A solicitor advanced money to his client on a second mortgage, in which was inserted a power of sale exerciseable at any time without the usual proviso requiring that notice should be given, or some interest should be three months in arrear; and it was not shewn that he explained to the client that the power was not in the usual form. The solicitor afterwards took possession, and for several years received the rents, which, together with some payments made by the mortgagor, exceeded the interest on both mortgages. He then sold the property without notice. Held (affirming the decision of Fry, J), in an action by the mortgagor against the solicitor, that the omission from the power of sale of the usual qualifying clause was a breach of duty, and that the mortgagee was liable in damages as for an improper sale, unless it could be shewn that some interest was three months in arrear ; and whether the absence of explanation did not make it improper even if there was interest in arrear, quaere.
Held, that the fact that the mortgagee had received rents to an amount more than sufficient to pay the interest would not by itself prove that there was no interest in arrear if no appropriation was shewn to have been made.
The dictum in Brocklehurst v. Jessop overruled.
But held, that, as in an account sent by the mortgagee to the mortgagor the interest was treated as satisfied up to a certain day out of the rents, there was evidence of an arrangement that the rents should be applied in discharge of interest, and that, as the final account shewed that if the rents were thus appropriated there would be no interest in arrear at the time of sale, the sale was improper.
Whether a mortgagee in possession having a balance of rents in hand more than sufficient for payment of the interest and all expenses he has incurred can be heard to say that interest is in arrear so as to justify a sale
because no account has been rendered and no appropriation made, qnaere.
Held (reversing the decision of Fry, J), that the difference between party
and party costs and solicitor and client costs of the present action could not
be given to the Plaintiff by way of damages.
Jessel MR
[1881] UKLawRpCh 203, (1881) 18 Ch D 449, 50 LJCh 181
England and Wales
Cited by:
Cited – Ross v Caunters (a firm) ChD 1979
The court upheld a finding of negligence against a firm of solicitors for failing to ensure the correct attestation of a will, and also the award of damages in favour of a disappointed beneficiary.
A solicitor owes a duty of care to the party . .
Lists of cited by and citing cases may be incomplete.
Negligence, Legal Professions, Damages
Updated: 13 January 2022; Ref: scu.654667
