Bearss v. Ford

Citations

• 108 Ill. 16
• 1883 Ill. LEXIS 50

Syllabus

<p>1. Mortgage—whether an absolute deed with agreement for repurchase, or a mortgage. Where a debtor whose indebtedness is secured by deeds of trust, and to avoid a threatened foreclosure, conveyed the mortgaged premises to his creditor by a quitclaim deed, containing a proviso that if he should pay a certain sum (being the amount due from him, with interest and back taxes,) within one year, with interest thereon, the grantee should reeonvey the premises to him, and the grantee also executed to the grantor a lease of the premises for one year, at a rental equal to the interest on the debt, payable monthly, which monthly rental, it was recited, was to be deemed and applied as interest, under the conditions of the quitclaim deed, it was held, that the transaction was but a mortgage for the payment of the indebtedness of the grantor, and was not an absolute sale and extinguishment of, the prior indebtedness.</p> <p>2. Whether a deed for land is an absolute sale and conveyance, with an agreement for a repurchase by the grantor, or a mortgage to secure the payment of money, is a.question of fact, depending upon the intention of the' parties to it at the time of its execution.</p> <p>3. Same—when deed absolute in form is given as a further security, creditor may still enforce his prior securities. Where a deed absolute in form, with a clause for repurchase, is given in consideration of an existing mortgage indebtedness, the court is more inclined to treat it as a mortgage than where given upon an original advance, and when so treated the new mortgage will not be regarded as a substitute for the former security, unless the intention to that effect is manifest; and in such cases the original mortgage may be foreclosed, notwithstanding the giving of the new one.</p> <p>4. If the new instrument operates as a satisfaction or extinguishment of the mortgage indebtedness, it will be regarded as a sale and conveyance of the equity of redemption, with an agreement for a repurchase;