Mills v. Nashua Federal Savings & Loan Ass'n

In this case of first impression we are asked to decide whether a due-on-sale clause contained in a mortgage instrument constitutes a per se unreasonable restraint on alienation or whether the manner in which it was applied amounted to an unreasonable restraint on alienation. In both instances we answer in the negative and, therefore, affirm the result below.

On February 18, 1977, the plaintiffs purchased certain property in Nashua from William L. and Theresa M. Dube, giving a first mortgage to the defendant bank in the amount of $32,800 at an interest rate of 10-3/4 percent per year. At that…