227. Extent of mortgagee's duty to examine title deeds.

In creating an equitable mortgage by deposit of title deeds1, it was not negligence to accept the owner's statement that the deeds deposited were all that were necessary. If the court was satisfied of the good faith of the person who had a prior equitable charge, and was satisfied that there had been a positive statement, honestly believed, that he had the necessary deeds, then he was not bound to examine the deeds, nor was he bound by constructive notice of their actual contents or of any deficiencies which by examination he might have discovered in them