Chapple v Mahon

• Jurisdiction: Ireland
• Judgment Date: 08 July 1870
• Date: 08 July 1870
• Court: Chancery Division (Ireland)

V. C. Court.

CHAPPLE

and

MAHON.

Stains v. Banks 9 Jur. N. S. 1049.

Toomes v. ConsettENR 3 Atk. 261.

Jennings v. WardENR 2 Vern. 520.

Re Edwards' EstateUNK 11 Ir. Ch. 367.

Broad v. Selfe 9 Jur. N. S. 885.

Hudson v. ThompsonELR L. R. 2 Ch. App. 255.

Thornhill v. EvansENR 2 Atk. 330.

French v. BaronENR 2 Atk. 120.

Arnold v. GarnerENR 2 Phil. 231.

Leith v. Irvine 1 M. & K. 277.

Healer v. M'MurrayENR 23 Beav. 401.

Cowdry v. DayENR 1 Giff. 316.

Gubbins v. Creed 2 Sch. & Lef. 214.

Goodman v. Grierson 2 B. & Bea. 274.

Moses v. MacfarlaneENR 2 Burr. 1009.

Foley v. HillENR 2 H. L. C. 28.

Philips v. PhippsENR 9 Hare, 471.

Close v. PhippsUNK 7 M. & G. 586.

Smith v. Leveaux 12 W. R. 31.

Hemings v. PughENR 4 Giff. 456.

Irish Midland Railway Company v. JohnsonENR 6 H. L. C. 798.

Frazer v. PendleburyUNK31 L. J. C. P. 1.

Faulkner v. DanielENR 13 Hare, 199.

Close v. PhippsUNK 7 M. & Gr. 586; 8 Scott, N. R. 381.

Fraser v. PendleburyUNK 31 L. J. C. P. 1.

Johnson v. The Midland Railway CompanyENR 6 H. L. C. 798.

Edwards' Estate 11 Ir. Ch. R. 367.

Barrett v. HartleyELR L. R. 2 Eq. 789.

Mortgagor and Mortgagee — Stipulation for a Payment beyond Interest in case Mortgage paid off — Unconscionable Bargains — Jurisdiction of Court of Equity.

VoL. Y.) EQUITY SERIES. 225 CHAPPLE v. MAHON. V. C. Court. Mortgagor and Mortgagee-Stipulation for a Payment beyond Interest in case 1870. Mortgage paid of-Unconscionable Bargains-Jurisdiction of Court ofJuly 6, 7, 8. Equity. 1. By a mortgage deed the mortgagor covenanted, in case the mortgage were paid off, to pay to the mortgagee a commission of 5 per cent. upon the sum advanced, and interest upon that commission from the date of the advance. Held, that this agreement was illegal and void, as contrary to the nature of a mortgage security and a clog upon redemption. 2. The interest on the mortgage debt was to be 10 per cent., reducible to 8 per cent. if paid within twenty-one days after it fell due. The mortgagees were appointed by the mortgagor agents and receivers over the mortgaged lands, and, as such agents, acted so as to delay the payment of rents, which, if punctually paid, would have been funds in their hands to pay the interest within twenty-one days. Held, that the mortgagees could only claim interest at the lower rata. 3. Although, since the repeal of the usury laws, a lender may demand any interest he likes, yet the jurisdiction of the Court of Chancery over unconscionÂÂÂable bargains did not rest on these laws and is unaffected by their repeal. 4. If a mortgagee makes unfounded claims and refuses to reconvey unless they are paid, and the mortgagor pays them under protest, he can maintain a bill for repayment. THE Plaintiff, Francis Chapple, was seised of certain lands for life, with remainder to his first and other sons in tail, with reÂÂÂmainder to his brother, Edward Chapple, in fee ; and was seised in fee of certain other lands in remainder after estates for life, in some of the lands, to his brother, Edward Chapple, and, in the rest, to another brother, Robert Chapple ; with estates in tail to their first and other sons respectively. In 1866 the interests of the PlainÂÂÂtiff and of Edward Chapple were to be sold in the Landed Estates Court on the petition of an incumbrancer, and the Plaintiff and Edward Chapple, being anxious to buy in the property if they could raise money enough to pay off the incumbrances, apÂÂÂplied to the Defendants, who are bankers and land agents in Dublin, and carry on business as Guinness, Mahon, and Co., to purchase the lands by private contract for £5700, iu trust for them, on having the price secured by a mortgage. The Defend VOL. V. 226 THE IRISH REPORTS. [I. R. V. C. Court. ants agreed to do so, and made an offer of £5700 for the lands, 1870. which offer was accepted by the Judge, and the lands were conÂÂÂveyed to a Mr. Sinclair, a nominee of the Defendants. SubseÂÂÂquently the Defendants made some further advances to the Plaintiff and his brother, and there was also due to them a considerable sum for interest and costs ; in all, the amount due to the Defendants on the 25th July, 1867, was £7194 13s. 10d. On the 25th July, 1867, a deed was executed, by which SinÂÂÂclair, by the direction of the Plaintiff and Edward Chapple, granted the lands to R. S. Guinness, one of the Defendants, as a trustee for Guinness, Mahon, and Co., subject to redemption, on payment of £7194 13s. 10d., and such further sum as might be advanced or become owing, not exceeding in the whole £8000, with interest, at 10 per cent., payable on the 25th February and 25th July, and to be reduced to 8 per cent. in case of payment within twenty-one days after it fell due. By the deed the Plaintiff and Edward Chapple appointed the Defendants agents, to receive the rents of the property ; agreed that they were not, by reason of the receipt of the rents, to be chargeable as mortgagees in possession ; and covenanted that, in the event of the Defendants being obliged to accept payment of the sums advanced or to be advanced or become owing, or of their being removed from the agency, the Plaintiff and Edward Chapple, or one of them, would pay to the Defendants 5 per cent. commission on the £7194 13s. 10d., and any further advances; such commission not to exceed £350, with interest at 10 per cent. on the commission from the time at which the money on which the commission was payable had been advanced. After the execution of this mortgage, the Defendants, under the agency clause in it, received the rents of the lands in which the Plaintiff and Edward Chapple had life estates, the rental of which in the whole amounted to £1058 a year. Edward Chapple died in India, after the agreement, but before the execution of the mortgage (which was executed by the Plaintiff under a power of attorney from him), intestate, and withÂÂÂout issue ; and the Plaintiff, as his heir-at-law, became...