Where the terms of the power prescribe that the sale shall be by public auction only, a sale by private contract will not be valid (j).

It would be inadvisable for the mortgagee to depart from the well established practice of duly advertising the property for sale; the advertisement is an evidence of the mortgagee's good faith and desire to obtain the best possible price. Where the mortgagee offered the property for sale without advertisement and sold it for one-half its cash value, the price received being near the amount due to himself the sale was set aside (k).

"It is the ordinary course before a sale by auction to give every publicity to it by advertisement in the newspapers and by handbills; I should almost have said it is the invariable practice. I think the sale in question is the only exception that has ever come under my notice. It is the course of this court and the practice of everyone who desires to get the best price that can be gotten for the property to be sold." (l)

Where the mortgagees selling under power of sale inserted no advertisement in a local newspaper but only in a newspaper published in a town over seventy miles distant, and the advertisement made no mention of any improvements, although there were valuable improvements on the land, it was held that the mortgagees had so negligently and carelessly conducted the sale that the property was sacrificed, and that they were liable for the difference between the amount realized by the sale and the amount which the evidence shewed the property would have brought if it had been properly advertised (m).

(j) Bousfield v. Hodges, 1863, 33 Beav. 90.

(k) Latch v. Furlong, 1866, 12 Gr. 303; see Richmond v. Evans, 1861, 8 Gr. 508; Thompson v. Holman, 1880, 28 Gr. 35; Aldrich v. Canada Permanent Loan and Savings Co., 1896, 27 O.R. 548; affirmed 24 O.A.R. 193.

(l) Richmond v. Evans, 1861, 8 Gr. 508.

(m) Carruthers v. Hamilton Provident and Loan Society, 1898, 12 M.R. 60, following Aldrich v. Canada Permanent Loan and

The usual practice is to advertise the sale once a week for three or four consecutive weeks and to fix as the date for sale a day one or two weeks after the last publication of the advertisement. In some cases it will be advisable to advertise in a newspaper published in the neighborhood of the property to be sold: in other cases, as for instance where the property is a manufactory, the advertisement might be published to more advantage in one of the newspapers of the largest city in the province. It is usual to post up or distribute about one hundred posters; but it would seem that even fifty will be sufficient (n).

The extended form of the power of sale above mentioned provides that the person exercising the power of sale may sell and absolutely dispose of the said lands, tenements, hereditaments and premises hereby conveyed or mentioned, or intended so to be, or any part or parts thereof, with the appurtenances, and the implied power of sale given by the Mortgages Act provides for the sale of the whole or any part of the property. Such a power of sale does not authorize the sale of timber standing upon the mortgaged lands without the land (o), nor may the mortgagee exercising his power of sale sell trade machinery apart from the mortgaged buildings (p). The principle may be stated thus: The land may be divided vertically and parcels of it sold; but it may not be divided horizontally "They [the trustees] might sell different parcels of the estate at different times, and make separate conveyances of each parcel so sold; that is the extent of their authority. They cannot sell part of a parcel. They must not sell the land without the timber, or the timber without the land on which it grows" (r).

Savings Co., supra, and National Bank of Australasia v. United Hand-in-Hand etc. Co., 1879, 4 App. Cas. 391.

(n) Thompson v Holman, 1880, 28 Gr. 35.

(o) Stewart v. Rowsom, 1892, 22 O.R. 533.

(p) In re Yates, Batcheldor v. Yates, 1888, 38 Ch.D. 112. See Ex parte Barclay, In re Joyce, 1874, L.R. 9 Ch. 576; Ex parte Brown, In re Reed, 1878, 9 Ch.D. 389.

(q) Stewart v. Rowsom, supra.

The mortgagee is bound to take the proper precautions to ensure an advantageous sale, and if the circumstances so required he must sell the property in parcels and not in a block. The mortgagees in a mortgage containing two parcels of land, a farm with buildings, and 'some village lots with stores thereon about three-quarters of a mile distant from the farm, sold the property en bloc, under the power of sale in the mortgage, for a much smaller sum, as shown by the evidence, than would have been realized had the parcels been sold separately, and it was held that the mortgagees had not acted with due prudence and discretion, and that they were liable to the mortgagors for the amount that might have been realized (s).

It has been held that a trustee-mortgagee has power to release part of the property on receipt of the whole of the proceeds of such part. "It was stated in argument that the question had never been raised before, and we can appreciate the reason. For at least a century a mortgagee has usually been empowered, as he now is by statute, to sell the mortgaged property 'either together or in lots.' There is nothing in the decision to justify an improvident sale or release" (t).

The extended statutory form of power of sale above mentioned authorizes the mortgagee to "sell and absolutely dispose of" the mortgaged lands, and it has been held that the mortgagee may exercise the power by way of exchange for other land instead of by sale for money (u).

(r) Cholmeley v. Paxton, 1825, 3 Bing. 207, at p. 213.

(s) Aldrich v. Canada Permanent Loan and Savings Co., supra; cf. Wilson v. Taylor, 1912, 4 O.W.N. 253, 7 D.L.R. 317, 23 O.W.R. 359; Uren v. Confederation Life Association, 1917, 40 O.L.R. 536.

(t) Note in 31 L.Q.R. 139 (April, 1915) on In re Morrell and Chapman's Contract, [1915] 1 Ch. 162.

(u) Smith v. Spears, 1892, 22 O.R. 286; cf. Abel v. Heathcote, 1793, 4 Bro. C.C. 277, where it was held that the word "sell" justifies partition; In re Frith and Osborne, 1876, 3 Ch.D. 618, where it was

A mortgagee selling under power of sale may make special conditions provided that they are not unreasonably depreciatory. The following was said with reference to a condition that the vendor might rescind if unable or unwilling to answer objections to title:

"This, however, must be borne in mind, that though of course the object of the mortgagor is to realize the largest amount that can be got, yet it does not follow that conditions of sale, the effect of which would be to obtain the largest possible amount at the sale, arc always the best for the mortgagor; for they may be such that after selling at a good price immense expense may afterwards occur, and after all you may fail in enforcing the contract, which would be to the detriment of the mortgagor. It does not follow, therefore, that because the conditions do to some extent tend to depreciate the price that will be offered at the sale, they are conditions which are really to the detriment of the mortgagor. If such a condition as this were to the detriment of a mortgagor, it would be equally so when the absolute owner is selling; and yet we find that it is in practice a very ordinary and reasonable condition for an absolute owner to introduce in his conditions, and one that without saying all conveyancers, but at any rate many leading conveyancers, consider extremely proper to be introduced when a mortgagee is selling under a power. The strong impression upon my mind is this, that the question is not simply whether such a condition may tend to diminish the number of buyers or the sum which any bidder may be disposed to give; but whether it would tend to the detriment of the mortgagor or of an absolute owner, or be prudent in an absolute owner. If it would be prudent in an absolute owner it is not imprudent as affecting a mortgagor" (v).

Where a condition of sale provided that the abstract should commence with a certain deed fifteen years old, that all recitals in deeds fifteen years old should be taken as conclusive evidence of the facts recited, and that the purchaser should not require evidence as to the identity of the parcels, held that a power of exchange authorizes partition; see, however, Winters v. McKinstry, 1902, 14 M.R. 294, where Smith v. Spears is explained and distinguished.

(v) Falkner v. Equitable Reversionary Society, 1858, 4 Drew. 352.

it was held that the condition was proper (w). A condition by trustees that the title should commence with the deed under which they took the trust property was held to be improper

On a sale of mortgaged lands it is usual to require the purchaser to make a deposit of 10% of the purchase price, that being the amount required on a judicial sale by the standing conditions of the court. The mortgagee has, however, the right to fix what sum he chooses as being the reasonable deposit (y). An agent of the mortgagee, selling under a power of sale is not negligent in accepting a cheque in payment of the deposit; and the mortgagee mil not be deprived of the costs of a sale which is rendered abortive by such acceptance (z).

A mortgagee selling under a power of sale may give time for payment of part of the purchase money without the consent of the mortgagor, if he accounts for the purchase money as cash at the time of the sale, but he cannot charge the mortgagor with a discount paid for cashing the mortgage or with costs thereby incurred.

"The reason is that he can deal as he pleases about giving time on his own debt, and if as to any surplus he accounts forthwith to the mortgagor and pays him cash, that removes any objection on the part of the latter that the sale should have been a cash sale (a).

Where a mortgagee has sold the lands under a power of sale he is under obligation to carry out the sale; he cannot without sufficient reason treat the sale as a nullity and fall back on the mortgage to enforce payment in other ways, as if the exercise of the power was a mere matter of form (b).

(w) Kershaw v. Kalow, 1855, 1 Jur. N.S. 974.

(x) Dance v. Goldingham, 1873, L.R. 8 Ch. 902.

(y) Farrer v. Lacy, Hartland & Co., 1885, 31 Ch.D. 42.

(z) Farrer v. Lacy, Hartland & Co., supra.

(a) Beatty v. O'ConnorT 1884, 5 O.R. 731; Davey v. Durrant, 1857, 1 DeG. & J. 535; Thurlow v. Mackeson, 1868, L.R. 4 Q.B. 97.

(b) Patterson v. Tanner, 1892, 22 O.R. 364.

A mortgagee's power of sale is not extinguished by reason of an ineffectual attempt to exercise it (c).