Can a mortgagee sue the mortgagor on the basis that the mortgaged property is not in a condition in which it was when the mortgage was signed?
Saskatchewan, Canada
The following excerpt is from Saskatchewan Farm Loan Board v. Morgan, 1932 CanLII 180 (SK QB):
In Mendels v. Gibson (1905) 9 O.L.R. 94, part of the head-note is as follows: The principle that a mortgagee cannot sue the mortgagor on his covenant unless he is in a position to reconvey the mortgaged property to him intact does not apply to the case where the mortgagee is in a position to restore, the whole of the mortgaged land, but owing to the removal or destruction of a building on the mortgaged land the property is not in the condition in which it was when the mortgagee took possession, unless, semble, the building is of such a character that compensation in money, which the mortgagor is in such an event entitled to, would not be an adequate indemnity.
In Munsen v. Hauss (1875) 22 Gr. 279, the mortgagee still had the land, but the brick building was absolutely gone and the other building very much out of repair. That did not prevent the plaintiff from recovering.
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