Sec. 321. General principles, p. 617.

Sec. 322. Costs of negotiating and completing loan, p. 618.

Sec. 323. Costs incurred to protect the security, p. 619.

Sec. 324. Costs of mortgage action, p. 622.

Sec. 325. Taxation of costs, p. 628.

Sec. 321. General principles

In England, the mortgagee on the usual order for foreclosure, as on the usual order for redemption, is entitled only to the taxed costs of the action, but on a special case being made a direction will be made for an enquiry as to the "costs, charges and expenses properly incurred by him in respect of his mortgage security" (a). In Ontario it is provided by rule 410 that under an order of reference the master may take into account "costs and other expenses properly incurred" (6). The court will proceed on the principle stated in Dryden v. Frost (c):

"This Court, in settling the account between a mortgagor and mortgagee, will give to the latter all that his contract, or the legal or equitable consequences of it, entitle him to receive, and all the costs properly incurred in ascertaining or defending such rights, whether at law or in equity. But even as to the costs in equity this Court exercises a discretion, and refuses to him his costs if his conduct has been improper; and, in some cases, orders him to pay them. In Detillin v. Gale (d) Lord Eldon says that he ought to be indemnified to the extent that he acts reasonably as mortgagee;

(a) Rees v. Metropolitan Board of Works, 1880, 14 Ch.D. 372.

(b) See chapter 27, Accounting between Mortgagor and Mortgagee, Sec. 293.

(c) 1838, 3 My. & Cr. 670, at p. 675; Wales v. Carr, [1902] 1 Ch. 860, at p. 863; National Provincial Bank of England v. Games, 1886, 31 Ch.D. 582, at p. 592.

(d) 1802, 7 Ves. 583, 18 R.C. 502.

which must mean reasonably with respect to such rights as his mortgage title gives him."

The indemnification of the mortgagee extends so far as he acts reasonably as a mortgagee, and the court will indemnify him to this extent, whether he could have recovered the consequent costs, charges, or expenses at law or not (e).