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Rights and Duties of the Mortgagor and Mortgagee

Vijay
Written by Vijay. Posted in Law & Legal on 10 September 2009.
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Section 60 to 77 of the Transfer of the Property Act deals with the rights and duties of the mortgagor and mortgagee.
Rights of Mortgagor :
The mortgagor has the nine rights.
They are:-
1. Section 60 of the Act,the mortgagor ha sthe right of redemption of the mortgaged property after payment of mortgaged money.He can take delivery of possession of the mortgaged property and the return of all the title deeds.
2. Section 60 A of the act,the mortgagor has the right to direct the mortgagee to transfer the mortgaged property to a third party instead of transferring it to the mortgagor.
3. Section 60 B of the act,the mortgagor has the right to inspect the documents in the possession of the mortgagee.But it must be only at a reasonable time.He can take copies from such documents.
4. Section 63 of the act,the mortgagor has the right to the properties accrued by natural means like accretion,etc..This right is called "Right of Accession".
5. Section 65 A of the act,the mortgagor has the power to amke lease also,but it must be with the constent of the mortgagee.Such lease must satisfy the prescribed conditions.
6. Section 66 of the act,the mortgagor has the right to reasonable waste of the property but he must not make permanent injuries of destruction of the property or reduce its value.If he does so,then he must give additional security to the mortgagee.
7. Scetion 63 A of the act,the mortgagor has the right to claim improvement made by the mortgaged properties.
8. The mortgagor can avoid consolidation by the mortgagee in the mortgaged properties.
9. The mortgagor has the right to deposit the mortgage money in the court,if there is any suit relating to the property.
Duties or Liabilities of Mortgagor :
1. The mortgagor must indemnify the mortgagee for the defective title to the proeprty.If any third person interferes,the mortgagor must compenssate the mortgagee for the expenses incurred by him in protecting the title.
2. The mortgagor must compensate the mortgagee for payment of all taxes and public charges.Similarly when the property the mortgagor must pay all taxes and public charges.
3. When the mortgaged property is leased,the mortgagor must direct the rent payable under the lease,etc.,to the mortgagee.
Rights of Mortgagee :

1. Section 67 of the act.At any time after the mortgagemoney has become due,the mortgagee has the right to obtain from the court,a decree for foreclosure.
2. The mortgagor has the right to sue for the mortgage money in the following four cases,section 68 of the act.
a. when the mortgagor binds to repay the money.
b. When the mortgagor's property is wholly or partly destroyed by any cause other than the wrongful act or default of the mortgagee.
c. When the mortgagee is deprived of the whole or part of his security.
d. When the mortgagee was entitled to possession of the mortgaged property and the mortgagor has failed to deliver it.
3. The mortgagee has the power to sell the mortgaged property without the intervention of the court,on default of payment of mortgage money by the mortgagor in the following three cases,Section 69 of the act.
a. When the mortgage is english mortgage between Non Hindus,Non Muslims,Non Mohammedans and member of the race or sect notified by the State Government to the Official Gazette.
b. When Government is the mortgagee,with the express provision of sale without intervention of teh court.
c. When the mortgaged property is situated at Calcutta,Madras,Bombay or any other gazetted town or area.
4. The mortgagee has the right of accession to the increased mortgaged property.
5. The mortgagee has the right of accession to the increased properties for renenwal of security.
6. If the mortgaged property is under lease,the mortgagee is entitled for renenwal of the lease for purpose of security.
7. The mortgagee has the right for reimbursement with interest for the money spent for purposes like preservation of mortgaged property etc...,
8. When a property is mortgaged for successive debts to successive mortgagees a mesne mortgagee has the same rights against mortgagee posterior to himself as he has against the mortgagor.
Liabilities of Mortgagee :

1. A mortgagee is bound to sue on behalf of all the mortgagees in respect of which the mortgage money has become due in the absence of express contract.During  the continuance of the mortgage,the mortgagee is bound.
2. To manage the property as aperson of ordinary prudence would manage if it were his own.
3. To use his best endeavour to collect the rents and profits thereof.
4. In the absence of a contract to the contrary,to pay Government revenue and the other charges  of  apublic nature and all rents,out of the income of the property.
5. In the absence of a contract to the contrary,to make such necessary repairs as the income of the property permits.
6. Not to commit ant act which is destructive or permanently injurious to the property.
7. When the whole or any part of the property is insured against loss or damamge by fire,in case of such loss or damamge to reinstate the insured property with the money obtained from the insurance policy or to discharge the mortgage debt with it,if the mortgagor so dircets.
8. To keep clear,full and accurate accounts of all sums received and spent by him as mortgaged and give them to the mortgagor when asked.
9. To debit receipts from the mortgaged property or where such property is personally occupied by him a fair occupation rent thereof after deducting the expenses of management,the collection charges,revenue and costs of repairs,first agaginst the interest on the mortgage money and then against the principal.
10. To account for the receipts from the mortgaged property.Such accounting of receipt from the proeprty shall be taken in lieu of interest on the prinicipal money given to the mortgagor.
This article is very useful to Mortgagor and Mortgagee to know their rights and liabilities of the property in the Transfer of the property act.

Vijay

Author: Vijay

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