Mortgagee in Possession in UK Law

Leading Cases
  • Medforth v Blake
    • Court of Appeal (Civil Division)
    • 26 May 1999

    They are duties in equity imposed in order to ensure that a receiver, while discharging his duties to manage the property with a view to repayment of the secured debt, nonetheless in doing so takes account of the interests of the mortgagor and others interested in the mortgaged property. What a mortgagee or a receiver must do to discharge them depends upon the particular facts of the particular case.

    I do not accept that there is any difference between the answer that would be given by the common law to the question what duties are owed by a receiver managing a mortgaged property to those interested in the equity of redemption and the answer that would be given by equity to that question. I do not, for my part, think it matters one jot whether the duty is expressed as a common law duty or as a duty in equity.

  • Palk v Mortgage Services Funding Plc
    • Court of Appeal (Civil Division)
    • 31 Jul 1992

    So far as I am aware, foreclosure actions are almost unheard of today and have been so for many years. They usually appoint a receiver or exercise their powers of sale. Take the present case: the security is inadequate, but Mortgage Services is not seeking to foreclose, nor is it seeking to sell at once. The nineteenth century cases were not concerned with this situation. The principle applied in those cases does not address the problem which has now arisen.

    In the exercise of his rights over his security the mortgagee must act fairly towards the mortgagor. His interest in the property has priority over the interest of the mortgagor, and he is entitled to proceed on that footing. He can protect his own interest, but he is not entitled to conduct himself in a way which unfairly prejudices the mortgagor. The mortgagor also has an interest in the property and it is under a personal liability for the shortfall.

  • Meretz Investments NV v ACP Ltd
    • Chancery Division
    • 11 Dec 2007

    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. In addition I consider that it is legitimate for a mortgagee to exercise his powers for the purpose of protecting his security.

  • Hill (Edwin) and Partners v First National Finance Corporation Plc
    • Court of Appeal (Civil Division)
    • 22 Jul 1988

    Justification for interference with the Plaintiffs' contractual right based upon an equal or superior right in the Defendant must clearly be a legal right. Such right may derive from property real or personal or from contractual rights.

  • Socimer International Bank Ltd ((in Liquidation)) v Standard Bank London Ltd
    • Queen's Bench Division (Commercial Court)
    • 17 Nov 2006

    Mr Millett also submitted that the evidence of the Standard witnesses as to the valuations that they would have put on the TDA-Es, had they come to value them, was irrelevant and inadmissible. That was because, he said, in circumstances where Standard had not in fact carried out a valuation exercise, the Court should pay no regard to the opinions of the Standard witnesses.

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Legislation
  • Rights of Light Act 1959
    • UK Non-devolved
    • January 01, 1959
    ......seven years remain unexpired, or is a mortgagee in. possession (within the meaning of the Law of Property. Act, 1925) ......
  • Landlord and Tenant (Covenants) Act 1995
    • UK Non-devolved
    • January 01, 1995
    ......those premises, or. . (b) any mortgagee in possession of the reversion in those premises. who is so entitled. . ......
  • Housing Act 1964
    • UK Non-devolved
    • January 01, 1964
    ......society in which the Corporation have an interest as mortgagee. under a mortgage entered into by the society; and where directions. under ...possession against the Corporation by virtue of the Rent and. Mortgage Interest ......
  • Increase of Rent and Mortgage Interest (Restrictions) Act 1920
    • UK Non-devolved
    • January 01, 1920
    ...... the Law with respect to the increase of rent and recovery of possession of premises in certain cases, and the increase of the rate of interest on, ... Provided that, where a landlord or mortgagee has increased the rent of any such dwelling-house or the rate of interest ......
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Books & Journal Articles
  • Making a Silk Purse out of a Pig's Ear ‐ Medforth v Blake & Ors
    • Nbr. 63-3, May 2000
    • The Modern Law Review
    ...... v First City Corporation Ltd 1 the Privy Council held that a mortgagee, and a receiver and manager 2 appointed by him, owe no general duty of ..., a venerable feature of the law governing mortgagees in possession, and now expressed to be applicable also to receivers. It will be ......
  • Making the Case for Socio‐legal Research in Land Law: Renner and the Law of Mortgage
    • Nbr. 37-4, December 2010
    • Journal of Law and Society
    The aim of this article is to enhance knowledge of and to encourage further research into two areas not traditionally the subject of socio‐legal research, namely, the work of Karl Renner and the En...
    ...... 7 Renner, op. cit., n. 1, p. 53. 8 Pre-Action Protocol for Possession Claims Based on Mortgage or Home Purchase Plan Arrears in Respect of ...The mortgagee's inherent right to possession, for example, has been in evidence since ......
  • Permitting Uncertainty: Owners, Occupiers And Responsibility For Remediation
    • Nbr. 66-2, March 2003
    • The Modern Law Review
    ......Indeed the legislation implies that a mortgagee who takes possession of land could incur liabilities as a knowing ......
  • Why do real estate appraisals nearly always equal offer price?. A theoretical justification
    • Nbr. 20-3, June 2002
    • Journal of Property Investment & Finance
    • 242-253
    Are real estate appraisals based on fundamentals that determine the value of the real estate or on offer price? Does this question really matter? In a game of moral hazard with hidden information, ...
    ......,and buyers who may have interests inconsistent with those of a mortgagee. Forexample, property buyers/mortgagors have a strong incentive to see ......
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Law Firm Commentaries
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