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Case name Neutral citation Legal points Case summary Facts Held Comment Landmark Mortgages Limited v Bamrah [2017] EWHC 20141 (QB) [2017] EWHC 2041 (QB) Money judgment - calculation of account – evidence – s 36 A trial judge had been wrong to conclude that a lender had made concessions about 3 x cheque payments to a mortgage account, and consequently wrong to discount the lender’s calculation of the account from £355,000 to £200,000. In 2003 Mr remortgaged property in his sole name to Northern Rock for £200,000. Following his death (being an event of default), L as successor to Northern Rock brought proceedings for possession and a money judgment. Mrs sought to defend the claim on the basis that she had an overriding interest, which the trial judge dismissed. However, the trial judge heavily discounted L’s claim for a money judgment from £355,000 to £200,000 because she rejected the reliability of L’s evidence as to the account. L appealed. The trial judge fell into error by concluding that L had conceded that 3 x cheque payments had been credited to the mortgage account but had not been recorded and that she was therefore entitled to disregard as inaccurate L’s calculation of the balance of account. On analysis, L’s evidence did not contain a concession, and in fact none of the cheques relied on named Northern Rock as payee. The appeal would accordingly be allowed. Although the judge had made a suspended order for possession under s 36 Administration of Justice Act 1970 allowing Mrs time to pay £200,000, the court was not satisfied on the evidence that she could pay £355,000 or even £200,000 within a reasonable time. The court would therefore make an order for possession. What is remarkable about this case, is not that the judge made a finding of fact about a concession which was not in fact made, and which at best only involved three disputed payments totalling £1,500, but that the judge felt able to rely upon this as a sufficient discrepancy on the accuracy of the lender’s accounts in order to discount the claim from £355,000 to £200,000. Rather surprisingly, the transcript makes no comment about this, although it would, invariably, have amounted to a separate, and possibly more compelling, ground of appeal. The case also reflects a fairly relaxed approach to s 36. The trial judge appears to have given L more than 3 months to pay £200,000 although it is not clear what evidence she relied on (self-evidently, there was insufficient evidence by the time the matter was heard on appeal). Although the appeal judge refused to exercise his powers under s 36 and ordered Mrs to give vacant possession, he then invited L to ‘agree a relatively generous date by which such order will come into effect which may be incorporated in the order of this Court’. There is of course no such generous discretion. Unless the claim for possession is genuinely disputed on grounds which appear to be substantial, in which case the court will usually give case management directions (CPR 55.8(2)), or the court exercises its powers under s 36, or the lender consents, the court has no inherent jurisdiction to delay an order for possession. The practice of making an order for possession in 28 days, which has become the ‘usual’ order, was recognised in Birmingham Citizens Permanent Building Society v Caunt [1962] 1 Ch 883 as being the product of the standard forms of order then in use. Note that the usual restrictions on the discretion of the court in making possession orders in housing cases in s 89 Housing Act 1980 (14 days to six weeks in cases of exceptional hardship) do not apply in an action by a mortgagee for possession (s 89(2)(a)).
Case name Neutral citation Legal points Case summary Facts Held Comment Conte v National Westminster Bank Plc (Unrep) First Tier Tribunal (Judge Brilliant) 15 Aug 2017 Registered charge – forgery – non est factum – misrepresentation/undue influence – alteration of register The First Tier Tribunal directed the cancellation of an application to alter the register to remove a charge based on forgery, non est factum or undue influence. In 2005 the bank obtained a registered charge over residential property owned by C as security for a loan facility to C’s company which C guaranteed. In 2015, C applied to Land Registry for alteration of the register under Para 5, Sched 4, Land Registration Act 2002 to remove the charge on the basis (1) that he did not sign it (forgery); alternatively (2) he did, but there was a radical difference between what he signed and what he thought he was signing (non est factum); and/or (3) he was tricked into signing it (misrepresentation/undue influence). The Tribunal clarified: • That if C succeeds on (1) or (2), the charge is void, and the register can be altered to correct a mistake. • That if C succeeds on (3), the charge is voidable and remains valid until such time as it is set aside (NRAM Ltd v Evans [2017] EWCA Civ 1013) so that there are at present no grounds for altering the register. The Tribunal gave C permission to treat his application as if it were made directly to the Tribunal under s 108(2) LRA 2002 (Tribunal may make any order which the High Court could make for the setting aside of a document which effects a qualifying disposition). But if the Tribunal sets aside the charge, C will have to make a further application to bring the register up to date • The Tribunal should only determine the issues which go to the merits of the dispute referred for determination and should not determine the merits of other disputes (Inhenagwa v Onyencho [2017] EWHC 1971 (Ch) 62)) As to (1) the forgery issue, the Tribunal accepted the evidence of a solicitor who attended on the completion of the charge and gave C advice about it, and which was supported by expert handwriting evidence that there was ‘very strong support’ for the view that C signed the charge. Given that C had been advised about the charge, the plea of non est factum in (2) failed. As to (3), there was no evidence of any misrepresentation or undue influence. Even if there had, the bank was not on constructive notice of any wrongdoing. The case was far removed from Barclays Bank Plc v O’Brien [1994] 1 AC 180 and Royal Bank of Scotland Plc v Etridge [No.2] [2010] AC 773. The Tribunal directed the registrar to cancel the application with an indication that costs should follow the event. We don’t often get forgery/non est factum/undue influence cases involving bank lending anymore (particularly in the same case), because the scope to run them has largely been closed down following O’Brien and Etridge. In this case, the applicant was always going to be up against it in attempting to recall events more than ten years earlier, against a solicitor witness who the Tribunal described as ‘impressive’ and who had the benefit of contemporaneous file and attendance notes. Interestingly, the Tribunal also rejected what it called an ‘alibi defence’ – that C was somewhere else at the time the charge was signed.
Publications On 29 August 2017 the Law Society published its Consultation Response to the Civil Procedure Rule Committee’s Consultation on proposals to clarify the process for enforcing suspended possession orders following the Court of Appeal’s judgment in Cardiff County Council v Lee (Flowers) [2016] EWCA Civ 1034 The Society’s response argues that a permission stage in enforcement provides a useful safeguard to often vulnerable defendants and must therefore apply to all suspended orders. However, judicial scrutiny must be careful not to discourage claimants agreeing to suspended orders in the first instance. The response therefore also recommends simplifying the process to issue a warrant and suggests that permission could be decided on the papers, rather than requiring a full hearing. On 30 August 2017 the Civil Justice Council published its Consultation Response to the CPRC Consultation. The CJC is supportive of the view reached by the majority of the CPRC that a distinction should be drawn between those cases where the order was suspended on condition of payment of monies, and those where a suspension is for some other reason (for eg. in landlord and tenant cases, to deal with anti-social behaviour). It acknowledges that the breach of a condition as to payment of money can be evidenced more easily than the breach of some other condition, and a form of request attaching a schedule of payments and verified by a statement of truth should suffice. In general, the CJC agreed that the rules for issue of warrants in the County Court and writs in the High Court should be aligned.