Mortgage by deposit of title deeds memorandum was only evidential and did not require registration.

A mortgage by deposit of title deeds arises when title deeds are delivered with intent to create security, without any need for a registered instrument if the charge springs from the deposit itself. Where, however, the parties intend the writing to embody the bargain and create the security, that memorandum becomes the operative instrument and requires registration. Applying that test, the memorandum here was only evidential of an already completed transaction and did not itself create the mortgage. It was therefore not required to be registered and remained admissible to prove the mortgage.

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Issues: Whether the memorandum signed and delivered along with the deposit of title deeds was a mere record of an already concluded transaction or an operative document embodying the bargain so as to require registration under the Registration Act.

Analysis: A mortgage by deposit of title deeds is recognised where title deeds are delivered with intent to create security, and no registered instrument is needed if the security arises by implication from the deposit itself. But where the parties intend to reduce their bargain to writing, the writing becomes an integral part of the transaction and operates as the instrument creating the charge. In determining registrability, the decisive question is whether the document itself embodies the terms of the bargain and was intended to be the basis of the rights and liabilities, or whether it is merely evidential of a transaction already completed orally. On its terms and in the surrounding circumstances, the memorandum here only recorded a transaction already concluded and did not itself create the security.

Conclusion: The memorandum did not require registration and was admissible in evidence to prove the creation of the mortgage.

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