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Cuckmere Brick Co v Mutual Finance [1971]

Facts

  • A mortgagee took possession of land which had recently acquired planning permission for 100 flats and 35 houses
  • The mortgagee sold the land, with reference to the planning permission for the 35 houses, but not the 100 flats

Issue

  • Was the mortgagee liable to the mortgagor?

Decision

  • Yes

Reasoning

  • A mortgagee is under a duty to take reasonable care to obtain the true market value of land
  • This duty was breach where the mortgagee failed to make reference to the (very valuable) planning permission for 100 flats
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