The operation of mortgages

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. Edward owns Westacres, currently worth £500,000. Frank is proposing to lend Edward £300,000, secured by a mortgage of Westacres. While inspecting Westacres, Frank exclaims 'Wow, what a lovely house. I would not mind living here. If I paid you £10,000, not part of the loan agreement, for an option exercisable at any time in the next 20 years, would you be agreeable?' Edward, who is anxious to get his loan, says 'I think I would.' How should Frank arrange things so that the option is undoubtedly valid?

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. Karesh is the owner of The Dog and Duck public house. He borrows £100,000 from X, and mortgages The Dog and Duck to secure the loan. The mortgage contains a clause stating that he cannot redeem the mortgage for ten years. In what circumstance is this 'postponement of redemption' undoubtedly valid?

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. Matthew needed £50,000 to modernise his filling station. In 2015, he mortgaged it to Lion Petrols PLC to raise the cash. The mortgage cannot be redeemed for five years. While the mortgage exists, Matthew is 'tied' to selling only Lion petrol. Which of the following rules/doctrines can not be used as an argument that the tie clause is invalid?

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. Which of the following propositions regarding 'collateral advantages' is correct?

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. Giles has just mortgaged Manor Top farm to Eastminster Bank. The statutory power to lease the mortgaged land has not been excluded. Giles remains in control of the farm. The farm includes North, South, East and West Fields. Which of the following leases will not be binding on Eastminster Bank?

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. H and W own a quite substantial house, Westroofs, as tenants in common in equal shares. H's business is in financial difficulties, and its account at the Northminster Bank is heavily overdrawn. The bank is willing to continue the overdraft only if it gets a mortgage of Westroofs. A few days later H calls in with a mortgage deed of Westroofs, already executed by H and W. In what circumstances could it be argued that the bank is not 'put on inquiry', and therefore need not ensure that W gets separate advice?

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. When W is going to be 'surety' for H's loan, and the bank is 'put on enquiry', what sort of advice should the bank ensure that W receives?

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. Which of the following is not required of a solicitor to fulfil his professional obligations to a person (W) who is going to be a 'surety' for the mortgage loan?

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