Bankruptcy or assignment of lessee
173 Bankruptcy or assignment of lessee
In any case where the registered proprietor of a lease has heretofore, or shall hereafter, become bankrupt, or has heretofore made or shall hereafter make, a statutory assignment—
If lease not subject to mortgage or encumbrance if the lease is not mortgaged or encumbered under this Act, the
Registrar‑General must, on the application in writing of the lessor (being a lessor in possession of a statement, signed by the
Official Receiver, or by the trustee under the bankruptcy or assignment, certifying his or her refusal to accept the lease), make a record in the Register Book of the refusal, and the record will then operate as a surrender of the lease;
Mortgagee or encumbrancee of the leasehold interest of a bankrupt or assignor may be entered as transferee of a lease if such lease be mortgaged or encumbered, the Registrar-General shall, upon the application in writing of any mortgagee or encumbrancee, accompanied by a statement in writing signed by the Official
Receiver, or the trustee under such bankruptcy or assignment, certifying his refusal to accept such lease, or by proof that the
Official Receiver or trustee has neglected or refused to certify such refusal or to become registered as proprietor of such lease within one month after being thereunto required by notice in writing given to him by the mortgagee or encumbrancee, enter in the Register Book a
note of such refusal or neglect, and such entry shall operate as a foreclosure, and the estate or interest of the bankrupt or assignor in such lease shall thereupon vest in such mortgagee or encumbrancee, free from all other charges subsequent to his mortgage or encumbrance, and such mortgagee or encumbrancee shall thereupon be deemed to be the registered proprietor of such estate or interest, and shall, while he remains such registered proprietor, be subject to and liable for the same requirements and liabilities to which he would have been subject and liable if named in the lease originally as lessee;
Protection to subsequent mortgagees and encumbrancees no such entry shall be made unless it be proved to the satisfaction of the Registrar-General that the applicant mortgagee, or encumbrancee, has given fourteen days' notice in writing of his intended application to every subsequent mortgagee or encumbrancee of the lease, or has obtained his written consent; and any such subsequent mortgagee or encumbrancee shall be entitled to pay to the applicant mortgagee or encumbrancee the amount due to him under his mortgage or encumbrance, with costs, at any time before foreclosure, and shall thereupon be entitled to a transfer from him of such mortgage or encumbrance;
Where
Official Receiver, trustee, and mortgagee neglect to become proprietors if the Official Receiver or the trustee under the bankruptcy or assignment shall certify his refusal to accept the lease, or shall neglect or refuse to become registered as proprietor of the lease, within, one month after having been thereunto required by notice in writing given to him by the lessor, and the mortgagees or encumbrancees (if any) of the lease shall neglect or refuse to have an entry operating as a foreclosure made in the Register Book under the provision in that behalf hereinbefore contained within the period of two months after having been thereunto required by notice in writing given to them by the lessor, the Registrar-General shall, upon the application in writing of the lessor, and, upon proof of such certificate or such neglect or refusal as aforesaid, enter in the Register Book a note of such neglect or refusal, and every such entry shall operate as a surrender of such lease.
A lessor, mortgagee or encumbrancee must retain a copy of any document used for the purpose of fulfilling his or her obligations under subsection (1) for the period prescribed by the regulations.
Maximum penalty: $10 000 or imprisonment for 2 years.
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