The House considered the right to redeem a mortgage. Kindersley VC said: ‘There is no doubt that the broad rule is this: that the Court will not allow the right of redemption in any way ‘to be hampered or crippled in that which the parties intended to be a security either by any contemporaneous instrument with the deed in question, or by anything which this Court would regard as a simultaneous arrangement or part of the same transaction.’ The rule in comparatively recent times was. unsettled by certain decisions in the Court of Chancery in England which seem to have misled the learned Judges in the Full Court. But it is now firmly established by the House of Lords that the old rule still prevails and that equity will not permit any device or contrivance being part of the mortgage transaction or contemporaneous with it to prevent or impede redemption. The learned Counsel on behalf of the Respondents admitted as he was bound to admit that a mortgage cannot be made irredeemable. That is plainly forbidden. Is there any difference between forbidding re demption and permitting it, if the permission be a mere pretence? Here the provision for redemp tion is nugatory. The incumbrance on the lease the subject of the mortgage according to the letter of the bargain falls to be discharged before the lease terminates, but at a time when it is on the very point of expiring when redemption can be of no advantage to the mortgagor even if he should be so fortunate as to get his deeds back before the actual termination of the lease. For all practical purposes this mortgage is irredeem able. It was obviously meant to be irredeemable. It was made irredeemable in and by the mortgage itself.’
Judges:
Kindersley VC
Citations:
[1869] 32 LJ Ch 653, [1869] WR 1137
Jurisdiction:
England and Wales
Cited by:
Cited – Fairclough v The Swan Brewery Company Ltd PC 17-May-1912
. .
Cited – Brighton and Hove City Council v Audus ChD 26-Feb-2009
The claimant was the proprietor of a fourth legal charge on a title. It sought a declaration that a second charge in favour of the defendant was void as a clog on the proprietor’s equity of redemption. An advance secured by a first charge, also in . .
Lists of cited by and citing cases may be incomplete.
Equity
Updated: 09 December 2022; Ref: scu.304591