The creditor was a tenant of rent-controlled premises who had been charged too much rent by his landlord. The bankrupt landlord’s trustee argued that the claim in respect of overpaid rent had been converted into a right to prove the debt in the bankruptcy, and that therefore any other method of recovery was barred.
Held: The trustee’s argument was rejected. The property passed to the trustee ‘in the same plight and condition in which it was in the bankrupt’s hands’ and that included the right of the tenant to live there rent free until the overpaid rent had been recouped. The tenant’s rights included the right to be considered as having paid rent in advance up to the amount of the excess. A tenant’s right under the statute to deduct earlier overpayments of rent from a future rent payable by him was not an ordinary case of set-off and could continue to be exercised after the bankruptcy of the landlord.
 1 QB 300,  1 All ER 87
Increase of Rent and Mortgage Interest (Restrictions) Act 1920 14(1)
England and Wales
Cited – Mulvey v Secretary of State for Social Security HL 20-Mar-1997
The appellant had had repayable awards from the social fund and also income support benefit. Deductions were made from the benefit to repay the awards. Her estate was sequestrated. She argued that the awards should no longer be deducted.
Held: . .
Applied – Regina v Secretary of State for Social Security, Ex parte Taylor and Chapman ChD 5-Feb-1996
The applicants were in turn the recipient of a Social Fund loan and a claimant who had been overpaid benefit. Both were later declared bankrupt. The Secretary of State then began to recover the loan and overpayment by deduction from their current . .
Cited – Secretary of State for Work and Pensions v Payne and Another SC 14-Dec-2011
The appellant sought to recover overpayments of benefits and Social Fund Loans, after the respondent had had a Debt relief order.
Held: The Secretary of State’s appeal failed. The ‘net entitlement principle’ argued for did not exist. The . .
Lists of cited by and citing cases may be incomplete.
Insolvency, Landlord and Tenant
Updated: 31 October 2021; Ref: scu.184748