691. Effect of legal mortgage on equitable charge.

691.     Effect of legal mortgage on equitable charge.

A mere charge or equitable mortgage1 is extinguished by the taking of a formal mortgage2, even though the mortgage does not confer a legal estate, and the sum from then on secured is the sum mentioned in the mortgage notwithstanding that other sums were covered by the deposit3. However, an equitable security is not merged by taking a security which is ineffectual4.