What happens when a regulated mortgage contract is breached? A recent Supreme Court decision gives some welcome guidance, write Cecily Crampin & Caroline Shea KC
- The decision in A1 Properties (Sunderland) Ltd v Tudor Studios RTM Co Ltd on the approach where a statutory provision requiring an action makes no provision for the consequence of breach is applicable in mortgage law to the effect of non-compliance with s 126 of the Consumer Credit Act 1974, which requires a court order before enforcement of a regulated mortgage contract.
- Using the approach suggested supports a conclusion that lack of a court order makes the enforcement void. Judicial consideration of this point is needed to inform lender practice.
The decision of the Supreme Court in A1 Properties (Sunderland) Ltd v Tudor Studios RTM Co Ltd [2024] UKSC 27, [2024] All ER (D) 40 (Aug) gives general guidance on the correct approach to take when a statutory provision requires an action before a power can be exercised, but does not specify the consequence of failure. One instance of that problem arises in mortgage
