|Neutral Citation:  NIMaster 11||Ref: 2016NIMASTER11|
|Judgment: approved by the Court for handing down
(subject to editorial corrections)
2009 No 29922/05
"Moreover in the present case had the court been made aware last year when the possession order was made the total negative equity pertained for the plaintiff the making of the order might not have been considered proper in accordance with Schedule 7 of the Land Registration Act (Northern Ireland) 1970 which confers a discretion on the court whether to grant a chargee an order for possession of land and imposes a duty on the court not to do so unless it is satisfied that such a course would be proper".
"I do not think a court should be asked to make an order for possession of a persons property let alone her home in favour of a plaintiff lender not for the purpose of releasing or protecting its security but apparently to hold as a threat eviction over her so as to coerce her into payment or punish her for her default".
"Sufficient to say that if there were such a mortgage condition permitting a lender to take possession (in the event that equity is non-existent) for such purpose I believe it would be void whether as being unconscionable useable close to a penalty in terrorem or under the unfair terms in the Consumer Contracts Regulations 1991".
"Given the inevitable uncertainty as to the movement of property values over the next few years and the reserve with which the court should approach estate agents estimates of sale prices … no one could be sanguine about the adequacy, now or continuing over that period, of the property as security for the mortgage debt and arrears."
"Where there has already been a considerable delay in realising a sale of a property and or the likely sale proceeds are unlikely to cope with the mortgage debt and arrears or there is not sufficient evidence as to sale value the normal order would be for immediate possession".
"The registered owner of a charge may apply to the court for possession of the registered land the subject of the charge or any part of that land and (a) on such an application the court may subject to sub-paragraph 3 order possession of the land or that part thereof to be delivered to him and (b) upon so obtaining possession of the land or as the case may be that part thereof he shall be deemed to be a mortgagee in possession.
Paragraph 5(3) then states the power conferred on the court by sub-paragraph 2 shall not be exercised (a) except where payment of the principal sum of money secured by the deed of charge has become due and the court thinks it is "proper" to exercise the power or (b) unless the court is satisfied that, although payment of the principal sum has not become due, there are urgent and special reasons for exercising the power".
"Thus under paragraph 5(2)(a) the court has a discretion rather than a duty to make an order for possession and paragraph 5(3)(b) makes it clear that only in the most exceptional cases will a chargee be given possession where the chargor has not been guilty of any default. The court's power to refuse possession under paragraph 5(2) and its duty to do so under paragraph 5(3) are clearly potentially more favourable to chargors than the jurisdiction conferred in respect of mortgages of dwelling-houses by the Administration of Justice Acts 1970 and 1973. Therefore although the relevant provisions of the latter Acts apply also to charges on registered dwelling-houses it would seem that the application serves only to indicate particular circumstances in which it would not be proper within the meaning of paragraph 5(3)(a) of Schedule 7 Part 1 of the Land Registration Act to make an Order for possession".
"For the avoidance of doubt I should confirm that we are dealing here with unregistered land so the provisions of the Land Registration Act (Northern Ireland) 1970 Schedule 7 thereof do not apply. All the same it would scarcely be ideal if the court's discretion regarding registered land in this jurisdiction were to differ to a marked extent from its discretion regarding unregistered land".
"Without prejudice to any other powers exercisable by it a court acting on equitable grounds may stay any proceedings or the execution of any of its process subject to such conditions as it thinks fit".
"It seems to me that particularly in the context of a repossession action for a dwelling-house where the right to family life of a party may come into effect that the discretion under Section 86 of the 1978 Act should not be confined solely to instances where it would be unconscionable not to do otherwise. As Lowry LCJ said in McAuley:-
"It could be exercised to enforce a legal or equitable right that would include in an appropriate case staying possession while a mortgagor exercised a right at law against the mortgagee or pursued proceedings that would allow the mortgagor the pay the sums due under the mortgage". But in the context of the basic principle respected by Parliament in the Financial Servicing Markets Act, that a mortgagee is entitled to possession of the property when the mortgagor is in default. It seems to me that the exercise of such a discretion outside Section 36 would only be in rare and compelling circumstances as Lord Bingham said in Reichold. Given that it is an exercise of discretion it would be unwise to hypothesise in advance in any rigid way on the circumstances which would cause the discretion to be exercised. One might however consider that one such circumstance might be where the mortgagor had a clear and strong case against either the mortgagee or perhaps a third party which made it likely that the mortgagor would recover compensation greater in extent than the sums due to the mortgagee and that compensation would be forthcoming in a reasonable period of time to address the arrears. In saying that one ends up being very close to the statutory power given under Section 36 of the Administration of Justice Act 1972 to adjourn proceedings or to stay or suspend any judgment execution or postpone the date for delivery if it appears to the court that in the event of its exercising the power to do so the mortgagor is likely to be within a reasonable period to pay any sums due under the mortgage".
"In the absence of any clear and authoratitive guidance from the Strasbourg Court to the contrary we would take the view that, although it may well be that Article 8 is engaged when a judge makes an order for possession of a tenant's home at the suit of a private sector landlord it is not open to the tenant to contend that Article 8 could justify a different order from that which is mandated by the contractual relationship between the parties at least where, `as here' there are legislative provisions which the democratically elected legislature has decided properly balance the competing interests of private sector landlords and residential tenants".
"To hold otherwise would involve the convention effectively being directly enforceable as between private citizens so as to alter their contractual rights and obligations whereas the purpose of the convention is as we have mentioned to protect citizens from having their rights infringed by the state. To hold otherwise would also mean that the convention could be invoked to interfere with the A1 P1 rights of the landlord and in a way which was unpredictable. Indeed if Article 8 permitted the court to postpone the execution of an order for possession for a significant period of time it could well result in financial loss without compensation for instance if the landlord had wished or indeed needed to sell the property with vacant possession (which notoriously commands a higher price than if the property is occupied).
"Of course there are many cases where the court can be required to balance conflicting convention rights of two parties for example, where a person is seeking to rely on her Article 8 rights to restrain a newspaper from publishing an article which breaches her privacy, and where the newspaper relies on Article 10 but such disputes arise not from contractual arrangements between two private parties but from tortious or quasi tortious relationships where the legislature has expressly, impliedly or through an action left it to the courts to carry out the balancing exercise. It is in sharp contrast to the present case where the parties are in a contractual relationship in respect of which the legislature has prescribed how respective convention rights are to be respected".