On Mortgages of Reversionary Interests

Extract

Amongst the various descriptions of securities, whether requiring for their absolute safety the insurance of a life or lives or not, it is well known by those who are called upon to advise lenders with regard to them, that none require more anxious care and caution than dealings involving expectancies, reversions and postobits. A long course of judicial decisions makes it manifest that our Courts are averse from giving any facilities for enabling persons entitled to such interests to obtain money on them; and until the Legislature interfered to modify the doctrine so often enunciated by the judges, so far at least as sales of reversions are concerned, the purchase of expectant titles was rendered almost impossible. But even the Act to which we allude protects the purchaser only in a modified degree, for instead of relegating his position to that of ordinary purchasers of other kinds of property, it enacts merely that a sale, otherwise bona fide, and without fraud or unfair dealing, is not to be set aside on the ground of undervalue alone. We have intimated that this enactment applies only to sales of reversions. This is the received opinion in the legal profession, although it is quite arguable, from the scope of the interpretation clause in the Statute, that it might be held to apply equally to advances on reversionary interests.