Doctrine of Contribution
Introduction
In the modern time mortgage is not just a way of securing money but rather it becomes a way of our of the financial loss. In India many people mortgage their property to get money , due to several reasons. But there are certain difficulty arises which are provided under transfer of property act . One of such difficulty is the contribution. Where two or more persons having interest in one property and such property is subject to mortgage then the question arises that who and how much the person interested in the property will contribute to ward such mortgage.
Such questions has been dealt by the Transfer of property act . Section 82 of the provide for the doctrine of contribution .
Meanings
Doctrine of contribution has been provided under under section 82 of the Transfer of property act , Which says that where a property subject to mortgage belongs to two or more persons having different interests and distinctive ownership right , then who and how much they shall contribute towards the mortgage. Doctrine contribution generally provide for rule and procedure to calculate the rate at which the owners shall contribute towards the Mortgage.
Contribution to mortgage debt where property belongs to two or more persons.
Doctrine of contribution provided for the two rule to determine the rate at which the owners will contribute which are are as follows
Firstly, according to share in the property, it says that the owners will contribute according to the share in the property.
Illustration
1. A and B both are the owners of property having equal amount of share the property, then both will contribute equally to the mortgage debt i.e.,1/2 and 1/2.
2. Where A having 75 percent of interest in the property and B having 25 percent of interest in the property, then A and B will contribute according to their share i e., 3/4 and 1/4 .
Secondly, according to part of ownership,which means that will contribute according to how much of part they own in the property and its value.
Illustration
1. Where A having 50 percent part ownership and B having ownership over the rest of of 50 percent . Then they will contribute equally towards the mortgage.
2. Where A having 70 percent part of ownership and B having rest of the part ownership, then they will contribute according to the values of the property.
Contribution to mortgage debt where two different properties belong to same person
Section 82 of the Transfer of property act deal with another case relating to Mortgage debt , where two properties which are subject to mortgage are belongs to same person.
Where a property is Mortgage or secure a debt and then both properties are mortgage to secure another debt . Then former debt is to be paid out from the former property and leter debt is to be paid out from both the property after excluding the former debt from the former property.
Illustration
Where A having property X and Y , A mortgage the property A to secure a debt later on A mortgage both the property X and Y to secure another debt .
Then former debt will be paid out only from the property A and the later debt will be paid out from the both property i.e., X and Y after excluding the debt to be paid to from property X.
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