The Court of Appeal dismissed the plaintiff's appeal against the dismissal of his originating summons seeking determination of the question whether the respondent bank had been entitled to take possession of his property and exercise its power of sale without an order of the court.
The plaintiff had mortgaged a residential property to the bank. The bank made a valid demand for payment, but the plaintiff did not repay the sum demanded. The bank wrote to the plaintiff, informing him that the property would be entered for sale in a forthcoming auction. The plaintiff was not living at the property at that time, and denied having received the letter.
The property was sold at auction, and on 31 December 1996 the bank informed the plaintiff that the sale had been completed. The plaintiff had in the meantime learned from a neighbour that the property had been sold, and on 30 December had sworn an affidavit in support of an ex parte application for an injunction restraining the bank from proceeding with the sale.
Since the sale had already been completed, the application was refused. The plaintiff then issued an originating summons, seeking the court's determination of the question whether the bank as mortgagee had been entitled by law, particularly having regard to section 36 of the Administration of Justice Act 1970 as amended, to take possession of the property and sell it by auction without first having sought and obtained an order of the court.
The district judge dismissed the originating summons and the plaintiff appealed to the judge, who dismissed the appeal and refused leave to appeal. The Court of Appeal granted leave to appeal on the basis that there was not universal agreement on the question whether the effect of section 36 of the 1970 Act was that a mortgagee had first to obtain the leave of the court before proceeding to enforce its right to possession or its power of sale under a mortgage deed in relation to a dwelling house.
Anthony Scrivener QC and Norman Joss (Phoenix Walters, Cardiff) for the plaintiff; Elizabeth Gloster QC and Michael Sullivan (Eversheds) for the bank.
Lord Justice Chadwick said that it was impossible to be satisfied that Parliament had intended, when enacting section 36 of the Administration of Justice Act 1970, that the mortgagee's common law right to take possession by virtue of his estate should be exercisable only with the assistance of the court. The only conclusion as to Parliament's intention which the court could properly reach was that which could be derived from the circumstances in which the section had been enacted, the statutory context in which it appeared, and the language used, and all pointed in the same direction.
Parliament had been concerned with the problem which had arisen following the decision in Birmingham Citizens Permanent Building Society v Caunt  1 All ER 163, which had put an end to a practice under which mortgage possession summonses were adjourned to give the mortgagor an opportunity to pay by instalments. It had intended to restore the position to what it had previously been thought to be; it had not addressed its mind to the question whether the mortgagor required protection against the mortgagee who took possession without the assistance of the court.
It was impossible to be sure that Parliament had not intended, or would not have intended, had it addressed its mind to the question, to leave the position as it was in that regard. It could not therefore be appropriate to embark on an investigation whether the words which had been used in the section were capable of some construction other than that which they naturally bore.