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4 Law Coach 108 (1923-1924)
The Doctrine of Consolidation of Mortgages

handle is hein.journals/lwcoarch4 and id is 112 raw text is: THE LAW COACH- DECsB*R, 192$ THE DOCTRINE OF CONSOLIDATION OF MORTGAGES. I. The doctrine of consolidation in mortgages is based on the equitable maxim he who seeks equity must do equity. .(onsolidation is the right of the mortgagee, where he holds two .or more properties in mortgage of the same mortgagor to hold them as one security for all the mortgage debts. The result is the mortgagor cannot redeem one property without redeeming the others. The position is more clear from an illustration. Suppose A the mortgagor mortgages first Whiteacre for £1,000 to X the mortgagee, and subsequently he mortgages Blackacre to X for another £1,000. If A wishes to redeem Whiteacre X can say No ! you cannot redeem one property alone, you must redeem both Whiteacre and Blackacre or neither of them. II. The-right to consolidate, however, cannot arise until there has been default by the mortgagor on both properties. This is the decision of Cummins v. Fletcher. By this we mean that while the mortgagor can redeem at law, that is within the six months which is invariably expressed in all mortgage deeds as being the duration of the loan, no right to consolidation arises. It is only when the mortgagor has made default upon both mortgages by having permitted the fixed period of six months to elapse in the case of both securities that the right to consolidate arises. The reason is clear, he who seeks equity must do equity ; during the fixed period the mortgagor has an absolute right to redeem at law, but upon its expiration he has no legal right of redemption, but merely an equitable right of redemption; and as the right of the mortgagor becomes then entirely equitable, so he must do equity to the mortgagee if he is to be allowed to avail himself of his equity of redemption. I. Hitherto we have considered consolidation only in a simple case of where the right to consolidate is sought by the original mortgagee against the -original mortgagor, but the doctrine extends also to the transferees of the original parties and complications arise. We will deal with these shortly -- (a) A is mortgagor, X mortgagee of both Whiteacre and Blackacre, there being a separate mortgage to X of each of the two properties. If A transfers both equities of redemption to C, X can still consolidate, because C takes the transfers only subject to the same rights of redemption that A had; as A's right to redeem was subject to con- solidation, so must C's right also be subject to consolidation by X. This is the case of Pledge v. White. (b) If A instead of transferring both equities of redemption to C, A gives C a second mortgage on both the properties, i.e., instead of selling right out both equities of redemption he mortgages both equities of redemption to C, for remember that a second mortgage is the mortgage of any equity of redemption, X can still consolidate against C. This is Vingt v. Padget. 108

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