Queensland Consolidated Acts

PROPERTY LAW ACT 1974 - SECT 85

85 Duty of mortgagee or receiver as to sale price

(1) It is the duty of a mortgagee, including as attorney for the mortgagor, or a receiver acting under a power delegated to the receiver by a mortgagee, in the exercise of a power of sale conferred by the instrument of mortgage or by this or any other Act, to take reasonable care to ensure that the property is sold at the market value.

(1A) Also, if the mortgage is a prescribed mortgage, the duty imposed by subsection (1) includes that a mortgagee or receiver must, unless the mortgagee or receiver has a reasonable excuse—

(a) adequately advertise the sale; and

(b) obtain reliable evidence of the property’s value; and

(c) maintain the property, including by undertaking any reasonable repairs; and

(d) sell the property by auction, unless it is appropriate to sell it in another way; and

(e) do anything else prescribed under a regulation.

Penalty—

Maximum penalty—

(a) if the contravention of duty relates only to paragraph (e) —20 penalty units; or

(b) otherwise—200 penalty units.

(2) Within 28 days from completion of the sale, the mortgagee shall give to the mortgagor notice in the approved form.

(3) The title of the purchaser is not impeachable on the ground that the mortgagee or receiver has committed a breach of any duty imposed by this section, but a person damnified by the breach of duty has a remedy in damages against the mortgagee exercising the power of sale.

(4) A mortgagee who, without reasonable excuse, fails to comply with subsection (2) commits an offence.

Penalty—

Maximum penalty—2 penalty units.

(5) An agreement or stipulation is void to the extent that it purports to relieve, or might have the effect of relieving, a mortgagee or receiver from the duty imposed by this section.

(6) Nothing in this section affects the operation of any rule of law relating to the duty of the mortgagee to account to the mortgagor.

(7) Nothing in sections 83 (1) (a) , 89 (3) and 92 (2) affects the duty imposed by this section.

(8) Nothing in this section affects the operation of a law of the Commonwealth, including, for example, the Corporations Act, section 420A .

(9) This section applies to mortgages whether made before or after the commencement of this Act but only in relation to the exercise of a power of sale if—

(a) the exercise of the power arises upon or in consequence of a default, mentioned in section 84 (1) , that happens after the commencement of this Act; or

(b) the power is being exercised under section 84A (4) .

(10) In this section—

"prescribed mortgage" means a mortgage of a kind prescribed under a regulation.