be secured to him by the mortgage." In that case the demandant in a writ of entry was mortgagor, and the tenant claimed under the mortgagee through various mesne conveyances executed after the law day, and it was held that nothing passed to the tenant, the court observing that to enable the mortgagee to sell and convey his estate was not one of the purposes for which his interest is to be thus treated; that there was no necessity that it should be so treated, as the sale could be equally well effected by the transfer of the note secured by the mortgage.

$428. Mortgagee cannot sell timber wrongfully cut by mortgagor. With these views of the nature of the interest of the mortgagee, under the law of New Hampshire, the question presented in the case at bar becomes one of easy solution. The timber growing upon the land mortgaged constituted a portion of the realty. It was embraced in the pledge of the land as security. As the assignees of the mortgage held the land, so they held the timber upon it, both before and after it was cut, as a portion of their security. They could not sell it any more than they could pass, by their conveyance, the fee of the land. The mortgagors had, it is true, no right to cut the timber after default made in any of the payments designated in the mortgage. They could do nothing to diminish the value of the estate. The right to cut the timber rested upon the license contained in the stipulations of the mortgage. Their cutting, except in pursuance of such license, might have been restrained, upon proper application, by a court of equity. Brady v. Waldron, 2 Johns. Ch., 148. The sale by them after it was cut did not divest the lien of the assignees of the mortgage; the purchaser took the timber subject to their paramount rights. The assignees could follow it and take possession of it, and hold it until the designated amounts due at the time were paid. When these were paid, their rights over it ceased, and the vendee of the mortgagors became invested with a complete title. The subsequent detention of the timber by the assignees was wrongful, and the sale of it a conversion, for which they were liable to the purchaser.

§ 429. A bill of exceptions must show that exception to ruling of court was taken at the time.

Some other positions were pressed by the plaintiffs in error upon the attention of the court on the argument, but we do not notice them; because what is termed in the transcript "a bill of exceptions," does not show that any exception was taken to the rulings of the court. The bill simply shows that certain positions were urged by the parties, and that certain rulings were made. We have, however, considered the material question argued, because no objection was taken to the record on the argument, and because the associate justice of this court, who presided at the circuit where the cause was tried, informs us that an exception was in truth taken, and that the omission of the bill to state. the fact is a mere clerical error. We do not intend, however, to allow this case to be drawn into a precedent. To authorize any objection to the admission or exclusion of evidence, or to the giving or refusal of any instructions to the jury, to be heard in this court, the record must disclose not merely the fact that the objection was taken in the court below, but that the parties excepted at the time to the action of the court thereon. Judgment affirmed.

§ 430. A pre-emption right may be the legal title be in the United States. § 431. A mortgage of a crop, though the time the crop comes into existence.

the subject of a mortgage by the pre-emptor although Bush v. Marshall, 6 How., 284 (§§ 673–675). See § 432. made before the seed is sown, attaches as a lien from Butt v. Ellett,* 19 Wall., 544.

IV. EQUITABLE MORTGAGES.

SUMMARY- Pre-emption claim, § 432.- Agreement to mortgage, § 433.- Deposit of title deeds,

§ 434.

§ 432. A pre-emption claim after entry may be mortgaged, though it is not perfected. Wright v. Shumway, SS 435-439. See § 430.

§ 433. An equitable mortgage arises from an agreement to purchase and mortgage certain land. Ibid.

§ 434. An equitable mortgage may arise from the deposit of a title deed, where an equity is shown beyond the mere deposit of such deed; as where a creditor held as security coupons convertible into lands, and these were replaced by the delivery of an unrecorded deed of the lands running to the debtor. This equitable lien was held to be superior to the lien of a general judgment against the debtor. First National Bank v. Caldwell, § 440. NOTES.-See SS 441-447.]

WRIGHT v. SHUMWAY.

(District Court for Wisconsin: 1 Bissell, 23-28. 1853.)

STATEMENT OF FACTS.-Proceeding in equity to foreclose a mortgage given by the defendants upon certain unsurveyed public lands upon which they had settled, to secure the payment of their promissory notes in the sum of $1,200 to complainants. In the deed the defendants agreed to purchase the said land from the government whenever it was surveyed and put up for sale, and then to re-mortgage it to complainants or their heirs. In 1852 the lands were surveyed and offered for sale. John Shumway, one of the defendants, proved up a preemption right and entered one quarter section; the certificate of location war assigned by him to Fitzgerald, a co-defendant, and the latter entered another quarter section in his own name for Charles Shumway, a defendant herein, giving to each a bond for $500, conditioned that he should give to each of them a deed for a quarter section, for a consideration of $200, interest and annual taxes, within two years thereafter.

§ 435. Private sales or mortgages of pre-emption claims, though the latter are not yet perfected, are valid.

Opinion by MILLER, J.

It is contended on the part of the defendants that the deed of the Shumways to complainants is a contract in violation of the act of congress, approved March 31, 1830 (4 Stats. at Large, 392), entitled "An act for the relief of the purchasers of public lands, and for the suppression of fraudulent practices at the public sales of the lands of the United States," and is therefore void. I do not think that this position is tenable. There is nothing in the deed tending to the formation of a combination of purchasers, or to prevent biddings for the land at a government public sale. But the improved portion of the land was not intended by the Shumways to be the subject of a public sale. As settlers and improvers, at the date of the deed, they considered that their right to pre-emption would be secured, which was afterwards perfected through Fitzgerald. The deed is not within the prohibition of the act. Private sales of pre-emption claims of settlers are recognized as valid by the federal courts. Bush. Marshall, 6 How., 284 (§§ 673–675, infra); Thredgill v. Pintard, 12 How., 24.

436. A mortgage founded upon a past consideration is valid.

At the date of the deed, the Shumways had peaceable and undisturbed possession of the land, with the tacit or implied assent of the United States, and had erected thereon a saw-mill, dwellings, a tavern stand and other buildings;

and they had an inchoate right of pre-emption. In consideration of their indebtedness to the complainants, they made the deed as a security. The debt was then payable. A conveyance, covenant or mortgage founded on a past consideration is valid.

§ 437. Where the money is due and payable, and no time of payment is fixed, a foreclosure will be decreed at any time.

When the money is due and payable, and no time is mentioned in the mortgage for its payment or redemption, a foreclosure will be decreed at any time. And a mortgage intended to secure a certain debt is valid in equity, for that purpose, whatever form the debt may assume. The consideration expressed in the deed is valuable, and is sufficient to authorize the court to enforce performance of its covenants.

§ 438. Where the mortgagor acquires a perfect title to the property after the mortgage, it inures to the benefit of the mortgagee.

It is further contended that the deed is of no validity, the premises not being legally vested in the Shumways. The deed does not purport to be a mortgage of the fee, but nevertheless it may be valid. In equity, whatever property, real or personal, is capable of an absolute sale may be the subject of a mortgage. Therefore, rights in remainder and reversions, possibilities coupled with an interest, rents, franchises and choses in action, are capable of being mortgaged. 2 Story's Eq. Jurisprudence, § 1021. And courts of equity support assignments of, or contracts pledging property, or contingent interests therein, and also things which have no present, actual, potential existence, but rest in mere possibility. Mitchell v. Winslow, 2 Story, 630. If a mortgage be made of an estate, to which the mortgagor has not a good title, and then he who has the real title conveys to the mortgagor, or his representatives, a good title, the mortgagee will be entitled in equity to the benefit of it, for it will be considered as a graft into the old stock, and as arising in consideration of the former title. Seabourne . Powell, 2 Vern., 10; Best v. Meddlenurst, 3 Atk., 276; Goodright v. Meade, 3 Burr., 1703; McGinnis v. Noble, 7 Watts & Serg., 454.

§ 439. An agreement to purchase and mortgage certain land is a specific lien, which will be enforced in equity.

The deed purports to be a mortgage of all the property or interest of the Shumways then existing, with express covenants "that they will purchase the land and mortgage it to the complainants to secure their indebtedness." By this express written agreement to make a mortgage, a lien is created on the land, in equity, on the principle that what has been agreed to be performed shall be performed. Houhey v. Vernon, 2 Cox, 12; 3 Powell on Mortgages, 1049, a, b. An equitable mortgage springs from an agreement, express or implied, that there shall be a lien. The agreement in this case to purchase the land, and then to mortgage it, is express, and is a specific lien, which will be enforced in equity. Finch v. Winchelsea, 1 P. Wms., 277; Freemoult v. Dedire, id., 429; Devlin v. Smith, 3 Atk., 323; Tooke v. Hastings, 2 Vern., 97; Loyde v. Mynn, 4 Leonard, 505; Laundell v. Beerry, id., 481; Metcalf v. The Archbishop of York, 6 Sim., 224; Burn v. Burn, 3 Ves. Jr., 573; Legard v. Hodges, 1 id., 352. The same principle also seems to be well settled in the courts of this country. In re Howe, 1 Paige, 131; Delaire v. Keenan, 3 Desaus. Eq., 74; Menude v. Delaire, 2 id., 564; Dow v. Kerr, Speers, 413; Campbell v. Moseby, 6 Litt., 358; Fleming v. Harrison, 2 Bibb, 171; Richter v. Selin, 8 Serg. & R., 425; Fysor v. Possman, 2 Barr, 122; Longworth v. Taylor, 1 McL., 395. I do

not deem it necessary to enter into a minute statement of these cases, and also of many others, as I consider the principle to be settled beyond all controversy. The deed is an equitable mortgage, to be enforced by a bill in equity. The legal title to half the land is in Fitzgerald, subject to the equity of the Shumways, to redeem on or before the day of payment specified in the bonds of Fitzgerald for conveyance. On or before the day of payment, Fitzgerald is obligated to convey to the Shumways, or to their assigns, or to the purchaser under a decree in this case, upon the payment to him of the amount he advanced for the land to the government, with interest, according to the conditions of the bonds. The Shumways continue to hold actual possession of the land. The bonds of Fitzgerald for deeds are not conveyances of the land, but obligations, whereupon the Shumways, or their representatives or assigns, may compel, by bills in equity, conveyances of the fee, upon the payment of the purchase money, according to the conditions. The purchase of the land by Fitzgerald, at the instance of the Shumways, the settlers and improvers in possession, and their acceptance of bonds for conveyances, are the same in equity as if they had made the purchases in their own names, with money borrowed of Fitzgerald, secured by mortgage of the land.

It is not necessary to determine the question of priority of lien, as the complainants consent to a decree of sale of the two quarter sections entered by Fitzgerald, subject to his lien, according to the conditions of his bonds to the Shumways, the lands being considered quite valuable, and abundant for the payment of both liens. A decree of sale is ordered, according to the prayer of the bill.

FIRST NATIONAL BANK v. CALDWELL.

(Circuit Court for Nebraska: 4 Dillon, 314-316. 1876.)

STATEMENT OF FACTS.- Plaintiff held notes of Gise, and as collateral security coupons convertible into land. With the consent of plaintiff Gise withdrew the coupons and secured lands, and replaced in the hands of the plaintiff the unrecorded deeds for the lands which vested the title in him, Gise. Caldwell, Hamilton & Co. were judgment creditors of Gise, and recorded their judgment in the county in which the lands were situated. The bill sets up the possession of the deeds as an equitable mortgage.

Opinion by DILLON, J.

Counsel have largely argued this cause as if it involved the question whether the English doctrine of equitable mortgages, arising from the mere deposit of title deeds, prevails in the state of Nebraska. It may be admitted, for the purposes of this case, that the deposit of recorded title deeds, without more, will not create an equitable lien against the debtor, or a general judgment creditor of his, and yet the equity of the present cause is with the plaintiff.

$440. The possession of deeds as a collateral security in lieu of coupons preriously held as such creates an equitable mortgage, superior to the lien of a general judgment creditor.

The plaintiff corporation held coupons, convertible into lands, as a specifie security for its debt. Without the debtor's consent it could have converted these coupons into lands, and taken the deed in its own name. Both the plaintiff and Gise, however, thought it advantageous to exercise the option of exchanging the coupons for lands. Gise made the selection of the lands, and the deed was taken in his name, but not recorded, and was delivered at once to the plaintiffs, and is now held by them in virtue of an agreement with Gise,

made at the time, that the deed should be a substituted security in lieu of the coupons. Gise does not controvert the plaintiff's rights. The defendants Caldwell, Hamilton & Co. do not dispute the above facts, but contend that their rights, as a general judgment creditor of Gise, without levy or sale, are superior to the plaintiff's. There is no statute of Nebraska which, in terms, gives such effect to a general judgment lien, nor any decision of the supreme court of the state that a judgment lien overrides existing specific equities in lands in favor of others. The plaintiff's rights, as the equitable mortgagee of the lands, or having an equitable lien upon them, are superior to the rights of a general judgment creditor, who has not become a purchaser under the judg ment, in good faith, and without notice of the rights of the equitable mortgagee. Brown v. Pierce, 7 Wall., 205, 217.

Decree for the plaintiff.

§ 441. An agreement for a mortgage will be treated by a court of equity as a mortgage if it be the intent of the parties. White Water Valley Co. v. Vallette, 21 How., 414, 422.

§ 442. Agreement to mortgage. Where land is sold partly for cash, and the remainder of the purchase money is to be paid in instalments, the purchaser agreeing to execute a mortgage to secure such instalments, but the vendor neglects to make a deed, a court of equity will consider the parties as holding the relation of mortgagor and mortgagee. Longworth v. Taylor, 1 McL., 395, 407.

§ 443. When by a contract of sale a deed is to be made, and a mortgage given to secure deferred payments, the vendor is considered in equity as a mortgagee, on the principle that equity will, for the purposes of justice, treat that to have been done which ought to have been done. Taylor v. Longworth, 14 Pet., 172, 177.

§ 444. After-acquired property.- Courts of equity in certain cases give effect to a mortgage of property to be acquired subsequently, when it appears that no rule of law is infringed and the rights of third persons are not prejudiced. Beall v. White, 4 Otto, 386.

§ 445. A deposit of title papers does not constitute an equitable mortgage unless there is an intent to give security thereby. Mandeville v. Welch, 5 Wheat., 277, 284.

§ 446. A customer of a bank, having deposited with it as collateral security for discounts a note of a third person secured by mortgage, was allowed to withdraw them for the purpose of foreclosure upon his agreement to return the proceeds, or to replace them by other securities. At the foreclosure sale, the customer purchased the property and deposited the deed with the bank. He afterwards discharged the indebtedness to secure which the deposit was made, and thereafter incurred new debts to the bank while the bank held the deed, but it did not appear that these debts were created on the faith of the deposit. Upon his subsequent bankruptcy it was held that the bank could not claim an equitable mortgage by such deposit of the deed. Biebinger v. Continental Bank,* 9 Otto, 143.

S447. While the mere deposit of recorded title deeds will not create an equitable lien against the debtor, yet, under some circumstances, a deposit of an unrecorded deed may be held to create an equitabie mortgage. Thus, where railroad coupons, which were convertible into lands, were held as security, and the debtor so converted them, and took a deed in his own name, and delivered it to his creditor without record as a substituted security in lieu of the coupons, it was held to be an equitable mortgage, superior to the lien of a general judgment creditor. First National Bank v. Caldwell, 4 Dill., 314 (§ 440).

V. ABSOLUTE DEED AND AGREEMENT TO RECONVEY.

SUMMARY - Deed with separate defeasance, § 448.- Right to redeem not renounced except upon a good consideration, § 449.— A conditional sale valid, § 450.— Absolute sale instead of mortgage, § 451.— Assignment of a mortgage with agreement to reassign, § 452.

§ 448. At law an absolute deed and separate defeasance or agreement to reconvey, executed at the same time, amount to a mortgage; although within the time limited for the reconveyance the grantee is empowered to sell the whole or any part of the land at a fixed price, in payment of the debt. Dow v. Chamberlin, §§ 453, 454.

§ 449. The mortgagor is not held to have renounced the right to redeem unless the creditor shows that the right was given up deliberately, and for an adequate consideration. An abso