Judgment Mortgage in UK Law

We have no reason to doubt Peter Smith J's conclusions but in any event, as he observed, section 114 provides for a transfer "unless a contrary intention is expressed" in the mortgage. Thus if section 114 applies, all depends upon the true construction of the mortgage and, in our judgment, for the reasons given earlier, on the true construction of the sub-charge, there was no such transfer in this case.

The general rule established by long-standing authority is that except insofar as his rights are limited by contract or statute, a mortgagee by way of legal charge is entitled to seek possession of the mortgage property at any time after the mortgage is executed: see, for example, Mobil Oil Co. Ltd. v. Rawlinson (supra); Barclays Bank plc, v. Tennet, an unreported Court of Appeal decision of 6th June 1984; and Citibank Trust v. Ayivor (supra).

I say nothing about the case where a mortgagor establishes that he has a claim to a quantified sum by way of equitable set-off. Possibly such a claim might have the effect of actually discharging the mortgage debt. In my judgment, however, the Mobil Oil principle is applicable both where the cross-claim is a mere counterclaim and where it is a cross-claim for unliquidated damages which, if established, would give rise to a right by way of equitable set-off.

My Lords, there is no general doctrine of unjust enrichment recognised in English law. It is a convenient way of describing a transfer of rights from one person to another, without assignment or assent of the person from whom the rights are transferred and which takes place by operation of law in a whole variety of widely different circumstances.

(1) The mortgagee's costs, reasonably and properly incurred, of proceedings between himself and the mortgagor or his surety are allowable. The classical examples are proceedings for payment, sale, foreclosure or redemption, but nowadays the most common are those for possession of the mortgaged property preliminary to an exercise of the mortgagee's statutory power of sale out of court.

The cases do support the proposition that a power of sale is improperly exercised if it is no part of the mortgagee's purpose to recover the debt secured by the mortgage. Where, however, a mortgagee has mixed motives (or purposes) one of which is a genuine purpose of recovering, in whole or in part, the amount secured by the mortgage, then in my judgment his exercise of the power of sale will not be invalidated on that ground.

If that is right, it follows that George Cann was permitted by her to raise money on the security of the property without any limitation on his authority being communicated to the society.