Under a deed of assignment over shares as security, which statement about default is true?

• A. I only
• B. II only
• C. Neither
• D. Both

Answer: (B)

When a deed of assignment over shares is used as security, the essential idea is that the secured party gains a right to realize the value of the security if the debtor defaults. The key enforcement action is to realize the security—typically by selling the shares or appointing a receiver to manage and dispose of them—and use the proceeds to satisfy the outstanding debt. This is the practical remedy that the deed contemplates: the secured party can convert the security into cash to recover what is owed, subject to any legal and procedural steps, such as notice or consent requirements.

If the statement describes the secured party’s power to realize the security by selling the shares (or to appoint someone to realize the value) on default, that is the true, enforceable remedy under a deed of assignment over shares. The other claims—such as an automatic transfer of legal title to the secured party upon default, or other remedies that don’t align with how a security deed typically operates—do not fit the usual structure of this arrangement. In short, the enforcement mechanism that focuses on sale/realization of the shares upon default is the correct concept here.