Usufructuary Mortgage: An Analysis

National Law University, Jodhpur
(Winter Session: January-May, 2017)
Project
on
Usufructuary Mortgage: An Analysis
Submitted By: Submitted To:

Pallavi Singhal Tejvir Singh Ms. Rosmy Joan
Roll No:- & Roll No:-1370 Faculty of law
Section- B Section B
ACKNOWLEDGEMENT
On the completion of this project, we take the opportunity of thanking the people who
contributed in the completion of it, without whose aid, contribution and help this project
wouldn’t have seen practicability.
First we extend our heartfelt gratitude to, our mentor and Teacher, Ms. Rosmy Joan, Faculty of
Law whose continuous guidance and support provided us with the much needed impetus and
gave us a better insight into the topic. We are grateful to the IT Staff for providing all necessary
facilities for carrying out this work. We thank all members of the Library Staff for providing us
the assistance anytime needed.
We also thank our friends and batchmates for providing us the much needed aid whenever
needed.
TABLE OF CONTENTS
ACKNOWLEDGEMENT...............................................................................................................2
TABLE OF CONTENTS................................................................................................................3
METHODOLOGY..........................................................................................................................5
INTRODUCTION...........................................................................................................................7
THE USUFRUCTUARY MORTGAGE.........................................................................................9
HISTORY....................................................................................................................................9
DEFINITION...............................................................................................................................9
INCIDENTS OF THE USUFRUCTUARY MORTGAGE.......................................................10
IMPORTANT FEATURES OF THE USUFRUCTUARY MORTGAGE...................................11
DELIVERY OF POSSESSION.................................................................................................11
APPROPRIATION OF RENTS AND PROFITS......................................................................12
ABSENCE OF PERSONAL LIABILITY.................................................................................12
NO TIME LIMIT NECESSARY...............................................................................................13
THE USUFRUCTUARY MORTGAGE AS DISTINCT FROM CUSTOMARY LEASES.......15
ZURIPESHGI LEASES.............................................................................................................15
KANAM-KUZHIKANAM LEASES........................................................................................17
LEKHA MUKHI TRANSACTIONS........................................................................................18
USUFRUCTUARY MORTGAGE WITH A LEASE-BACK CONDITION...........................19
USUFRUCTUARY MORTGAGE AS A 'DEBT'.....................................................................21
CLAIMS UNDER A USUFRUCTUARY MORTGAGE.............................................................23
REDEMPTION..........................................................................................................................23
ACCESSIONS AND IMPROVEMENTS.................................................................................24
RIGHTS OF THE MORTGAGEE ON DEFAULT BY THE MORTGAGOR........................25
RIGHTS AND LIABILITIES OF THE MORTGAGEE IN POSSESSION.................................29
RIGHTS OF THE MORTGAGEE IN POSSESSION..............................................................29
LIABILITIES OF THE MORTGAGEE IN POSSESSION......................................................31
EXCEPTION.................................................................................................................................40
USUFRUCTUARY MORTGAGES AND USURY REGULATIONS........................................40
CONCLUSION..............................................................................................................................42
BIBLIOGRAPHY..........................................................................................................................44
METHODOLOGY
Scope & Focus
The usufructuary mortgage forms the predominant form of possessory mortgage today and
is often transacted under the name of a lease simple. The present undertaking seeks to analyse
the usufructuary mortgage conceptually, breaking it down into its key elements and requisites
and comparing it with transactions under whose nomenclature it is often executed. In the process,
the remedies, rights and liabilities of the parties to the transaction are also examined. Certain
incidental questions on the use of the usufructuary mortgage have also been looked into, they
focus nevertheless has remained on a conceptual analysis of the pure usufructuary mortgage.
Aims & Objectives
 To examine the essential ingredients of the usufructuary mortgage through judicial

interpretation.
 To compare the same with customary leases.
 To examine the rights and remedies of both parties to the transaction and the mode of
appropriation of the mortgage-money and the usufruct.
Research Questions
 What are the essential and unique features of the usufructuary mortgage?
 In interpreting these features have courts adopted a narrow framework or a liberal purposive
approach?
 How does it differ from a lease?
 Is a usufructuary mortgage a legal debt?
 How is it to be terminated?
 What are the rights and duties of the mortgagee when in possession? Have these been
interpreted liberally or strictly?
Chapterisation
A beginning is made with a broad overview of the conceptual understanding of the

usufructuary mortgage. In this part, the key ingredients of the mortgage and its interpretations
have been looked into. In the next part, the process of termination of the mortgage and the
remedies available to the different parties are noted. The manner of appropriation of the usufruct
as stipulated under the Transfer of Property Act, 1882 are also analysed.
Hypothesis
The usufructuary mortgage has several unique features, which set it apart from all other
forms of mortgages. Absence of any of these features, renders it anomalous and no longer purely
usufructuary. The general interpretative approach in analysing these components has been liberal
in favour of the mortgagor and comparatively strict as regards the mortgagee.
Sources
The sources used were mainly primary data in the form of cases and statutes. Secondary
data in the form of books and commentaries were used to a limited extent.
Citation
A uniform style of footnoting has bee used to cite all relevant material
INTRODUCTION
Among the transfers of property, accorded statutory recognition under the Transfer of Property
Act1, 1882, the mortgage occupies an important place. In simple terms, a mortgage is a secured
debt transaction. It has known its existence since the ancient times and its presence can be traced
back to the Roman law in the West and to the systems of Hindu and Mohammedan law in India2.
Section 58(a) of the Act provides a comprehensive definition of the concept of the mortgage. Its
essential ingredients are as follows:
 A transfer of an interest
 In specific immovable property
 For the purpose of;
- securing the payment of money advanced or to be advanced as a loan
- securing an existing or future debt
- securing the performance of an engagement which may give rise to a pecuniary
liability.
Clauses (b), (c), (d), (e), (f) and (g) go on to define specific forms of mortgages - simple, by
conditional sale, usufructuary, English, by deposit of title deeds and anomalous, respectively. A
mortgage therefore is essentially a debtor-creditor relationship that is secured by the conveyance
of some specific immovable property.
One of the basic principles regarding interest in a property is the concept of possession.
Possession, it is often said is nine-tenths ownership. Transfer of possession is not an absolute
pre-requisite for all forms of mortgages. It is however central to the concept of the usufructuary
mortgage. The usufructuary mortgage is therefore often referred to as a possessory mortgage.
1
Hereinafter referred to as "the Act".
2
See, D.F. Mulla, The Transfer of Property Act, 9th Edition, Solil Paul, Ed., Butterworths India, New Delhi, 2000,
pp. 568-569. In Roman law, there existed the concept of the fiducia whereby property was given as a security for a
loan with a condition that on non-payment, it was forfeited. Similarly, in Hindu law contained the transaction of the
bhog bandakam and in Mohamedan law, the concept of the by-bil-wafa. As the author points out, these concepts
underwent considerable evolution over the years.
This however, should not be taken to imply that all mortgages where there is a transfer of
possession is a usufructuary mortgage3.
The usufructuary mortgage, which forms the specific focus of the present undertaking, has been
in existence for centuries. It has also been modified considerably by different customary
practices in different regions. Nevertheless the two central features in this form remain the
existence of a creditor-debtor relationship and the transfer of possession of immovable property
to the creditor to enjoy the usufructs thereof. In several cases, the usufructuary mortgage is often
referred to by colloquial usages of the trade such as a 'lease'- where a landlord gives a tenant a
house for rent and collects an advance money as a lump-sum. In such cases therefore, one has to
bear the cardinal principle in mind that irrespective of the name of the transaction, its essential
substantial characteristics need to be looked into. This principle will have to be kept in mind at
all times while understanding the elements of the usufructuary mortgage and in differentiating
the same from other forms of transfers.
3
This point was reiterated as obiter in the judgement in Jangali Singh v. Ramjag Singh, AIR 1944 All 198.
THE USUFRUCTUARY MORTGAGE
HISTORY
The usufructuary mortgage has existed in India for over three to four centuries. In ancient Hindu
law, it was referred to by the phrase bhog bandakam, literally meaning 'mortgage by enjoyment'.
This form of transaction consisted of a transfer of property for an indefinite period with the
mortgage coming to an end with the repayment of the loan initially advanced. The usufructuary
mortgage continued to remain in vogue, even in the period of the Mughals where it was referred
to by the name zer-i-peshgi. This basically was a lease for a period of time with a certain amount
of money being advanced initially by the lessee4.
The modern usufructuary mortgage however is by and large derived from the Welsh mortgage in
England which has off late, been declining in importance. Under this form of mortgage, the
lender goes into possession of the property and continues to remain in possession until the other
party chooses to redeem and the debtor is always free to redeem such that there exists the
permanent right of redemption in the absence of a right to foreclosure by the lender 5. It will be
seen that the concept of the Welsh mortgage has been incorporated in the definition of the
usufructuary mortgage in the Act.
DEFINITION
The definition of the usufructuary mortgage is to be found in S. 58(d) of the Transfer of Property
Act, 1882. It runs as follows;
4
This historical development was traced by the court in Lachhman Singh v. Natha Singh, AIR 1940 Lah 401.
5
As stated in the Irish decision of Cassidy v. Cassidy, (1890) 24 L R Ir 577, discussed in the above decision.
Another definition of the Welsh mortgage is
"…a kind of security by which on the one side the land is assured to the lender as his security - his
possession of the land and enjoyment of the profits being in lieu of interest - while on the other side, the
borrower is under no personal obligation to pay the principal money but is entitled to redeem at any time
upon its payment."
"(d) Usufructuary mortgage. -- Where the mortgagor delivers possession [or expressly
or by implication binds himself to deliver possession] of the mortgaged property to the
mortgagee, and authorises him to retain such possession until payments of the mortgage-
money, and to receive the rents and profits accruing from the property [or any part of
such rents and profits and to appropriate the same] in lieu of interest or in payment of
the mortgage-money, or partly in lieu of interest [or] partly in payment of the mortgage-
money, the transaction is called an usufructuary mortgage and the mortgagee an
usufructuary mortgagee."
As the definition signifies, a usufructuary mortgage is one where possession is delivered to the
mortgagee with the right to enjoy the property also being bestowed upon him until his claim is
satisfied by repayment of the mortgage debt. Delivery of possession is one of the key
distinguishing features of this mortgage.
INCIDENTS OF THE USUFRUCTUARY MORTGAGE
As the definition of the usufructuary mortgage indicates, the usufructuary mortgage is essentially
of three kinds depending of the mode in which the usufruct is appropriated by the mortgagee.
(a) where the rents and profits are appropriated in lieu of the mortgage-money,
(b) where the rents and profits are appropriated in lieu of interest,
(c) where the rents and profits are appropriated partly in lieu of interest or partly in lieu of the
mortgage-money.
Among these categories, the first and the third are self-redeeming, i.e., the usufructuary mortgage
terminates when the appropriation is complete vis-à-vis the mortgage-money or a part of the
interest of the mortgage-money. Where the usufruct is to be appropriated in lieu of interest, the
mortgage is not self-redeeming since both the rents and profits and the interest incur
continuously as long as the debt remains outstanding.
IMPORTANT FEATURES OF THE USUFRUCTUARY MORTGAGE
DELIVERY OF POSSESSION
As indicated by the definition, delivery of possession is of essence in the usufructuary mortgage.
What constitutes such delivery? Is it necessary that the mortgagee must be given actual physical
delivery of the immovable property or is constructive possession sufficient?
As distinct from a simple mortgage or a mortgage by conditional sale, in a usufructuary
mortgage delivery of possession must be instantaneous and must occur simultaneously upon the
execution of the mortgage. This was laid down by the Privy Council in the case of Mt. Maina
Bibi v. Chaudhari Vakil Ahmad6. The court held that while in a simple mortgage or other kinds
of mortgages in general, delivery of possession is not stipulated as immediate upon the creation
of the security, in a usufructuary mortgage it is intended by the parties to occur immediately
upon the execution of the same. This was a case relating to a dower debt obtained by a woman
and the question that arose was whether it was a usufructuary mortgage or not. The court ruled in
the negative.
It is not necessary that actual physical delivery to the mortgagee take place. What is necessary is
that delivery of possession to the mortgagee as the property is capable of on the date of the
mortgage is sufficient. This seems logical since construing delivery otherwise would result in
excluding mortgages from the category where a prior usufructuary mortgage is already
executed7. Thus, where the owner of a property has already leased the property to a tenant and
thereafter executes a usufructuary mortgage to another, it is not necessary for the mortgagee to
take actual delivery by occupation. It is sufficient if the tenant is directed to pay the rent to the
mortgagee.
In addition, after the Amendment to the Act in 1929 the phrase, expressly or by implication
binds himself to deliver possession was added. This indicates that such delivery need not take
place at the actual time of execution of the mortgage. A delivery prior to the execution however
can be considered valid only if the parties can prove that there was an agreement by which the
6
AIR 1925 PC 63. "The difference between a usufructuary mortgage and an ordinary mortgage is not so much a
difference in the kind of security created as in the method of enjoying it." (per Lord Atkinson). The widow who hold
possession of her husband's property until she has been paid her dower has no estate or interest in the property as has
a mortgagee under an ordinary mortgage.
7
Ram Khilawan v. Ghulam Husan, AIR 1933 Oudh 35.
mortgagees were asked to remain in possession in order to pay themselves for the mortgage 8. It
can be agreed upon to take place in future. The position prior to 1929 was however different and
delivery had to occur immediately upon execution9.
APPROPRIATION OF RENTS AND PROFITS

This can be of the three forms indicated earlier, with two being of the self-redeeming
variety10. This is one of the key ingredients of a usufructuary mortgage in the absence of which
the mortgage becomes anomalous11.
The appropriation of the usufruct is often referred to as the right to enjoyment. The
usufructuary mortgagee enjoys the fullest rights of enjoyment and during the pendency of the
mortgage has the power to exclude all others including the mortgagor from the property. This
was laid down by a Full Bench of the Allahabad High Court in Fateh Singh v. Raghubir Sahai12.
In Ramdayal v. Bhanwarilal13, where the main issue was the construction of the deed to
ascertain whether the mortgage was usufructuary or anomalous, the court held that one of the
essential ingredients of a usufructuary mortgage was that the mortgage money or the interest had
to be realised out of the usufruct from the property. Such appropriation however cannot occur
indefinitely since such a stipulation would be deemed as a clog on the equity of redemption and
therefore, void14. The exact nature of the mode of appropriation is to be ascertained from the
exact wording of the mortgage deed. Where it is in lieu of interest, the mortgagee always runs
the risk that the rents and profits will be less than the interest15.
ABSENCE OF PERSONAL LIABILITY

In a simple mortgage, personal liability is stipulated as an ingredient by the very definition.
Though no such express stipulation as to its absence has been indicated in the definition of the
8
Subh Karan Singh v. Kedar Nath, AIR 1941 All 341.
9
Subbarayya v. Subramanyam, AIR 1952 Mad 856; Lachman Singh v. Natha Singh, AIR 1940 Lah 401.
10
Lachman Singh v. Natha Singh, AIR 1940 Lah 401.
11
Nammalwar Chetty v. Krishnaswamy Chetty, AIR 1923 Mad 71.
12
AIR 1938 All 577.
13
AIR 1973 Raj 173. Accordingly the court on construction concluded that the mortgage was anomalous and not
usufructuary.
14
Rajai Singh v. Randhir Singh, AIR 1925 All 643.
15
Supra., note 2, pp. 614-615.
usufructuary mortgage, it has been held on several occasions that the presence of personal
liability converts the usufructuary mortgage into an anomalous one16.
In Akbar Ali v. Sheikh Mahyuddin17, a mortgage deed was executed in 1922 for a debt of
Rs. 100. The usufruct was to be appropriated in lieu of interest. The mortgagee was to continue
enjoying the property until repayment of the debt. A clause existed in the deed which provided
that in the case of disturbance…the mortgagor would incur personal liability and the mortgagee
would have the right to attach other properties of his. The court held it to be an anomalous
mortgage owing to the presence of the condition relating to personal liability.
Any clause, which indicates the power to bring the property to sale or to attach the same,
indicates a personal liability, which is inconsistent with a usufructuary mortgage 18. In all
mortgages, there ordinarily exists a rebuttable presumption as to personal liability. In the case of
a usufructuary mortgage however, this will have to be very strongly implied 19. This is because
personal liability as a concept is unknown to the usufructuary mortgage.
NO TIME LIMIT NECESSARY

Since in most cases, the usufructuary mortgage is self-redeeming, it is not mandatory to
specify a time period for the mortgage. In cases however, where the mortgage is not self-
redeeming in nature such a stipulation of a time period may be necessary. In such a case, the
mere stipulation of a time period is not opposed to the definition of the usufructuary mortgage
simply because a time period is not stipulated by the definition.
The stipulation as to a time period is often used an indicator in distinguishing a
usufructuary mortgage from a lease. This however, is not to be taken as a bar to the fixing of
such a time period in a usufructuary mortgage. In Seshayya v. Lakshminarayana Rao20, a sum of
Rs. 2200 was advanced to the mortgagor and possession of immovable property was delivered to
the creditor who was to appropriate the rents and profits. The lender was to be discharged after
55 years. The court held that since all the other features of a usufructuary mortgage were present;
16
See, Lachhman Singh v. Natha Singh, AIR 1940 Lah 401.
17
AIR 1942 Cal 55. See also, Ram Lal v. Mt. Genda, AIR 1942 All 326.
18
Ram Lochan Prasad v. Bachhu Chaube, AIR 1934 Oudh 255. The condition in this case was that if the mortgagor
defaulted, the mortgagee would take absolute possession of the hypothecated property.
19
Qadir Parast Khan v. Mehr Nur Mohd., AIR 1935 Lah 103.
20
AIR 1930 Mad 160. This case was on appeal from Lakshminarayana Rao v. Seshayya, AIR 1925 Mad 825, where
it was held that a fixation of a term was not repugnant to the notion of a usufructuary mortgage.
the land was intended to be used as security and the rents and profits were to be appropriated by
the mortgagee - it still continued to remain a usufructuary mortgage.
In a more recent case 21, 6.63 acres of land were mortgaged for a debt of Rs. 300.
Usufructs were to be enjoyed by the mortgagee for a period of 5 years. A condition was added
which provided that if the mortgagor did not repay within the stipulated period, the mortgage
would become a sale. The condition was held to be a clog on the equity of redemption. The court
also observed that merely because a stipulation of time period exists, the mortgage would not be
converted from a usufructuary to an anomalous variety. The court drew from S. 62(b), which
relates to usufructuary mortgages and specifically mentions the permissibility as to the time
period stipulation.
Such a stipulation as to the time period merely indicates the minimum period for
possession by the mortgagee 22. Such a stipulation is not mandatory 23. A fixation of a time period
for redemption is permissible since the Welsh mortgage, the precursor to the usufructuary
mortgage allowed for it. Such a condition has no effect on the main document24.
In some cases, where the transaction purports to be a lease but has all the ingredients of a
usufructuary mortgage, merely because there is a time stipulation, it cannot cease being a
usufructuary mortgage25. It is submitted that the position becomes clear from the express
wording in S. 62(b) which relates only to usufructuary mortgages where the phrase "…when the
term (if any) prescribed for the payment of the mortgage-money has expired…" has been used26.
In cases however, where the stipulation as to the minimum time period for redemption
exists, it may result in the mortgage becoming impossible to redeem. In such cases, the
stipulation becomes a clog on the equity of redemption and therefore wholly void27.
21
Haji Fatma Bee v. Prahlad Singh, AIR 1985 MP 1.
22
Rameshwar Narain v. Pani Ram, AIR 1934 Patna 217.
23
Ganesh Singh v. Bhikham Singh, AIR 1928 Oudh 1.
24
Ramarayanmigar v. Krishna Vachendra, AIR 1921 Mad 183.
25
Shiobaksh Singh v. Jagannath, AIR 1921 Nag 161; Ram Narayan Singh v. Adhindra Nath, AIR 1916 PC 119.
26
See, Bhutnath Janan v. Gopal Prasad Sahu, AIR 1940 Cal 436
27
Kunj Behari Lal v. Pandit Prag Narayana, AIR 1922 Oudh 283.
THE USUFRUCTUARY MORTGAGE AS DISTINCT FROM CUSTOMARY LEASES
A lease is a transfer of immovable property for the purpose of enjoyment for a certain time, in
return for a certain consideration 28. Two factors are extremely crucial in a lease. First, that the
purpose is not the repayment of any debt but the actual enjoyment by the lessee and second, that
it is for a certain time period. While a usufructuary mortgage may also be for a certain time
period, its dominant purpose is to serve as security for a debt transaction and not the actual
enjoyment by the mortgagee.
There however, do exist certain customary leases, which have several similarities with the
usufructuary mortgage. The courts have on several occasions sought to draw guidelines to
distinguish these leases from actual usufructuary mortgages. In some cases, the courts have held
the leases to be actual usufructuary mortgages. The three important customary leases of this
variety are - the zuripeshgi lease, the kanam-kuzhikanam lease and the lekha mukhi.
ZURIPESHGI LEASES
Zuripeshgi literally means a lease for a premium, the premium here representing the
original loan. This form of lease has been in existence since the Mughal times. Its origins can be
traced to the desire to evade laws against usury and also canons of the Koran, which forbade
lending of money commercially29.
The most common form of this lease is where the debtor borrows money from the creditor
and in return leases him his property for a certain rent to be reserved for the lessee. The rent so
fixed is always slightly higher than the interest due on the loan. This difference is referred to as
the haq aziree and is paid to the debtor who is to use it to discharge the loan 30. The only test
therefore to distinguish a usufructuary mortgage from a zuripeshgi transaction is the existence of
a debtor-creditor relationship. If it is present, the transaction becomes a usufructuary mortgage
irrespective of what the parties call the transaction.
The necessity to lay down a general rule to be followed in distinguishing the two
transactions came before the Supreme Court in Ramdhan Puri v. Bankey Bihari Saran31. In this
28
See, S. 105, Transfer of Property Act, 1882.
29
S.R. Roy, Ed., Rashbehary Ghose on Law of Mortgage, 7th Edition, Kamal Law House, Calcutta, 1997, p. 90.
30
Id.
31
AIR 1958 SC 941.
case, the facts revealed that the executant was heavily indebted to the other party and therefore
executed the deed letting out possession at a low rate of interest so that the excess could be used.
The document purported to be a zuripeshgi lease. The lease was to subsist for a period of 15
years. The court observed that since the facts established a creditor-debtor relationship, the
property could be deemed to have been given as security for the debt. The guiding principle
according to the court was, "…once you get a debt with security of land for its redemption, then
it is a mortgage…". Thus, the court held the transaction to be a usufructuary mortgage and not
merely a lease.
The distinction was also brought out earlier by the Patna High Court 32. Here, the court was
attempting the construction of a lease executed by a widow. In this context, the question that
arose for consideration was whether a zuripeshgi transaction was a lease or a mortgage. The
court laid down that it was necessary first to see whether there was a secured debt and a right to
redemption. In a zuripeshgi lease, an advance is made to the lessor and in consideration the
lessee is given possession for a term during which he recoups himself for the sum advanced and
interest out of the profits of the land. There exists no question of redemption and the lessee re-
enters upon the land on the termination of the lease. On the other hand, where possession
continues until complete repayment of the money advanced, the transaction has the essential
characteristics of a mortgage.
Where a lease had been executed with the premium amount of Rs. 1716000 for a period
of 25 years and the loan was neither returnable by repayment nor by enjoyment of usufructs and
in the absence of the right to interest and the right to redemption, it was not a money-lending
transaction but a payment for a premium33. In the case where the lessee was put in possession of
the property for the fixed term of 3 years, the court held that the essential condition of a
usufructuary mortgage is that that mortgagee is authorised to retain possession of the property
until full payment of the mortgage money and in the absence of such a right, the transaction was
not a mortgage34.
To conclude therefore, the 4 tests to distinguish a zuripeshgi lease from a usufructuary
mortgage are:
32
Kesho Prasad v. Chandrika Prasad, AIR 1923 Patna 122.
33
Kameshwar Singh v. State of Bihar, AIR 1959 SC 1303. [Three-judge bench].
34
Chhathi Lal v. Bindeshwari Prasad, AIR 1929 Patna 606; Bachhu Lal v. jang Bahadur, AIR 1939 Patna 427.
 Return of the property upon repayment of the loan or upon termination of the loan from
enjoyment of the property35.
 Fixation of a rate of interest.
 Existence of a right of redemption36.
 Existence of personal liability after the termination of a stipulated period.
The presence of the first three characters indicates the transaction to be a mortgage, while
the last indicates it to be a lease for a premium37.
KANAM-KUZHIKANAM LEASES
A kanam-kuzhikanam is essentially identical to the zuripeshgi transaction in that it
involves the lease of a property for enjoyment but for a particular period of time. The existence
of a creditor-debtor relationship is totally absent. It is to be found in vogue in Kerala.
In Charumanalil Lakshmi v. Mulivil Kunninamkandy Narayani38, there was a transfer of
possession of certain lands with fruit-bearing trees for a period of 24 years. The purpose of the
transfer was for the enjoyment of the land with the trees. The lessee was entitled to appropriate
the income of the land in lieu of the interest on the premium he had advanced and however, was
also entitled to hold on to the land beyond the 24 year period until the premium and interest
amounts were satisfied. The court held the transaction to be a kanam-kuzhikanam since the
purpose of the transfer was solely for the enjoyment of the property and not to secure a debt.
The most important factor therefore to be ascertained is the intention of the parties as to
the purpose of the transaction. The Supreme Court 39 has laid down certain guidelines to
recognise the intention in such transactions:
 The proportion of the amount advanced to the value of the security. If they are proportionate
it leans in favour of a mortgage.
 The rate of interest payable on the sum advanced.
 A portion of the income reserved for appropriation towards interest.
35
Where the lessee is to remain in possession even after the repayment of the debt, it cannot be a usufructuary
mortgage but only a lease. See, Board of Revenue v. M&S Ltd., AIR 1958 Mad 508.
36
Tulshi Ram v. Muna Kuar, AIR 1937 Oudh 146. Where there is no right to redemption but the lessee is to quit
land on the expiry of a fixed term, it is a lease and not a usufructuary mortgage.
37
See, Kameshwar Singh v. State of Bihar, AIR 1959 SC 1303.
38
(1967) 1 SCR 314.
39
Mangala Kunhimina v. Puthiyaveetil Paru Amma, (1971) 1 SCC 562, 566.
 Surrounding circumstances.
To distinguish a usufructuary mortgage from a kanam lease the criteria laid down are as
follows:
In the case of a lease,
 The intrinsic intention behind the transfer of possession as being enjoyment by the lessee.
 The term of renewal of the enjoyment.
 A provision for payment of customary dues.
In the case of a usufructuary mortgage,

 Proportionality of the security to the amount advanced.
 Absence of the right of the creditor to sell the property to recover the amount advanced.
In the present case the court found the following facts;

 No provision for renewal
 No provision for payment of customary dues
 Enjoyment of property in lieu of interest after payment of revenue
 Surrender of the property upon receipt of the premium and balance
 Return of documents upon repayment
 Liability to pay interest on the premium and enjoyment of profits in lieu of interest.
Accordingly, the court held the transaction to be a usufructuary mortgage and not a kanam lease.
LEKHA MUKHI TRANSACTIONS

This type of mortgage is most common in the Punjab region. In a lekha mukhi transaction,
the mortgagee takes over the land and binds himself to keep an account of the produce, and as
soon as the principle and interest have been paid off therefrom, he must surrender the property to
the mortgagor. The mortgagor, here undertakes no personal liability and while he is competent at
any time to claim redemption on payment of the amount found to be due under the mortgage, the
mortgagee is not entitled to sue for his debt40. In essence, it is a usufructuary mortgage.
40
See, Lachhman Singh v. Natha Singh, AIR 1940 Lah 401, 404.
In Karam Chand v. Shera41, the appellants held a lekha mukhi mortgage. They contended
in the course of the trial that the mortgage was not a usufructuary mortgage. The court in holding
it to be a usufructuary mortgage,
"A lekha mukhi mortgage is one in which possession is given to the mortgagee who is
responsible for the accounts and looks to the produce for payment of the mortgage debt."
Similarly, where proprietors contracted to be allowed to remain in cultivating possession,
but all produce was to be taken by the mortgagees who would render accounts annually it was
held that the mortgagees had legal possession though constructive and the transaction was a
lekha mukhi one and a usufructuary mortgage42.
USUFRUCTUARY MORTGAGE WITH A LEASE-BACK CONDITION

As noted earlier, delivery of possession or future delivery of possession is an absolutely
essential ingredient of a usufructuary mortgage. In many mortgage-deeds where the possession is
purportedly transferred to the creditor, a lease-deed is executed simultaneously leasing the
property back to the mortgagor. In such a case the duty to pay the rents are on the mortgagor and
the mortgagee can file a suit for recovery of rent arrears upon default by the mortgagor. Does this
deviate from the essential feature of the usufructuary mortgage? Is the second lease to be
considered a part of the usufructuary mortgage transaction?
If both the usufructuary mortgage and the lease-back are considered to be part of the
same transaction, then the mortgagee would be forbidden from filing a suit only for the recovery
of rent arrears or only for recovery of the mortgage-money. This is by virtue of Order II of the
C.P.C, whereunder in Rule 1 it is provided that every suit shall include the whole of the claim
the plaintiff is entitled to make for a particular cause of action and that the only situation under
which the plaintiff can relinquish his claim, is to bring the suit within the jurisdiction of a
particular court.
A consideration of these arguments took place in the Patna High Court 43. Here
usufructuary mortgage transactions were executed for loans of Rs. 4000 and Rs. 2000 on two
different days. On the same days, the property so mortgaged was leased back by the mortgagee.
The question was whether the lease-back formed a part of the usufructuary mortgage transaction.
41
AIR 1931 Lah 498. [Division Bench]
42
Khandu Lal v. Fazal, 51 I.C. 956.
43
Mohd. Ahsanul Tauhid v. Akhtar Hussain, AIR 1960 Patna 106.
The court held that where though the documents take the shape of a usufructuary mortgage with
the mortgagee purporting to take possession, the second document (i.e., the lease-back) is in
reality a mere device to ensure payment of the interest regularly, since the onus to pay the rent is
re-transferred to the debtor. They thus form part of the same transaction. Further, in the present
case, since both the deeds were executed contemporaneously, they evidenced a single
transaction. As a result, the court barred a suit only for the rent arrears under O. II, R. 2 of the
C.P.C.
Where however, the defendant executed a mortgage-deed to the plaintiff on a debt of Rs.
4000 for a period of 3 years and on the same day the plaintiff leased the property backt to the
defendants for 3 years with the defendant agreeing to pay a rent of Rs. 30 per month, the
question again was whether it was a single transaction. If it was a single transaction, then the
creditor could not claim the right to sell the property to reclaim the debt, since such a remedy
was unavailable to a usufructuary mortgagee. The court concluded that where the intention of the
parties was that the mortgagee should not get possession but only the interest on the money
advanced, the documents merely formed a device to ensure regularity of interest payments. In
such a case, the court concluded that they would not form part of the same transaction and the
mortgagee could file a suit for sale of the property to recover rent arrears44.
This case seems to import some amount of ambiguity in ascertaining the true nature of the
transaction. Even in the case where the device is merely to ensure regularity in interest, the
necessary pre-requisite of the debtor-creditor relationship exists. Then, why should it be
considered as two separate transactions?
In a case where the facts were very similar to the above mentioned case but the lease to
the mortgagor had expired and had been renewed by him, the Kerala High Court, held that both
of them were separate transactions and the mortgagor was entitled to redeem by mere payment of
the principal and that the suit for rent arrears would lie separately45.
44
Savitiri Devi v. Beni Devi, AIR 1968 Patna 222. [DB]
45
Thommen Varkey v. Govindan Nair, AIR 1959 Ker 155. [DB]. The loan in this case was Rs. 2131 for a period of
10 years with some immovable property being transferred into the possession of the mortgagee. The reason one may
attribute to this conflict in opinion is that where the mortgagee seeks to terminate the equity of redemption the court
favours its retention. Thus, where the mortgagor approached the court to redeem the transaction, the court interprets
the transaction in favor of a mortgage to allow such redemption, free of a subsequent condition entered into for the
benefit of the creditor.
USUFRUCTUARY MORTGAGE AS A 'DEBT'
One of the distinguishing features of the usufructuary mortgage is with regard to the
remedies of the mortgagee. The right to foreclosure of to bring the property to sale to satisfy the
debt amount is not present with the mortgagee. His only remedy is therefore to insist on specific
performance, i.e., to retain possession of the property or alternately he can sue to recover the
mortgage-money if possession is not granted to him46. In such a scenario, the main question is
whether a usufructuary mortgage is a debt in the traditional legal understanding of the term
'debt'.
A debt is generally understood as being a "…liability on a claim or a specific sum of
money due by an agreement or otherwise. 47" In a usufructuary mortgage, the claim cannot be
enforced by any action but the right to retain possession until it is paid back being retained by the
mortgagee. Thus, can a usufructuary mortgage be termed a debt?
This question arose for consideration in the case of Lachhman Singh v. Natha Singh48,
where S.7 of the Punjab Relief of Indebtedness Act defined a debt as including all liabilities of
debtor in cash or in kind, secured or unsecured, payable under a decree or order. The question
was whether a usufructuary mortgage would be a debt for the purposes of the said legislation. A
Full Bench of the Lahore High Court held that since the essence of a debt was the liability of the
obligor which the obligee was entitled to enforce by action, such an entitlement being absent in a
usufructuary mortgage, it could not be deemed to be a debt49.
This position it is submitted may have been appropriate for the purpose of the said
legislation, but it cannot be taken to lay down a general rule. It is not necessary for a debt that it
should be payable under a decree or an order. For instance, a time-barred debt is not payable
under a decree or an order of a civil court, but it cannot cease to be a debt. The position is made
clear by the definition in Black's Legal Dictionary, where it is defined as a "specific sum of
money due by agreement or otherwise". The very fact that under a usufructuary mortgage there
remains a certain amount of money due indicates that it will be a debt, in the broader sense of the
term.
46
Under S. 68(1)(d) of the Act.
47
Bryan A Garner, Ed., Black's Legal Dictionary, 7th Edition, West Group, Minnesota, 1999, p. 410.
48
AIR 1940 Lah 401.
49
Ibid., p. 405.
CLAIMS UNDER A USUFRUCTUARY MORTGAGE
REDEMPTION
The right of the mortgagor to terminate the mortgage by repayment of the outstanding debt
is called the right of redemption. The right is absolute and cannot be taken away except by the
act of parties or by a decree of a court 50. In a usufructuary mortgage, upon repayment of the debt,
the mortgagor is entitled to regain possession initially delivered to the mortgagee. This is made
clear by S. 60 and further by S. 62. S. 62 of the Act, provides two situations under which the
mortgagor can redeem the mortgage by repayment of the debt,
 In the cases where the mortgage is self-redeeming, i.e., in cases where the mortgagee is
authorised to pay himself out of the rents and profits of the property towards the mortgage-
money, when such money is paid51.
 In cases where the mortgage is not self-redeeming, i.e., in cases where the mortgagee is to
appropriate the rents and profits towards the interest or towards a part of the mortgage-money
and a time period for realisation of the same has been stipulated by parties, upon the expiry
of that time period and upon the mortgagor having repaid the money by depositing it in
court52.
Thus, a self-redeeming mortgage terminates immediately upon the mortgage-money being

repaid53. However, merely because a time period is stipulated in the mortgage-deed this cannot
render a self-redeeming mortgage from terminating on its own. In such a case, the time
stipulation is only indicative of the date on which the mortgage would have ordinarily redeemed
itself. Notwithstanding such a stipulation, the debtor can redeem the mortgage by showing that
50
See, S. 60 of the Act.
51
S. 62 (a).
52
S. 62 (b).
53
Ram Prasad v. Bishambhar, AIR 1946 All 400. See also, Lakshminarasimha Rao v. Seshayya, AIR 1925 Mad
825.
the principal and interest due have been repaid to the creditor 54. He however cannot sue without
discharging the debt55.
On the other hand, where the mortgage-deed stipulates a time period and the mortgage is not
capable of redeeming itself automatically, the mortgagee is not bound to accept the money
before the expiry of the stipulated period56. S. 62 has no application to other forms of
mortgages57.
ACCESSIONS AND IMPROVEMENTS

S. 63 of the Act provides that in the absence of a contract to the contrary, the mortgagor is
entitled to any accessions to the property. When however, the accession is made by the
mortgagee expending a certain amount of money and the accession is inseparable from the
property, the mortgagor will have to compensate the mortgagee for the same, if it was done to
preserve the property or upon the assent by the mortgagor. In other such cases, the accession is
deemed part of the property, except where separable.
S. 63 goes on to provide that in the case of a usufructuary mortgage, where the accession is
acquired at the expense of the mortgagee, the profits arising from the accession are liable to be
set off against the interest due on the money spent on the accession.
Thus, where the usufructuary mortgagee carries out repairs to prevent the property from
destruction, he would be entitled to interest on the money so spent. This interest is to be
accumulated from the profits, which may occur from the accession.
Accessions may be natural, acquired and separable or acquired and inseparable. It is only in
the third category, if certain conditions are satisfied, the mortgagor is compelled to pay the
amount spent to the mortgagee. Most cases, in this regard have sought to determine whether
certain accessions are inseparable or separable58.
54
Sehayya v. Lakshminarasimha Rao, AIR 1930 Mad 160 [DB].
55
Id.
56
Lakshminarasimha Rao v. Seshayya, AIR 1925 Mad 825.
57
Ramarayanmigar v. Maharaja of Venkatgiri, AIR 1927 PC 32.
58
Raghunandan Rai v. Raghunandan, AIR 1921 All 353; Nagesgar Rai v. Nand Lal, AIR 1926 All 67; Gopi Lal v.
Abdul Hamid, AIR 1928 All 381.
A similar provision exists as regards improvements 59. The only situations under which an
improvement can be effected by the mortgagee and the amount can be claimed from the
mortgagor are60:
a) when necessary to preserve the property
b) when necessary to ensure the security does not become insufficient
c) when done under the orders of a public authority.
It is of importance to note that by a contract to the contrary, these provisions can be
overridden. The objective underlying both the sections- Ss. 63 and 63-A is to ensure that the
mortgagee does not effect unreasonable accessions and improvements and then claim the same
from the mortgagor to exploit his dominant position. These provisions are not restricted to a
usufructuary mortgage, but always arise in a usufructuary mortgage since the mortgagee is
always in possession,
RIGHTS OF THE MORTGAGEE ON DEFAULT BY THE MORTGAGOR

In an ordinary mortgage, the mortgagee retains the right to obtain from a court a decree
stipulating that the right of the mortgagor to redeem shall be debarred. This right is referred to as
the right to foreclosure61. In most mortgages, the mortgagee may also either bring the property to
sale to satisfy the debt. This is called the right to sale62.
It has been held in several decisions that the right to foreclosure and the right to sale are
wholly inconsistent with a usufructuary mortgage63. In a relatively recent decision, the Allahabad
High Court has held that where the mortgage deed expressly reserves the right of the mortgagee
to bring the property to sale to realise the debt, it is no longer a usufructuary mortgage but an
anomalous one64. Here, the debt amount was Rs. 23, 000 and the interest was fixed at 12% p.a.
The rents and profits of the property were to be appropriated in lieu of the interest. The mortgage
also contained a condition that in the event of default, the mortgagee could bring the property to
sale. The court held the mortgage not to be a usufructuary mortgage but an anomalous one.
59
See, S. 63-A.
60
S. 63-A (2).
61
S. 67, Transfer of Property Act, 1882.
62
Also contained in S. 67.
63
Lachhman Singh v. Natha Singh, AIR 1940 Lah 401; K.N.M.I.G. Nambudri v. S. Anand, AIR 1939 Mad 887;
Fateh Singh v. Raghubir Sahai, AIR 1938 All 577; Ram Lal v. Mt. Genda, AIR 1942 All 326.
64
Munni Lal v. Phuddi Singh, AIR 1987 All 155.
The position, it is submitted has been made clear after the Amendment of 1929, whereby a
non-obstante clause was added to S. 67 providing that the right to foreclosure shall not
automatically accrue to a mortgagee other than a mortgagee by conditional sale or an
anomalous mortgagee and the right to initiate a suit for sale shall not automatically accrue to a
usufructuary mortgagee65. It has been held that the position was therefore altered only after the
Amendment and that prior to it, the usufructuary mortgagee had a remedy under S. 67 66. This
view however is contestable since cases even prior to the Amendment have held that one of the
essential features of the usufructuary mortgage to be absence of the right to sale or foreclosure67.
In the case of default by the usufructuary mortgagor, the mortgagee has the right to retain
possession and enjoy the usufruct until the repayment of the debt. In cases however where the
mortgagor fails to ensure delivery to the mortgagee as stipulated in the deed, the usufructuary
mortgagee has a right to sue for the mortgage-money under S. 68(1) (d) of the Act 68. Where the
mortgage is a simple usufructuary mortgage, i.e., a combination of simple and usufructuary
mortgages, the mortgagee may exercise his option either under S. 68 or under S. 67, when
possession is not delivered to him69.
As regards interest that was to accrue to the usufructuary mortgagee, it has been held that
under the remedy available under S. 68, the mortgagee cannot sue for recovery of rents and
profits in lieu of interest, but only for the mortgage-money70. However, the mortgagee can sue
for interest on the property, where the he is dispossessed prior to the expiration of a stipulated
duration71.
The nature of the remedy under S. 68 was discussed by the court in Ramanatha v.
Annamalai Chettiar72. Here a debt of Rs. 365 had accrued and the rate of interest was 5% p.a. for
3 years. A further covenant of leasing back the property to the mortgagor existed. The mortgagor
failed to pay the rent to the mortgagee. The court held the following:
65
S. 67 (a).
66
Subbarayya v. Subramanyam, AIR 1952 Mad 856.
67
Chhathi Lal v. Bindeshwari Prasad, AIR 1929 Patna 606.
68
Subbarayya v. Subramanyam, AIR 1952 Mad 856.
69
Kanhaiya v. Mt. Hamidan, AIR 1938 All 418; M. Ramanatha v. Annamali Chettiar, AIR 1963 Mad 342.
70
Mahadeo v. Sittla Baksh, AIR 1922 Oudh 102; Dubri v. Ram Naresh, AIR 1926 Oudh 224. In the latter of these
cases, the mortgagee waited for 21 years before exercising the remedy. The court held that since he did not bring the
suit within a reasonable time asking for additional security and compensation, he could be taken to have acquiesced
to the diminished security.
71
Subramania v. Panchanada, AIR 1932 Mad 175. The court held that as long as the claim for the main debt is not
barred, so also the claim for payment of damages is not forbidden.
72
AIR 1963 Mad 342.
 It is a compensation for failure to surrender possession and it is not an alternative remedy
akin to a personal covenant.
 Ordinarily, the mortgagee has no right to sue for recovery, S. 68(1)(d) confers this right
which he ordinarily would not have had - it is a privilege given to the usufructuary
mortgagee.
 A mere resort to this remedy does not obliterate another remedy he may have under the
specific terms of the covenant.
Accordingly, the claim was allowed.
Under S. 68(1)(d) another ground when a mortgagee entitled to possession of the
property may initiate a suit for recovery of the mortgage-money is when the mortgagor fails to
deliver possession to him without disturbance by the mortgagor or by any other person claiming
under a title superior to that of the mortgagor 73. This section is applicable where by the
mortgagor's negligence or default, the property is attached or where it is already leased out to
some other person.
The above-mentioned dispossession however, cannot be one which was brought about by
the mortgagee's own default. In the case where owing to the failure of the mortgagee to pay a
debt arising out of a prior encumbrance on the property, the property was attached and sold, the
mortgagee was barred from initiating a proceeding under S. 68(1)(d) for recovery of the
mortgage-money74.
The gamut of this sub-section is illustrated by the simple example where, if the
mortgagee is dispossessed by a trespasser, he has the right only to sue for recovery of possession
whereas, if he is dispossessed by the mortgagor, he can sue either for recovery of possession or
for the mortgage-money75.
Thus, where a mortgagor mortgaged out property over which he had not rightful title, it
was held that the mortgagee could invoke S. 68(1)(d) 76. Similarly, where after entering into a
usufructuary mortgage with the property already being encumbered with a simple mortgage, the
simple mortgagee brought the property to sale and thereby dispossessed the usufructuary
73
See, S. 68(1)(d).
74
Bharat Ram v. Beni Dutt, AIR 1936 Oudh 263; Kashi Lal v. Shaikh Nurul Haq, AIR 1929 Patna 209.
75
See, supra., note 2, p. 778.
76
Fateh Din v. Kishen Lal, AIR 1923 All 584.
mortgagee, the usufructuary mortgagee could invoke the section since the title of the simple
mortgagee was superior to that of the usufructuary mortgagor77.
Generally, suits on mortgages are to be dealt with under Order XXXIV of the Code of
Civil Procedure. A suit under S. 68 however, is merely one for a simple money decree and is not
one related to a mortgage and therefore it is not one that will fall under the said order78.
To sum up therefore, the rules relating to the rights of the usufructuary mortgagee are:
 He cannot sue for foreclosure or for the sale of the property to satisfy the debt.
 In the event of default by the mortgagor, he can retain possession of the property until the
outstanding debt is satisfied.
 If he is dispossessed either by the mortgagor or by a person claiming a superior title, then he
can either sue for possession or he can sue for recovery of the mortgage-money.
 In such a suit for recovery of the mortgage-money he can also sue for interest provided the
dispossession occurred prior to the expiration of the time period of the mortgage.
 Such a suit for recovery of the mortgage money is not one relating to the actual mortgage but
is one for a simple money decree 79. The exercise of this option does not defeat any other
remedies that the usufructuary mortgagee may have.
77
Ramjanam v. Kunj Behari, AIR 1922 Patna 154.
78
Supra., note 2, p. 781.
79
See, Nityanand Ghose v. Bani Cinema Ltd., AIR 1953 Cal 208.
RIGHTS AND LIABILITIES OF THE MORTGAGEE IN POSSESSION
The rights and liabilities of the usufructuary mortgagee are to be found in S. 72 and S. 76
respectively. These sections speak of the rights and liabilities of the mortgagee in possession and
are therefore not restricted in their scope to usufructuary mortgagees.
RIGHTS OF THE MORTGAGEE IN POSSESSION

S. 72 deals with the right of the mortgagee in possession to spend such money as may be
necessary in certain circumstances and allows him to add such money to the principal amount
and thereby recover the same from the mortgagor. The circumstances are:
1. For the preservation of the property from destruction, forfeiture or sale.
2. For supporting the mortgagor's title to the property.
3. For making his own title good vis-à-vis the mortgagor.
4. Where the property is a renewable lease, for the renewal of such lease.
In such cases, the mortgagee may add the amount spent to the principal money and is also
entitled to recover interest on the same at the right of 9 per cent. This provision however is
contingent on there not being a contract to the contrary between the parties80.
By an amendment to the section in 1929, a further condition was added that for an
expenditure to be necessary in the circumstances envisaged in (1) and (2), it is necessary that the
mortgagee should have given notice to the mortgagor and the latter must have failed to take
proper and timely steps to preserve the property or his title81.
One of the fundamental questions that the courts have been confronted with in
interpreting this section is ascertaining when an expenditure can be said to be necessary. The
courts have however, reiterated that this is a subjective element of fact, depending on the specific
circumstances in each case82. In Jagannath Singh v. Jagjiwan Das83, there were several
mortgages, some simple and some possessory. On some of the mortgages, there existed prior
encumbrances in the form of prior outstanding mortgage debts. When these rights were
exercised, to save the property from sale, the mortgagee incurred some expenditure and sought to
recover the same from the mortgagor under S. 72(b) of the Act. The court held that since the
80
See, S. 72.
81
By S. 37 of the Transfer of Property (Amendment) Act, 1929.
82
See, Jagannath Singh v. Jagjiwan Das, AIR 1925 Oudh 429; Mohd. Rahimtulla v. Esmail, AIR 1924 PC 133.
83
AIR 1925 Oudh 429 [DB].
deposit was necessary to avert the sale and there being no contract to the contrary, the mortgagee
could recover the same as he sought to, with interest.
In a later decision, the court was called on to interpret what 'destruction, forfeiture or sale'
meant. In this case84, there was a usufructuary mortgage of a house in a precarious condition. The
deed also provided that the mortgagee had the authority to rebuild the house, in case it fell. When
the house fell, the mortgagee rebuilt the house, but instead of the prior kuchha house, he built a
pucca one, but of the same size. The court held that he was entitled to rebuild in the more
substantial manner as he did to avoid constant expenditure and hence, he could recover the same.
The court however, did add one caveat - that courts should be on their guard against extravagant
and unfounded claims and should enquire strictly into the facts and the fairness of each claim.
In all these cases however, the payment to avert the destruction or sale must be necessary.
Thus, in a case where the mortgagee deposited an amount to avert a sale in the absence of proof
that the mortgagor had been called upon but failed to failed to take necessary steps, the payment
was held not to be necessary and he was not allowed to recover85.
If a mortgagee initiates proceedings to support the title of the mortgagor, he can recover
the money as stipulated. Here too however, the expenditure must be necessary and must be in
compliance with the proviso, i.e., the mortgagor must have been given notice of the situation but
must have failed to take necessary steps in reasonable and proper time. Thus, in cases where the
mortgagee initiated proceedings against trespassers on the property, it was recoverable under S.
72(c)86.
In the case of a possessory mortgage, where the government brought the property to sale
to realise the penal assessment to be levied on the mortgagor, the mortgagee paid the government
to avert the loss of the mortgagor's title. This was held to be recoverable and could be added to
the mortgage amount. However, where the same mortgagee sought to recover from the
mortgagor expenditure incurred in bringing a suit against the government for recovery of the said
monies, the money was held to be irrecoverable since the government had a paramount right to
the money so claimed and therefore there was no question of the mortgagor's title being
affected87.
84
Qasim Bux v. Bhagwandeen, AIR 1930 Oudh 337 [DB].
85
Vasudevayya v. Bhagirathibai, AIR 1950 Mad 333. See also, Hamappa v. Ramangouda, AIR 1956 Bom 575.
86
Benjamin v. Devadoss, AIR 1955 Mad 245.
87
Venkata Satteyya v. Mulibai, AIR 1955 Andhra 274.
Similarly, the mortgagee is also entitled to costs incurred in defending his own title
against the mortgagee. For this however, no prior notice is required. However, here too the
expenditure must be necessary. Thus, where in a suit for redemption of a prior mortgage, the
mortgagors did not recognise the right of the mortgagees and the latter were forced to file a suit
for making good their own title vis-à-vis the mortgagor, they were entitled to add the amount
spent to the mortgage money under S. 72(c)88.
S. 72 also authorises the mortgagee to insure the property against fire, where the property
is by its very nature insurable. In such a case, the mortgagee can add the money spent on the
same to the mortgage-money and recover the same from the mortgagor. This, however cannot
exceed an amount expressly specific or 2/3rd the amount that would be required in the case of the
destruction of the total property89.
It however, must be noted that this clause too, is subject to a contract to the contrary
whereby it can be overridden.
LIABILITIES OF THE MORTGAGEE IN POSSESSION

The liabilities of the mortgagee in possession are enumerated in Sections 76 and 77 of the
Act. The list of liabilities imposed on the possessory mortgagee by these sections is considerably
exhaustive. It is important to note that whereas the rights of the mortgagee in possession can be
altered by way of a contract to the contrary, no such provision exists for all the liabilities. Some
of the liabilities are therefore absolute and cannot be contracted out while in the case of some
others an express provision exists making it subject to a contract to the contrary. The liabilities
can be categorised as follows:
a. To manage the property as a person of ordinary prudence would manage his own property.
This liability imposes two conditions on the exercise of the supervisory power of the
mortgagee. He not only must manage it as if the property were his own, such management must
be prudent as a reasonable prudent man would have done under similar circumstances.
88
Minakshi Ayyar v. Janaki Achalier, AIR 1942 Mad 592. [DB. See also, Mahmud v. Hakim Saiyadali, AIR 1941
Oudh 498.
89
See, S. 72.
The main question in this sub-section however, has revolved around interpreting what
constitutes an act of 'ordinary prudence'. In the case of a usufructuary mortgage this does not
mean that the mortgagee is completely barred from further encumbering the land by means of a
subsequent tenancy agreement with a third party. For such a transaction, prior consent from the
mortgagor is not required90.
While the basic rule was that the mortgagee is empowered to create a lease of the
mortgaged property, he could not create the same to endure beyond the period of the mortgage.
A lease therefore which extends for perpetuity or beyond the period of the mortgage is invalid
and inoperative91. This, it is submitted, is in keeping with the basic principle that a person cannot
transfer a better title than that which he has.
Through judicial interpretation however, it has been held that S. 76(a) is an exception to
this general rule. The interpretation is that where in the course of prudent management, the lessee
acquires rights such that he cannot be evicted by the mortgagor even upon redemption of the
mortgage, the lease is not rendered invalid but is saved by S. 76(a) 92. This position came under
scrutiny of the court in All India Film Corporation Ltd. v. Raja Gyan Nath93. The case involved a
usufructuary mortgage where the mortgagee had leased out the land which was subsequently
brought to auction and sold. The question was whether the land could be recovered from the
lessee. In examining this issue, the court interpreted S. 76(a). One of the most significant
observations of this court however, was that the exception in S. 76(a) would not apply in the case
of urban property. This finding however was part of the obiter dictum of the court.
This position was reiterated in the case of Tajammul Husain v. Mir Khan94, where it was
held that if the mortgagee, acting as an ordinary prudent man lets out the premises and enters into
a bona fide transaction in connection therewith, in that event the rights of the such a lessee do not
automatically extinguish upon redemption.
Several authors however, opine that the wording in S. 76(a) makes it clear that only when
the mortgagee acts truly prudently and thereby creates an interest beyond his own, would it bind.
Further, the artificial distinction restricting the scope of S. 76(a) to agricultural lands only is
uncalled for. Therefore, an act in the course of management whereby an interest is created by the
90
See, Barjorji v. Shripadprasadji, AIR 1927 Bom 145; Karamat Ali v. Ganeshi Lal, AIR 1927 All 552.
91
Jhagru Mian v. Raghunath Singh, AIR 1929 Patna 630. [DB].
92
See, Mahabir Gope v. Harbans Narain, AIR 1952 SC 205.
93
(1969) 3 SCC 79.
94
AIR 1974 All 234.
mortgagee beyond his own term, is prima facie imprudent and the onus is on the mortgagee to
prove that it is a prudent act95.
The reasoning given by the courts for restricting the scope of S. 76(a) to agricultural
properties alone is that agricultural land requires constant care and attention and therefore a lease
arising out of prudent and sound management would be binding on the mortgagor even after
redemption whereas in the case of a building, no such care and attention is necessary 96. In this
case, it was held that ordinarily a lease always terminates with redemption of the mortgage and a
lease beyond the period of redemption cannot be considered an act of ordinary prudent
management.
A similar presumption as to the unsoundness of management in the case of a lease
beyond the redemption period was reiterated by the Supreme Court in a more recent decision 97.
In the case of a usufructuary mortgage where the mortgagee leased out the property and
subsequently the mortgagor sought eviction of the tenant upon redemption, the court followed a
finding that the lease was an act of imprudent management. The following observations by the
court are relevant98;
 Ordinarily, the mortgagee cannot transfer a title better than that which he possesses.
 A lease granted by the mortgagee must terminate upon redemption.
 Unless it is a lease which is a permissible settlement in the course of ordinary prudent
management and subsequently, the rights of the tenant get enlarged.
The position therefore to summarise, is as follows:

 In general, no person can create a title better than his own.
 To this, an exception exists in the case of agricultural lands in the course of ordinary
management.
95
See, supra., note 2, p. 830.
96
C.K. Kuttappan v. Karthiyayani, AIR 1981 Ker 107. In this case the mortgagee had inducted tenants in the
mortgage building. The question arose as to whether upon redemption the tenants became lessees of the mortgagor.
The court held that upon redemption, the tenancy terminates and would no longer bind the mortgagors. In this case,
the property it will be observed was urban.
97
Om Prakash Garg v. Ganga Sahai, (1987) 3 SCC 553.
98
Hanumant Kumar v. Mohan Lal, AIR 1988 SC 299. See also, H.P. Singh v. M.N. Prasad, AIR 1956 SC 305; Asa
Ram v. Ram Kali, AIR 1958 SC 183; Sachalmal Parasran v. Ratanbai, AIR 1972 SC 637.
 The reason for this is that in the case of agricultural land, constant care and cultivation of the
soil is necessary. A prudent mortgagee may therefore grant a long-term lease to improve the
conditions of the land.
 A mere permission to lease the land does not imply the right to lease the land out beyond the
term of the mortgage.
 In such a case, the tenant cannot claim protection under the Rent Act.
 Even in exceptional cases, a lease granted by the mortgagee beyond the term of the mortgage
with respect to urban properties is invalid and comes to an end upon redemption.
 The onus is on the mortgagee to show that the lease was an act of ordinary prudent
management where there is no proscription in the deed prohibiting the mortgagee from
leasing out the land99.
Thus, while the prima facie presumption of prudence in all leases is done away with, the
somewhat artificial distinction between agricultural and urban properties, still persists. The only
exception to the ordinary rule appears to be in the case where though the initial lease was
reasonable and prudent, it turns out that the rights of the tenant get enlarged to subsist even
beyond the period of redemption.
b. He must make his best endeavours to collect rents and profits from the land
The mortgagee will have to attempt recovery of rents and profits of the property even with
regard to arrears of rent. Thus in the case where a usufructuary mortgage was executed
subsequent to a lease of the same property, the mortgagee argued that since he was not in
possession when the lease was executed he did not have to recover the rents and profits thereof,
upon redemption. This argument was negated and the court held that one the person acquires the
status of the mortgagee, he becomes akin to the proprietor. He therefore has a duty to collect
rents and profits from the tenant and to eject him upon expiry of the tenancy100.
Directly flowing from this duty is the right vested in the mortgagee to determine with the
tenant the exact rents and profits due to be paid101.
99
See, Lalji Purshottam v. Thacker Madhavji Meghaji, AIR 1976 Guj 161.[FB]
100
Ram Kishan Das v. Badri Bishal, AIR 1937 All 337. [DB]
101
Arjorji v. Shirpatprasadji, AIR 1927 Bom 145.
c. In the absence of a contract to the contrary, he must pay Government revenue and all other
public charges with respect to the debt and also any arrears of rent in default of which the
property is liable to be sold summarily
It has been held that a similar condition was implied even prior to the passing of the
Act as a part of prudent management102. This clause is inapplicable in all cases where there is a
contract to the contrary. The right to appropriate expenditure incurred out of necessity in S. 72 is
made subject to the condition imposed on the mortgagee by S. 76(c). Without paying the
revenue, the mortgagee cannot enforce his rights under S. 72103.
This condition is ordinarily restricted only to revenue that accrues after possession has
been transferred to the mortgagee. Similarly, it is also inapplicable to properties, which have not
been specifically transferred to the mortgagee. Both these general rules however, can be
overridden by the express terms of a contract104.
The Patna High Court however, took a different position. It held that the phrase "all rent"
introduced in S. 76(c) by the Amendment Act of 1929 was merely superfluous, i.e., it merely
reiterated an already existent position. Thus, the mortgagee had to pay the rent that accrued not
only after the execution of the mortgage, but even before. In this case, the court also interpreted
the phrase "summarily sold", to mean a sale under tenancy laws where the procedure is of a
summary nature105. It is submitted that after the Amendment such a position becomes clear, but
before the Amendment, one may infer otherwise.
In many cases, the problem that arises is that on the date of execution a certain revenue is
collected by the government. Subsequently, when the government hikes the revenue, is the
mortgagee bound to pay the enhanced revenue too? The courts have held that such a position was
indeed a part of ordinary prudent management even prior to the passing of the Act and the
enhanced revenue would have to be paid106.
The scope of this condition has been interpreted in such a way as to make it applicable
only to cases, where actual physical delivery of the property is transferred to the mortgagee. In
Sivaraj Lal v. M.H.P. Fund Ltd.107, the court held that the sub-section comes into the picture only
102
See, Abid Hussain v. Haniz Fatima, AIR 1924 PC 102.
103
Mohamed Hadi v. Mt. Parbati, AIR 1922 Oudh 91.
104
Ram Dulare v. Sahdeo, AIR 1925 All 189. See also, Sankunni Variar v. Neelakandhan, AIR 1943 Mad 627.
105
Jagat Mohan v. Sheonarain Marwari, AIR 1938 Patna 196.
106
Vasteva Holla v. Mahabala Rao, AIR 1926 Mad 405.
107
AIR 1943 Mad 62.
when the mortgagee exhibits actual physical control over the property and intercepts the rent
from going to the mortgagor. The liability does not arise where the mortgagor himself remains in
possession.
d. To make necessary repairs out of the rents and profits

This duty was recognised even prior to the passing of the Act 108. This however, is subject
to the income left after deducting the revenue due to the government under clause (c) 109. Here
too, the liability can arise only where the mortgagee is in actual possession of the property and
not otherwise110.
The exact scope and purpose of this section was explained by a 3-judge bench of the
Supreme Court in 1968111. Here, there was a mortgage transaction with a transfer of possession
of the property, a large bungalow. The court observed that S. 76(d) was very limited in its scope.
The clause merely made it obligatory on the mortgagee to carry out necessary repairs. The
amount for this is however limited to:
 The difference between the rents and profits and payments of revenue, and the interest money
due to him
The very object of the section was held to be to limit the amount which can be spent by the
mortgagee so as to ensure that he does not misuse his dominant position to exploit the
mortgagor.
e. He is not to undertake any activity destructive or permanently injurious to the property is

possession
This, is a logical corollary to the rule of prudent management. If the mortgagee does
anything to destroy or reduce the value of the property he is in possession of, he is liable to make
good the same. Thus, if he fells immature trees or stumps, he commits an act destructive to the
mortgagor's interest and is liable for the same112.
108
109
See, S. 76(d).
110
Baquar Ali Khan v. Nisar Husain, 1885 AWN 262.
111
Anansram v. Premraj, AIR 1968 SC 250.
112
Mahabir v. Sheo Shankar, AIR 1929 Oudh 124.
f. When he has insured the property against loss by fire, in the event of such a loss, he must
appropriate the money received in reinstating the property or in the reduction of the
principal if the mortgagor so directs.
While S. 72 gave the mortgagee the right to insure the property against damage or loss by
fire, this section merely directs him how the same is to be applied, in case the money is realised.
g. He must keep clear, full and accurate accounts if all money spent by him as mortgagee and
he must render copies of the same to the mortgagor upon the latter's request.
The usufructuary mortgagee is under a statutory liability to keep accounts of all the
income he derives and of the money he spends113. The nature of the duty was explained in the
case of Chen Shankar v. United Bank of India114. Here, a mortgage was executed and
subsequently possession was delivered to the mortgagee. The court observed that the mortgagee
was under a fiduciary duty and liable from the date on which he gets possession. He is liable not
only for income actually received but also for income, which he might have received if, it had
been in the custody of an ordinary prudent man. He is liable for his negligence in failing to keep
proper accounts.
Unlike some other duties, no contract to the contrary can override the provision in S.
76(g)115.
What happens in the event of a failure on the part of the mortgagee to render accounts?
This question came up for consideration on several occasions. Where an anomalous mortgage
was executed in terms of a simple usufructuary mortgage, it was observed that upon foreclosure
by the mortgagee there had been no accounting undertaken by him. The court held that S. 76(g)
imposed an imperative liability on the mortgagee to render true and full accounts. The duty is
based on equity and good conscience and in its absence, it would be impossible for the
mortgagor to assess what is due to him from the mortgagee. If he does not keep accounts, he is
exposed to the risk of every presumption being made against him, including the presumption that
the rents and profits were in fact greater than the interest to be levied on the principal116.
113
Mahadev Tambali v. Mohd. Siddiq, AIR 1949 All 189.
114
AIR 1955 Cal 569. [DB]
115
Id.
116
Devki Devi v. Devi Dass, AIR 1951 Pepsu 18.[DB]
These presumptions however made against him, must be reasonable and not based on
mere conjecture. They must be supported by some statistical data 117. The liability to render
accounts on the part of the mortgagee arises only when the mortgagor files a suit for redemption
of the mortgage and not before118.
h. Mode of appropriation
On obtaining usufruct of the property, the mortgagee can deduct ordinary expenditure
incurred and expenditure provided for in clause (c) and (d) and is then entitled to a fair
occupation rent, if the property is personally occupied by him. When such receipts exceed the
interest due to him, they shall be used to discharge the mortgage-money and thereafter be paid to
the mortgagor119. This liability too is incapable of being contracted away of waived.
The exact order for appropriation of the property was laid down by the Supreme Court120:
1) Towards expenses he incurs on the management of the property.
2) Towards the interest thereon.
3) The surplus then towards the interest on the mortgage-money which is due.
4) The remainder towards the mortgage-money itself.
The expenses referred to must be reasonable and necessary expenses and not all incidental
and ancillary expenditure. These are 'just allowances121'.
The duty to render accounts continues even after the preliminary decree for redemption
has been passed until the final mortgage decree has been passed122.
i. This clause merely provides that when the mortgagor deposits the amount due on the
mortgage, the mortgagee will have to account for his receipts from the property from the
date of the tender of the money or from the earliest time when he could take such amount out
of court and is not entitled to deduct any amount therefrom towards any expenditure.
117
118
Gordhanlal v. Thakur Radha, AIR 1943 All 109.
119
See, S. 76(h).
120
Anandram v. Premraj, supra., note 108.
121
122
Gyarsibai v. Dhansukh Lal, AIR 1965 SC 1055.
It merely provides that upon delivery of the mortgage-money, the mortgagee must tender
full accounts as to the utilisation of the same and he cannot incur further expenditure and seek to
recover the same from the mortgagor.
If the mortgagee fails to perform any of these duties and thereby any loss is caused to the
mortgagor, when accounts are taken after a final decree such loss may be debited from the
amount due to him123.
123
See, S. 76.
EXCEPTION
An exception to some of these duties is to be found in S. 77 of the Act. It provides that nothing
in clauses (b), (d), (g) and (h) shall apply to cases where the mortgagor and mortgagee have
contracted that the mortgagee shall appropriate receipts from the property-
 In lieu of interest on the principal
 Or, in lieu of such interest and defined portions of the principal.
In such cases the obligations to collect the rents, to repair, to keep accounts and to appropriate
in a particular manner are done away with. However, where the rents are to be appropriated
solely towards the principal, this exception would seem to have no application. The obligation on
the mortgagee to pay government revenue continues124.
On the other hand, if the contract provides that the mortgagee is entitled to a fixed sum in
lieu of the interest or if it provides that the mortgagee is entitled to an interest only if he fails to
get other receipts, the exception does not come into play125.
The reason for this section, it would appear is because when the mortgagee himself must
appropriate the rents in lieu of interest, the onus is automatically on him to collect rents, make
repairs and keep accounts. The mode of appropriation is already stated in the deed.
Usufructuary mortgages and usury regulations

Usufructuary mortgages were essentially instruments of oppression. They were used by
creditors to take rents in lieu of huge interest rates. As a result, usury regulations were passed to
check this practice. These regulations126 fixed the maximum rate of interest that could be levied
at 12% and also made the mortgagee liable to account for rents and profits.
In keeping with the objects of these regulations, courts have started interpreting the terms of
the mortgage deed in favour of the debtor, i.e., the mortgagor. Thus, he is allowed to redeem
before the actual expiry of the term stipulated. Any interest received in excess of the prescribed
rate was automatically used to reduce the principal money.
124
Misri Lal v. Gajadhar, AIR 1943 Oudh 433.
125
Manickchand v. Mohd. Sait, AIR 1969 SC 751.
126
See, Bengal Regulation 15 of 1793; Bengal Regulation 34 of 1803; Bengal Regulation 17 of 1806; Madras
Regulation 34 of 1802; Bombay Regulation 1 of 1814.
As of 1855, most of these regulations have been repealed 127. Nevertheless, their importance
lies in having modeled the entire pattern of judicial interpretation towards recognising that
usufructuary mortgages are capable of being used to exploit the debtor and therefore the
necessity of adopting a liberal interpretation of the mortgage-deed in favour of the mortgagor. It
is also submitted that several of these aspects were in fact codified by the Act of 1882 - such as
the duty to render full accounts. In recent times courts have begun recognising that customary
leases, may also afford a cloak for such exploitative transactions and have therefore begun
including the same within the scope of the usufructuary mortgage.
127
CONCLUSION
Based on the previous discussion it can now be concluded that the essential and unique
features of a usufructuary mortgage as defined in S. 58(d) of the Transfer of Property Act, 1882
are:
 Delivery of possession or an undertaking to advance possession

 To secure the advancement of a loan
 Transfer of the right to appropriate the usufruct of the property;
- in lieu of the mortgage-money
- in lieu of the interest thereon
- or partly in lieu of the interest or partly in lieu of the mortgage money
 There is no personal liability imposed on the mortgagor.
 The mortgagee does not have the remedies of foreclosure or sale. His only remedy is to
retain possession until payment of the debt. If possession has not bee delivered or if he has
been dispossessed, he can sue for a money-decree under S. 68.
 The mortgagor has the right to redeem in accordance with S. 60 and S. 62. In the case of a
self-redeeming mortgage, when the mortgage-money is satisfied from the usufruct and in a
non-self-redeeming mortgage, when the time period expires and the mortgagor tenders the
mortgage-money.
 The usufructuary mortgagee, being in possession is authorised to spend necessary sums of
money on the property and can add the same to the principal due in accordance with S. 72.
 The usufructuary mortgagee in possession has to perform duties specified in S. 76 (provided
he is not excepted by S. 77), with the failure for non-performance being the loss debited from
the money to accrue to him.
The usufructuary mortgage has been recognised at the very basic level to be lending
transaction, irrespective of the name used. Thus, even in the cases of customary leases,
irrespective of the name used, the courts have scrutinised the transaction for the existence of a
debtor-creditor relationship and then have held the transaction to be a usufructuary mortgage. In
doing so, the courts have been wary of usurious rates of interest and penalising conditions which
form clogs on the equity of redemption, considered basic in a mortgage transaction.
Nevertheless, the usufructuary mortgage is still being used as a cover for usurious transactions
involving high rates of interest and extremely long periods of time. Courts have over the years,
made attempts to uncover such transactions. Principled adherence to the tests laid down by the
courts in determining whether a transaction is a usufructuary mortgage and thereafter whether it
fall foul of any of the usurious interest legislations is the only way by which this practice can be
curbed. Only then will the exploitative nature of the debt transaction be alleviated and the abuse
of dominant positions by the mortgagees would be reduced.
This liberal interpretative approach in favour of the mortgagor, it is submitted is in
keeping with the basic principles of equity, justice and good conscience and is an attempt to
cover up the loopholes that are present in identifying a transaction by its nomenclature. Such an
approach is inherent in the very nature of the usufructuary mortgage, where the mortgagor has
the right to redeem whereas the mortgagee has no corresponding right to foreclose or bring the
property to sale.
In recognition of the fact that the pure usufructuary mortgage is one-sided in favour of
the mortgagor, in recent times anomalous possessory mortgages such as the simple mortgage
usufructuary have developed and are gaining in popularity. Such a mortgage has all the
characters of the usufructuary mortgage but also contains the right of the mortgagee to foreclose
the property or bring it to sale on default by the mortgagor. Such developments should not be
taken or interpreted as whittling down the effect of the usufructuary mortgage, but as in fact
recognising the equitable framework the pure usufructuary mortgage exists in, in securing a debt
transaction towards the mortgagor.
BIBLIOGRAPHY
 Bryan A Garner, Ed., Black's Legal Dictionary, 7th Edition, West Group, Minnesota,
1999.
 C.K. Takwani, Civil Procedure, 4th Edition, Eastern Book Company, Lucknow, 1997.
 D.F. Mulla, The Trasnfer of Property Act, 9th Edition, Solil Paul, Ed., Butterworths India,
New Delhi, 2000.
 J.M. Shelat and B.J. Divan, Eds., Mulla on the Code of Civil Procedure, 14th Edition,
N.M. Tripathi Pvt. Ltd., Bombay, 1989.
 S.K. Ray, Ed., B.B. Mitra on the Transfer of Property Act, 1882, 15th Edition, Kamal Law
House, Calcutta, 1988.
 S.R. Roy, Ed., Rashbehary Ghose on Law of Mortgage, 7th Edition, Kamal Law House,
Calcutta, 1997.

Usufructuary Mortgage: An Analysis

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Usufructuary Mortgage: An Analysis

Uploaded by

Copyright:

Available Formats

National Law University, Jodhpur

(Winter Session: January-May, 2017)

Usufructuary Mortgage: An Analysis

Submitted By: Submitted To:

Roll No:- & Roll No:-1370 Faculty of law

wouldn’t have seen practicability.

the assistance anytime needed.

Scope & Focus

Aims & Objectives

 To examine the essential ingredients of the usufructuary mortgage through judicial

A beginning is made with a broad overview of the conceptual understanding of the

INCIDENTS OF THE USUFRUCTUARY MORTGAGE

APPROPRIATION OF RENTS AND PROFITS

ABSENCE OF PERSONAL LIABILITY

NO TIME LIMIT NECESSARY

In the case of a usufructuary mortgage,

In the present case the court found the following facts;

LEKHA MUKHI TRANSACTIONS

USUFRUCTUARY MORTGAGE WITH A LEASE-BACK CONDITION

Thus, a self-redeeming mortgage terminates immediately upon the mortgage-money being

ACCESSIONS AND IMPROVEMENTS

RIGHTS OF THE MORTGAGEE ON DEFAULT BY THE MORTGAGOR

RIGHTS OF THE MORTGAGEE IN POSSESSION

LIABILITIES OF THE MORTGAGEE IN POSSESSION

The position therefore to summarise, is as follows:

d. To make necessary repairs out of the rents and profits

e. He is not to undertake any activity destructive or permanently injurious to the property is

Usufructuary mortgages and usury regulations

 Delivery of possession or an undertaking to advance possession

You might also like