Q&As

What are the remedies available to a creditor where the property is sold by the debtor before the charging order is registered against the property?

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Published on LexisPSL on 05/05/2017

The following Dispute Resolution Q&A provides comprehensive and up to date legal information covering:

  • What are the remedies available to a creditor where the property is sold by the debtor before the charging order is registered against the property?
  • Effect of failure to register charging order
  • Remedies

What are the remedies available to a creditor where the property is sold by the debtor before the charging order is registered against the property?

A charging order over land must be protected by registration at every stage of the process of obtaining the order to secure the priority of the order over competing interests and, in particular, to ensure that the order is not void as against a purchaser for value.

The correct form of protection depends on whether the charging order affects the legal estate or a beneficial interest under a trust. If the title to the land is registered, a charging order over the legal estate can be protected by notice, whereas a charging order over a beneficial interest under a trust can only be protected by a restriction.

If the title is unregistered, a charging order over the legal estate can be protected in the register of writs and orders, but there is a specific exclusion prohibiting the registration of any order affecting an interest under a trust. See Practice Note: Registration of a charging order over land.

Effect of failure to register charging order

Failure to protect a charging order by appropriate registration enables a purchaser of registered land for valuable consideration under a registered disposition to take the land free of any order. See the commentary: Registered Land: Fisher and Lightwood's Law of

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