Mortgages Flashcards
National Securities v Hegarty
Husband forged wife’s signature to mortgage the JT. His act of alienation severed the JT, but the wife’s share was unaffected by the mortgage.
Ahmed v Kendrick
Although wife had not signed mortgage agreement, the effect of it was to vest title to property in her name, so she could not deny the charge in equity. The effect of the passing of beneficial interest by a fraudster owner of that interest is to sever the beneficial JT
Thames Guaranty v Campbell
The other party can obtain an order compelling him to grant what the has got
Barclays Bank v Zaroovabli
Mortgagor leased premises without permission from lender, contrary to mortgage agreement. But lender had never registered the charge, and when it tried to 6 years later, it found itself bound by the lease.
Abbey National v Cann
Acquisition mortgages - the mortgagee’s interest always takes precedence
Barclays Bank v Buhr
The borrower still holds proceeds of sale on constructive trust for lender
Western Bank v Schindler
An unusual case of the bank seeking possession even though no default - they were trying to protect the security. The right to possession is not contingent on default, it’s a common law right, also by virtue of s.85-87 LPA
Administration of Justice Act s.36
Where mortgaged property is residential, motgagee may prefer to go through court and ask for an order for possession through s.36
Ropaigaelach v Barclays Bank
Where no one is in residence, mortgagee may take possession and is entitled to do so.
Albany Homes v Massey
No possession where charge effective in equity over only one co-owner’s interest. But not Achampong
First National Bank v Achampong
Mortgagee can still get order for sale under s.14 TLATA 1996 without going into posession
Mortgage Corporation v Shaire
Ms Shaire had a legal charge, but undue influence, Mr defaulted and the C wanted their money. She was not in actual occupation of the property, but she was able to pay the money back. The mortgage company would not be kept out of their money, because she could repay the whole sum during the lifetime of the mortgage.
TLATA replaces trusts for sale with trusts of land, giving more discretion to tip the balance in favour of families
Bank of Ireland Home Mortgages v Bell
It is generally unjust to keep a creditor out of its money if no payments are made. But not where refusal to order sale would leave bank with no realistic prospect of ever recovering at least some of the money. The innocent co-owner has to show that they are able to meet the repayments to keep up their home (see Mortgage Corporation v Shaire)
Edwards v Lloyds TBS Bank
Charged share valued at more than enough to cover the debt, and Mrs E could not, with her share, afford to move elsewhere. There was no danger that the creditor could not be paid. Purpose was still possible and no danger of negative equity.
Re Citro
Trustee in bankruptcy should prevail. They are the melancholy consequences of debt and improvidence with which every civilized society has been familiar. Children and homelessness where not extreme enough to postpone sale.
Alliance and Leicester v Slayford
Mortgagee can purse debt claim against mortgagor so that he falls into bankruptcy: easier to get sale under Insolvency Act, one year after bankruptcy, and this is not an abuse of process.
Cheltenham & Gloucester v Krausz
S.36 cannot help the mortgagor when there is negative equity. Once a lender wants possession to realise its security, a defaulting borrower with no definite prospect of repaying will be powerless to prevent loss of the home
Quennell v Maltby
Possession sought in order - a mortgagee’s power can be said to be exercised improperly only if no part of the reason was to protect the security (like in this case)
Halifax BS v Thomas
T had defrauded H in obtaining a mortgage loan to buy property; defaulted, T convicted of fraud, H sold property, some left over after discharge of debt. Q - who got this residue? Since T could not profit prom sale of property which he had acquired through fraud, could H keep it? No. It went to the Crown as bona vacantia.
Cuckmere Brick v Mutual Finance
Planning permission was not mentioned in an advert, which would significantly raise the price of the sale. Mortgagee to take ‘reasonable steps’ - no duty to make profit for mortgagor: purpose of duty is to obtain enough to release mortgagor from debt
Standard Chartered Bank v Walker
Choice open to the mortgagee to choose the time of sale did not extend to choosing the ‘worst possible time’ and that there was an arguable case that any choice should involve a reasonable degree of care.
Parker-Tweedale v Dunbar Bank
Duty owed to mortgagee because of relationship but not owed to beneficiary under trust of land. Here mortgagor agreed with mortgagee the price of sale, week later before completion of sale from mortgage, X agrees to sell to Z for 150k more;
Corbett v Halifax
Equity will intervene but only where improprietary
Tse Kowng Lam v Wong Chit Sen
Auctions were usually alright, but not on these facts (only one bid offerred by mortgagee’s family at the reserve price fixed by the mortgagee
Barclays Bank v O’Brian
Mrs O ‘agreed that a loan to her husband’s business be secured on the family home. Believed loan was for 60k, but in fact it was unlimited (overdraft account) and soon rose more than double that. She later argued that husband has unduly influenced her, that this vitiated her consent, and that the contract should be set aside with respect to her.
Held: Contract was voidable for UI
RBS v Etridge
The solicitor advising W had falsely confiirmed in writing to RBS that he had explained everything to her. RBS could reasonably rely on that to ignore possiblity of undue influence.
CIBC Mortgages v Pitt
UI: here, the picture given to the bank was of an ordinary transaction which would benefit both the wife and a husband. Notice depends on the nature of transaction: must be to manifest disadvantage of compliant (or need explaining post-Etridge)
TSB Bank v Camfield
Result of undue influence - all or nothing. UI vitiates contract, so bank has no claim against W’s share despite her having agreed to a lesser amount. Mrs Camfeld was a legal as well as a beneficial owner and so had entered into a contract with the bank which she then set aside.
Barclays Bank v Caplan
Here constructive notice of UI not shown on original agreement, but accepted for later agreements extending amount of loan, so W interest still charged up to the amount of the original loan.
Barclays Bank v Rivett
Man can be unduly influenced too!
