Four-Maids Ltd v Dudley Marshall (Properties) Ltd
A mortgagee is entitled to possession of the mortgaged property as soon as the mortgage is made, even if the mortgagor is not in default.
Facts
Four-Maids lent money to Dudley Marshall, secured by a legal mortgage of its property. There was no term in the mortgage restricting the lender's right to take possession. The lender sought possession of the property, although it was not clear that the borrower was in default.
Legal principle
Harman J held that the mortgagee was entitled to possession. He said that the mortgagee may go into possession before the ink is dry on the mortgage, unless there is something in the contract, express or implied, whereby he has contracted himself out of that right. The right to possession arises because a legal mortgage gives the lender a legal estate in the land, not because of any default. The courts now have powers under section 36 of the Administration of Justice Act 1970 to adjourn possession proceedings for dwelling houses.
Related cases on mortgages
- Barclays Bank plc v O'Brien [1994] 1 AC 180
- Biggs v Hoddinott [1898] 2 Ch 307
- Cheltenham & Gloucester Building Society v Norgan [1996] 1 WLR 343
- CIBC Mortgages plc v Pitt [1994] 1 AC 200
- Cityland and Property (Holdings) Ltd v Dabrah [1968] Ch 166
- Cuckmere Brick Co Ltd v Mutual Finance Ltd [1971] Ch 949
- Fairclough v Swan Brewery Co Ltd [1912] AC 565
- Horsham Properties Group Ltd v Clark [2008] EWHC 2327 (Ch), [2009] 1 WLR 1255
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