In England under Lord Cranworth's Act (m) a mortgage could not sell until after the expiration of one year from the time when the principal had become payable or unless interest was in arrear for six months, or unless there had been a breach of a covenant to insure against fire. Similar limitations are expressed in Ontario in the statutory power contained in the Mortgages Act (n), except that the default in payment of principal need only be for four months. The notice may, however, be given at any time after any default in making a payment provided for by the mortgage. The English Conveyancing Act, 1881, confers a power of sale, "when the mortgage money has become due," but the power of sale is subject to certain conditions already mentioned (o).

(h) Hind v. Poole, 1855, 1 K. & J. 383.

(i) R.S.O. 1914, c. 133, s. 4. See chapter 13, Persons entitled on Death of the Mortgagee, Sec. 124.

(j) Cf. Coote, Law of Mortgages, 8th ed., p. 915. (k) McCarogher v. Whieldon, 1864, 34 Beav. 107. (I) In re Cooper and Allen's Contract, 1876, 4 Ch.D. 802. (m) 23 & 24 V. c. 145. See Sec. 332, supra.

A notice served by a mortgagee, after the mortgage money has become payable, requiring payment at the expiration of three months from the date of the notice, is a good notice under s. 20 of the Conveyancing Act, 1881. The three months default in payment mentioned in the section begins to run from the service of such a notice, not from the date fixed by the notice for payment (p).

In the case of an express power of sale, the time when the power may be exercised will be governed by the terms of the power.

Where the power of sale was in these words: "Provided that the mortgagees, on default of payment for three months, may enter on and lease or sell the lands without notice," and a covenant followed: "And the mortgagees covenant with the mortgagors that no sale or lease of the said lands shall be made or granted by them until such time as one month's notice in writing shall have been given to the mortgagors," it was held, in an action by the mortgagors to set aside the sale, that the mortgagees were not bound to wait until default had been made for three months before serving the notice, in other words that the month's notice might be concurrent with the default (q). Where, however, the power of sale provided that after default of payment for one month and upon one month's notice of sale the land might be sold, it was held that the default and the notice could not run concurrently (r).

(n) See Sec. 332, supra. (o) See Sec. 332, supra.

(p) Barker v. Illingworth, [1908] 2 Ch. 20, distinguishing Sel-wyn v. Garfit, 1888, 38 Ch.D. 273.

(q) Grant v. Canada Life Assurance Co., 1881, 29 Gr. 256.

It has been held that the mortgagee may enter into an agreement for sale before the power of sale is exercisable, if it is not to be carried into execution until the power becomes exercisable (s).

It is not unusual, where a new mortgagee is advancing money for the purpose of paying off persons entitled to old securities, to take an assignment of the old securities so as to keep them alive as a protection to the new mortgagee against encumbrances which may have been made by the mortgagor in the interval between the old securities and the new mortgage. Where, upon the making of a new advance and the taking of new security, it was recited that the power of sale under an earlier mortgage "has not been and is not intended to be exercised," it was held that the power of sale was not destroyed, but that all that was meant by the recital was that the power of sale had not been exercised and that it was not intended to exercise it at present, or for a certain time, or in any manner inconsistent with the stipulations connected with the new advance (t).

If sale proceedings are begun in consequence of the mortgagor's default in payment of an instalment of interest, and the principal has become due by virtue of an acceleration clause in the short form contained in schedule B to the Short Forms of Mortgages Act, so that the relieving provision in the corresponding extended form is available to the mortgagor, the latter may pay the instalment in arrear and become entitled to have the sale proceedings stayed (u). On the other hand where the mortgagee on default in payment of an instalment gives notice to the mortgagor requiring payment of the whole debt, he is not entitled to withdraw the notice without the consent of the mortgagor (v).

(r) Gibbons v. McDougall, 1879, 26 Gr. 214. (s) Farrar v. Farrars, 1888, 40 Ch.D. 395; Major v. Ward, 1847, 5 Hare 598.

(t) Boyd v. Petrie, 1872, L.R. 7 Ch. 385, 14 R.C. 760.

A sale under the power of sale is a "proceeding" to recover out of land money secured by mortgage, within the meaning of s. 24 of the Limitations Act, and the mortgagee's right to sell will be barred after the expiration of ten years from the time when the right to receive the mortgage money accrued or from the time of the last payment or acknowledgemnt (w).

The defendants advertised an auction sale of mortgaged lands situate near Kincardine to take place there on January 19th. At eleven a.m. on January 17th the mortgagor telegraphed to the defendants at Toronto to inquire the amount required to redeem it and the defendants telegraphed a reply. At 10 a.m. on January 19th the defendants received at Toronto the amount named, but in accordance with their office procedure, the accountant was not aware of this till about eleven a.m., when knowing the property was up for sale, he telegraphed and telephoned the fact to Kincardine. The sale had, however, been made a few minutes before to the plaintiff. The defendants then returned the money to the mortgagor. It was held that the plaintiff was entitled to specific performance, for the mortgagor had not tendered the amount such reasonable time before the sale as to make it obligatory on the defendants to receive it in payment (x).

(u) Todd v. Linklater, 1901, 1 O.L.R. 103. See chapter 23, Action on the Covenant, Sec. 226.

(v) Santley v. Wilde, [1899] 1 Ch. 747, at p. 763, S. C. reversed on another point, [1899] 2 Ch. 474.

(w) McDonald v. Grundy, 1904, 8 O.L.R. 113. See chapter 26, Limitation of Actions, Sec. 264.

(x) Gentles v. Canada Permanent and Western Canada Mortgage Corporation, 1900, 32 O.R. 428.