Insurance.—The power of the mortgagee to insure the mortgaged pro perty is thus described by statute :—" A power, at any time after the date of the mortgage deed, to insure and keep insured against loss or damage by fire any building, or any effects or property of an insurable nature, whether affixed to the freehold or not, being or forming part of the mortgaged property, and the premiums paid for any such insurance shall be a charge on the mortgaged property, in addition to the mortgage money, and with the same priority, and with interest at the same rate as the mortgage money." But the amount of such an insurance effected by a mortgagee must not exceed the amount specified in the mortgage deed ; or if no amount is so specified, then it must not exceed two-third parts of the amount that would be required, in case of total destruction, to restore the property insured. This statutory power to insure cannot be exercised by a mortgagee in any of the following cases :—(1) Where there is a declaration in the mortgage deed that an insur ance is not required ; (2) Where an insurance is kept up by or on behalf of the mortgagor in accordance with the mortgage deed ; (3) Where the mort gage deed contains no stipulation respecting insurance, and an insurance is kept up by or on behalf of the mortgagor, to the amount in which the mortgagee has a statutory authority to insure. All money received on an insurance effected under a mortgage must be applied by the mortgagor, if the mortgagee so requires, in making good the loss or damage in respect of which the money is received. A mortgagee has a right, however, to require that all money received on an insurance shall be applied in or towards discharge of the money due under his mortgage ; but this right is subject to any obligation to the contrary imposed by law or by special contract.
Receiver.—A mortgagee has also a statutory power, when the mortgage money has become due, to appoint a receiver of the income of the mortgaged property, or of any part thereof. He cannot, however, exercise this power until he has become entitled to exercise the power of sale ; then, by writing under his hand, he may appoint any person he thinks fit to be receiver. But the receiver will be deemed to be the agent of the mortgagor ; and the latter is solely responsible for the receiver's acts or defaults, unless the mortgage deed otherwise provides. A receiver has power to demand and recover all the income of the property of which he is appointed receiver, to the full extent of the estate or interest which the mortgagor could dispose of, and to give effectual receipts therefor. He can do this by action, distress, or otherwise, in the name of either the mortgagor or mortgagee. Any one paying money to the receiver is not concerned to inquire whether any event has happened which authorises the receiver to act. The receiver may be removed, and a new receiver appointed, from time to time by the mortgagee by writing under his hand. A receiver cannot charge what costs he pleases. He is only entitled to retain out of any money received by him, for his remunera tion, and in satisfaction of all costs, charges, and expenses incurred by him as receiver, a commission at such rate, not exceeding 5 per cent. on the gross atnount of all money received, as is specified in his appointment, and if no rate is so specified, then at the rate of 5 per cent. on that gross amount, or at such higher rate as the Court thinks fit to allow, on application made by him for that purpose. If so directed in writing by the mortgagee, he must insure and keep insured against loss or damage by fire, out of the money received by him, any building, effects, or property comprised in the mort gage, whether affixed to the freehold or not, being of an insurable nature.
He is bound to apply all the money he receives in the following manner (1) In discharge of all rents, taxes, rates, and outgoings m hatever affecting the mortgaged property ; and (2) In keeping down all annual sums or other payments, and the interest on all principal sums, having priority to the mortgage in right whereof he is receiver ; and (3) In payment of his commission, and of the premiums on fire, life, or other insurances, if any, properly payable, and the cost of executing necessary or proper repairs directed in writing by the mortgagee ; and (4) In payment of the interest accruing due in respect of any principal money due under the mortgage. The residue he must pay to the mortgagor, or the person who but for the possession of the receiver would have been entitled to receive the income of the niortgaged property, or who is otherwise entitled to that property fri;072 respecting mortgage.—A person entitled to redeem mortgaged property may bring an action for an order for its redemption or sale. In any action, whether for foreclosure, redemption, or sale, the Court can order a sale of the mortgaged property on such terms as it thinks fit, as for exampie the deposit in Court of a reasonable sum fixed by the Court to meet the expenses of sale and to secure performance of the terms. Such an order is made on the request of the mortgagee, or of the mortgagor or any person interested either in the mortgage money or in the right of redemption, and notwithstanding that the mortgagee, mortgagor, or other person does not appear in the action. The Court can also order the plaintiff to give security for costs.
" Foreclosure" is the process adopted by a mortgagee for extinguishing the mortgagor's right of redemption, whereby the estate becomes the absolutt property of the mortgagee. When the mortgagor is sufficiently in default the mortgagee may proceed with an action for foreclosure, and compel the mortgagor to redeem by the payment of the debt, or submit to a fore closure and be for ever barred from any right of redemption. This in most cases would be a severe remedy, and is accordingly adopted only when the interests of both parties require it, as where the security is an insufficient one as it stands, but could be improved and made sufficient if the mortgagee could obtain absolute possession of it. As mentioned above, an action for a foreclosure is always subject to the Court's right to direct a sale. The proceedings are taken in the Chancery Division of the High Court, but where the mortgage does not exceed the sum of 13,5oo, they may be taken in a County Court. The practice is for the Court to take an account of the principal and interest due from the mortgagor, and then to allow a. certain interval of time, usually six months, wherein the mortgagor, and any further mortgagees, can pay the amount found by the account. Default in such payment will extinguish the right of redemption and absolutely vest the pro perty in the mortgagee. But even after the foreclosure has been completed the Court, in a proper case, will reopen the action and afford the mortgagcr a further opportunity to redeem. Foreclosure is the proper and only remedy against the property in the case of an equitable mortgage by depo8it of title-deeds; but if the deposit it3 accompanied by an aeTeement to execute a legal mortgage, the mortgag,ce may proceed with an adion for siLle.