Property repossessed and sold — Plaintiff alleging sale at undervalue — Plaintiff alleging that defendant bank wrongly employing two estate agents instead of one — Loss of personal effects — Agents arranging for house clearance after plaintiff’s failure to collect effects — Judgment for bank
The defendant bank lent money to the plaintiff, by way of a second charge, on 133 Higgins Lane, Quinton, Birmingham. The bank brought proceedings against the plaintiff and secured judgment in those proceedings in 1992. To satisfy that judgment, it then sold the property for £39,000 in January 1994.
The plaintiff alleged that the sale of the property had been undervalued so that the bank had acted unreasonably in not securing a fair price. He also contended that the fees and costs paid to the estate agents were unjustified; two estate agents had been instructed to act jointly. He also claimed in relation to loss of his personal effects as a result of the house being cleared; the charge for clearing the property was the value of the items cleared. In the plaintiff’s view the property should have been sold at £57,000.
Held Judgment for the bank.
1. It was acknowledged on all sides that the bank was faced with a difficult housing market when it put the property up for sale. The property had not been occupied full time by the plaintiff. The bank had acted wholly reasonably and justifiably in trying to market the property at a higher price and had originally asked for £45,000. It then sought another valuation which made it clear that £40,000 was a realistic price in view of the fact that the property needed upgrading.
2. In light of that evidence, and the fact that the plaintiff had produced no evidence before the court to justify his contention that the figure should have been £57,000, the bank did not err in disposing of the property at £39,000. In fact, to have turned down an offer of £39,000 would have been folly.
3. With regard to the criticism of the bank for employing two estate agents at a fee of 1.5% each, and that it was unreasonable in requiring commission to be paid in that way, joint agencies were by no means an unusual arrangement for property sales.
4. Clearly the bank, having responsibility for the sale of the property, acted sensibly in ensuring that two estate agents were involved rather than one. Further evidence showed that one estate agent would have charged 2.5%, so the bank, while securing the advantage of two estate agents, had not incurred any particular extra costs except for those relating to photocopying, printing, etc.
5. The plaintiff had lost personal records, etc, which were of irreplaceable value to him. However, the court could not deal with emotion, but had to look at the evidence. That evidence showed that there had been extensive correspondence in which the bank had sought an arrangement for the plaintiff to repay his loan to them. They had also asked him, once the property had been repossessed, to remove the contents and despite the plaintiff’s contentions to the contrary, the court found that he had had due notice of the intention to clear the property prior to putting it on the market.
6. The agents found a firm to clear the property whereby the contents would be accepted in lieu of a charge, so there was no resulting gain to the plaintiff.
7. The court did not find that the bank had acted unreasonably to clear the property in order to offer it on the market.
The plaintiff appeared in person; Donald McCue (instructed by Moon Beever, London agents for J Keith Park & Co, of Liverpool) appeared on behalf of the bank.
