Mortgage Act

Section Interpretation Section In this Act, unless the context otherwise requires— “ civil debt recoverable summarily ” means a civil debt recoverable summarily in a court of competent jurisdiction; “ court ” means a court, not lower than a grade I magistrates court including a land tribunal, having jurisdiction to hear a case with regard to the value and location of the subject matter; “ currency point ” has the value assigned to it in Schedule 1 to this Act; “ customary land tenure ” has the meaning given to it by the Land Act ; “ extortionate ” means calculated to obtain property from another induced by wrongful use of actual or threatened force, violation or fear under colour of official right; “ freehold land tenure ” has the meaning given to it by the Land Act ; “ informal mortgage ” means a written and witnessed undertaking, the clear intention of which is to charge the mortgagor ’s land with the repayment of money or money’s worth obtained from the mortgagee and includes an equitable mortgage and a mortgage on unregistered customary land; “ land tenure ” means a system of holding land and includes customary land tenure , freehold land tenure , leasehold land tenure and mail...

Section Consolidation Section Unless there is an express provision to the contrary clearly set out in the mortgage instrument— where a mortgagee has more than one mortgage from a single mortgagor ; or where the mortgagee has lent money or money’s worth to a single mortgagor on two or more securities, Notwithstanding subsection (1) , a right to consolidate shall not be exercisable to the prejudice of any person acquiring land under any form of land tenure or under a certificate of occupancy or any other interest in land entitling that person to the occupation and use of that land prior to the recording of that right to consolidate in the prescribed register. The rules of equity applicable to consolidation shall, from the commencement of this Act, no longer apply to a mortgage . For the purposes of this section, “consolidation” means the combination of two or more mortgages or securities.

Section Variation of mortgage Section The rate of interest payable under a mortgage may be reduced or increased by a notice served on the mortgagor by the mortgagee which shall— The amount secured by a mortgage may be reduced or increased by a memorandum which— is signed— The term or currency of a mortgage may be shortened, extended or renewed by a memorandum which— The covenants, conditions and powers expressed or implied in a mortgage may be varied, but not so as to impose any significantly greater burdens on the borrower than those set out in section 17 by a memorandum which— A memorandum for the purposes of subsections (2) , (3) and (4) — give the mortgagor not less than fifteen working days’ written notice of the reduction or increase in the rate of interest; state clearly and in a manner which can be readily understood, the new rate of interest to be paid in respect of the mortgage ; state the responsibility of the mortgagor to take such action as he or she is advised by the notice to take to ensure that the new interest rate is paid to the mortgagee . complies with subsection (5) ; in the case of a memorandum of reduction, by the mortgagee ; or in the case of a memorandum of...

Section Suits by mortgagor Section A mortgagee may, on receipt of the notice referred to in subsection (1) , either— A mortgagor intending to commence any action in a court in respect of the mortgaged land shall by notice in writing inform the mortgagee or mortgagees of his or her intention and the nature of the action which is to be commenced. require the mortgagor at his or her expense, to join the mortgagee in the action; inform the mortgagor that the mortgagee will take over the action and the mortgagor should cease to pursue the action; or take no action. Where a mortgagee informs the mortgagor that he or she will take over the action, the mortgagor shall forthwith cease to pursue the action. Where as a result of any decree or order of a court arising out of any action taken by the mortgagor under this section, any sum of money becomes payable to the mortgagor by way of damages on account of some damage or injury caused to the mortgaged land by the defendant, a mortgagee may apply to the court for an order that that sum or such proportion of it as the court thinks fit should be paid to the mortgagee in reduction or discharge of the mortgage .

Section Power to create mortgages Section Nothing in this section shall operate to prevent a borrower from offering and a lender from accepting— a deposit of any of the following— A person holding land under any form of land tenure , may, by an instrument in the prescribed form, mortgage his or her interest in the land or a part of it to secure the payment of an existing or a future or a contingent debt or other money or money’s worth or the fulfilment of a condition. The power conferred by subsection (1) includes the power to create third party mortgages, second, subsequent mortgages and sub-mortgages. The power conferred by this section shall be exercisable subject to any prohibition or limitation imposed by this Act, by regulations made under this Act, by any written law or by any restriction contained in an instrument creating or affecting an interest in land which is to be the subject of a mortgage . A mortgage created under subsection (1) shall only take effect when registered. Notwithstanding subsection (4) , an unregistered mortgage shall be enforceable between the parties. Where a second or subsequent mortgage is made by a mortgagor whose title is registered under the Regi...

Section Duty to disclose information Section A mortgagee and mortgagor shall— act honestly and in good faith; and in particular, disclose all relevant information relating to the mortgage . A mortgagee or mortgagor who refuses, neglects or fails to disclose information relevant to a mortgage and which is in his or her possession, commits an offence and is liable, on conviction, to a fine not less than forty-eight currency points but not exceeding one hundred twenty currency points or to imprisonment for a term not less than two years but not exceeding five years, or both.

Section Mortgage of matrimonial home Section Notwithstanding section 40 of the Land Act , a mortgage of a matrimonial home, including mortgage on customary land of a matrimonial home is valid if— For the purposes of subsection (1) — any document or form used in applying for the mortgage is signed by or there is evidence from the document that it has been assented to by the mortgagor and the spouse or spouses of the mortgagor living in that matrimonial home ; or any document or form used to grant the mortgage is signed by or there is evidence that it has been assented to by the mortgagor and the spouse or spouses of the mortgagor living in that matrimonial home . an intending mortgagee shall take reasonable steps to ascertain whether an intending mortgagor is married and whether or not the property to be mortgaged is a matrimonial home ; and an intending mortgagor shall make full disclosure to the intending mortgagee as to his or her marital status and whether or not the property to be mortgaged comprises the matrimonial home . The mortgagee shall be deemed to have discharged the duty under subsection (2) , if the mortgagee obtains a marriage certificate issued in accordance with th...

Section Consent to mortgage of matrimonial home Section Where a matrimonial home is the subject of an application for a mortgage , a mortgagee shall satisfy himself or herself that the consent of a spouse referred to in section 4 is an informed and genuine consent and that duty is deemed to have been complied with if— the mortgagee has— explained to the spouse or spouses of an applicant for a mortgage in the presence of an independent person, the terms and conditions of the mortgage which is being applied for; or in writing, advised the applicant for a mortgage that he or she should ensure that his or her spouse or spouses receive independent advice on the terms and conditions of the mortgage which is being applied for; and the spouse or spouses, as the case may be, provide a signed and witnessed document to the effect that they have received independent advice on the mortgage which is being applied for and have understood and assented to the terms and conditions of the mortgage or that they have, notwithstanding the advice from the mortgagee , waived their right to take independent advice. In this section an “independent person” means any officer of the Government, a Justice of th...

Section Application of Act to mortgages on customary land Section The mortgagor under a mortgage on customary land may, after making use of the services of the mediator to try and mediate on the matter with the mortgagee , apply to a court for the mortgage to be re-opened on the ground that the terms of the mortgage are— In any case concerning a mortgage on customary land, the court determining the case shall, where it appears to the court that— The creation and operation of mortgages on customary land shall, subject to this Act, continue to be in accordance with the customary law applicable to the land in respect of which the mortgage on customary land is created. Where the mortgagee under a mortgage on customary land seeks to exercise any customary remedy which involves or may involve the mortgagor being dispossessed or permanently deprived of the occupation of the mortgaged land, the mortgagee shall, after using the services of the mediator to try and mediate on the application of the proposed or any other remedy, make an application to the court for an order authorising the exercise of that remedy; and the court shall, in determining whether to authorise the exercise of that re...

Section Mortgage of land to take effect as security only Section On and after the commencement of this Act, a mortgage shall have effect as a security only and shall not operate as a transfer of any interest or right in the land from the mortgagor to the mortgagee ; but the mortgagee shall have, subject to this Act, all the powers and remedies in case of default by the mortgagor and be subject to all the obligations conferred or implied in a transfer of an interest in land subject to redemption. Where a mortgagor signs a transfer as a condition for the grant of a mortgage under this Act, the transfer shall have no effect. A mortgagee who requires a transfer as a condition for the grant of a mortgage under this Act, commits an offence and is liable, on conviction, to a fine not exceeding four thousand currency points. In the case of the mortgage of a lease, the mortgagee shall not be liable to the lessor for rent or in respect of the covenants and conditions contained or implied in the lease to any greater extent than he or she would have been if the mortgage had been by way of a sublease.

Section Priority Section In respect of mortgages of land registered under the Registration of Titles Act, mortgages shall rank according to the order in which they are registered in accordance with section 48 of that Act. In respect of mortgages of land held for customary tenure under a certificate of customary ownership, mortgages shall rank according to the order in which they are registered by the recorder and the recorder shall register all such mortgages in the order and as from the time they are presented to him or her for registration. Informal mortgages shall rank according to the order of the date and time when they are made. Where a mortgagee , subsequent in time to a prior mortgagee under a mortgage , lends money or money’s worth to a mortgagor as a consequence of or through the fraud, dishonesty or misrepresentation of the prior mortgagee , either in conjunction with or separately from the fraud, dishonesty or misrepresentation of the mortgagor , that prior mortgagee ’s right to repayment under the mortgage shall be postponed to the rights of the subsequent mortgagee . The rules of priority for informal mortgages shall apply as far as the circumstances permit, to liens...

Section Tacking Section A further advance referred to in subsection (1) shall not rank in priority to any subsequent mortgage unless— A mortgagee may, subject to this section, make provisions in the mortgage instrument to give further advances or to give credit to the mortgagor on a current or continuing account. the provision for further advances is noted in the register in which the mortgage is registered; or the subsequent mortagee has consented in writing to the priority of the further advance. Except as provided for in this section, there is no right to tack. Where a mortgage provides for the payment of a principal sum by way of instalments, the payment of those instalments shall not be taken to be a further advance and such payment shall rank in priority to all subsequent mortgages.

Section Right to discharge Section Subject to this section and section 14 , on the payment of all money and the performance of all other conditions and obligations secured by the mortgage, and on the payment of any costs and expenses properly incurred by the mortgagee in exercising any of his or her rights under the mortgage, the mortgagee shall at the request and cost of the mortgagor release the mortgage at any time and any agreement or provision in the mortgage instrument or otherwise which— purports to deprive the mortgagor of that right; seeks to fetter the exercise of that right; or stipulates for a collateral advantage which is unfair and unconscionable and inconsistent with the right to discharge, is void. A discharge whether of the whole or a part of a mortgage shall be made in the prescribed form.

Section Release of mortgage Section Upon the presentation for registration of a release of a mortgage registered under the Registration of Titles Act or the Land Act in the prescribed form signed by the mortgagee or his or her transferees, attested by one witness and discharging wholly or in part the land or any portion of the land from the mortgage, the Registrar of Titles or recorder as the case may be shall and upon payment of the prescribed fees, make an entry of the release upon the original and duplicate certificate of title or certificate of customary ownership evidencing the time and date of the registration. Upon the entry being made under subsection (1) , the land affected by the release shall cease to be subject to the mortgage to the extent stated in the release.

Section Deposit of mortgage money where mortgagee cannot be found Section Where a mortgagee is under a disability or is absent from Uganda or his or her whereabouts are unknown and there is no person authorised to discharge the mortgage at or after the date appointed for the payment of that money, it shall be lawful for the Secretary to the Treasury to receive the mortgage money with all arrears of interest due on it in trust for the mortgagee or other person entitled to it; and the interest upon that mortgage shall then cease to run or accrue. In the case of an informal mortgage , where the mortgagee cannot be found, a mortgagor may apply for an order of discharge and the court may, if satisfied that the mortgagor has discharged his or her obligations under the mortgage , make an order discharging the mortgagor . The Registrar of Titles or recorder as the case may be shall, upon the production of the receipt of the Secretary to the Treasury for the amount of the mortgage money and interest, make an entry in the register, stating the time at which the entry was made; and that entry shall be a valid discharge from that mortgage ; and the Registrar of Titles or recorder , as the case...

Section Transfer of mortgage Section Subject to the consent of the mortgagor , which consent shall not be unreasonably withheld, the persons who may make the written request under subsection (1) are any— The current mortgagor or any person mentioned in subsection (3) may at any time, other than a time when the mortgagee is in possession of the mortgaged land, in writing request the mortgagee to transfer the mortgage to a person named in the written request. The current mortgagee may at any time transfer the mortgage by a transfer in a prescribed form and shall give notice of the transfer to the mortgagor . person who has an interest in the land which has been mortgaged; surety for the payment of the amount secured by the mortgage ; or creditor of the mortgagor who has obtained a decree of sale of the mortgaged land. Where the consent required by subsection (3) is withheld, a person aggrieved by the withholding of the consent may appeal to the court for an order requiring the mortgagor to show cause why the mortgagor cannot give consent, and the court may, in its discretion, dispense with the consent. The mortgagee , on receiving a written request made under subsection (1) and on pa...

Section Implied covenants by mortgagor Section There shall be implied in every mortgage the following covenants by the mortgagor with the mortgagee binding the mortgagor — except in the case of a mortgagor under a third party mortgage , to pay the principal money on the day appointed in the mortgage agreement, and, so long as the principal money or any part of it remains unpaid, to pay interest on it or on so much of it as for the time being remains unpaid at the rate and on the days and in the manner specified in the mortgage agreement; to pay all rates, charges, rent, taxes and other outgoings which are at all times payable in respect of the mortgaged land; to repair and keep in a reasonable state of repair all buildings and other improvements upon the mortgaged land and to permit the mortgagee or his or her agent at all reasonable times until the mortgage is discharged and after reasonable notice to the mortgagor , to enter the land and examine the state and condition of those buildings and improvements; to insure by insurance or any other means as may be prescribed or as are appropriate, that resources will be available to make good any loss or damage caused by fire to all buil...

Section Notice on default Section The notice required by subsection (2) shall be in the prescribed form and shall adequately inform the mortgagor of the following matters— Where money secured by a mortgage under this Act is made payable on demand, a demand in writing shall create a default in payment. Where the mortgagor is in default of any obligation to pay the principal sum on demand or interest or any other periodic payment or any part of it due under any mortgage or in the fulfilment of any covenant or condition, express or implied in any mortgage , the mortgagee may serve on the mortgagor a notice in writing of the default and require the mortgagor to rectify the default within forty-five working days. the nature and extent of the default made by the mortgagor ; where the default consists of the non-payment of any money due under the mortgage , the amount that must be paid to rectify the default, which amount may be the whole of the money due under the mortgage , and the time, being not less than twenty-one working days, by the end of which the payment in default must have been made; where the default consists of the failure to perform or observe any covenant, express or impl...

Section Remedies of mortgagee Section Where the mortgagor is in default and does not comply with the notice served on him or her under section 18 , the mortgagee may— require the mortgagor to pay all money owing on the mortgage ; appoint a receiver of the income of the mortgaged land; lease the mortgaged land or where the mortgage is of a lease, sublease the land; enter into possession of the mortgaged land; or sell the mortgaged land.

Section Mortgagee's action for money secured by mortgage Section The mortgagee may sue for the money secured by the mortgage only in the following cases— where the mortgage deed provides that if there is default by the mortgagor , the money secured by the mortgage becomes payable in full; where the mortgagor is personally bound to repay the money; where a surety has agreed to be personally liable to repay the money in circumstances that have arisen; or where the mortgagee is deprived of the whole or a part of his or her security or the security is rendered insufficient through or in consequence of the wrongful act or default of the mortgagor . An action shall not be commenced under subsection (1) until the time for complying with a notice served under section 18 has expired. The court may, on the application of the mortgagor or a surety , order a stay of any proceedings brought under this section, until the mortgagee has exhausted all his or her other remedies against the mortgaged land, unless the mortgagee agrees to discharge the mortgage on payment of the money secured by the mortgage .

Section Appointment, powers, remuneration and duties of receiver Section The receiver shall apply all money received by him or her in the following order of priority— in payment of all reasonable expenses incurred in the doing of anything which a receiver is required or entitled to do in respect of the mortgaged land, including but not limited to— It is an implied condition in every mortgage that the mortgagee has the power to appoint a receiver of the income of the mortgaged land. Before the appointment of a receiver under this section, the mortgagee shall serve a notice on the mortgagor and shall not proceed until fifteen working days have lapsed from the date of the service of the notice of appointment of receiver . The appointment of a receiver shall be in writing signed by the mortgagee. A mortgagee may apply to the court for the appointment of a receiver and any such application may be made in an interlocutory application. A receiver may be removed at any time and a new receiver appointed in writing signed by the mortgagee . A receiver appointed under this section shall be deemed to be the agent of the mortgagor for the purposes for which he or she is appointed, and the mortg...

Section Power of mortgagee to lease Section A mortgagee shall, unless the mortgage instrument expressly provides to the contrary, have power, subject to this Act and any other law applicable to the leasing of land— Every lease granted by the mortgagee shall— to grant leases in respect of the mortgaged land or any part of the land; and to accept a surrender of any lease so granted and of any lease granted by the mortgagor , Before granting a lease under this section, a mortgagee shall serve a notice on the mortgagor in the prescribed form and shall not proceed with the granting or execution of that lease until fifteen working days have lapsed from the service of the notice. reserve the best rent that can reasonably be obtained, having regard to the circumstances of the case; be for a term not exceeding fifteen years or the length of the term of the mortgage whichever is the shorter; contain any terms and conditions which are reasonable, having regard to the interests of the mortgagor and of any other persons having an interest in the mortgaged land; and if prior to granting a lease, the mortgagee has appointed a receiver under section 21 , contain a declaration that the lender has a...

Section Power of mortgagee to take possession of mortgaged land Section A mortgagee may exercise the power of entry into possession of mortgaged land by— The mortgagee shall be regarded as being in possession on the date— A mortgagee in possession of any mortgaged land— A person on whom a notice under subsection (1) has been served shall forthwith comply and continue to comply with that notice until— A mortgagee may, after the end of the period specified in section 18 , and after serving a notice of not less than five working days of his or her intention to do so, enter into possession of the whole or a part of the mortgaged land. entering into and taking physical possession of the land or a part of it during the day time using only such force as shall be reasonable in the circumstances; asserting management or control over the land by serving a notice in the prescribed form requiring any lessee of the mortgagor or any other occupier of the land to pay to the mortgagee any rent or profits which would otherwise be payable to the mortgagor ; or an order of court . on which he or she enters into possession in accordance with subsection (2)(a) or (c) ; or on which he or she first recei...

Section Withdrawal of mortgagee from possession Section A mortgagee shall withdraw from possession of the mortgaged land where— A mortgagee in possession shall be taken to have withdrawn from possession of all or a part of the mortgaged land— when the mortgagee — a court makes an order directing the mortgagee to withdraw; the mortgagee appoints a receiver under section 21 ; the default which was the cause of the entry into possession has been rectified through the possession of the mortgagee ; the mortgagee has exercised the power of sale under section 25(2) ; or the mortgagor becomes entitled to a discharge of the mortgage under section 13 . when the court makes an order under subsection (1) ; when the receiver has been appointed in accordance with section 21 ; ceases to occupy the mortgaged land; or where he or she is not in occupation, serves a notice of withdrawal on all persons served with a notice under section 23(2)(b) ; when the purchaser of the mortgaged land enters into occupation of that land; or when the mortgagor obtains the discharge of the mortgage . A mortgagee who has withdrawn from possession of mortgaged land may not again enter into possession of that land, othe...

Section Power of sale of mortgagee Section A copy of the notice to sell served in accordance with subsection (2) shall be served on— Where a mortgagor is in default of his or her obligations under a mortgage and remains in default at the expiry of the time provided for the rectification of that default in the notice served on him or her under section 18(3) , a mortgagee may exercise his or her power to sell the mortgaged land. Before exercising the power to sell the mortgaged land, the mortgagee shall serve a notice to sell in the prescribed form on the mortgagor and shall not proceed to complete any contract for the sale of the mortgaged land until twenty-one working days have lapsed from the date of the service of the notice to sell. a mortgagor ; any spouse or spouses of the mortgagor in respect of a matrimonial home ; a surety ; the independent person as provided under this Act; or in case of customary land, the children and the spouse or spouses.

Section Duty of mortgagee exercising power of sale Section A mortgagee who exercises a power to sell the mortgaged land, including the exercise of the power to sell under an order of a court , owes a duty of care to the mortgagor , any surety of the whole or any part of the sums advanced to the mortgagor , any mortgagee under a subsequent mortgage including a mortgage on customary land or under a lien, to take all reasonable steps to obtain the best price as prescribed in the regulations. A mortgagee shall not be entitled to any compensation or indemnity from the mortgagor , any former mortgagor or any surety in respect of any liability arising from a breach of the duty imposed by subsection (1) .

Section Powers incidental to power of sale Section Where a mortgagee becomes entitled to exercise the power of sale, that sale may be— of the whole or a part of the mortgaged land; subject to or free of any mortgage or other encumbrance having priority to the mortgagee ’s mortgage ; by way of subdivision or otherwise; by public auction, unless the mortgagor consents to a sale by private treaty; with or without reserve; and subject to such other conditions as the mortgagee shall think fit, having due regard to the duty imposed by section 26(1) . Where a sale is to proceed by public auction, it shall be the duty of the mortgagee to ensure that the sale is publicly advertised in advance of the sale by auction in such a manner and form as to bring it to the attention of persons likely to be interested in bidding for the mortgaged land and may include but not be limited to the mortgagee placing an advert including a colour picture of the mortgaged property, in a newspaper which has wide circulation in the area concerned, specifying the place of the auction, and the date of the auction, being no earlier than thirty days from the date of the first advert. A transfer of the mortgaged land...

Section Protection of purchaser Section A purchaser is not— For the purposes of this section, a purchaser is— A purchaser in a sale effected by a mortgagee acquires good title except in a case of fraud, misrepresentation or other dishonest conduct on the part of the mortgagee of which the purchaser has actual or constructive notice. answerable for the loss, misapplication or non-application of the purchase money paid for the mortgaged land; obliged to see to the application of the purchase price; or obliged to inquire whether there has been a default by the mortgagor or whether any notice required to be given in connection with the exercise of the power of sale has been duly given or whether the sale is otherwise necessary, proper or regular. a person who purchases mortgaged land excluding the mortgagee when the mortgagee is the purchaser; or a person claiming the mortgaged land through the person who purchases mortgaged land from the mortgagee , but does not include the mortgagee where the mortgagee is the subsequent purchaser. A purchaser prejudiced by unauthorised, improper or irregular exercise of the power of sale shall have a remedy in damages against the mortgagee exercising...

Section Sale by mortgagee to himself or herself Section The following shall not be permitted to purchase the mortgaged land without leave of court — Where the mortgaged land is to be sold by public auction, the mortgagee or other persons mentioned in subsection (1) may bid for the mortgaged land at the public auction so long as the price bid for the mortgaged land by the mortgagee is— a mortgagee ; an employee of the mortgagee or an immediate member of his or her family; an agent of the mortgagee or an immediate member of his or her family; any person in a position to influence the matter directly or indirectly; and a person in position of any other privileged information with regard to the transaction. A court shall not grant leave to a person mentioned in subsection (1) , unless the court is satisfied that the sale of the mortgaged land to that person is the most advantageous way of selling the land so as to comply with the duty imposed on the mortgagee by section 26(1) . the highest price bid for that land at the auction; or equal to or higher than the reserve price, if any, put upon the land before the auction, which ever amount is the greater; and immediately after the fall of...

Section Application of proceeds of sale of mortgaged land Section The purchase money received by a mortgagee who has exercised his or her power of sale shall be applied in the following order of priority— in payment of any rates, rents, taxes, charges or other sums owing and required to be paid on the mortgaged land; in discharge of any prior mortgage or other encumbrance subject to which the sale was made; in payment of all costs and reasonable expenses properly incurred and incidental to the sale or any attempted sale; in discharge of the sum advanced under the mortgage or so much of it as remains outstanding, interest, costs and all other money due under the mortgage , including any money advanced to a receiver in respect of the mortgaged land; in payment of any subsequent mortgages in order of their priority; and the residue, if any, in payment to the person who, immediately before the sale, was entitled to discharge the mortgage . Where a mortgagee holding the proceeds of sale in trust under this section is in doubt as to the proper distribution of all or part of those proceeds, he or she may apply to the court for directions and may, if the court so orders, deposit the procee...

Section Right of mortgagor to discharge mortgage on payment of sums due any time before sale Section Where payment is made under subsection (1) , the mortgagee shall deliver to the mortgagor— At any time before an agreement is reached between the mortgagee and any purchaser for the sale to that purchaser of the mortgaged land, the mortgagor or any other person who is entitled to discharge the mortgage , may discharge the mortgage in whole or in part by paying to the mortgagee all money secured by the mortgage at the time of discharge. a discharge of the mortgage in the prescribed form over the whole or that part of the mortgaged land to which the payment relates; and all instruments and documents of title held by the mortgagee in connection with the mortgaged land.

Section Application for relief by mortgagor Section An application to the court for relief against the exercise by the mortgagee of any of the remedies referred to in section 19 may be made— An application for relief is not to be taken as an admission by the mortgagor or any other person applying for relief that— by the mortgagor ; if two or more persons are joint mortgagors, by one or more of them on their own behalf; by a spouse or spouses of the mortgagor ; or by the trustee in bankruptcy of the mortgagor . Where an application under subsection (1)(b) is not made by all the joint mortgagors, then, unless the court orders otherwise, it shall be served on all the other joint mortgagors. An application for relief may be made at any time after the service of a notice under section 18 , 21(2) , 22(2) , 23(1) or 25(2) , or during the exercise of any of the remedies referred to in those sections. there has been a breach of a covenant of the mortgage by the mortgagor ; by reason of such a breach, the mortgagee has the right to exercise the remedy in respect of which the application for relief has been made; all notices which were required to be served by the mortgagee were properly serv...

Section Power of court to review certain mortgages Section Where a mortgage has been obtained— through fraud, deceit or misrepresentation by the mortgagor ; or in a manner or containing a provision which is unlawful,

Section Application to court to exercise power under section 33 Section An application to the court to exercise any of the powers conferred upon the court by section 33 may be made— An application under subsection (1) may be made— by the mortgagor or mortgagee ; if two or more persons are joint mortgagors or joint mortgagees, by one or more of them on their own behalf; by a spouse or spouses of the mortgagor ; by the trustee in bankruptcy of the mortgagor ; by the trustee in bankruptcy, receiver or liquidator of the mortgagee ; or by a surety . If an application made in accordance with subsection (1)(b) is not made by all joint mortgagors or mortgagees, then unless the court orders otherwise, the application must be served on all the other joint mortgagors or mortgagees. at any time before the mortgagor has obtained a discharge of the mortgage ; or on an application by the mortgagee to the court for an order for possession or the execution of such an order.

Section Exercise of power under section 33 to review certain mortgages Section Upon an application made under section 33 , the court may— declare the mortgage void; direct that the mortgage shall have effect subject to such modifications as the court shall order; or require the mortgagee to repay the whole or part of any sum paid under the mortgage or any related or collateral agreement by the mortgagor or any surety or other person who assumed an obligation under the mortgage whether it was paid to the mortgagee or any other person. The court shall not declare a mortgage void unless it is satisfied that the circumstances justify it. Where an application is made on the grounds that the mortgage contains any provision which is unlawful, unconscionable or extortionate, the court shall to the greatest extent possible, uphold the mortgage with the omission of the unlawful, unconscionable and extortionate provision. Where an application is made on the grounds of the exercise of undue influence or other unconscionable conduct, and two or more persons are joint mortgagors or mortgagees, and those grounds are proved to the satisfaction of the court , the court shall uphold the mortgage to...

Section Extinction of certain rights Section Upon application by the mortgagee under subsection (2) , the court shall grant the order if the mortgagee satisfies the court— in the case of cancellation of a mortgage under subsection (1) that during the period of limitation— Where upon an application for the purpose, the Registrar of Titles is satisfied that the right of action to recover any security under a mortgage , whether the right is granted in that mortgage or otherwise, has become extinguished by the operation of the Limitation Act, the Registrar of Titles shall, after giving a notice of not less than thirty days to the mortgagee , remove the mortgage from the title of the land to which it relates; and the mortgage shall be deemed cancelled with effect from date of removal. Notwithstanding subsection (1) , the mortgagee may not later than ninety days from the expiration of the notification under subsection (1) apply to the court for an order restoring the mortgage and his or her right under it. the mortgagor or his or her successor in title acknowledged the mortgage debt in writing, and agreed to pay, or settle part of it; the mortgagor was dead and that either no successor h...

Section Registrar of Titles may issue special certificate of title to mortgagor Section Where, upon the expiration of the time specified under subsection 36(2) for the mortgagee to apply to the court for the mortgage and his or her rights under the mortgage to be restored, the mortgage and the rights have not been so restored and there are no proceedings pending in court in respect to such application, the Registrar of Titles shall, by writing under his or her hand, require the mortgagee or his or her transferee within thirty days to surrender to the Registrar of Titles any certificate of title in his or her possession relating to the mortgaged land. A certificate surrendered to the Registrar of Titles pursuant to subsection (1) shall be returned to the mortgagor or his or her transferee. Where, upon a request by the Registrar of Titles under subsection (1) , the mortgagee or his or her transferee fails to comply within the time specified, the Registrar of Titles shall issue to the mortgagor or his or her transferee a special certificate of title in place of the certificate in possession of the mortgagee or his or her transferee, and the provisions of section 70 of the Registration...

Section Offences and penalties Section Any person who— impersonates a spouse of a mortgagor ; presents to a mortgagee as his or her spouse, a person not being his or her spouse; or forges any document or utters a forged document to any person, for the purpose of fulfilling any duty or requirement under this Act, Any person who purchases mortgaged property in contravention of section 29 commits an offence and is liable, on conviction, to a fine not less than forty-eight currency points but not exceeding one hundred twenty currency points or to imprisonment for a term not less than two years but not exceeding five years, or both. A mortgagee who sells mortgaged property in breach of his or her duty to the mortgagor under section 26(1) , commits an offence and is liable, on conviction, to a fine not exceeding two hundred currency points. A mortgagee who refuses or neglects to release the mortgage under section 13 commits an offence and is liable, on conviction, to a fine not exceeding two hundred currency points.

Section Short form of covenant by mortgagor to insure Section Where in any mortgage under this Act the mortgagor uses the form of words contained in column one of Schedule 2 to this Act, the mortgage shall be taken to have the same effect and be construed as if he or she has inserted in it the form of words contained in column two of that Schedule; and every such form shall be deemed a covenant with the mortgagee by the mortgagor binding the latter and his or her heirs, executors, administrators, transferees and assignees in title. There may be introduced into or annexed to the form in the first column of Schedule 2 to this Act any express exception from or express qualification to the form; and the like exception or qualification shall be taken to be made from or in the form in the second column.

Section Regulations Section Without prejudice to the general effect of subsection (1) , Regulations made under this section may prescribe— The Minister may, in consultation with the Bank of Uganda, make regulations prescribing anything which may be prescribed under this Act and generally for the better carrying into effect of the purposes and provisions of this Act. the forms and notices to be used under this Act; the manner and form of the conduct of the business of mortgages; the persons on whom notices must be served; the conduct of auctions in connection with the sale of mortgaged land; or penalties in respect of the contravention of the regulations not exceeding a fine of seventy-two currency points or imprisonment for a term not exceeding three years, or both.

Section Power to amend Schedule 1 Section The Minister may, by statutory instrument, with the approval of Cabinet, amend Schedule 1 to this Act.

Section Application of common law and doctrines of equity Section The rules of common law and the doctrines of equity applicable to mortgages shall apply in accordance with the Judicature Act, except insofar as they are inconsistent with this Act.