119. Mortgagee may be affected by a wrong committed by another.

A mortgagor whose suretyship was procured by the undue influence, misrepresentation or other legal wrong of the debtor can set aside the mortgage if either the debtor was acting as the mortgagee's agent1 or the mortgagee had actual or constructive notice of the conduct of the debtor which vitiated the surety's consent2. The burden of proving that the mortgagee had actual or constructive notice that the surety's consent was improperly obtained is on the surety3. If the mortgagee knows of certain facts which put him on inquiry as to the fact that the surety's concurrence may have been procured

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