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 .
Before the right of redemption was recognized by courts of equity, no foreclosure was necessary, since the mere breach of the condition vested an absolute estate in the mortgagee. When, however, the right of redemption came to be recognized, it was, in justice to the mortgagee, necessary that a time be limited within which this right should be exercised, and chancery accordingly adopted the practice of issuing a decree, upon the filing of a bill by the mortgagee, cutting off, that is, foreclosing, the right of redemption if not exercised by a time named.65 Such a decree, in effect vesting the title to the land in the mortgagee unless there was a redemption within a period named, was at one time the only method of foreclosure; but since the introduction of a foreclosure by sale of the land, it has acquired the distinctive name of "strict foreclosure."66
47 Atl. 20; Jackson v. Wood, 12 Johns. (N. Y.) 242, 7 Am. Dec. 315; Allen v. Everly, 24 Ohio St. 97; Hale v. Pack's Ex'rs. 10 W. Va. 145. But see Cheever v. Per-ley, 11 Allen (Mass.) 584; Kellogg v. Dickinson, 147 Mass. 432, 1 L. R. A. 346, 18 N. E. 223, to the effect that some act of recognition of the claim is necessary in order to rebut the presumption. 63. See Brobst v. Brock, 10 Wall. (U. S.) 519, 19 L. Ed. 1002; Courtney v. Staudenmayer, 56 Kan. 392, 54 Am. St. Rep. 592, 43 Pac. 758; Chick v. Rollins, 44 Me. 104; Howland v. Shurtleff, 2 Mete. (Mass.) 26. 35 Am. Dec. 384; Stimis v. Stimis, 54 N. J. Eq. 17, 33 Atl. 468; Collins v. Torry, 7 John. (N. Y.) 278, 5 Am. Dec. 273. In Jackson v. Slater, 5 Wend. (N. Y.) 295, the presumption was held to be rebutted by the fact that the possession was in a stranger. In Jenkins v. Andover Theological Seminary,
205 Mass. 376, 91 N. E. 552, and Crooker v. Crooker, 49 Me. 416, it was held that there was no presumption of payment if the mortgagee could not have taken possession owing to an outstanding estate in another person.
In Massachusetts there appear to be recognized two presumptions, one applicable to a mortgage debt, as well as any other debt, to the effect that the debt has been paid, this presumption being rebuttable by any evidence to show that the debt has not been paid, and the other presumption being applicable only in the case of a mortgage debt, and being dependent on the mortgagor's possession, and this presumption being rebuttable only by evidence of recognition or admission of the debt. Jenkins v. Andover Theological Seminary, 205 Mass. 376, 91 N. E. 552.
64. Ante, Sec. 640(f).
This method of foreclosure has not been favored in this country, since it is liable to result in forfeiting the whole property on account of a debt considerably loss than the value of the property. It is however recognized in a number of states as an appropriate form of proceeding under special circumstances, when not calculated to prejudice either of the parties in interest.67 It has been regarded as particularly appropriate for the purpose of cutting off the rights of subsequent incumbrancers and lienholders who were not made parties to a prior foreclosure proceeding under which a sale of the property was made.68 And in one state at
65. 4 Kent's Comm. 181; Coote, Mortgages (4th Ed.) 990.
66. See 4 Kent's Comm. 181; 2 Jones, Mortgages, 1538-1570; Lansing v. Goelet, 9 Cow. (N. Y.) 346; Clark v. Reyburn, 8 Wall. (U. S.) 318, 19 L. Ed. 354.
67. Farrell v. Parlier, 50 III. 274; Stephens v. Bichnell, 27 III. 444, 81 Am. Dec. 242; Illinois Starch Co. v. Ottawa Hydraulic Co., 125 III. 237, 17 N. E. 486; Shepard v. Barrett, 84 N. J. Eq. 408, 93 Atl. 852; Moulton v. Cornish, 138 N. Y. 133, 20 L. R. A. 370, 33 N. E. 842; Harding v. Gil-lett, 25 Okla. 199, 107 Pac. 665; Bresnahan v. Bresnahan, 46 Wis. 385, 1 N. W. 39.
68. Jefferson v. Coleman, 110 Ind. 515, 11 N. E. 465; Shaw v. Hersey, 48 Iowa, 468; Eldridge v. Eldridge, 14 N. J. Eq. 195; Donovan v. Smith (N. J. Ch.), 88 Atl. 167;Bolles v. Duff, 43 N. Y. 469; Ross v. Boardman, 22 Hun.(N. Y.) 527; Koerner v. Williamette Iron least such a foreclosure is recognized as proper when the property is worth less than the amount of the debt, and the mortgagor is insolvent, and the mortgage creditor is willing to take the property in discharge of the debt.69 In some states a strict foreclosure is never allowed.70 It is apparently a usual method of foreclosure in Connecticut and Vermont.71
A decree of strict foreclosure vests the absolute title in the mortgagee,72 but the mortgage debt is not necessarily satisfied, and the mortgagor's personal liability for any excess in the amount of the mortgage over the value of the land may be enforced in an action at law.73