Kadiri v. Olusaga (1956) 1 FSC at p. 178: “It is the case, as stated by the learned trial Judge, that the security given was not the form of a legal mortgage, that is to say by deed, transferring the legal estate to the respondent, but the deposit of title deeds as security for a loan is an equitable mortgage, and I am unable to agree that the loan was an unsecured one within the meaning of the legislation in question. As Lord Macnaghten said when delivering the judgment of the Board in Bank of New South Wales v. O’Connor (1889) 14 AC page 273. ‘It is a well established rule of equity that a deposit of a document of title without either writing or word of mouth will create in equity a charge upon the property to which the document relates to the extent of the interest of the person who makes the deposit. In the absence of consent that charge can only be displaced by actual payment of the amount secured.'”
EQUITY LOOKS AT SUBSTANCE NOT FORM IN MORTGAGES
In determining whether any given transaction is in the nature of a mortgage, equity looks at the substance of the matter and not merely at the form. – Iguh JSC. Ejikeme v. Okonkwo (1994)