thomas v. Scutt, 127 N. Y. 133, 27 N. E. 961.
5. Georgia Code 1911, Sec. 3258; Mississippi Code 1906, Sec. 4783.
6. Act June 8, 1881. See O'Donnel v. Vandersaal, 213 Pa. 551, 63 Atl. 60; Oliver v. Oliver, 251 Pa. 574, 97 Atl. 84.
7. Goodwin v. McMinn, 193 Pa. 646, 74 Am. St. Rep. 703, 44 Atl. 1094.
8. Pub. St. 1901, ch. 139, Sec. 2.
See Benton v. Sumner, 57 N. H. 117.
9. 4 Kent's Comm. 142; Blake-more v. Byrnside, 7 Ark. 505; Washburn v. Merrills, 1 Day (Conn.) 139; Crutcher v. Muir, 90 Ky. 142, 29 Am. St. Rep. 366; 13 S. W. 435; McClane v. White, 5 Minn. 178; Lokerson v. Stilwell, 13 N. J. Eq. 358; Sprague v. Bond, 115 N. C. 530, 20 S. E. 709.