Rue v. Dole

Citations

• 107 Ill. 275
• 1883 Ill. LEXIS 259

Syllabus

<p>1. Sale—mortgage—whether a transaction was am, absolute sale or only a mortgage—conveyance in satisfaction of a mortgage indebtedness, with a contract for a repurchase. Where the owner of property had given deeds of trust for a large sum of borrowed money, and had failed to pay the interest or taxes for four years, on being notified by the executors of the creditor that they would proceed to foreclose the trust deeds and sell the premises unless the interest was paid, he replied that he preferred to make a deed for the property rather than to have a sale made under the trust deeds or on foreclosure, and after some negotiations the amount of the indebtedness was agreed on, and he conveyed the property by a deed absolute in form, taking back a contract to convey the land to him upon the payment of the sum found to be due, within one year, and his notes and deeds of trust were surrendered and the record of the trust deeds satisfied, he executing no new obligation binding him to pay: Held, that the transaction was not in the nature of a mortgage, but was an absolute sale of the equity of redemption, and that the contract given back to the grantor was a re-sale.</p> <p>2. A mortgagee has the right, if he can agree with the mortgagor on the terms, to purchase the mortgaged premises, and if he does, the mere fact that the deed to him is made in satisfaction of the mortgage does not make such deed a mortgage, and the surrender of the evidences of the mortgage debt, taking back no new obligation to pay, is a circumstance affording evidence that the new conveyance was not intended as a mortgage.</p> <p>3. A mortgage being a conditional conveyance of property as a security for the payment of money or the performance of some act or duty, it is essential to its creation and existence that there be a subsisting indebtedness or obligation to pay money or perform some duty or act. When the debt or obligation is released or wiped out, the convej'ance becomes null and void. Theref