Doctrine of marshalling

A principle for doing equity between two or more creditors, each of whom are owed debts by the same debtor, but one of whom can enforce his claim against more than one security or fund and the other can resort to only one. It gives the latter an equity to require that the first creditor satisfy himself (or be treated as having satisfied himself) so far as possible out of the security or fund to which the latter has no claim.

-The doctrine of marshaling is an old equitable remedy that can be traced back as. It was described by Lord Hoffmann as: A principle for doing equity between two or more creditors, each of whom are owed debts by the same debtor, but one of whom can enforce his claim against more than one security or fund and the other can resort to only one. It gives the latter an equity to require that the first creditor satisfy himself (or be treated as having satisfied himself) so far as possible out of the security or fund to which the latter has no claim. A claim for marshalling will not be allowed by the courts where it would be unjust or unfair to allow the junior creditor to marshal, and therefore: -It cannot interfere or prejudice the position of the senior creditor. -It cannot prejudice third parties. -It must be brought in a fair and timely fashion

**DOCTRINE OF MARSHALLING** The doctrine of marshalling states If the owner of two or more properties mortgages them to one person and then mortgages one or more of the properties to another person The subsequent mortgagee is in the absence of contract to the contrary,entitled to have the prior mortgage debt satisfied out of the property or properties not mortgaged to him, so far as the same will extend but no so as to prejudice the right of the prior mortgagee. this is known as the doctrine of marshalling. Thanks