(1) When a registered mortgage is discharged, the Registrar of Ships shall, on production of the mortgage, with a receipt for the mortgage money or other release endorsed thereon and duly signed and attested, make an entry in the register book to the effect that the mortgage has been discharged.
(2) When the entry referred to in subsection (1) has been made, the estate, if it has passed to the mortgagee, shall vest in the person in whom it would have vested if the mortgage had not been made, having regard to intervening acts and circumstances, if any.