A mortgage is a conveyance, The power of sale arises<\/em> in The main problem for lenders arises The mortgagee’s right to take Lastly, the lender has a right to An easement is an intangible right Prima facie it would appear that a Prescription is an easement that A restrictive covenant is an Firstly, the covenant must touch Land Law Essays – Use Our Free Law Essays and Assignments To Help You With Your Law Course<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[85],"class_list":["post-2513","post","type-post","status-publish","format-standard","hentry","category-free-law-essaysgeneral-law","tag-uk-law"],"yoast_head":"\n
\nassignment or demise of real or personal estate as security for the repayment
\nof money borrowed<\/em>.
\nThe money lender is known as the Mortgagee has an interest in the land as they have granted the Mortgagor,
\nor legal owner of the personal estate, a mortgage and would have had it
\nregistered as a charge on the Land Registry. One of the first remedies
\navailable to a lender is the dispossession of the property through foreclosure
\nalthough this is one of the less favourable remedies. A mortgagee cannot seek
\nforeclosure before the contractual date or obligation has passed and the process requires a court
\norder
\nwhich has the effect of vesting the mortgagor’s estate in the mortgagee to
\nassure full repayment of the debt.
\nThe reason this remedy is unfavourable is because it is viewed as unfair on the
\nmortgagor. This is because if the value of the estate is greater than the
\nactually debt owed the mortgagor has no right to the excess, however, a right
\nto appeal exists whereby the mortgagor can request the estate to be sold rather
\nthan face foreclosure.
\nIf successful the mortgagor will receive the residue of the sale after the
\nmortgage, debts and any interest are paid. Disadvantageous to the mortgagee is
\nthe plausibility that the court will reopen the entire lending situation and
\nallow the mortgagor to redeem the property under certain circumstances detailed
\nin Campbell v Holyland<\/em>,
\nwhich includes potentially re-evaluation of the situation after sale of the
\nestate. Thus foreclosure remains the primary remedy of an equitable mortgagee
\nand is often deemed to be the most extreme remedy due to its unfairness to the
\nmortgagor and its improbability that the entire debt will be extinguished.<\/p>\n
\na mortgage, which shows no contrary intention and is created by deed and already
\npassed the legal date of redemption,
\nwhen the mortgage money has become due but it is not exercisable<\/em> until
\none of the following conditions is fulfilled. The mortgagor will have to verify
\nif a notice requiring payment has been served on him a minimum of three month
\nprior to proceedings, as default on payment for three months is required unless some of the interest was
\npayable and in arrears for at least two months
\nor he was in breach of a covenant in the mortgage deed or some other provision
\nof the LPA 1925.
\nWhen a mortgage claim includes land that is made up of at lease one residential
\nproperty, the mortgagee must send notice to the property no less than 14 days
\nbefore the hearing addressed to the owner or occupiers. When the hearing comes
\nto court it will be required for the mortgagee to give the court a copy of the
\nnotice and evidence that it had been served to the property although not necessarily
\nto the actual mortgagor which is disadvantageous to any absent mortgagors
\nperhaps for business reasons.<\/p>\n
\nsurrounding the sale price for the property thus; many mortgagees employ third
\nparties to delegate the sale in order to alleviate the burden of liability upon
\nthemselves. The mortgagee has an equitable duty to ‘obtain a proper price’ on the property should they exercise
\ntheir right to sale. However, an open sale by auction, even where prices are
\nlow, satisfies the mortgagee’s duty.
\nThe mortgagor specifically has a right to appeal in this instance to the courts
\nif there is a valid assumption that he would have obtained a higher price for
\nthe property sold, perhaps as he may be aware of an unregistered prescription
\nand\/or pending planning permission which could have augmented the price
\nsignificantly and perhaps clear the outstanding mortgage completely and produce
\na residue for the mortgagor.
\nPrecedent states that if the sale does not realise sufficient funds to repay
\nthe mortgagee, the mortgagee may sue in contract for the balance of the debt. Jonathan Parker LJ, giving the
\njudgment of the Court made some useful comments about the methods of
\nadvertising and modes of sale.
\nA mortgagee will not be liable if he takes reasonable care to assess the market
\nvalue.
\nWhereas once disappointed mortgagees turned to Barclays Bank v O’Brien<\/em> as a means of escape, only to find their exit route largely cut off by Royal
\nBank of Scotland v Etridge<\/em>, so too the majority of last ditch attempts to
\nchallenge the sale price are now being cut off by a concerted judicial effort. The mortgagor must be aware that the
\nduty to obtain the best price is only an equitable duty thus rendering it
\ninflexible and unyielding.<\/p>\n
\npossession is automatic because the arrangements of the mortgage will have
\nalready vested the legal estate in possession with the mortgagee and it becomes
\nexercisable even if the mortgagor is not in arrears or in default. The court retains the power to
\nrestrain any unjust use of this remedy and the receipt of rents and profits
\nfrom tenants may also constitute terms of possession. The mortgagee has the
\noption of taking possession of the premises and managing it in order to
\ngenerate an income which could have been used to satisfy the mortgagor’s
\nobligations bearing in mind that repossession does not stop the interest on the
\nmortgage from accumulating. Section 36 of the Administration of Justice Act
\n(AJA) 1970 (subsequently amended by section 8 of the AJA 1973) will allow the
\nmortgagor to apply to the court for a postponement in its discretion if it becomes
\napparent that he would have been able to pay back the outstanding debt and any
\nother sums due under the mortgage within a reasonable time. However, this
\noption was only available to the mortgagor up until the time of actual
\nrecovered possession.
\nA reasonable period
\nmust have transpired before the possession was completed in order to give the
\nmortgagor a sufficient means to reply to any correspondence that may have been
\nsent to him. It is within this reasonable time that the mortgagor can demonstrate
\nany planning intentions and permissions which reinforce his intention to repay
\nthe mortgage with the valuation report so as to rule out any implication of a
\nmere hope to repay.
\nThe mortgagor might seek redress of the possession if he can prove that there
\nexisted no justifiable reason for the possession to take place under the
\nmortgage arrangements that existed with mortgagee and no genuine need to seek
\npossession was justified in regards to protecting the lender’s security.<\/p>\n
\nappoint a receiver, which entails the appointment of an individual by the
\nmortgagee to act as an agent for the mortgagor with the power to collect rents
\nand profits. This is the most common remedy where the mortgagor has granted a
\nlease and thus existing rents exist for interception by the agent. The power to
\nappoint arises and is exercisable in the similar situation as outlined under
\npower of sale and should the mortgagee already be in possession of the property
\nthe appointment need only be instigated in writing under s.109 LPA 1925. Once
\nappointed the receiver must pay any rents or taxes due, interests in priority
\nof the mortgage, his commission, interest on the mortgage and lastly, if
\ndirected in writing makes payments towards the discharge of the principle sum
\nowed to the lender. It is possible that a mortgagee would find it more to their
\nadvantage if they exercised their right to sue on the personal covenant that is
\noutlined in the mortgage deed. This is to insure repayment of the loan
\nimmediately even if more than the property mortgaged is required to be sold.
\nThis is a much more beneficial remedy as the mortgagee retains their priority
\nof repayment and is more likely to be paid back faster than through the
\nrepayments of the receiver. This remedy is also beneficial to lenders as the
\nright will arise if the sale of the property does not discharge the entire
\namount owed.<\/p>\nQuestion 2<\/h3>\n
1)<\/h4>\n
\nin land and a right that is enjoyed by a person over his neighbour’s property
\neither in the form of a right of way, right of passage for water etc which is
\nenjoyed free of charge.
\nFour essential elements exist for an easement to exist; they are derived from
\nthe case of Re Ellenborough Park.<\/em> The first is a dominant and servient tenement must exist and the easement must
\nbe connected to land and cannot be independent of ownership in land. Secondly,
\nthe easement must accommodate the dominant tenement and must have some natural
\nconnection with the estate as being for its benefit, in this case a right to access the
\nproperty is a natural connection and provides a definite benefit to the owners.
\nLastly, the owner of the dominant and servient tenements must not be one in the
\nsame and the easement must be able to become the subject matter of a grant. As
\nthe owner of the common is different to Lord Sutton the criteria is fulfilled
\nin his case although this may not have been the case for the previous owner.
\nAlso the right of way can be conveyed in a grant as it is identifiable so long
\nas a specific tract has been used continuously by the family and they are not
\nmerely driving over the common in a random and haphazard way.<\/p>\n
\npositive easement exists in regards to the right of way used by cars to access
\nGunnerside Manor although it is not a legal interest in the land as it has not
\nbeen created by deed or prescription. If circumstances are as stated by the
\nfamily, the previous owner’s use of the right of way would have passed to them
\nwith the transfer of the land without having been specifically mentioned and by
\nvirtue of s.62(1) LPA 1925 as a conveyance shall operate to convey with land
\nall easements, rights and advantages whatsoever to the purchaser so long as
\nno contrary intention or objection is raised at the time of sale.<\/p>\n2)<\/h4>\n
\nhas been in use for a long time thus prompting a deed created by statute to be
\nin force. Prescription is where no person can show a title to what he claims as
\na right other than having enjoyed the pleasure or access immemorially without
\nforce,
\nwithout secrecy
\nand without permission
\nagainst another fee simple owner.
\nThe difference between custom and prescription is that custom pertains to local
\nusage and is [not] annexed to any person, whereas prescription is a personal
\nusage
\nThe Prescription Act 1832 s.4 states that the use of the land must be without
\ninterruption and use must be continuous although continuous cannot be taken
\nliterally allowing regular usage to suffice.
\nThe right to prescription is included under section 1 of the Prescription Act
\n1832 and in this case as the right of way across the common has been used for
\n30+ years, thus qualifying it for consideration as a prescription as 20 years
\nis outlined as the ‘short period’ required to forgo defeat of a claim even if
\nproof exists that shows use began after 1189, the date of legal memory. The prescription does not depend on
\ncommon law rules, nor does it depend on presumption of a lost modern grant although both could be used to
\nenforce the prescription as the 30 years of continuous use have been completed.
\nHowever, if at any time during the period of use, Lord Sutton had received
\npermission expressly either in writing or orally this will defeat a claim as
\nthe right will have been used precariously. A negative prescription could be
\nenforced because the owner of the common lost their right to challenge under
\nthe Statutes of Limitation and if action does not take place within twelve
\nyears of the wrongful possession the owner will lose his rights to the
\nProperty.
\nOnce granted a prescription, Lord Sutton should have it registered as a Class
\nD(iii) under the rules of the Land Charges Act 1972 or as an overriding interest.<\/p>\n3)<\/h4>\n
\ninterest in the land of another recognised first by equity whereby the owner of
\none piece of land may hold a restrictive covenant over the land of another. The
\ncovenant restricts the second owner’s use of the property and is generally used
\nas a means by which developers of land can maintain the amenities of an area. The
\ncovenant must be outlined in a deed which demonstrates that Lord Sutton
\nobtained the promise of the owner of the field not to do certain things, in
\nthis case building work without his permission. Mr. Giles claims he was not
\nparty to the deed therefore, the courts will not enforce the covenant against
\nMr. Giles even if the deed had been made between Lord Sutton and the previous
\nowner under the rules of privity to contract. However exceptions exist which
\ngives the person trying to enforce the covenant the right, enforceable in
\nequity, against the current owner. Five requirements exist in these
\ncircumstances which are outlined below.<\/p>\n
\nand concern the land, meaning it must relate to the use or value of the land in
\nthe terms of a proprietary obligation. A test to determine this is set out by
\nLord Oliver in Swift Investments <\/em>which asks whether the covenant could benefit any owner of Gunnerside
\nManor, whether the covenant affects the nature, quality or value of the land
\nand is the covenant expressed as a personal obligation. Secondly, the covenant
\nmust be restrictive or negative in nature which in this case is likely to be
\ntrue, as was the case in Tulk v Moxhay<\/em> whereby a covenant not to build was held to be negative. Thirdly, the covenant
\nmust have been imposed to benefit Gunnerside Manor by the original coventee in
\norder to benefit the land. The land must be identifiable although it need not
\nnecessarily be the same size as when the original covenant was made. The next
\nrequirement is that the burden of the restrictive covenant must be intended to
\nrun with the land. This obligation is fulfilled by evidence which establishes
\nthat the burden was meant to be proprietary instead of personal. The burden of
\na restrictive covenant is deemed to be attached to the land by virtue of s.79(1)
\nof the LPA whereby a covenant relating to land of the covenantor shall unless
\ncontrary intention is expressed be deemed to be made by the covenantor on
\nbehalf of himself, his successors in title. which results in the burden being
\nannexed to the land in order that the burden may run. Therefore, prima facie it
\nis likely that no contrary intention will arise if the original instrument does
\nnot contain any words or expressions which indicate such an intention. In
\nregistered land the person against whom the restrictive covenant is being
\nenforced is registered under the LRA, therefore the covenant must be registered
\nas a minor interest against the burdened land in order to be binding. If it is not registered it will
\nbecome void and unenforceable forever. The only exemption to this rule under
\nregistered land that would benefit Mr. Giles is if he was registered as
\nproprietor yet not the purchaser of the land for valuable consideration or he
\nis someone who purchased merely an equitable interest in the land.<\/p>\nBibliography<\/h3>\n
\n
\n
\nLondon: Cavendish Publishing Ltd.<\/li>\n
\nProblem Website: Penner (2001) page 232.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"