MORATORIUM WIDENED

Dominion, Volume 11, Issue 176, 15 April 1918, Page 6

MORATORIUM WIDENED

AN IMPORTANT NEW PROVISION. A new clause added to the Finance Bill in the itousu of Representatives on Saturday proposes to widen the scope of tho iUoiigages Extension Act, 11)14, by providing mat the moratorium shuil apply to mortgages regardless of contracts to the contrary. The Minister of Finance explaiueu that many' borrowers nad contracted themselves out of the moratorium during the last three years, because lenders insisted upon adding provisions to this effect to tho mortgages. Tho clause would render such contracts invalid.

The clause provides that "except in the ease of trade mortgages, no covenant or condition 'xcluding tuo provisions ot thu principal Act shall hereafter have any iorce or effect, notwithstanding-that such covenant or condition is contained in a deed, instrument, or agreement executed alter tho coAimeneeniont of the principal Act, whether such deed, instrument, or agreement was executed betore or is executed, after the passing of this Act, and whether such deed, instrument, or agreement constitutes a- new mortgage or an extension of the term of an existing mortgage." ' A trade mortgage is defined as follows: "In this section trado mortgage means a mortgage securing to any bank, trading company, or merchant tho balance of the account 'current of a customer of such bank, trading company, or merchant, whether such mortgage be granted by the customer or by any surety for tlie customer." Section 2 of the Mortgages Extension \mendmcnt Act, 1914, providing that tho provisions of (he principal Act may be ncatived by agreement 'between mortgagor and mortgagee, is to have no force or eil'ect except; in the case of trade mortgages. m