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Law of Property Act 1922

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Charges and Mortgages of Registered Land.

167Provisions as to registered charges.

(1)A charge under section twenty-two of the Act of 1875 and any alteration thereof, to be noted on the register, shall be effected by deed, and the following provisions shall apply thereto.

(2)A charge on freehold land shall (subject to any provision to the contrary contained in the charge) take effect as a charge by way of legal mortgage as if it had contained a demise to the charge creditor of a term of three thousand years without impeachment of waste in the registered land intended to be charged, subject to a proviso for cesser on redemption of the charge; and a charge on leasehold land held for a term of years absolute shall (subject as aforesaid) take effect as a charge by way of legal mortgage as if it had contained a subdemise to the charge creditor of the land for the residue of the term created by the registered lease except the last three days thereof, subject to a proviso for cesser on redemption; and in each case as if the term or subterm had commenced from the date of the instrument of charge.

(3)A charge or a deed of alteration of a charge may (subject to the provisions of Part I. of this Act) contain, in the case of freehold land, an express demise, and in the case of leasehold land an express subdemise of the land to the creditor for a term of years absolute, subject to a proviso for cesser on redemption.

(4)Any such demise or subdemise or charge by way of legal mortgage shall take effect from the date of the delivery of the deed containing the same, but subject to the estate or interest of any person whose estate or interest (whenever created) is registered or noted on the register before the date of registration of the charge or deed of alteration.

(5)On registration of any transfer or transmission of a charge the registered term or subterm granted by the charge or any deed of alteration shall, without any conveyance or assignment and notwithstanding anything to the contrary in the transfer or any other instrument, vest in the registered proprietor for the time being of the charge.

(6)Where a charge is registered in the names of two or more proprietors (whether jointly or in undivided shares) the registered mortgage term implied or comprised in the charge shall (but without prejudice to the beneficial interests in the mortgage money) vest in them as joint tenants, and the registered proprietor for the time being of the charge, or his personal representative, shall have power to give valid receipts, notwithstanding that the mortgage money may he held in undivided shares, in like manner as if the money had been held on a joint account.

(7)Any charge registered on or before the commencement of this Act shall take effect as a demise or subdemise of the land in accordance with the provisions of Part I. of this Act, and the registered estate or term shall (without prejudice to any registered charge or any mortgage term or subterm created by this Act) vest in the person appearing by the register to be entitled to the ultimate equity of redemption.

(8)Rules shall be made for applying the provisions of Part I. of this Act and of this section to the case of charges by way of submortgage, whether registered before or after the commencement of this Act.

(9)On the notification on the register of the entire cessation of a registered charge, whether as to the whole or part only of the land affected thereby the term or sub-term granted by the charge or any deed of alteration so far as it affects the land to which the discharge extends, shall merge and be extinguished in the registered estate in reversion without any surrender.

(10)Notwithstanding the creation of a term or sub-term under this section, a transfer under the power of sale conferred by section twenty-seven of the Act of 1875 shall (subject to any prior incumbrances or other entries on the register), as heretofore, operate to transfer the registered estate or the whole of the residue of the term created by the registered lease, as the case may be, and the term or subterm shall become merged, and any purported disposition of or dealing with the mortgage term or subterm apart from the charge, and any process or act purporting to keep alive the term or subterm after the cessation of the charge shall be void,

(11)A charge made under section twenty-two aforesaid (as amended by section nine of the Act of 1897) may be registered notwithstanding that it contains any trust, power to appoint new trustees, or other provisions for giving effect to the security.

(12)Subject to any entry to the contrary on the register, the vesting of any term in accordance with this section in the registered proprietor of a charge shall, subject to the right of redemption, have the same effect as if such proprietor had been registered as the transferee for valuable consideration of the mortgage term.

(13)In section twenty-five of the Act of 1875, after the words " profits thereof " there shall be inserted the words, " and may, after entry into possession and after " having acquired a title under the Limitation Acts, " execute a declaration, in the prescribed form, that the " right of redemption is barred, and thereupon he shall " be entitled, subject to furnishing any evidence which " may be prescribed in support thereof, to be registered " as proprietor of the land, with the same consequences " as if he had been a purchaser for valuable consideration " of the land under the power of sale."

(14)At the end of section twenty-six of the Act of 1875 (which relates to foreclosure) there shall be inserted the following provision:—

The foreclosure shall be completed by the registration of the proprietor of the charge (or such other person as may be named in the foreclosure order absolute for that purpose) as the proprietor of the land, and by the cancellation of the charge and of all incumbrances inferior thereto; and such registration shall operate in like manner and with the same consequences as if the proprietor or other person aforesaid had been a purchaser for valuable consideration of the land under the power of sale.

(15)At the end of section twenty-seven of the Act of 1875 (which confers a power of sale) there shall be inserted the following provision:—

The transfer shall operate and be completed by registration, in the same manner, as nearly as may be (but subject to any alterations on the register affecting the priority of the charge), as a transfer for valuable consideration by the registered proprietor of the land at the time of the registration of the charge would have operated or been completed, and, as respects the land transferred, the charge and all incumbrances inferior thereto shall be cancelled.

(16)In addition and without prejudice to the powers conferred by the Acts, the registered proprietor for the time being of a charge shall (subject to any entry on the register to the contrary) have and may exercise all the powers conferred on mortgagees by the Conveyancing Acts, 1881 to 1922, in the like circumstances as are provided by those Acts, including the powers of leasing and of accepting surrenders of leases.

(17)An instrument of charge may be in any form provided that it complies with the requirements of this Act in regard to mortgages capable of registration.

(18)This section applies whether the land is registered before or after the commencement of this Act.

168Mortgages protected on the register.

(1)The registered proprietor of any freehold or leasehold land may, subject to any entry to the contrary on the register, mortgage, by deed or otherwise, the land or any part thereof (by way- of demise or subdemise or of charge by way of legal mortgage) in any manner which would have been permissible if the land had not been registered and with the like effect: provided that the registered land comprised in the mortgage is described in a manner sufficient to enable the registrar to identify the same without reference to any other document.

(2)A mortgage made under this section may, if by deed, be protected by a caution in a specially prescribed form and in no other way, and a mortgage, if not by deed, may be protected by a caution lodged under section fifty-three of the Act of 1875.

(3)The entry of a caution prescribed under this section shall be deemed a dealing capable of being restrained by caution lodged under section fifty-three of the Act of 1875.

(4)Until the mortgage is protected on the register under this section, it shall be capable of taking effect only in equity and of being overridden as a minor interest.

(5)Where a mortgage by deed has. been protected by a caution in the specially prescribed form, the mortgagee, or the persons deriving title under him, may, subject to furnishing sufficient evidence of title, require the mortgage to be registered as a charge with the same priority as the caution.

(6)When a mortgage by deed has been so registered, the registered proprietor thereof shall, subject to any entry to the contrary on the register, have all the powers which are by the Acts conferred on the proprietor of a registered charge; but so long as the mortgage is protected only by a caution, the mortgagee shall not be capable of dealing with the registered land by registered disposition.

(7)Any mortgage created under this section (whether registered or protected by a caution in a specially prescribed form) shall devolve and may be transferred, discharged, reconveyed or otherwise dealt with by the same instruments and in the same manner as if the land had not been registered, subject, as follows:—

(a)Where a mortgage has been registered as a charge the devolutions, dealings and notification of cessation shall be registered in the same manner and with the same consequences as in the case of a registered charge :

(b)Where the mortgage has been protected only by a specially prescribed caution then such devolutions and dealings shall be protected in like manner and in no other way:

(c)Subject to any entry to the contrary on the register, the priorities arising in respect of devolutions and dealings shall be regulated by the order of application for registration or for the entry of a caution in the specially prescribed form.

(8)An ad valorem fee may be charged for a caution specially prescribed under this section, but, if and when a mortgage protected by such a caution is registered as a charge, any ad valorem fee paid in respect of the caution may be taken towards satisfaction of the fees payable on such registration of the mortgage.

(9)Rules shall be made for giving effect to the provisions of this section, and in particular for providing in what case documents, or copies thereof, shall be left at the registry, for providing for the marking of documents not retained at the registry, and for extending and adapting the provisions of this section to the case of submortgages:

Provided that where—

(a)The mortgage relates also to property other than registered land ; or

(b)The mortgage is only protected by a caution ; or

(c)The nature of the security is such that it is not expedient or practicable that the mortgage should be retained at the registry;

then neither the mortgage nor any instruments dealing therewith nor discharges affecting other property besides the registered land shall be required to be permanently retained by the registrar.

(10)All mortgages made under this section which are registered shall take effect as registered dispositions, and in the Acts the expression " registered charge " shall include a registered mortgage.

(11)This section applies whether the land is registered before or after the commencement of this Act.

169As to securing further advances.

(1)When a registered charge is made for securing further advances, the registrar shall, before making any entry on the register which would prejudicially affect the priority of any further advance thereunder, give to the registered proprietor of the charge at his registered address, notice by registered post of the intended entry, and the proprietor of the charge shall not, in respect of any further advance, be affected by such entry, unless the advance is made after the date when the notice ought to have been received in due course of post; and if, by reason of any failure on the part of the registrar or the post office in reference to the notice, the proprietor of the charge suffers loss in relation to a further advance, he shall be entitled to be indemnified under the Acts in like manner as if a mistake had occurred in the register ; but if the loss arises by reason of an omission to register or amend the address for service, no indemnity shall be payable under the Acts.

(2)This section applies whether the land is registered before or after the commencement of this Act.

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