The Society had repossessed and sold the mortgagors’ house in 1990. It knew then that there was a shortfall, but took no further recovery proceedings until 2002. What was the date from which the relevant limitation period began to run? Though the deed provided for payment of monthly instalments, it did not include an express covenant by the mortgagors to repay the whole of the balance of the advance on a specified date or in a specified event, such as default in the payment of the instalments.
Held: The omission af the clause gave rise to questions about how personal repayment obligations, which were not expressed, should be implied, either by way of covenant or contract, and the construction and application of ss5, 8 and 20 of the 1980 Act. Before the action, more than 12 years had elapsed from the accrual of the right of the Society to receive the balance of the mortgage debt secured by the legal charge. The claim for the shortfall was statute barred and the appeal allowed.
Judges:
Lord Justice Mummery, Lord Justice Jonathan Parker And Lord Justice Dyson
Citations:
[2004] EWCA Civ 1063, Times 05-Oct-2004
Links:
Statutes:
Jurisdiction:
England and Wales
Citing:
Cited – Scottish Equitable Plc v Thompson and Another CA 6-Feb-2003
The mortgage deed, which was a second mortgage, did not contain any express covenant to repay the principal sum, but only for monthly interest instalments with no element of capital repayment, since the principal was to be paid from an insurance . .
Cited – Sutton v Sutton 1882
A mortgage deed contained an express covenant to repay on demand the amount advanced. The principal sum and interest were secured by a mortgage of real property. A demand for payment was made, but not satisfied. An action was brought on the covenant . .
Cited – Fearnside v Flint 1882
The court rejected the contention that the limitation period was 20 years for a case of an action on a collateral bond. The sum secured by a mortgage on land and also secured by a covenant in the deed is one and the same sum ‘so that when the right . .
Cited – Barnes v Glenton 1899
A contract debt had been then secured on land. The defendant pleaded limitation.
Held: The section, in not enlarging the period of recovery of a simple contract debt from 6 years to 12 years, was prohibitory and was enacted to limit existing . .
Cited – In re McHenry CA 1894
The court considered the effect of the Limitation Acts on the rights of a secured creditor where there was an express shortfall provision in a mortgage deed. There was an express promise by a mortgagor to pay the difference on realisation of the . .
Cited – Hornsey Local Board v Monarch Investment Building Society CA 1889
The local authority had incurred expense in paving a street. They were entitled to apportion those expenses amongst the owners of the properties fronting onto that street and summarily to recover from the respective owners the amounts so . .
Cited – Hopkinson and Others and Birmingham Mid-Shires Building Society v Tupper CA 30-Jan-1997
The plaintiffs appealed from an order striking out their claim for want of prosecution. The defendant’s property had been sold by the mortgagees, and the plaintiffs as assignees of their debt sought to recover the balance outstanding from the . .
Cited by:
Appeal from – West Bromwich Building Society v Wilkinson HL 30-Jun-2005
The Society had taken possession of a property in 1989. It located the defendants many years later and sought payment of the excess after deduction of the proceeds of sale, and for interest. The borrowers claimed the debt was expired by limitation . .
Cited – Doodes v Gotham, Perry ChD 17-Nov-2005
The trustee in bankruptcy had taken a charge on the property in 1992 to support the bankruptcy in 1988. He sought to enforce it in 2005. The chargor appealed an order which denied he was protected by limitation.
Held: The appeal succeeded. . .
Cited – Gotham v Doodes CA 25-Jul-2006
The former bankrupt resisted sale of his property by the trustee, saying that enforcement was barred by limitation. He and his wife bought the property in early 1988, and he was made bankrupt in October 1988. He was dischaged from bankruptcy in . .
Lists of cited by and citing cases may be incomplete.
Limitation
Updated: 11 June 2022; Ref: scu.199634