Increase of Rent and Mortgage Interest (Restrictions) Act, 1923

Restrictions on calling in of mortgages.

9.—It shall not be lawful for any mortgagee under a mortgage to which this Act applies, so long as:—

(a) interest at the rate permitted under this Act is paid and is not more than twenty-one days in arrear; and

(b) the covenants by the mortgagor (other than the covenant for the repayment of the principal money secured) are performed and observed; and

(c) the mortgagor keeps the property in a proper state of repair and pays all interest and instalments of principal recoverable under any prior encumbrance,

to call in his mortgage or to take any steps for exercising any right of foreclosure or sale, or for otherwise enforcing his security or for recovering the principal money thereby secured:

Provided that—

(i) this provision shall not apply to a mortgage where the principal money secured thereby is repayable by means of periodical instalments extending over a term of not less than ten years from the creation of the mortgage, nor to any case in which the mortgagor consents to the exercise by the mortgagee of the powers conferred by the mortgage, nor shall this provision affect any power of sale exercisable by a mortgagee who was on the twenty-fifth day of March, nineteen hundred and twenty, a mortgagee in possession; and

(ii) if, in the case of a mortgage of a leasehold interest the mortgagee satisfies the Court that his security is seriously diminishing in value or is otherwise in jeopardy, and that for that reason it is reasonable that the mortgage should be called in and enforced, the Court may by order authorise him to call in and enforce the same, and thereupon this section shall not apply to such mortgage; but any such order may be made subject to a condition that it shall not take effect if the mortgagor within such time as the Court directs pays to the mortgagee such portion of the principal sum secured as appears to the Court to correspond to the diminution of the security.