Appellant mortgagor in arrears – Judge granting respondent order for possession – Whether judge failing to properly exercise statutory discretion to extend time or vary terms of payment – Appeal dismissed
The appellant purchased Brookfield House in 1961 and proposed to develop it with a view to selling at an enhanced value. The appellant set up Brookfield House Ltd as the vehicle to develop the property. In September 1989 the respondent lent £1,600,000 to Brookfield House Ltd secured by a mortgage on the property. The term of the loan was 20 years. Following difficulties with the redevelopment of the property, the company was unable to sell Brookfield House. In July 1995 the respondent commenced possession proceedings against that were compromised by a consent order in March 1996, to enable Brookfield House to be marketed by joint agents. In addition, the appellant also agreed to make monthly payments to the respondent of £12,844.75 until either completion of the sale or the date upon which either party applied to the court for the actions to be relisted, whichever occurred earlier. Brookfield House was not sold. The actions were relisted for hearing on 11 March 1997. On that date, the mortgage action was compromised on terms that the appellant delivered to the first plaintiff possession of the property within 28 days. The order was not to be enforced however, while the appellant paid the respondent the specified monthly sums. The appellant paid the sums due under the consent orders up to and including 1 April 1998, but then ceased to make payments. The respondent sought an order for possession. At the hearing the judge rejected the respondent’s submission that the court’s jurisdiction to extend time or vary the terms of payment under section 36 of the Administration of Justice Act 1970 and section 8 of the Administration of Justice Act 1973 was excluded. The judge then identified the factors that had to be taken into account in the exercise of such discretion, as those set out in Cheltenham and Gloucester Building Society v Norgan [1996] 1 All ER 449. The order for possession was made. The appellant appealed the order on the ground that the judge had misapplied the principles in Norgan (supra). It was submitted by the appellant that the judge erred in the exercise of his discretion in failing to take as the starting point the appellant’s ability to repay the relevant amounts over the full period of the outstanding term in the mortgage or in the consent order. Further, that the judge had failed to consider, or impliedly rejected the invitation by the appellant to contemplate, a longer time and less onerous regime for repayment.
Held The appeal was dismissed.
It could not be said that the judge had failed to take into account the likelihood of the appellant being able to make the payments set out in the consent order of 11 March 1997. Nor had the judge confined his consideration to the period of months in which the appellant said that he expected to be able to pay off the three unpaid monthly installments. The facts of Norgan (supra) were very different from the present case. The judge had concluded that the appellant would have “very great difficulties” in repaying the monthly sums as agreed in the consent order. There was no error in the judge’s approach to the present case, or in the conclusion that he reached, that this was not a case in which the court’s discretion should be exercised in favour of the mortgagor. The order for possession was confirmed.
The appellant, Kenneth Bagnall QC, appeared in person; Peter Brunner (instructed by Hedleys) appeared for the respondent.
Sarah Addenbrooke, barrister
