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Owner needed $100,000 to prevent a tax sale of Greenacre, which was worth $350,000. Investor gave Owner $100,000. At Investor's request, Owner signed and delivered a warranty deed conveying Greenacre to Investor. At the same closing, Investor signed a letter stating, "If Owner repays $130,000 within one year, Investor will deed Greenacre back. If Owner does not repay by that date, Investor will keep Greenacre and Owner will have no right to redeem." Owner remained in possession and paid property taxes during the year.
Owner did not pay by the one-year date. Investor recorded the deed and demanded possession, claiming to be absolute owner. Owner argues that the transaction was really a mortgage and that Owner may still redeem before foreclosure.
Discuss the parties' rights. Address whether the deed should be treated as an absolute conveyance or equitable mortgage, the effect of the no-redemption language, and the procedures Investor must follow to obtain title free of Owner's interest.