Credit & Mercantile Plc v Kaymuu Ltd & Ors

Credit & Mercantile Plc v Kaymuu Ltd & Ors

Mr Wishart became the beneficial owner of Dalhanna on completion under a common intention constructive trust, but by giving Sami full authority to acquire the property, he enabled Sami to represent himself as owner and thus C&M's charge binds Mr Wishart's interest under principles akin to estoppel/agency. C&M is entitled to retain the sum required to discharge the mortgage but not its High Court costs from the surplus. The trustee is not entitled to remuneration or costs from the surplus as he took an adversarial role.

Parties
Claimant: Credit & Mercantile PLC; First Defendant: Kaymuu Limited; Second Defendant: Kevin Michael Wishart; Third Defendant: Ian Mark Defty (as Trustee in Bankruptcy for Mr Sami Muduroglu)
Jurisdiction
England and Wales
Judgment Date
05 June 2014
Procedural Posture
Mortgagee's Action for Possession / Chancery Division Claim / Judgment After Trial
Outcome
Claimant (C&M) entitled to retain mortgage sum; Second Defendant (Wishart) entitled to surplus; C&M and trustee not entitled to further costs from surplus.
Legal Topics
Constructive Trusts, Beneficial Ownership, Mortgage Priorities, Actual Occupation, Bankruptcy, Mortgagee's Costs
Equity and Trusts Property Law Insolvency Constructive Trusts Beneficial Ownership Mortgage Priorities Actual Occupation Bankruptcy +1 more

Case Brief

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Parties

Credit & Mercantile PLC

Claimant

Kaymuu Limited

First Defendant

Kevin Michael Wishart

Second Defendant

Ian Mark Defty (as Trustee in Bankruptcy for Mr Sami Muduroglu)

Third Defendant

Procedural Posture

Mortgagee's Action for Possession / Chancery Division Claim / Judgment After Trial

Legal Issues

  1. 1 Whether Mr Wishart was the beneficial owner of Dalhanna on completion of the purchase
  2. 2 Whether C&M's charge over Dalhanna ranked in priority to Mr Wishart's beneficial interest
  3. 3 Whether C&M is entitled to recover its legal costs from the surplus

Ratio Decidendi

Mr Wishart became the beneficial owner of Dalhanna on completion under a common intention constructive trust, but by giving Sami full authority to acquire the property, he enabled Sami to represent himself as owner and thus C&M's charge binds Mr Wishart's interest under principles akin to estoppel/agency. C&M is entitled to retain the sum required to discharge the mortgage but not its High Court costs from the surplus. The trustee is not entitled to remuneration or costs from the surplus as he took an adversarial role.

Court Disposition

Claimant (C&M) entitled to retain mortgage sum; Second Defendant (Wishart) entitled to surplus; C&M and trustee not entitled to further costs from surplus.

Orders

  • C&M to retain £694,072.75 from proceeds of sale of Dalhanna.
  • Mr Wishart entitled to surplus of £328,158.08 paid into court.