(1) This section applies only in circumstances where:(a) a claim for compensation is made as a result of the registration of a mortgage and the execution of the mortgage involved, in the opinion of the Registrar-General, fraud against a registered proprietor of the mortgaged land, and(b) a person would be entitled to compensation under this Part for deprivation of the mortgaged land as a consequence of fraud if the position of that person is not otherwise rectified, and(c) as a result of the registration of the mortgage, the mortgagee is entitled to exercise a power of sale in respect of the land mortgaged.
(2) Section 129A does not apply in the circumstances in which this section applies.
(3) The total compensation that is payable to a mortgagee is limited to the market value of the land at the date on which compensation is awarded to the mortgagee less the amount secured by any other mortgage affecting the same land (including a mortgage that is registered as a result of fraud) that has, or would have had, more priority.
(4) Subsections (5) and (6):(a) apply to limit the interest and costs components of a claim, and(b) apply despite anything to the contrary in the mortgage (including any associated document).
(5) The rate of interest to be applied in calculating the interest component of a claim on any particular day must not exceed:(a) if the interest rate specified in the mortgage is no greater than the official cash rate applicable on that day plus 2%--the interest rate specified in the mortgage, or(b) if the interest rate specified in the mortgage is greater than the official cash rate applicable on that day plus 2%--the official cash rate plus 2%.
(6) The costs component (being the costs incurred by the mortgagee in relation to the mortgage) of a claim is limited to the reasonable costs incurred by the mortgagee in directly protecting the mortgagee's interest in respect of the land mortgaged.
(7) In this section,
"official cash rate" means the official cash rate specified by the Reserve Bank of Australia.