Andrew Butler secures win for disability couple

Judge rules that all moneys charge does not extend to assigned debts.

Andrew Butler recently secured a notable victory for a couple threatened with eviction from their Oxfordshire home.

The couple took a 15-year loan from A Ltd in 2004. The loan was secured by an all moneys charge on their property – albeit that the charge was expressed to be in favour not of the lender (A Ltd), but of a company associated with it (B Ltd), and to secure sums owed to B Ltd. A year after entering the loan, the husband suffered a serious motorcycle accident leaving him severely disabled and incapable of work. Instalments were paid for a few years by a payment protection plan but that lapsed, leaving the couple unable to meet their instalments.

A Ltd issued possession proceedings. When the problem of the misnomer in the charge came to light, A Ltd assigned the debt to B Ltd and both parties made a joint application for B Ltd to be substituted as Claimant. The intention was that the debt, as well as the security, would then be vested in B Ltd. Following substitution, B Ltd made an application for summary judgment.

Relying on a line of Australian authority, and the English case of ING v Harwood [2008] Bus LR 762, Andrew argued on the couple’s behalf that an all moneys charge was not effective to secure debts which did not arise from mutual dealings between the mortgagor and mortgagee, but which had only become vested in the mortgagee by assignment from a third party. The Judge in the Oxford County Court acceded to this argument, holding that, far from B Ltd being entitled to summary judgment, it was B Ltd’s own claim which should be summarily dismissed.

Judgment was duly entered for the couple, together with an order for costs. It was not necessary, in those circumstances, for the Court to embark on an investigation of the substantive merits concerning the extent of the couple’s payment protection insurance.

Andrew Butler was instructed by Shelter, initially via the Bar Pro Bono Unit.