256. Sub-mortgagee takes subject to outstanding equities.

256.     Sub-mortgagee takes subject to outstanding equities.

As the sub-mortgagee is in the position of a transferee of the mortgage, he takes, like any other transferee, subject to the accounts between the mortgagor and the mortgagee at the date of the sub-mortgage1, and he will be affected by dealings between the mortgagor and mortgagee until the mortgagor has had notice of the sub-mortgage2. The mortgagor's receipt for the mortgage money, incorporated in the mortgage or indorsed on it, is, however, usually conclusive in favour of the sub-mortgagee that the original mortgage money was in fact