Sale by mortgagee

Horsham Properties Group Ltd v Clark & another Ch D TLR 29 October; NLJ 17 October p 1458

The main issue to be decided, which had potentially wide-ranging implications, was whether s101 of the Law of Property Act 1925, construed as it and its predecessors had been since 1860, infringed art 1 of the first protocol to the European Convention on Human Rights, protecting the right to property by permitting mortgagees to over-reach the mortgagor’s rights in relation to the mortgage property by selling it out of court, without first obtaining a court order for possession, or an order for sale. The primary reason for concluding that there was no relevant deprivation of possessions was that s101 serves to implement rather than override the private bargain between the borrower and the lender. It was as far removed from the concept of state intervention into private lives through overriding legislation, which lay behind art 1, as it was possible to get. Accordingly, the claimant, the present registered proprietor, was granted possession of premises as against the second defendant, a former registered proprietor of the property.