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MORTGAGOR IS ENTITLED TO POSSESSION AS OF RIGHT

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Dictum

As was said by Harman J. in Alliance Perpetual Building Society v. Belrum In-vestments Ltd. And Ors. (1957) 1 W.L.R. 720, at p. 722 – possession is a remedy to which a mortgagee is entitled as of right against a mortgagor, whether the principal or interest be due or not, unless there is some special clause in the mortgage excluding it. (See also Hughes v. Waite (1957) 1 W.L.R. 713; and Four Maids Ltd. v. Dudley Marshall (properties) Ltd. (1957) Ch. 317.

— Udoma, JSC. Nig. Housing Dev. Society v. Mumuni (1997) – SC 440/1975

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DEFINITION OF MORTGAGE

A mortgage is defined as creation of an interest in a property defeasible, that is, annullable upon performing the condition of paying a given sum of money with interest at a certain time. Thus, the legal consequence of the above is that the owner of the mortgaged property becomes divested of the right to dispose of it until he has secured a release of the property from the mortgagee.

— M.L. Shuaibu, JCA. FBN v Benlion (2021) – CA/C/31/2016

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A MORTGAGEE HAS A POWER OF SALE AS OF RIGHT IN THIS INSTANCE

A mortgagee, unless where a contrary intention is shown, has a power of sale provided: (a) the mortgage was made by deed; and (b) the mortgage money is due, that is the legal date for redemption has passed. Where the money is payable by installments, the power of sale arises as soon as any installment is in arrears.

– L.A. Ayanlere v. Federal Mortgage Bank of Nig. Ltd. (1998) – CA/K/186/96

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BAD FAITH ON THE PURCHASER OF MORTGAGE PROPERTY

The law of sale by auction or auction sale protects the purchaser and that is the basis of the principle of law that a mortgagor’s right essentially is in damages. The law has an important qualification and it is that the purchaser must have bought the mortgaged property in good faith, that is bona fide and not in bad faith, that is mala fide. The sympathies of the law on the purchaser will vanish the moment the court comes to the conclusion that the purchaser bought the property in bad faith. Bad faith on the part of the purchaser is a matter of fact to be deduced from the totality of the purchasing or buying conduct of the purchaser. Bad faith taints or better still, destroys a mortgage sale and therefore the property in the sale.

– Niki Tobi JSC. Okonkwo v. Cooperative Bank (2003)

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CONTINUING MORTGAGE NEEDS NO REGISTRATION

B.O.N Ltd. v. Akintoye (1999) 12 NWLR (Pt. 631) 392: “Where an original mortgage is a continuing security for raising a second mortgage, what is needed is to upstamp it. There is no need to obtain a fresh consent of the Governor for the second mortgage. In the instant case, where the wordings of the mortgage deeds relating to the security are clear and unambiguous and where the original deed was a continuing security, there was no need to obtain a fresh consent of the Governor for the second mortgage”.

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DEPOSIT OF TITLE DEED CREATES EQUITABLE MORTGAGE

It is settled that the deposit of title deeds with a bank as security for a loan, creates an equitable mortgage as against legal mortgage which is created by deed transferring the legal estate to the mortgagee. – Chukwuma-Eneh JSC. Yaro v. Arewa CL (2007)

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ONCE MORTGAGE ALWAYS MORTGAGE

An important feature of mortgages both legal or equitable is that once a mortgage always a mortgage and nothing but a mortgage. – Chukwuma-Eneh JSC. Yaro v. Arewa CL (2007)

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