Consents – mortgagee

This article explains which instruments require mortgagee/encumbrancee consents, as well as why consents are required.

Why are consents required?

In various legislation, there is a legal requirement for the consent of the mortgagee/ chargeholder/caveator etc to the registration of instruments. LINZ is required to ensure compliance with these legal requirements.

Consents are required to ensure that an existing interest holder (eg mortgagee, chargeholder or caveator etc):

  • is aware of any transaction that may affect their interest
  • is not disadvantaged by a transaction (eg variation of mortgage increasing the priority amount of a prior mortgage) without their knowledge and consent, and
  • has agreed to any change to the title that may affect their interest (eg creation or surrender of an easement).

Certifications

The practitioner certifying and signing an instrument must ensure they hold the appropriate consent (if applicable). Before they complete a certification, they must ascertain if a consent is required and ensure the consent has been received.

If a lodged instrument does not display the certification but the consent is required as listed in one of the tables below, the consent should be attached as an image to the instrument.

Which instruments require mortgagee/encumbrancee consents?

The following instruments require mortgagee/encumbrancee consents as specified in the stated statutory provision:

TypeInstrument descriptionStatutory provision
AP17Application for Record of Title ss155, 172, or 204 LTA 2017 Section 172(5) and (8)
C132Cancellation/Revocation/Rescission of Licence to OccupySections 131(2) and 132(1)
EGrant of Easement Without TransferSection 109(3)
EIEasement InstrumentSection 109(3)
HCECHousing Corporation Easement CertificateSection 26(2)(a) Housing Act 1955 - applies only if there is a pipeline easement
LLeaseSection 91(4)
MPMemorandum of PrioritySection 102(6)
OLLicence to OccupySections 124(1) and 91(4)
PDPLPartial Surrender of Deferred Payment LicenceSection 127(1) Land Act 1948
PPProfit à PrendreSection 109(3)
PSEPartial Surrender of EasementSection 109(4)
PSLPartial Surrender of LeaseSection 94(4)
SDPLSurrender of Deferred Payment LicenceSection 127(1) Land Act 1948
SESurrender of Easement without TransferSection 109(4)
SLSurrender of Lease/LicenceSection 94(4)
SOLSurrender of Licence to OccupySections 130 and 131
SPPSurrender of Profit à PrendreSection 109(4)
TETransfer and Grant of EasementSection 109(3)
TSETransfer and Surrender of EasementSection 109(3)
UAPPApplication for Deposit of Unit Title PlanSection 32(1)(d) Unit Titles Act 2010
VEVariation of EasementSection 112(4)
VENCVariation of EncumbranceSection 101(4) and (6)
VFLVariation of Licence under Crown Forest Assets Act 1989Section 31 Crown Forest Assets Act 1989 - optional but not binding if mortgagee hasn’t consented
VLVariation of LeaseSection 93
VMVariation of MortgageSection 101
VPPVariation of Profit à PrendreSection 112(4)

*Statutory provisions relate to the Land Transfer Act 2017 unless specified otherwise

Notes:

  1. AP17 can be used for an Application to Record of Title under sections 155, 172 or 204 Land Transfer Act 2017. The mortgagee consent requirement applies only to applications made under section 172 and 204 (if applicable).
  2. EI (Easement Instrument) can be used to create easements and profits à prendre.
  3. If a plan of subdivision has a lot to vest, before the plan can be deposited and the lot vested, the consent of the mortgagee is required (sections 224b)(ii), 238 and 239 Resource Management Act 1991) unless the mortgage is discharged as to the lot to vest.
  4. A Transfer of a Licence to Occupy, requires the consent of the mortgagees of the Licence to Occupy - sec 130(2) Land Transfer Act 2017.
  5. A discharge of the head mortgage or a transfer for the purpose of exercising a power of sale under the head mortgage cannot be registered if it is subject to a submortgage – sections 104(4) and 103(3) Land Transfer Act 2017.
  6. A Forest Sink Covenant (COV), a Variation of forest sink covenant (VCOV) and a Cancellation/Revocation of a forest sink covenant (RCOV) requires the consent of the mortgagee - Sec 67ZA Forests Act 1949.

Variation of mortgage / memorandum of priority

For a Mortgage variation instrument, the following consents must be obtained:

  • consent of a subsequent mortgagee (unless the variation only reduces the amount secured or the stated priority limit or the rate of interest) - see s101(4) LTA 2017; and
  • consent of a submortgagee – see s101(6) LTA 2017.

For a Mortgage priority instrument (memorandum of priority):

  • authority must be obtained from all mortgagees whose priority is affected by registration of the instrument (including those gaining priority); and
  • consent of a submortgagee must be obtained (where the head mortgagee is losing priority)  - see s102(6) LTA 2017.
Last Updated: 24 June 2019