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An owner mortgages several properties to one lender, then sells one of the properties. In the absence…

Section 56 of the Transfer of Property Act, 1882 gives the subsequent buyer a right of marshalling. It is limited by the mortgagee's rights and those of other protected…

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An owner mortgages several properties to one lender, then sells one of the properties. In the absence of a contrary contract, and without prejudicing protected third-party interests, the buyer can require the mortgage debt to be satisfied from the properties not sold to the buyer, as far as they will extend. What is this right called?

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Answer and explanation

Correct answer A

Section 56 of the Transfer of Property Act, 1882 gives the subsequent buyer a right of marshalling. It is limited by the mortgagee's rights and those of other protected persons who acquired an interest for consideration.

Option feedback

Option A

Section 56 calls this marshalling by a subsequent purchaser.

Option B

Subrogation under Section 92 involves stepping into the rights of a redeemed mortgagee.

Option C

Section 93 deals with tacking, which concerns mortgage priority and is not the buyer's right described here.

Option D

Cessation does not name the statutory right to require resort to the unsold properties.

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