Land - Legal Mortgages

Front 1

Mortgagor

Back 1

Buyer (borrower)

Front 2

Mortgagee

Back 2

Lender

Front 3

Remedies available to legal mortgage

Back 3

1) Action for debt
2) Possession
3) Appointment of receiver
4) Foreclosure
5) Power of sale

Front 4

Four Maids v Dudley Marshall (1957)

Back 4

Lenders can take possession of the property as soon as the mortgage is completed. The terms of the mortgage deed may expressly or impliedly postpone this right until the borrower is in default however.

Hint 4

Mortgagee may go into possession "before the ink is dry", unless there is something in the contract that excludes this right.

Front 5

White v City of London Brewery (1889)

Back 5

The mortgagee owes the mortgagor a duty to manage the property with due diligence, if not he must account for extra income he did or would have received

Hint 5

The Ropaigealachs did not receive the letter from Barclays, with a final demand for payment, warning the property would be sold, because they were having it renovated and were away. They heard of the sale through a neighbour.

Front 6

Ropaigealach v Barclays Bank (1999)

Back 6

A mortgagee remains entitled to exercise his right to possession by physical re-entry without bringing court proceedings. The mortgagee can bypass s.36. Not a human rights infringement (Horsham Properties v Clark and Beech).

Hint 6

Mortgagor created mortgage over pub in favour of the brewery. Due to default of mortgagor, mortgagee took possession and leased the pub incorrectly which had a detrimental effect on the rent. Mortgagee held liable to mortgagor for additional rent which would have been received had the property been let right.

Front 7

Priority between mortgages

Back 7

S.48 LRA 2002 - order of priority for registered charges depends on order in which they are entered on the register, mortgage that appears first, ranks first.
If a mortgage is not registered, equitable only, an IARE not RD.

Front 8

Priority between mortgages and other proprietary interests

Back 8

Interests created on or after 13 October 2003 when LRA 2002 came into force:
a) Registerable dispositions must be registered, IARE must be protected by a notice on the register by the date of registration of the mortgage to take priority over it (s.29 LRA)
b) All interests which override under Sch 3 LRA 2002 must exist by the date of completion of the mortgage to take priority over it.