National Westminster Bank Plc v Mayfair Estates Property Investments Ltd. & Ors [2007] EWHC 287 (Ch) (26 January 2007)

National Westminster Bank Plc v Mayfair Estates Property Investments Ltd. & Ors [2007] EWHC 287 (Ch) (26 January 2007)

The bank's entitlement to priority is governed by the declaration made by Warren J., which is final and binding. The proceeds of sale are to be distributed first to the bank up to the lesser of £910,000 plus interest and expenses or the amount due to the second and third defendants at the date of the declaration, then to the second and third defendants up to the original loan amount less what was paid to them, then to the first defendant, and finally any remaining sums as set out in the judgment. The doctrine of subrogation does not entitle the bank to a greater priority than that declared.

Citation
[2007] EWHC 287 (Ch)
Parties
Claimant: National Westminster Bank Plc; First Defendant: Mayfair Estates Property Investments Ltd.; Second Defendant: P H Madden; Third Defendant: D E Younghusband
Jurisdiction
England and Wales
Judgment Date
26 January 2007
Procedural Posture
Chancery Division Claim Under CPR Part 8 / Judgment After Hearing on Priority of Charges Following Interim Declaration and Sale of Property
Outcome
Declaration granted as to order of priority; directions for inquiries; matter adjourned for further directions.
Legal Topics
Priority of Charges, Subrogation, Deeds of Priority, Mortgage Law, Equitable Remedies
Property Law Equity Banking and Finance Priority of Charges Subrogation Deeds of Priority Mortgage Law Equitable Remedies

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Parties

National Westminster Bank Plc

Claimant

Mayfair Estates Property Investments Ltd.

First Defendant

P H Madden

Second Defendant

D E Younghusband

Third Defendant

Procedural Posture

Chancery Division Claim Under CPR Part 8 / Judgment After Hearing on Priority of Charges Following Interim Declaration and Sale of Property

Legal Issues

  1. 1 Whether the claimant bank is entitled to priority over the first defendant's charge by virtue of subrogation and/or the Deed of Priority
  2. 2 Whether the interim declaration by Warren J. was final and binding as to the bank's entitlement
  3. 3 How the proceeds of sale should be distributed among the charge holders

Ratio Decidendi

The bank's entitlement to priority is governed by the declaration made by Warren J., which is final and binding. The proceeds of sale are to be distributed first to the bank up to the lesser of £910,000 plus interest and expenses or the amount due to the second and third defendants at the date of the declaration, then to the second and third defendants up to the original loan amount less what was paid to them, then to the first defendant, and finally any remaining sums as set out in the judgment. The doctrine of subrogation does not entitle the bank to a greater priority than that declared.

Court Disposition

Declaration granted as to order of priority; directions for inquiries; matter adjourned for further directions.

Orders

  • Declaration that proceeds of sale are to be distributed in the order set out in the judgment.
  • Inquiries directed as to amounts due to each party as at relevant dates.