Q&As

If the ‘mortgagor’ under the relevant charge is four persons and the demand is only sent to three of the four relevant parties, is the subsequent appointment of the receivers valid?

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Published on LexisPSL on 26.09.2018

The following Restructuring & Insolvency Q&A provides comprehensive and up to date legal information covering:

  • If the ‘mortgagor’ under the relevant charge is four persons and the demand is only sent to three of the four relevant parties, is the subsequent appointment of the receivers valid?
  • What are the requirements in relation to serving demand?
  • What is effect on the receiver appointment?

If the ‘mortgagor’ under the relevant charge is four persons and the demand is only sent to three of the four relevant parties, is the subsequent appointment of the receivers valid?

What are the requirements in relation to serving demand?

The starting point is to consider whether the requirements (if any) are set out in the charge document to serve demand on the borrowers before any enforcement action can be taken. Any demand should be served in accordance with these requirements. We cannot advise on this since this is document-specific and depends on the terms of the charge document (and, potentially, the loan documentation).

The following Practice Note: How to serve a demand for payment may be useful in your research, particularly in respect of what the demand should contain and the practicalities of serving a demand.

It may also be useful to clarify whether section 103 of the Law of Property Act 1925 (LPA 1925) has been excluded. LPA 1925, s 103 provides that the power of sale under LPA 1925 does not arise unless notice requiring payment has been served on the mortgagor ‘or one of two or

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