The following Restructuring & Insolvency guidance note Produced in partnership with Jonathan Titmuss of Hardwicke provides comprehensive and up to date legal information covering:
This Practice Note considers whether a receiver may carry out building works and in particular whether the receiver may complete a development which is unfinished at the time of the appointment. This Practice Note highlights a number of issues which the receiver will need to consider before proceeding with any work.
For ease in considering the issues involved it is assumed that:
the developer is both the mortgagor of the property and a company, and
the mortgagor is using the common construction procurement method of employing a building contractor and a professional team of architect, engineers, quantity surveyors and others (the Professional Team)
References to the mortgagor include, where appropriate, the mortgagor acting by the receiver. A receiver in this context means a fixed charge receiver or a Law of Property Act receiver.
A receiver’s statutory powers under the Law of Property Act 1925 (LPA 1925) prior to executing a sale are limited to collecting rent and insuring the property (note that the latter may only be done at the written direction of the mortgagee responsible for the appointment).
Accordingly, a receiver will have to consider:
the powers conferred on the receiver pursuant to the terms of the security document under which the receiver is appointed, and
any terms of the appointment document which limit or
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