If a mortgage is made of land of which the owner has already granted a lease, the mortgagee takes subject to the lease (c), and can obtain possession only upon the termination of the lease (d). The effect of the mortgage, if it is a legal mortgage, is to convey the reversion to the mortgagee (e) and no attornment on the part of the tenant is necessary in order to create the relation of landlord and tenant, but the tenant may make valid payments of rent to the mortgagor until the mortgagee becomes entitled to possession as between mortgagor and mortgagee (f) and gives notice to the tenant requiring payment of the rent to him (g). It is provided in

(b) See Sec. 143, infra. It is assumed that the mortgage is registered prior to the making of the lease or that the lessee takes with actual notice of the mortgage. See chapter 8, The Registry Act, Sec. Sec. 72, 74, and chapter 10, The Land Titles Acts, Sec. Sec. 94, 95.

(c) See Sec. 141, supra.

(d) That is, upon the termination of the lease by lapse of time or after such notice to quit given by the mortgagee as is sufficient according to the terms of the lease. Cf. Canada Permanent Building and Savings Society v. Rowell, 1860, 19 U.C.R. 124.

(e) Rogers v. Humphreys, 1835, 4 A. & E. 299.

(f) See chapter 22, Action for Possession, Sec. 212, as to the right to possession as between the mortgagor and the mortgagee.

(g) Moss v. Gallimore, 1779, Doug. 279, at p. 282, 18 R.C. 403, at p. 407. As to the whole subject matter of this chapter, see the notes to this case in 1 Smith's Leading Cases, 12th ed., pp. 585 ff.

Ontario by the Landlord and Tenant Act, R.S.O. 1914, c. 155, s. 61, as follows (h):

61.- (1) Every grant or conveyance of any rent or of the reversion or remainder of any land shall be good and effectual without any attornment of the tenant of the land out of which such rent issues, or of the particular tenant upon whose particular estate any such reversion or remainder is expectant or depending.

(2) A tenant shall not be prejudiced or damaged by the payment of rent to any grantor or by breach of any condition for non-payment of rent before notice to him of such grant by the grantee.

The statute will not protect a tenant who pays rent before it is due if before the due date the mortgagee gives him notice (i).

After the mortgagee becomes entitled to possession and gives notice to the tenant requiring payment of the rent, he has the ordinary rights of a landlord to sue or distrain for rent. The same principles apply in the case.of a lease made subsequently to the mortgage by the authority of the mortgagee (i). When the mortgagee requires the rent to be paid to him he will thereafter be liable in equity as a mortgagee in possession (k).

The mortgagee who gives notice to the tenant requiring payment of rent is entitled to the rent which thereafter becomes payable, as well as any rent which has become payable since the time when the mortgagee became entitled to possession and which is in fact unpaid at the time of the notice, even though a portion of such rent is payable in respect of the period before the mortgagee becomes entitled to posseesion (I). The mortgagee is not, however, entitled to rent which became payable before he was entitled to possession unless such rent is expressly assigned to him (m) and even in that case, though he may sue for such assigned arrears of rent, he cannot distrain for them, as he can in the case of rent which falls due after he is entitled to possession (n).

(h) Re-enacting in substance 4 and 5 Anne, c. 3 (or c. 16, in Ruffhead's edition), ss. 9, 10.

(i) DeNicholls v. Saunders, 1870, L.R. 5 C.P. 589; Cook v. Guerra, 1872, L.R. 7 C.P. 132.

(j) In re Ind, Coope & Co., [1911] 2 Ch. 223.

(k) See chapter 28, Mortgagee in Possession, Sec. 301.

In the application of English cases it is to be observed that a proviso for quiet enjoyment until default is not usually inserted in a mortgage in England (o). In the absence of such proviso or other reservation to the mortgagor of the right to possession, a legal mortgagee may enter into possession whenever he thinks fit so to do so far as the mortgagor is concerned (p), and if there is a tenant in possession under a paramount lease, the mortgagee may at any time give notice to the tenant requiring payment of the rent to him instead of the mortgagor, and the mortgagee thereupon becomes entitled to any rent in arrear which has become payable since the making of the mortgage. In Ontario it is customary to insert in a mortgage a proviso for quiet enjoyment until default, which operates as a redemise to the mortgagor and constitutes him a tenant of the mortgagee until default (q). Consequently, in the case of a mortgage containing such a proviso, the mortgagee is not entitled until default to require payment of the rent, and when he does become so entitled and gives notice to the tenant, he is entitled only to the arrears of rent which have become payable since default, and not to those which became payable in the interval between the making of the mortgage and the occurrence of default.

(l) Moss v. Gallimore, 1779, Doug. 279, 18 R.C. 403; Rogers v. Humphreys, supra. The statement in the text is subject to qualification in Ontario in view of the provisions of the Apportionment Act, referred to below.

(m) Salmon v. Dean, 1851, 3 Mac. & G. 344.

(n) Flight v. Bentley, 1835, 7 Sim. 149; Brown v. Metropolitan Counties, etc., Society, 1859, 1 E. & E. 832.

(o) 18 R. C. at p. 409.

(p) See chapter 22, Action for Possession, Sec. 212.

(q) See chapter 22, Action for Possession, Sec. 214.

The question whether a mortgagee who gives notice to the tenant is entitled to rent accruing due in respect of the period prior to the giving of the notice may also be affected in Ontario by the Apportionment Act, R.S.O. 1914, c. 156, s. 4, which provides as follows (r):

4. All rents, annuities, dividends and other periodical payments in the nature of income, whether reserved or made payable under an instrument in writing or otherwise, shall, like interest or money lent, be considered as accruing from day to day, and shall be ap-portionable in respect of time accordingly.

Under this provision it would appear that a mortgagee, after giving notice to a tenant requiring payment of rent, is entitled only to rent which, upon being apportioned, is payable in respect of the period since he became entitled to possession, that is, since the making of the mortgage in the absence of a proviso for quiet enjoyment until default, and since default if there is such a proviso, and which either has become payable since the giving of the notice or though payable before is in fact unpaid when the notice is given (s).

If a tenant after notice from the mortgagee voluntarily pays to the mortgagor rent which he is afterwards compelled to pay over again to the mortgagee, he cannot recover it back from the mortgagor (t).

As an equitable mortgage does not convey the legal estate (u), the general rule is that an equitable mortgagee is not entitled to bring an action for possession against the mortgagor in occupation of the mortgaged lands (v) or, apart from express contract between the mortgagor and the equitable mortgagee, to require payment of rent by tenants in occupation. The equitable equivalent to the taking of possession is the appointment by the court of a receiver of the rents and profits (w).

(r) Following the English statute 33 & 34 V. c. 35, s. 2. (s) See Kinnear v. Aspden, 1892, 19 O.A.R. 468,, for a discussion of the general principle of the Apportionment Act'. (t) Higgs v. Scott, 1849, 7 C.B. 63. (u) See chapter 5, Equitable Mortgages, Sec. 41. (v) See chapter 22, Action for Possession, Sec. 212, where the excep-

In the absence of express contract between the mortgagor and the equitable mortgagee entitling the latter to take possession with the consequential right to take the rents, if the equitable mortgagee gives notice to a tenant requiring payment of the rent, the tenant may refuse payment because he would get no discharge from the mortgagee, and notwithstanding the notice he may still pay the mortgagor and get a good discharge (x). If, however, the tenant voluntarily pays rent to an equitable mortgagee who claims the rent in that capacity, the tenant is not entitled to recover it back (y).

A mortgagor who is entitled to possession or to receipt of the rents and profits of land subject to a lease, and whose mortgagee has neither taken possession nor given notice of his intention to take possession, has the right to sue the tenant for damages for breach of a covenant to repair contained in the lease (z).