Rufus Cambell vs. George Worthington, Executor of Erastus Watrous, 6 Vt. 448

The opinion of the court was delivered by Collamer, Chancellor.- — The main question in this case- is, what was the real character of the transaction, in its inception, between the parties. It is unquestionably true,"that chancery suffers itself to be little embarrassed with the forms which any transaction assumes. In whatever hand the fee may remain, or however disguised may be the terms, if the real object be the taking or holding land for the security of a loan or debt, it is, in equity, a mortgage.

But if the real character of the transaction be a contract for a sale, and whatever aspect it assumes can be reconciled with that view, it is so to be treated; yet even in this case, if the time of payment, from the conditions of the agreement or subsequent arrangements or acquiescence of the parties, is made immaterial, the result is much the same as the case of mortgage.

From the terms of this agreement it is apparent there are two distinct features, go far as it goes to the purchase money for the land, it is merely a contract for a sale; but it further provides for the advancements by Watrous and erections and improvements by Campbell. Such advancements became a loan or debt against Campbell, for which Watrous held the land and buildings as security. In this feature it was really a mortgage, whenever any advancements and erections had been made.

For the advancements were to Campbell, and he was subject to suit therefor; and the erections were his, made for himself, not Watrous, against whom no action could have been sustained by Campbell therefor. So much appears from the contract itself. In ascertaining the original character of a transaction, it is ever to be borne in mind, that no subsequent agreement can alter that character; but it does not therefore follow that we are to examine the original contract only, and shut our eyes to the subsequent acts and concessions of the parties tending to show what was such original character in its inception.

A question frequently arises, whether an absolute deed was not really a security and mortgage, as between the parties. Resort is always, had to the conduct and concessions of the parties, both cotem-poraneous and subsequent, and if any thing can be found absolutely inconsistent with its being a sale, it shows it a mortgage. For instance, if the purchaser takes the vendor’s note for the purchase money, or receives part payments or interest on the same. Let us now so examine this case. The whole contract on the part of Campbell was to have been executed in March, 1825.

It appears Watrous made him large advancements and Campbell erected buildings, but the defendant insists all was closed in March, 1825, and nothing was done by the parties, tending to show they considered and treated it as an open and subsisting contract after that time. It is however shown that the parties agreed on delaying payment another year, by the request of Watrous.

We find Campbell, after March, 1825, erecting a door-yard fence to this brick house, and Watrous assisting and charging it to Campbell — Campbell doing work still on the house and in possession and use of the hill lot, without paying rent, up to the death of Watrous in 1828. In 1824 and 1827, Watrous consulted Campbell as to the tenants for the house. In 1826, Watrous still states Campbell has an interest in the house.

In June, 1828, Watrous settles with Campbell an account for articles he bad previously furnished for this house, and takes his notes for the balance; and in May, 1827, he pays Campbell a balance due him by Watrous and Rublee, on settlement, by applying it on a settlement of similar character for materials. These are entirely irreconcilable with any other view of the subject, but that it was an open and subsisting contract, and Watrous held the land and buildings as security for his subsisting debts against Campbell.

How could Watrous be taking Campbell’s notes for his own advancements on his own house, and yet Campbell have no right to redeem ? Whether this be viewed as a mortgage, or a contract for a sale, the consent and acquiescence of the parties in treating the time as immaterial is fully shown, up to the death of Watrous; and Campbell has therefore a right to redeem. Since the death of Watrous, the orator presented his claims and has pursued with all the rapidity the law would permit.

Watrous was bailiff to Campbell of the rents which he actually received, but is not chargeable with those which were lost, as there is no proof of any gross neglect on his part.

Interest on the same is also chargeable, but as there is no proof that Watrous was ever called on to account during his life, or the pay ever offered him or his executor by the orator, or that the defendant is any way in fault in this case, the orator is not entitled to cost against him, but must pay the amount of the purchase money and balances of debt due the defendant, and interest thereon, as reported by the master, within one year; whereon the defendant must procure a license from the probate court and convey to the orator, and all further proceedings on the appeal from commissioners be enjoined; and on failure of payment by the orator, all further right of redemption be foreclosed.

Decree accordingly. Phelps, Chancellor, dissenting.