Someone recently bought our

students are currently browsing our notes.


Remedies Of The Mortgagee Notes

Law Notes > Land Law Notes

Updates Available  

A more recent version of these Remedies Of The Mortgagee notes – written by Oxford students – is available here.

The following is a more accessble plain text extract of the PDF sample above, taken from our Land Law Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

Remedies of the Mortgagee:

1. Foreclosure

Traditional right of mortgagee is to ask the court to put end to equitable right to redeem o This is inapplicable until after the legal date for redemption has passed o And mortgagor normally has six months to pay off the mortgage

Smith: However, power is rarely exercised these days o If property is worth more than the debt, than it is more advantageous that the mortgagee sell the property
? Which will ensure that the debt and other expenses are paid off

With the remaining balance given to the mortgagor o If property is worth less than the debt
? Then foreclosure will bar the mortgagee from claiming anything more than the value of the property sold from the mortgagor

Because the mortgagor has lost the right to redemption o The mortgagee will lose the right to sue for the balance of the debt
? And the value of the property will have to suffice.

2. Possession

The mortgagor's possession o Mortgagees can technically take possession immediately after mortgage agreed
? But mortgagors will generally be in possession

Thus, where possession is sought or taken, the mortgagor must be allowed the opportunity to redeem

Smith: regardless, possession not normally taken until default b/c point of taking possession is to exercise power of sale
- which isn't available until default. Court's jurisdiction to postpone possession under common law

Birmingham Citizens BS v Caunt [1962]
o Russell J:
? Where mortgagee is entitled to possession by reason of default of mortgagor -and the whole money has become payable -

The court has no jurisdiction to decline to make the order or to adjourn the hearing.
? The sole exception is where a short adjournment would afford the mortgagor a chance to pay off the mortagee in full or otherwise satisfy him;

but it should not be done if there is no reasonable prospect of this occurring

Quennell v Maltby [1979]: wife of mortgagor bought mortgage from bank, tried to use it to evict tenants by taking possession when bank had previously refused to do so. o Lord Denning:
? Equity should be able to step in and restrain a mortgagee from getting possession unless it is

bona fide

and is reasonably for the purpose of enforcing the security o Not for any ulterior motive as in the present case.

Buy the full version of these notes or essay plans and more in our Land Law Notes.

More Land Law Samples