Artificiality of Mortgage Law and Agency of the Receiver: An Overview
Abstract
The original conception of a mortgage at common law was a contract of loan under which proprietary interest in the mortgaged property became vested in the creditor-mortgagee as security for loans and advances subject to cessor on redemption by the debtor-mortgagor based upon strict compliance with the contract.1 The transaction, like many other contractual relations, was subject to the hallowed principle of sanctity of contract2 so that upon default by the mortgagor to repay the loan, the subject matter of the mortgage would be attached and the mortgage loan realised from the mortgage security. Parties' agreement was the bedrock of their obligations and the terms and conditions contained in the mortgage instrument actually guided the transaction and provided justification for the mortgagee's realisation of the mortgage security or the mortgagors redemption upon repayment of the loan on the contractual date stipulated in the mortgage agreement.
