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Lord macnaughten in the house of lords in noakes and

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Unformatted text preview: age. ✘ PROPERTY AND MORTGAGES REVIEW QUESTIONS 33.8 What is a mortgage? 33.9 What is the distinction between a legal mortgage and an equitable mortgage? Mortgagor’s right to deal with the property The purpose of the mortgage is that the land should be security for repayment of a loan and nothing more. Accordingly, the mortgagee is not permitted to take the fee simple outright or to impose conditions or restrictions that make the mortgage materially harder to redeem. Lord MacNaughten in the House of Lords in Noakes and Co Ltd v Rice [1902] AC 24 said: Redemption is of the very nature and essence of a mortgage … Equity will not permit any device or contrivance designed or calculated to prevent or impede redemption. The right to possession of the mortgaged property depends on whether it is common law system or Torrens system. The common law system mortgage takes effect as a conveyance of the land to the mortgagee of all of the mortgagor’s interest. This means the mortgagor has also given...
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