Mr. Justice Beckwith
delivered the opinion of the Court:
This is a suit in equity to enforce an equitable mortgage. The bill alleges, that one Hickox made three promissory notes for the sum of six thousand two- hundred and fifty dollars each, payable to Haddock or order, with interest, in one, two and three years after date, respectively, and executed a mortgage of certain premises in Chicago to secure the payment of the same. That afterwards the equity of redemption in the premises came to and was vested in Isaac Speer, under whom the other defendants, after the making of the alleged equitable mortgage, derived their title, with notice. Soon after the note payable in one year from date arrived at maturity, Isaac Speer paid the same, and took it up, Haddock receipting its payment on the back thereof.
Speer then applied to Thompson, under whom the other complainants claim, for a loan of money; and by an agreement between Speer, Haddock and Thompson, the receipt of payment upon the note was erased, and it was indorsed to Thompson. An agreement was written upon the back of the note, which was signed by Speer and Haddock, as follows, viz:
“Received of Arch’d Thompson, as purchaser and assignee, the fall amount of the within note, and interest from date, (the interest to 10th May on the other two notes being paid by I. Speer as above,) and in consideration of such purchase payment, I hereby sell, assign and transfer the within note to said Thompson, with all interest accrued or to accrue, including the incident security, by trust deed, or mortgage, of Hickox, the maker. But it is understood that said Thompson is not to proceed thereon until I shall have had time and opportunity to collect my said two next notes included in same security by deed or mortgage. It being understood that I. Speer, assignee of Hickox (who also undersigns,) is to have three years from date to pay this note, by his allowing or paying ten per cent, interest on the advance purchase-money, (amount on 10th May last, $6,625; one and a half months more to 25th June, is $46.87, $6,671.87), so advanced in purchase of this note by said Thompson. Chicago, June 24th, 1856.
BENJ’M E. HADDOCK.’-
“ And said Speer hereby agrees to pay the within note, and interest accrued, besides ten per cent, hereafter as above. Chicago, June 24th, 1856. ISAAC SPEER.”
It was insisted in argument that the payment of the note discharged the mortgage; and that it could not be revived, without the assent of Hickox, the mortgagor, nor by an instrument having none of the formalities necessary to create a legal mortgage.
An instrument under seal is required to create a mortgage conveying the legal title; and after such a mortgage is in contemplation of law discharged, it would seem to be necessary to observe the same formalities in reviving it, as were requisite to give it validity in the first instance; but although an instrument may not operate as a revival of a mortgage at law, it does not follow that it should not operate as an agreement to charge the lands as an equitable mortgage. While we cannot give effect to an instrument so as to do violence to the rules of language, or to the rules of law, we are to give to it such a construction as will bring it as near to the actual meaning of the parties, as the words which they saw fit to employ, and the rules of law, will permit.
It not unfrequently happens that instruments cannot have the effect intended by the parties, and effect is given to them in another way consistently with such intention.
In Gibson v. Minet, 1 H. Bl. 569, Lord Chief Baron Eybe said, “ a deed of feoffment upon consideration, without livery, may enure as a covenant to stand seized to the use of the intended feoffee. A feoffment without livery, operates nothing as a feoffment — is in truth no feoffment, but is a deed, which may operate as a covenant to stand seized to uses. The seizin remains in the feoffor, because the deed is insufficient to pass it; but the land is bound by the use; ” and the reason the learned Baron gives for this conclusion is, that “it is the effect of the feoffor’s own agreement, plainly expressed upon the face of his deed — it is a construction put upon the words of his deed, which his words will bear.”
In Shep. Touch., vol. 2, p. 82 (Preston’s edition), it is said, “ a deed that is intended and made to one purpose may enure to another; for, if it will not take effect in the way it was intended, it may take effect another way, provided it may have that effect, consistently, with the intention of the parties.”
In Goodtitle d. Edwards v. Bailey, Cowp. 597, Lord Mansfield said, “ the rules laid down in respect to the construction of deeds are founded in law, reason, and common sense; that they shall operate according to the intention of the parties; if by law they may; and if they cannot operate in one form, they shall operate in that which by law shall effectuate the intention.”
' In Sanders v. Seville, 8 Lev. 372, it was held, “ where a man who was seized in fee of a rent, granted it by deed to one who was his kinsman, and there was an attornment to the grantee, but it was made by a person who was not the real tenant of the land and therefore void, though the intent appeared that the deed should operate as a grant at common law with an attornment, yet since it could not pass that way, it was adjudged that the grant should operate as a covenant to stand seized.”
In Roe v. Franmar, 2 Wils. 75, it was unanimously resolved that, though a deed of release could not operate as such because it granted a freehold in future, which could not by law be done, yet the deed should operate as a covenant to stand seized to the use of the releasee. The same rule has been frequently applied in giving effect to other instruments. 2 Pars, on Cont. 15; Brown v. Slater, 16 Conn. 192.
In the case under consideration, although the agreement may not operate as a revivor of the mortgage at law, it may have effect as an agreement to charge the land consistently with the intention of the parties, if it contains all the essential elements of such an agreement. Speer received from Thompson $6,671.87, and agreed in writing to repay the same in three years with interest at ten per cent. The words of the undertaking are to pay the note and interest accrued, with ten per cent, interest thereafter, as before stated in the agreement.
The language has the same meaning as an undertaking in words to pay the sum of money specified in the note and interest accrued, amounting to $6,671.87, with ten per cent.. interest thereon. The only question to be considered is, whether Speer made an agreement to charge the lands with the payment of the debt. The agreement was in writing and signed by the parties to be charged thereby. Ho question as to its validity arises under the statute of frauds.
The parties were competent to contract, and there was a valuable consideration. The minds of the parties assented to the writing signed by them; and we have only to consider, whether it contains apt words expressive of an intention to charge the lands with the payment of the debt. Ho particular form of words was necessary for this purpose; but any words showing that the parties assented that the lands should be so holden, will be sufficient.
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Mr. Justice Beckwith
delivered the opinion of the Court:
This is a suit in equity to enforce an equitable mortgage. The bill alleges, that one Hickox made three promissory notes for the sum of six thousand two- hundred and fifty dollars each, payable to Haddock or order, with interest, in one, two and three years after date, respectively, and executed a mortgage of certain premises in Chicago to secure the payment of the same. That afterwards the equity of redemption in the premises came to and was vested in Isaac Speer, under whom the other defendants, after the making of the alleged equitable mortgage, derived their title, with notice. Soon after the note payable in one year from date arrived at maturity, Isaac Speer paid the same, and took it up, Haddock receipting its payment on the back thereof.
Speer then applied to Thompson, under whom the other complainants claim, for a loan of money; and by an agreement between Speer, Haddock and Thompson, the receipt of payment upon the note was erased, and it was indorsed to Thompson. An agreement was written upon the back of the note, which was signed by Speer and Haddock, as follows, viz:
“Received of Arch’d Thompson, as purchaser and assignee, the fall amount of the within note, and interest from date, (the interest to 10th May on the other two notes being paid by I. Speer as above,) and in consideration of such purchase payment, I hereby sell, assign and transfer the within note to said Thompson, with all interest accrued or to accrue, including the incident security, by trust deed, or mortgage, of Hickox, the maker. But it is understood that said Thompson is not to proceed thereon until I shall have had time and opportunity to collect my said two next notes included in same security by deed or mortgage. It being understood that I. Speer, assignee of Hickox (who also undersigns,) is to have three years from date to pay this note, by his allowing or paying ten per cent, interest on the advance purchase-money, (amount on 10th May last, $6,625; one and a half months more to 25th June, is $46.87, $6,671.87), so advanced in purchase of this note by said Thompson. Chicago, June 24th, 1856.
BENJ’M E. HADDOCK.’-
“ And said Speer hereby agrees to pay the within note, and interest accrued, besides ten per cent, hereafter as above. Chicago, June 24th, 1856. ISAAC SPEER.”
It was insisted in argument that the payment of the note discharged the mortgage; and that it could not be revived, without the assent of Hickox, the mortgagor, nor by an instrument having none of the formalities necessary to create a legal mortgage.
An instrument under seal is required to create a mortgage conveying the legal title; and after such a mortgage is in contemplation of law discharged, it would seem to be necessary to observe the same formalities in reviving it, as were requisite to give it validity in the first instance; but although an instrument may not operate as a revival of a mortgage at law, it does not follow that it should not operate as an agreement to charge the lands as an equitable mortgage. While we cannot give effect to an instrument so as to do violence to the rules of language, or to the rules of law, we are to give to it such a construction as will bring it as near to the actual meaning of the parties, as the words which they saw fit to employ, and the rules of law, will permit.
It not unfrequently happens that instruments cannot have the effect intended by the parties, and effect is given to them in another way consistently with such intention.
In Gibson v. Minet, 1 H. Bl. 569, Lord Chief Baron Eybe said, “ a deed of feoffment upon consideration, without livery, may enure as a covenant to stand seized to the use of the intended feoffee. A feoffment without livery, operates nothing as a feoffment — is in truth no feoffment, but is a deed, which may operate as a covenant to stand seized to uses. The seizin remains in the feoffor, because the deed is insufficient to pass it; but the land is bound by the use; ” and the reason the learned Baron gives for this conclusion is, that “it is the effect of the feoffor’s own agreement, plainly expressed upon the face of his deed — it is a construction put upon the words of his deed, which his words will bear.”
In Shep. Touch., vol. 2, p. 82 (Preston’s edition), it is said, “ a deed that is intended and made to one purpose may enure to another; for, if it will not take effect in the way it was intended, it may take effect another way, provided it may have that effect, consistently, with the intention of the parties.”
In Goodtitle d. Edwards v. Bailey, Cowp. 597, Lord Mansfield said, “ the rules laid down in respect to the construction of deeds are founded in law, reason, and common sense; that they shall operate according to the intention of the parties; if by law they may; and if they cannot operate in one form, they shall operate in that which by law shall effectuate the intention.”
' In Sanders v. Seville, 8 Lev. 372, it was held, “ where a man who was seized in fee of a rent, granted it by deed to one who was his kinsman, and there was an attornment to the grantee, but it was made by a person who was not the real tenant of the land and therefore void, though the intent appeared that the deed should operate as a grant at common law with an attornment, yet since it could not pass that way, it was adjudged that the grant should operate as a covenant to stand seized.”
In Roe v. Franmar, 2 Wils. 75, it was unanimously resolved that, though a deed of release could not operate as such because it granted a freehold in future, which could not by law be done, yet the deed should operate as a covenant to stand seized to the use of the releasee. The same rule has been frequently applied in giving effect to other instruments. 2 Pars, on Cont. 15; Brown v. Slater, 16 Conn. 192.
In the case under consideration, although the agreement may not operate as a revivor of the mortgage at law, it may have effect as an agreement to charge the land consistently with the intention of the parties, if it contains all the essential elements of such an agreement. Speer received from Thompson $6,671.87, and agreed in writing to repay the same in three years with interest at ten per cent. The words of the undertaking are to pay the note and interest accrued, with ten per cent, interest thereafter, as before stated in the agreement.
The language has the same meaning as an undertaking in words to pay the sum of money specified in the note and interest accrued, amounting to $6,671.87, with ten per cent.. interest thereon. The only question to be considered is, whether Speer made an agreement to charge the lands with the payment of the debt. The agreement was in writing and signed by the parties to be charged thereby. Ho question as to its validity arises under the statute of frauds.
The parties were competent to contract, and there was a valuable consideration. The minds of the parties assented to the writing signed by them; and we have only to consider, whether it contains apt words expressive of an intention to charge the lands with the payment of the debt. Ho particular form of words was necessary for this purpose; but any words showing that the parties assented that the lands should be so holden, will be sufficient.
Haddock held a mortgage which purported to secure the note, and both parties agreed that so much of the mortgage as purported to secure that note, should be transferred to and held by Thompson, as security for the money advanced by him; and it is fairly inferable from the agreement that Thompson was to be at liberty, after a limited time, to proceed upon the mortgage to enforce the payment of his money.
It was urged in argument, that so much of the mortgage as was transferred, was a mere shadow having no vitality ; and that Thompson was only to proceed upon such a shadow to enforce payment of the money advanced by him. If this were true, still, after Thompson had advanced his money, upon Haddock and Speer’s agreement that he might collect it by means of a shadow, they have no just right to say that he shall not do so. The material inquiry, however, is, what did the parties themselves intend ?
The surrounding circumstances render it evident that they intended to give Thompson a security upon the land; and the language employed by them, should be construed—if it consistently can be — so as to effectuate that intention.
If a contract admits of more than one construction, one of which will render it inefficacious, or nullify it, that construction should be adopted which will carry it into effect; or, as was said by Lord Mansfield in Pugh v. Leeds, Cowp. 714, “the parties necessarily understood and used the language in that sense which made their deed effectual."
In the case under consideration, we understand that the parties agreed that so much of the mortgage as purported to secure the note in question, should be effectually transferred to Thompson, and held by him as a valid security.
The agreement that Thompson should be at liberty, after a limited time, to proceed upon the mortgage to enforce the payment of his money, must be construed as an agreement that he might proceed thereon, as upon a valid mortgage. The instrument was one having all the forms of a mortgage; and the agreement of the parties must be construed as one, stipulating that it might be proceeded upon as a mortgage, for the purpose of collecting the money advanced by Thompson.
We think the language employed, when read in the light of surrounding circumstances, clearly expresses an intention to charge the land with the payment of the money.
There is no question as to the intention of the parties to revive the mortgage; and such an intention necessarily includes an assent, that the lands should be holden for the payment of the money to be secured by such revival. The agreement may not be operative in the way in which the parties intended that it should operate; but it expresses their intention so that we can give effect to it in another way consistently with the rules of law.
Our attention was called to the case of Hunt v. Rousmanniere’s Ads., 1 Pet. 1, and it was insisted that the case under consideration came within the rule there laid down.
We think otherwise. In that case a creditor had taken an instrument perfect in all its parts, and allowing no room for construction as to its effect or meaning, the legal effect of which was misunderstood. There, the parties intended to make an instrument creating a lien, but failed so to do because the instrument did not contain apt words to express their intention. The language employed was clear and unambiguous, and expressed an intention to give to the creditor an irrevocable power of attorney; and no construction of the language could make it express an intention to give a lien although the parties intended to create one, and supposed that such was the legal effect of the instrument In the case under consideration, the parties not only intended to create a lien, hut the instrument does contain words, when properly construed, expressive of their intention. The difference between the two cases is, that in reading the language of the two instruments by the light of surrounding circumstances, in the one there is an intention expressed to charge the property, and in the other there was none.
The decree of the court below is reversed and the cause remanded.
Decree reversed.