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Land Transfer Act 2017

Dealings in estates and interests in land - Flat and office owning companies

130: Restriction on disposal of licence or shares if licence subject to mortgage

You could also call this:

"Selling a licence with a mortgage: what you need to know"

Illustration for Land Transfer Act 2017

You have a licence that is subject to a mortgage. If you want to sell the licence, you do not need the mortgagee's consent. The mortgagee's consent is also not needed if the company cancels the licence and gives a new one to the person buying the interest. You cannot transfer shares related to a mortgaged licence without the mortgagee's consent. The consent must be written on the transfer document. Alternatively, you can ask the company to present a request to the Registrar as per section 134. If you do not follow these rules, any transfer of shares or new licence will not be valid. This means the transfer or new licence will have no effect if the mortgagee's consent is not given or the request is not made.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6731304.

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129: Rights of mortgagee of registered licence, or

"What rights do mortgagees have for registered licences?"

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131: Restrictions on cancellation, etc, of licence subject to registered mortgage, or

"Rules for cancelling a licence when there's a mortgage"

Part 3Dealings in estates and interests in land
Flat and office owning companies

130Restriction on disposal of licence or shares if licence subject to mortgage

  1. If a licence is subject to a registered mortgage,—

  2. the consent of the mortgagee is not required to the sale or other disposal of the licence; and
    1. the consent of the mortgagee is not required where the company cancels, revokes, rescinds, or accepts a surrender of the licence and issues, in its place, a new licence in the name of the person acquiring the interest of the licensee and that person requests the Registrar to register the mortgage against the new licence under section 134.

      1. Neither the company nor any director or officer of the company may register a transfer or other disposition of the shares to which a licence that is subject to a registered mortgage relates unless—

      2. the consent of the mortgagee has been endorsed on or attached to the instrument of transfer or other disposition; or
        1. the request referred to in subsection (1)(b) has been deposited with the company for presentation to the Registrar.

          1. None of the following has any force or effect if the requirements of this section are not complied with:

          2. a transfer or other disposition of any shares to which a licence relates:
            1. a new licence issued in place of a licence that has been cancelled, revoked, rescinded, or surrendered, if the request referred to in subsection (1)(b) is not made.

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