Bayley v. Bailey

Shaw, C. J. The plaintiff brings his bill in equity to redeem land alleged to have been transferred by the plaintiff to Richard W. Bayley, the defendant’s intestate, to secure the payment of a large sum of money. He sets out a deed from himself to said Richard, and an instrument of even date, signed and sealed by both parties, which he insists constitutes a defeasance, [509] The answer denies that the instrument in question amounts to a defeasance, and insists that, in legal effect, it is only a conditional contract for a resale of the land, and that the condition has not been complied with. The single question is, whether this agreement constitutes a defeasance. The instrument is rather peculiar in form, each party speaking in the first person; but it closes with the words, “in witness whereof we have mutually agreed to this instrument ; ” and is then signed, sealed and witnessed. Though it is not the joint language of the parties, yet it expresses the assent of both parties to the purposes and stipulations expressed in it. It seems to us clear that this instrument constituted a defeasance to the deed to which it refers. It has all the characteristics of a defeasance. The internal evidence shows that it was simultaneous; the agreement, as well as the deed, took effect from its delivery. If the deed was delivered some days after the date, the reference to it, as of “ this day,” indicates that the agreement was delivered at the same time. It shows an intention of the grantor to redeem, and an assent thereto by the grantee. The very terms, “ purchase back,” “ redeem,” on the part of the grantor, and the stipulation on the part of the grantee to “redeed,” on payment, are all indicative of an estate, defeasible and redeemable, taken for security. The grantor binds himself to “ refund,” that is, pay back, treating the money advanced as a debt; but there would be no debt, if it were purchase money received in payment for land sold. It is no objection that the grantor binds himself in the sum of $3,000, to pay $14,500. This is a mere penalty. It is always competent for the obligee to waive the penalty and proceed on the covenant, either to pay money or do other acts. In this same contract, the grantee binds himself in the same penalty of $3,000, on a certain condition, to convey land worth $15,000. Without regarding the penalty, it is a valid contract to convey. A mortgage is a conveyance of real estate, or of some interest therein, defeasible upon the payment of money, or the performance of some other condition. The defeasance may be contained in the deed itself, or in some other deed executed at the sama [510] time and referring to it, constituting with it one transaction, stipulating that the estate shall be reconveyed on the payment of a certain sum; this is a defeasance. Harrison v. Phillips Academy, 12 Mass. 456. The statute law recognizes as mortgages, subject to all the incidents and provisions affecting mortgages, not only those made by a common deed of mortgage, but also such as are made by a conveyance, with a separate deed of defeasance. Rev. Sts. c. 107, § 34. It being once established that the separate deed operated as a defeasance, and rendered the conveyance a mortgage, the right of redemption for three years after condition broken attaches as an inseparable incident, created by law, which cannot be waived by agreement. Though it be ever so strongly expressed that the estate shall be absolute if the money is not paid at the day fixed, such stipulation would be void. It does not depend upon the intent of the parties; because it is an intent contrary to the rules of law, which the law will not carry into effect. The recording of this instrument of defeasance was not necessary to give it its full effect, as between the parties. Such recording is provided for, to give notice to purchasers and atlaching creditors that the grantee’s estate, though apparently absolute, is in fact defeasible; and secures to the mortgagor his right of redemption against such purchaser or creditor, who otherwise would take without notice, and thereby defeat the right of redemption. Such being the rights of the parties under the deed and simultaneous indenture, both specialties, it cannot be affected by the receipts, accounts stated and memoranda which passed between the parties. If the estate was not redeemable at its creation, by force of the defeasance then given, proof of the intention, expectation or understanding of one or both of the parties would not give a right of redemption; if not thus originally redeemable, such proof would not defeat or impair it; and therefore, in cither aspect, such proof is immaterial to the issue. Decree that the plaintiff has the right to redeem.