Receivers Appointed under an Agreement
There are two drawbacks to relying on the Law of Property Act 1925:-
1. The mortgagees power to appoint a receiver is restricted
2. The powers of receiver once appointed are limited to collecting rents.
A mortgage deed, however, commonly gives the receiver the additional power to take possession and sell the property, and to borrow money to carry out his statutory duties - mainly to insure and repair.
The deed may give the receiver extensive powers to manage the company's business, however trading on may prove difficult in practice as the receiver only has access to the charged assets and would be a trespasser if, for example, he used stock not covered by his appointors charges.
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