had and received, in the name of Hatch, to recover from the plaintiff, under his written memorandum, whatever may remain after his claims are satisfied. I do not perceive that there is anything inconsistent with established modes of proceeding at the common law, in doing complete justice between the parties in this action, by giving effect to the equitable title of the defendant. It is a new case, in its facts, but I think not in its principles. Neponset Bank v. Leland, 5 Metc., 259. A judgment will, therefore, be entered for the amount paid by the plaintiff, and interest and cost of protest of the bill; and to this is to be added the sum of $50 and interest from the 22d June, 1849, the time when that sum was agreed to be paid.

§ 462. A defeasance must be between the same parties as the conveyance. It is of the very essence of a defeasance that it defeats the principal deed and makes it void ab initio, if the condition is performed. Flagg v. Mann, 2 Sumn., 486, 541.

§ 463. An absolute deed and a separate defeasance constitute a mortgage. Lanahan v. Sears, 12 Otto, 318 (§§ 707, 708).

§ 464. To constitute a conditional purchase, there must be a sale for a valuable consideration between the parties, with a right of repurchase. A mere gift would not raise the question. Flagg v. Mann, 2 Sumn., 456, 531.

§ 465. Whether the delivery of a deed is intended to be absolute or conditional depends upon the intention of the parties, and is a question of fact for the jury. Henry v. Henry, 4 Biss., 354, 355.

§ 466. Where there is a doubt whether a transaction be a mortgage or a conditional sale, courts of equity more readily treat it as a mortgage than a conditional sale. Flagg v. Maun, 2 Sumn., 486, 535.

VI. PAROL EVIDENCE TO PROVE AN ABSOLUTE DEED A MORTGAGE.

SUMMARY- Parol evidence admissible, § 467.--- Absolute deed to secure a loan, § 468. The real transaction may be shown, §§ 469, 470, 472.—Whether redemption has been waived, § 471.Inadequacy of consideration, § 473.- When trunsaction is doubtful, § 474.—Strict proof to be made, § 475, 476.— Evidence to show the transaction a mortgage, § 477.

§ 467. Parol evidence is admissible to show that an absolute deed was intended as a mortgage, and that the defeasance has been omitted or destroyed by fraud or mistake, or omitted by design upon mutual confidence between the parties. Babcock v. Wyman, §§ 478-482. $468. Where an application is made for a loan of money, and the money lent, a bond taken for the amount, and simultaneously an absolute deed executed conveying to the lender valuable real estate, such deed will be held a mortgage and redemption permitted. Morris v. Nixon, § 483.

$469. The rule which excludes parol testimony to contradict or vary a written instrument does not forbid an inquiry into the object of the parties in executing a conveyance. The court will look to the real transaction. Peugh v. Davis, SS 484–490.

$470. If the conveyance was made as a security, a right of redemption attaches to it, and this right cannot be waived by the parties by any stipulation made at the time. Ibid.

§ 471. In determining whether redemption has been subsequently waived by a release of uncertain import, the fact that the value of the property is at the time greatly in excess of the amount paid by the grantee, and the fact that the grantor retains possession of the land, are circumstances which strongly tend to show that such a waiver was not intended. Ibid. § 472. An absolute conveyance, given as a security, is a mortgage. The true character of the transaction will always be inquired into. Russell v. Southard, § 491-509.

§ 473. Inadequacy of consideration is a circumstance of importance in determining whether the transaction is a sale or a mortgage. Ibid.

§ 474. When it is doubtful whether the transaction was a sale or a mortgage, the courts lean to the conclusion that it was a mortgage. Ibid.

§ 475. One who alleges that his deed in absolute form was intended as a mortgage only is required to make strict proof of the fact. Andrews v. Hyde, §§ 510-514.

§ 476. The testimony of the grantor, that he understood the transaction to be a mortgage, is not alone sufficient to prove it to be so. The proof must be clear, satisfactory and convincing. Ibid.

§ 477. A deed absolute on its face may be shown to have been a mortgage, by confessions of the grantee that it was such; by receipts of money as interest for the debt; by length of possession, after the mortgage, by the mortgagor; by the relation of debtor and creditor admitted to have existed long before between the alleged mortgagor and mortgagee, and finally by the fact that the property was much more valuable than the consideration advanced. Any and all such facts are admissible as evidence for this purpose and are not forbidden by the statute of frauds. Bentley v. Phelps, §§ 515, 516.

[NOTES.- See §§ 517–532.]

BABCOCK v. WYMAN.

(19 Howard, 289-303. 1856.)

Opinion by MR. JUSTICE MCLEAN.

STATEMENT OF FACTS.-This is an appeal from the decree of the circuit court for Massachusetts. The bill states the following facts: Nehemiah Wyman was seized in fee of about eleven and a half acres of land in Charleston, purchased by him of Tuft's administrator, one acre of which he sold to Foster, who gave a mortgage to secure the payment of the consideration of $600, which sum was not paid when due, and he entered to foreclose. The entire tract, on the 1st of December, 1820, had been mortgaged by him to Francis Wyman, his brother, to secure three notes of that date, one for $676, payable in one month; another for $650, payable in six months; the third for $704.39, payable in one year; interest to be paid on each note semi-annually. Shortly after this, Francis Wyman, by his will, dated 14th June, 1822, devised to defendant Babcock all his estate, including said notes and mortgage, in trust for testator's wife and children, and made Babcock his executor. The testator died in August, 1822. On the 1st of December, 1824, Nehemiah paid Babcock, as trustee and executor, the note for $704 and interest; and from time to time paid the interest on the other notes, up to December, 1826.

In 1825 or 1826, Nehemiah became embarrassed, and having entire confidence in his brother-in-law, Babcock, he, by deed, 26th April, 1826, mortgaged the eleven acres of land as security of a note to Babcock of that date, for $1,200, payable in one year, with interest. At this time, little, if anything, was due to Babcock, but it was understood between them that Babcock would become security for him, or advance money to him, the mortgage to stand as a security. Before the 20th of November, 1828, Babcock did become bound for and advanced to him upwards of $400. In addition to this, there was due to Babcock as executor, for rent, $136.71. On a settlement, Nehemiah executed to Babcock three notes, one dated 7th November, 1828, for $486.79, of which $400.08 were due Babcock individually, and $86.71 to the heirs of Nehemiah Wyman, Sr.; another note for $8.10, and third for $50, due to the heirs of the same, were given. Nehemiah being thus indebted to Babcock, as trustee and executor, and not being able to pay the interest, Babcock and William Wyman, brother of Nehemiah, urged him to make a clear deed in fee for the land aforesaid, to Babcock, that he might manage and improve the same, and apply the rents and profits to pay interest on the incumbrances, and to the gradual liquidation of the principal. And finding that this conveyance to Babcock was made a condition of further advances, he eventually conveyed the estate to Babcock, it being expressly agreed by Babcock, that, notwithstanding the form of the conveyance, it should stand as security only for the sums due to him. That on the 20th of November, 1828, a memorandum was made out of the sums thus due, and handed to Nehemiah, as evidence of the amount for which the land was held. At the time this deed was executed, no one of the

notes held by Babcock was surrendered, nor the mortgage to Francis Wyman, deceased. All the evidences of indebtedness remained in the hands of Babcock, Nehemiah holding only the memorandum of the sums. The total amount of the notes in said memorandum, with interest to the 20th November, 1825, amounted to the sum of $2,033.87. Upon receiving the above deed, Babcock took possession under it, not only of the eleven acres, but of the adjoining acre. Babcock, it is alleged, received annually from sales of clay, grass and ledge stone, from the land, more than enough to pay interest and taxes. Nehemiah having removed to the west, regardless of his trust, Babcock sold the land at private sale, without notice to the said Nehemiah, and in fraud of his rights, for $8,000.

In the sale, Babcock represented himself to be the sole owner of the premises. On the 4th of February, 1853, Nehemiah conveyed his right to redeem to Edward Wyman, the complainant, etc. Within two years, Babcock has promised William Wyman, acting for his brother, that he would come to an account with Nehemiah for the price of the land, and pay him the proceeds of the sales, deducting the debts aforesaid, if he would take his notes on time; and would refer the question of amount of rents and profits to the arbitrament of neighbors. Babcock has frequently, recently, admitted that it was originally intended that said deed should stand as security for the amount set forth in the memorandum; and that he always intended to do right in the matter, but that he had been advised by counsel that the agreement, not being in writing, could not be enforced, and this was the reason he refused to perform it.

The bill prays for an account, and the defendant in his answer admits the conveyance stated in the bill, and that the land was subject to the mortgages. He avers the consideration named in the deed was the amount then due defendant in his own right, and as executor and trustee; and the further sum of $8.10 due the defendant, and $50 due as agent. He admits no additional consideration was paid; but he states the land was not worth more than $1,900; that he consented to receive the deed in payment of the sums due him person. ally, and upon an agreement that if he should be able to obtain therefrom, in addition, enough to pay the sums due to him as executor and trustee, he would pay these sums, and upon no other trust or confidence whatever. That, upon the delivery of the deed, he canceled the notes of Nehemiah held in his own right, and either surrendered them to him or destroyed them. That he did not cancel the notes held by him as executor or trustee, because he was not satisfied that he should receive enough from the land to pay the same; and in order to prevent the presumption that he had so agreed absolutely, he made a minute thereon to the effect that he did not guaranty the payment thereof, it being the understanding between him and Nehemiah, that Nehemiah should be personally liable therefor. That he made no other agreement, and he denies that it was understood or agreed that the land was conveyed to him on the trust set forth in the bill; but insists that the conveyance was absolute, in payment of the sums due him, and liabilities incurred; and the only understanding was, that if the defendant should realize therefrom more than enough to pay his own claims, he would pay the debts due him as executor and trustee. Defendant took possession of the land, and for eight years occupied it, Nehemiah never claiming any interest in it. He denies the allegations of the bill, as to the trust; sets up the defense that the agreement, not being in writing, cannot be enforced. He denies that he proposed a compromise, if his notes would be taken on time, as alleged, and he pleads the statute of twenty years'

limitation, etc., and avers the profits of the land did not exceed the taxes,

etc.

Three points may be considered as embracing the merits of this case: Was the deed executed by Nehemiah Wyman to Babcock, for the eleven and one-half acres of ground, given in trust? 2. Can this trust be established by parol evidence? 3. Does the statute of limitation or lapse of time affect the complainant's rights?

§ 478. A deed absolute on its face will be held a mortgage where such was the intention.

No one can read the history of this case, as stated in the bill, without being impressed with the confidential relations of the parties. The grantor and the grantee were brothers-in-law, and the advisers bore the same relation to the grantee. It was a family concern, designed, as it would seem from the bill, to aid an embarrassed member of it, without a probability of loss by the other members. The bill charges, when the deed in question was executed, the sums which it was intended to secure were stated, and handed to Nehemiah. This is not denied in the answer, and William Wyman, the brother, being present, swears, as a witness, to the sums so stated, amounting in the whole to the sum of $2,033.87, the consideration named in the deed. This list was in the handwriting of the son of Babcock, and the paper was delivered to Nehemiah in the presence of the witness. The deed was drawn by the witness, and he knows that the sums named included all the debts which Nehemiah owed to Babcock individually, or as trustee. The witness remembers Babcock said, after the statement was made, add sixty-two cents for recording the deed, which made the sum inserted as the consideration in the deed. Nehemiah hesitated to sign the deed, when Babcock said, he can have the land again, at any time he shall pay the debts secured by it. The answer avers, when the deed was executed, the defendant gave up the notes of Nehemiah held in his own right, and either surrendered them to him or destroyed them. But it is proved by the same witness that he did neither. These notes were given to the witness without explaining to whom they belonged. Witness supposed they belonged to the estate of Nehemiah Wyman, Sr. The witness says the property, at the time it was sold, was worth thirteen or fourteen thousand dollars, and that it was sold greatly below its value.

The bill charges that the defendant promised William Wyman, acting for his brother, that he would come to an account with Nehemiah for the price of the land, and pay him the proceeds of sales. This is denied in the answer. William Wyman swears that on the 8th of November, 1851, he showed to Babcock the memorandum of the sums named, to secure the payment of which the deed was executed. He was much embarrassed, and admitted the handwriting was his son's, then deceased. He then expressed a willingness to settle it up, and asked the witness, how shall this be done? Witness replied that he should first charge Nehemiah with all his notes and interest, and then credit him with the proceeds of the land, and what he received from the land, with interest, and be allowed a fair compensation for his trouble. He then said, I can't tell how much I have received from the land, but we will leave it to two good men; and that he would give his note for what should be due. A short time after this, Babcock told witness that he had consulted counsel, who advised him to pay the amount due the estate of Nehemiah, Sr., and no more; and this he offered to do, if the witness would execute a bond of indemnity against any farther claim. He said that he had been advised, as the deed was absolute on

its face, and no writing showed that the land was conveyed in security of a debt, the obligation could not be enforced. The witness signified to Babcock, some time before the sale of the land, that he would redeem it for his brother. Nehemiah Wyman, having transferred all his interest to the complainant, was examined as a witness, who stated, at the time he executed the deed to Babcock, he owed him, as an individual, as executor and agent, the sum of $2,033.87, which included sixty-two cents for recording the deed; and that sum was stated as the consideration in the deed. Of this sum, only $408.18 and interest were due to Babcock in his individual capacity.

In his answer, the defendant states that the conveyance was made in payment of the sums due him personally; that he did not cancel the notes held by him as executor or trustee, because he was not satisfied that he should receive enough from the land to pay those debts. But the proof shows that the debt due him as executor and agent, and also his individual debt, were all included in the consideration named in the deed. The defendant made no advance to the witness on the note and mortgage for $1,200; but, at the date of the subsequent conveyance, the defendant had advanced to him $400.08, and $8.10, which, as above stated, constituted the debt due to the defendant on his personal account. The conveyance was made to the defendant, the witness swears, with the express understanding that Babcock was to have the entire management of the land, so as to apply the proceeds in payment of the interest, and witness was to have the land again on paying the sums specified. He was induced to make the conveyance by the urgent request of his brother William, and Babcock; his brother told him, if he did not make it, he would not assist him in his pecuniary matters. On the execution of the deed none of the notes held by Babcock were canceled or surrendered to the witness; but they are still held against him. The witness says that Babcock promised to keep an account of the receipts of the land conveyed to him; but in his answer he says he kept no account, "because the land and rents and profits were his own, without any liability to account to any one."

Such a transaction as set out in the bill, between brothers-in-law, in the nature of things might be supposed to have taken place in the mutual confidence of the parties; and in the final adjustment there should be no evasions or subterfuges to gain an advantage. So far as regards the deed under consideration, all the material allegations of the bill are proved, and all the material averments of the answer seem to be unfounded. In coming to this conclusion, we do not rest alone on the witnesses Nehemiah and William Wyman. There are strong circumstances which corroborate the witnesses, and satisfy the mind beyond a reasonable doubt. In his answer, the defendant avers that the land was conveyed to him in payment of the sums due him personally. It appears from the oaths of both the Wymans that this is not correct; and, in addition, it is shown by the memorandum made out at the time, stating the sums for which the land was conveyed, in the handwriting of the son of the defendant. Taking the statement of the defendant as true, that he did not intend to make himself responsible for the debt due to him as executor and agent at the time the deed was executed, presents him in an unfavorable light. The land for which he received a deed from Nehemiah Wyman, he was aware, had been previously mortgaged to secure the debt in his hands as executor of Francis Wyman. Could he have carried out this declared intention, he would have been unfaithful to the trust committed to him. William Wyman seems to be a man of business. He drew the conveyance from his brother Nehemiah to