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Unit – 17 : Law Relating to Securities and Modes of Charge-II
Pledge
Mortgage
Hypothecation
Banker’s Lien
Set-Off
Pledge |
Mortgage |
Pledge required only a limited interest in the
property and ownership remains with the right of pledger. |
Here the legal ownership passes to mortgagee.
Of course subject to the mortgagor to redeem
the property |
The Pawnee has “special property” in the
goods decree of pledged |
The mortgage as a rule, takes decree of a Court of Law before having recourse against the property mortgaged. |
Pawnee has no right to foreclosure |
In certain cases, the mortgagee can foreclose the property. |
Pawnor – The person whose goods are bailed
Pawnee – The person who takes the goods for security
Pledge means bailment of goods for the purpose of securing a payment of debt or an obligation.
A valid pledge can be created by owner of goods or a mercantile agent
A constructive pledge involves only delivery of keys of the warehouse.
Under the Contract of pledge the Pawnee can sell the goods pledged after notice or retain the goods and file a suit for recovery of debt.
Hypothecation |
Mortgage |
The mortgage of moveable property is
called Hypothecation |
Mortgage relates to immoveable property |
There is only obligation to repay the money
and no transfer of interest |
There is transfer of interest. |
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