JMW successfully regain possession of a residential property on behalf of a receiver

Senior Associate solicitor Neli Borisova has successfully advised a receiver in complex possession proceedings.

Background

The property was a residential property that had been let to a tenant, but unfortunately the tenant had not paid the landlord the rent for around two years. The borrower company owned the property, but the tenancy paperwork was poor naming a company director as the landlord instead of the company itself. The receiver wanted to sell the property with vacant possession (nobody living there) and realise the value of the property to pay the lender as a secured creditor as is normal in mortgage enforcement matters.

There were significant complications because of the poor tenancy set-up and confusion between the director’s actions in his personal capacity and his dealings as an agent for the borrower company; and there was also a tenant in occupation.

How did JMW help

The difficulty with this type of matter is that the borrower company did not provide all paperwork about the property and its directors were not co-operating therefore there was very little information available.

Neli was able to review the case and extract the relevant information about the tenant’s occupation and arrears. Appreciating the complexity of the underlying facts and the receiver’s aim to sell the property as soon as possible, Neli instructed and worked with an experienced property barrister to maximise chances of obtaining a possession order without the need of going through a full trial process. Neli engaged with Counsel in strategic discussions from the outset of the claim to ensure that there was a clear understanding of the receiver’s priorities and the case is conducted in a pragmatic and commercially viable way for the client. There was a very short initial court hearing attended by our barrister and due to the complexities she secured directions for a longer hearing where the Judge would have sufficient time to consider the case.

At the second hearing, our barrister was able to explain all of the issues to the court including the complexities of the property and that there had been a tenant who had not paid for a long period and owed arrears in excess of £60,000.

What was the outcome?

The judge ordered that the property was to be vacated by the tenant so that it can be sold by the receivers and the lender can be repaid the debt owed to it.

The judge also ordered that the tenant was to pay over £75,000 to the receivers in respect of unpaid rent and legal costs. Neli also discovered that the tenant co-owned another property. The money judgment can be recovered from the sale of that property.

Neli said, “this was a particularly complex case because there was a tenant in occupation and there were uncertainties as to the legal identity of the landlord. I had prepared for all eventualities, and the judge did allow us to remove the tenant so that the property could be sold with vacant possession. It is unusual for a tenant to own sufficient assets to pay a judgment debt but in this case the tenant owns a property and therefore we can recover the debt.”