Law Report: No repossession against one only of married couple

LAW REPORT v 14 February 1997

Albany Home Loans Ltd v Massey; Court of Appeal (Lord Justice Aldous, Lord Justice Schiemann) 12 February 1997

Where joint mortgagors of a property, such as a husband and wife, fell into arrears and the mortgagee sought to repossess the property but was only granted possession against one of the mortgagors, then, pending determination of possession proceedings against the other mortgagor, the court should not enforce the possession order against the first.

The Court of Appeal dismissed an appeal by the defendant, Frank Reginald Massey, against a decision of Judge Hammond, sitting in Stockport County Court on 4 April 1995, upholding a possession order granted to the plaintiff, Albany Home Loans Ltd.

Martyn Birkin (McCormicks, Harrogate) for the defendant; Simon Edwards (BMD Geiringer, Potters Bar) for the plaintiff.

Lord Justice Schiemann said the defendant and his wife, Jacqueline Joyce Massey, were the joint owners and mortgagors of their home. They fell into arrears to a substantial extent and the plaintiff mortgagee sought possession.

The defendant claimed that he was only in arrears because of actions taken by associate companies of the plaintiff, by whom he was employed as a mortgage provider and by whom he had been wrongfully dismissed. He said he had a good claim against the associate companies for a sum in excess of what was owing on the mortgage, and that in those circumstances the judge should not make an order for possession against him, or at least not make it enforceable before the hearing of his claim.

The judge decided that even if the defendant were to succeed on his dismissal claim, that would provide no defence to a possession claim by the mortgagee: see Ashley Guarantee plc v Zacaria [1993] 1 WLR 62. He also declined to exercise his powers under section 36 of the Administration of Justice Act 1970 to adjourn the possession proceedings or stay or suspend the execution of the judgment or postpone the delivery of possession. He said the dismissal claim was unlikely to be heard before 1997 and it did not appear that the defendant was "likely to be able within a reasonable period to pay any sums due under the mortgage".

That decision was well within the judge's discretion. However, the defendant pursued a second argument which raised a point of general interest.

The plaintiff had not, as yet, obtained judgment for possession against the wife. It had brought proceedings, but she, relying on Barclays Bank plc v O'Brien [1994] AC 180, contended that the mortgage should be set aside, as against her, on the ground of undue influence.

It was clear that the possession order made by the judge did not bind the wife. Thus the husband had been ordered by the court to leave the matrimonial home in which his wife was entitled to stay. The plaintiff had not in fact sought to enforce the order against the defendant prior to the adjudication of his wife's case, and now offered an undertaking not to do so.

But, although no practical problem arose here, his Lordship saw force in the submission that the judge ought not to have made the order for possession. Its result was that a husband was in breach of the court's order and might be held in contempt of court for remaining in a house in which his wife was entitled to remain and invite whom she pleased.

In such a case, where the ejection of one of two mortgagors was of no benefit to the mortgagee, it would not in general be right to make an order requiring him to leave within the period during which the other mortgagor was in possession, particularly where the two mortgagors were husband and wife.

It could not be said that the court had no power to make such an order; but it ought so to have disposed of the case that the husband was not required to leave until his wife left. That could have been achieved by an undertaking by the mortgagee, such as was now offered, not to enforce the possession order against the defendant until such an order was made and became enforceable against his wife or she left voluntarily; or the court could have ordered an adjournment under its general powers (though not under section 36 of the 1970 Act) with liberty to restore if the wife left the property or a possession order was made against her.

In this case, the right course was to accept the undertaking now offered by the plaintiff and dismiss the appeal.

Paul Magrath, Barrister