Booth -v- The Viscount and Investec Bank [2016] JRC 068 (22 March 2016)

Booth -v- The Viscount and Investec Bank [2016] JRC 068 (22 March 2016)

The Court held that Article 12 does not permit payment to a spouse ahead of secured creditors except in very strong cases of hardship, which were not present. The interests of secured creditors must be respected to maintain confidence in lending. The application for a usufruct was also refused as the Viscount must...

Source-derived case information.

Citation
[2016] JRC 068
Parties
Applicant/representor: Mrs Booth; Secured Creditor/respondent: Investec Bank (Channel Islands) Ltd; Secured Creditors: Mr and Mrs Le Cornu; Court Officer/respondent: The Viscount
Jurisdiction
Jersey
Judgment Date
22 March 2016
Procedural Posture
Application Under Article 12 of the Bankruptcy (désastre) (jersey) Law 1990 / Judgment on Application After Hearing
Outcome
Application dismissed
Legal Topics
Matrimonial Home in Bankruptcy, Secured Creditors' Rights, Article 12 Bankruptcy (désastre) (jersey) Law 1990, Usufruct Applications, Distribution of Sale Proceeds, Preferential Payments, Spousal Occupation Rights
Insolvency Bankruptcy Property Law Family Law Matrimonial Home in Bankruptcy Secured Creditors' Rights Article 12 Bankruptcy (désastre) (jersey) Law 1990 Usufruct Applications +3 more

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Parties

Mrs Booth

Applicant/representor

Investec Bank (Channel Islands) Ltd

Secured Creditor/respondent

Mr and Mrs Le Cornu

Secured Creditors

The Viscount

Court Officer/respondent

Procedural Posture

Application Under Article 12 of the Bankruptcy (désastre) (jersey) Law 1990 / Judgment on Application After Hearing

Legal Issues

  1. 1 Whether the spouse of a debtor can receive payment from sale proceeds of the matrimonial home ahead of secured creditors under Article 12
  2. 2 Whether the spouse is entitled to a usufruct (right to occupy) the matrimonial home until sale under Article 12

Ratio Decidendi

The Court held that Article 12 does not permit payment to a spouse ahead of secured creditors except in very strong cases of hardship, which were not present. The interests of secured creditors must be respected to maintain confidence in lending. The application for a usufruct was also refused as the Viscount must retain discretion over vacant possession to maximise sale price and protect creditors' interests.

Court Disposition

Application dismissed