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Zinda v Bank of Scotland Plc; CA 23 Jun 2011

References: [2011] EWCA Civ 706, [2011] BPIR 1802, [2011] HLR 40, [2011] 38 EG 106, [2011] 2 All ER (Comm) 839, [2011] 3 EGLR 61, [2012] 1 WLR 728, [2011] CP Rep 40, [2011] 26 EG 85
Links: Bailii
Coram: Mummery, Munby LJJ, Hedley J
This appeal raises a short but important point of principle of great practical significance in relation to the standard form of suspended possession order used in mortgage cases and granted on a daily basis in hundreds of County Courts up and down the land. The appellant had fallen into arrears in the mortgage secured in favour of the respondent, and a standard form possession order made, requiring him to make the standard payments plus monthly sums to clear the arrears.
Held: The court discussed the provision of section 8 of the 1973 Act: ‘First, there is the jurisdictional gateway created by the requirement on the mortgagor to demonstrate that he is (section 36(1)) ‘likely to be able within a reasonable period to pay’ both (section 8(1)) the ‘amounts [he] would have expected to be required to pay if there had been no . . provision for earlier payment – in other words, the arrears of the instalments due to date – and (Section 8(2)) the ‘further amounts that he would have expected to be required to pay by then’ – in other words, the future instalments accruing during the reasonable period. The power of suspension exercisable by the court under Section 36 is conditional on it appearing to the court that in the event of the exercise of the power the mortgagor is likely to be able to pay the sums in question within a reasonable period. Absent such proof, the court has no jurisdiction to stay or suspend the Order for Possession.
Second, and assuming that the mortgagor surmounts the jurisdictional hurdle, the court is given a wide discretion under Sections 36(2) and (3). In particular, Section 36(3) permits the court, if it decides to stay or suspend a possession order, to attach such ‘conditions with regard to payment’ by the mortgagor of any sum secured by the mortgage as the court thinks fit. This power is not confined to the arrears of the instalments due to date or to the future instalments accruing during the reasonable period referred to in Section 36(1). It extends to ‘any’ sum secured by the mortgage including, for example, the totality of the future instalments accruing due throughout the remaining life of the mortgage.’
Statutes: Administration of Justice Act 1973 8
This case is cited by:

  • Cited – Santander (UK) Plc v Parker CANI (Bailii, [2015] NICA 41)
    Appeal by Parker against the judgment dismissing Mr Parker’s appeal against the Order of Master Bell refusing a stay on possession by Santander (UK) PLC of the appellant’s dwelling house.
    Held: A promisory note was equivalent to cash, but only . .

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