Mortgages

Question 1

What are the formalities to create a legal mortgage? Which Section of which Act?

Answer 1

Created in a deed. Section 52 Law of Property Act 1925

Question 2

What are the four remedies for mortgagees?

Answer 2

1. Possession
2. Appointment of a receiver
3. Power of Sale
4. Foreclosure

Question 3

Lenders can take possession of the property as soon as the mortgage is complete- subject to provisions within the contract. Which case?

Answer 3

Four Maids v Dudley Marshal

Question 4

No violence or threat of violence may be used to enter a property. Which Section of which Act?

Answer 4

Section 6, Criminal Law Act 1977

Question 5

A court can adjourn possession proceedings if a mortgagor brings a claim under which section of which Act?

Answer 5

Section 36 Administration of Justice Act 1970

Question 6

A mortgagee does not have to bring proceedings to exercise his right to possession. Which case?

Answer 6

Rapaigealach

Question 7

The right to appoint a receiver is implied into every deed. Which section of which Act?

Answer 7

Section 101 Law of Property Act 1925

Question 8

The power to appoint a receiver only arises once the legal date for redemption has passed. Which section of which Act?

Answer 8

Section 101 Law of Property Act 1925

Question 9

Where are the conditions set out for what must have occurred for the power to appoint a receiver to have become exercisable?

Answer 9

Section 103 Law of Property Act 1925

Question 10

A receiver must be appointed in writing. Which section of which Act?

Answer 10

Section 109 Law of Property Act 1925

Question 11

The receiver must apply the income in a certain order according to which section of which Act?

Answer 11

109(8) Law of Property Act 1925

Question 12

With both receivership and possession, a lender must manage a property with due diligence. Which case?

Answer 12

White v City of London Brewery

Question 13

The power of sale is implied into all mortgages created by deed. Which Section of which Act?

Answer 13

Section 101 Law of Property Act 1925

Question 14

The power of sale must have arisen. Which section of which Act?

Answer 14

Section 101 Law of Property Act 1925

Question 15

The power must be exercisable according to the conditions in which section of which Act?

Answer 15

Section 103 Law of Property Act 1925

Question 16

Lenders must act in good faith and take reasonable care to obtain the true market value. Which case?

Answer 16

Cuckmere Brick v Mutual Finance

Question 17

Sellers must apply the proceeds of a sale in which order according to which section of which Act?

Answer 17

Section 105 Law of Property Act 1925:

1. Payment of all costs charges and expenses as incident to the sale
2. Prior mortgages
3. Mortgagee’s own mortgage
4. Mortgages with less priority
5. Balance to the mortgagor

Question 18

The buyer of land from a mortgagee takes the property:

1. Free from an interests that the selling mortgagee had priority over
2. Subject to any interests that had priority over the selling mortgagee.

Which section of which Act?

Answer 18

Section 104(2) Law of Property Act 1925

Question 19

Explain what “foreclosure” is.

Answer 19

Foreclosure is an equitable remedy that will immediately vest all legal and equitable rights in the property in the mortgagee.

Question 20

How may a mortgagor object to foreclosure?

Answer 20

Under Section 91(2) of the Law of Property Act 1925

Question 21

In unregistered land how are mortgages registered?

Answer 21

The first mortgage takes possession of the title deeds (Section 85(1) Law of Property Act 1925

Subsequent mortgages are puisne mortgages and are created as land charges.

Question 22

A mortgagee has priority over all interests created before the mortgage, but is subject to all interests created after it. Which Section of which Act?

Answer 22

Section 104 Law of Property Act 1925

Question 23

The order of priority is dependent on the order in which a mortgage is registered on the register. Which Section of which Act?

Answer 23

Section 48 Land Registration Act 2002

Question 24

Which section governs how to distribute income for a receiver?

Answer 24

Section 109 Law of Property Act 1925

Question 25

Who was the Judge in Abbey National v Cann?

Answer 25

Lord Oliver

Question 26

Was there a scintilla temporis (moment in time) between NEPB acquiring the legal title to the property and the lender gaining a mortgage in which NEPB was free to create equitable or legal interests?

Answer 26

No there was not. Appeal to the Supreme Court pending.