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  • FIRST POST
    blueback
    Charging Order? The myth
    • #1
    • 26th Jul 09, 11:28 AM
    Charging Order? The myth 26th Jul 09 at 11:28 AM
    I feel that this is so important that I thought a new thread should be made to highlight the importance of understanding the law on Charging Orders and how many people are stuck with their property in the false believe that they have had a Charging Order put on their property.

    In particular the thousands of Northern Rock customers that have had unsecured debt turned into secured debt by their tactics.

    If your property is jointly owned a creditor will not be able to obtain a CO against you, they can only get what is called a restriction.

    The laws on Restrictions are totally different to Orders, the most important being there is NO OBLIGATION for you to pay any of the proceeds of the sale to the creditor.

    However, during the whole court process you go through the reference from all parties (especially the creditor) will be to charging order and NOT to restriction. This is done in order to decieve you believing you are stuck with a CO.

    However, not all solicitors are aware of the law in this regard and it is important that you raise this point with them in the first instance before proceeding with them

    Quote:

    Restriction


    The restriction which can be entered on the register where a charging order is made against one of joint proprietors is in the following form :-
    No disposition of the registered estate is to be registered without a certificate signed by the applicant for registration or his conveyancer that written notice of the disposition was given to [name of person with the benefit of the charging order] at [address for service], being the person with the benefit of [an interim] [a final] charging order on the beneficial interest of (name of judgment debtor) made by the (name of court) on (date) (Court reference.…).
    You are therefore correct in saying that when the Land Registry receives an application to register, for example a transfer, we will not ask to see the consent of the person who has the benefit of the charging order. We will only want a certificate from the applicant for registration or his conveyancer that the person who has the benefit of the charging order has been given written notice of the transfer.

    If both joint owners sell the land to a third party the restriction will be cancelled when the transfer to the purchasers is registered.


    So I hope I have provided benefit to everyone who has had a restriction entered against them (especially NORTHERN ROCK CUSTOMERS) who believe wrongly that they are Charging Orders.

    You now have the freedom to go and sell your houses with the knowledge that the vultures can do nothing

    I also think this VERY IMPORTANT point needs highlighting by the moderators as many many people are stuck with houses that they believe they cannot sell
Page 157
    • NZS1985
    • By NZS1985 16th Feb 17, 9:24 AM
    • 3 Posts
    • 0 Thanks
    NZS1985
    Thanks for the info guys,

    Just looking through the title deeds again, there is no other mention of the 'UNILATERAL NOTICE in respect of Final Charging Order'

    So I'm guessing if I go to sell, the solicitors of any prospective buyer would want me to settle the debt rather than leave the charge on the deeds for the new buyers to cancel themselves. To be honest if I was buying a house I'd be very wary of doing this, so I'm not surprised others would act in the same way.

    There is equity in the property to pay the amount owing, but if I legally don't have to pay this it's something I want to investigate.

    Just a quick question, what is meant by the term 'Overreaching'?

    Thanks,

    Adrian
  • Land Registry
    The PG76 and algorithm re sole ownership I linked you to in post #3111 explains that the creditor can register an Agreed or Unilateral Notice in these circumstances. The choice is theirs.

    As Wookiee501 posts a Unilateral Notice will remian in place until cancelled or withdrawn.

    If we receive no application to cancel or remove the UN then we would leave it on the register and take no further action.
    If they did apply to cancel or remove then we would notify the beneficiary of the UN and give them the opportunity to object as appropriate.

    eggbox - the option in this case is either an AN or a UN and whether it is a ICO or a FCO makes no difference as explained previously. The CO creates an equitable charge that can then be protected by either an AN or UN although in my experience it is normally a UN that is applied for and section 3.2 of PG 76 may help to understand

    However it is far more likely that the reason is one simply of process as IF the application is not made by or with the consent of the registered proprietor, an AN can only be entered if the registrar is satisfied as to the validity of the applicant’s claim.

    It follows that when application is made to enter an AN in respect of a CO we must be satisfied that the charging order affects the legal estate.

    Determining whether or not a CO imposed a charge on the legal estate may be complicated. A number of factors need to be considered, including the form of the order made, whether the property is held on trust for persons other than the registered proprietor(s) and whether the beneficial interests of joint proprietors are encumbered. The entries in the register will not generally give a conclusive answer to these questions but some entries, particularly restrictions, will give an indication. Even if we investigate the information that we hold in our files as to why a particular entry was made, we are still unlikely to be able to arrive at a conclusive answer.

    NZS1985 Overreaching - in a trust of land or strict settlement, overreaching takes place on sale, when the proceeds of sale are received by the trustees (of whom there must be at least two, or a trust corporation). The effect of this is that the equitable interests in the land arising under the trust are overreached. After overreaching, the beneficiaries cannot claim against the land: their only claim is against the proceeds of sale. The buyer is therefore protected.
    Official Company Representative
    I am the official company representative of Land Registry. MSE has given permission for me to post in response to queries about the company, so that I can help solve issues. You can see my name on the companies with permission to post list. I am not allowed to tout for business at all. If you believe I am please report it to forumteam@moneysavingexpert.com This does NOT imply any form of approval of my company or its products by MSE"
    • Rileybaby
    • By Rileybaby 16th Feb 17, 11:32 PM
    • 213 Posts
    • 127 Thanks
    Rileybaby
    Can anyone advise of a ball park time scale for a restriction to be removed once it has been paid?
  • Land Registry
    Can anyone advise of a ball park time scale for a restriction to be removed once it has been paid?
    Originally posted by Rileybaby
    From purely a registration perspective such applications are normally considered within 7 working days of receipt. If in order then we would notify the beneficiary of the restriction of the application and give them 15 working days to object.
    Official Company Representative
    I am the official company representative of Land Registry. MSE has given permission for me to post in response to queries about the company, so that I can help solve issues. You can see my name on the companies with permission to post list. I am not allowed to tout for business at all. If you believe I am please report it to forumteam@moneysavingexpert.com This does NOT imply any form of approval of my company or its products by MSE"
    • eggbox
    • By eggbox 17th Feb 17, 10:19 AM
    • 1,238 Posts
    • 635 Thanks
    eggbox
    From purely a registration perspective such applications are normally considered within 7 working days of receipt. If in order then we would notify the beneficiary of the restriction of the application and give them 15 working days to object.
    Originally posted by Land Registry representative
    Hi LRR

    Thank you for the updates over the past couple of days.

    Can I ask a couple of questions to the answers you have given, please (and please correct me if I have anything wrong below!);

    1. In response to the Unilateral Notice question you say a CO places an equitable charge which, I understand, is against the beneficial interest of the debtor concerned. But in the case of a sole owner this can be registered on the deeds as a charge that has to be dealt with before a transfer of ownership can proceed (unlike a CO made against a joint owner/sole debtor where only a Restriction can be entered.) But from the information placed of the deeds of NZS1985 (who is a sole owner and assuming the FCO is accepted as legitimate) which was,

    iii) On section C of the title, the charges register, it says the following...

    6 (17.03.2009) UNILATERAL NOTICE in respect of Final Charging Order in
    the ******** County Court.
    NOTE: Copy filed.
    7 (17.03.2009) BENEFICIARY: Barclays Bank Plc of ********, **********
    **********

    would that type of registration prevent a transfer proceeding if a sale of the property was made (for monies) but Barclays objected to the Notice being removed? I'm just a little confused why it isn't registered as an equitable charge as you would normally see for a sole owner? Or is what is registered amounting to the same thing?

    2. For Rileybaby's answer regarding a Restriction's removal being objected to within 15 days can I ask;

    i) If no objection is received within 15 days is that the end of the matter or is the Restrictioner allowed to appeal after this time period has elapsed?

    ii) Can I ask if a Restrictioner not objecting ever happens (and if so is it a common or very rare occurance?)
    • DAKOTA45
    • By DAKOTA45 17th Feb 17, 12:24 PM
    • 479 Posts
    • 38 Thanks
    DAKOTA45
    Hmmm.. can I go off on a bit of a tangent, please? This may be one for LRR and relates to changes made in the rules for applying for an ICO…

    I came across this;

    From April 2016 the rules changed again the process of obtaining a charge.
    There are three key differences:-

    An application for a charging order with respect to a judgment made in the county court will need to be made to the County Court Money Claims Centre;

    Where an application is made to the County Court Money Claims Centre it will be determined by a Court Officer; and
    Where an application is to be determined by a Court Officer this will be an administrative action and a hearing will not be listed.

    Under the previous rules, applications were sent to the County Court where the judgment was made, and determined at a hearing by a district judge before the claimant and whichever other party who saw fit to attend. Under the new regime, if the County Court Money Claims Centre receives an objection to the application, the matter will be transferred to the local court of the judgment debtor and the process will essentially revert back to the old regime, whereby the application will be determined at a hearing by a district judge.


    Does this mean that if a creditor was to make the application at the wrong court, it would be refused… and if not, and it went to a full CO, would that CO still be valid?

    D45
    • eggbox
    • By eggbox 17th Feb 17, 1:15 PM
    • 1,238 Posts
    • 635 Thanks
    eggbox
    No, it's designed to cut down on the administration process. All applications go through the same process. It just means if a creditor makes an application and there is no objection from the debtor the Court personal can process the work.

    If the debtor objects, however, it goes before a Judge as was the case for all applications previously.
  • Land Registry
    Hi LRR

    Thank you for the updates over the past couple of days.

    Can I ask a couple of questions to the answers you have given, please (and please correct me if I have anything wrong below!);

    1. In response to the Unilateral Notice question you say a CO places an equitable charge which, I understand, is against the beneficial interest of the debtor concerned. But in the case of a sole owner this can be registered on the deeds as a charge that has to be dealt with before a transfer of ownership can proceed (unlike a CO made against a joint owner/sole debtor where only a Restriction can be entered.) But from the information placed of the deeds of NZS1985 (who is a sole owner and assuming the FCO is accepted as legitimate) which was,

    iii) On section C of the title, the charges register, it says the following...

    6 (17.03.2009) UNILATERAL NOTICE in respect of Final Charging Order in
    the ******** County Court.
    NOTE: Copy filed.
    7 (17.03.2009) BENEFICIARY: Barclays Bank Plc of ********, **********
    **********

    would that type of registration prevent a transfer proceeding if a sale of the property was made (for monies) but Barclays objected to the Notice being removed? I'm just a little confused why it isn't registered as an equitable charge as you would normally see for a sole owner? Or is what is registered amounting to the same thing?

    2. For Rileybaby's answer regarding a Restriction's removal being objected to within 15 days can I ask;

    i) If no objection is received within 15 days is that the end of the matter or is the Restrictioner allowed to appeal after this time period has elapsed?

    ii) Can I ask if a Restrictioner not objecting ever happens (and if so is it a common or very rare occurance?)
    Originally posted by eggbox
    eggbox - you say it has to be dealt with before a transfer of ownership can proceed. From a registration perspective it doesn't as we would simply leave it on the register. From a practical perspective though a buyer will want it removed

    The Unilateral Notice is protecting it as an equitable charge. They are the same thing. Pre 2002 it would have appeared as an EC. Post 2002 it is either an AN or UN with the UN being the most common.

    If the buyer lodged their Transfer and an application to cancel the UN then we would serve notice giving Barclays the option of objecting. We'd then have to consider any objection before deciding next steps. Any argument would be around the CO and its impact on the legal estate and every instance is treated on merit so we can't tell you what would or wouldn't work re an objection.

    If no objection is received that's it and the application would be completed a day or two later depending on workloads. PG37 explains the Objection process https://www.gov.uk/government/publications/objections-and-disputes-a-guide-to-land-registry-practice-and-procedures

    There are no hard and fast rules re object or not but they do and it's not rare but there are numerous interests protected by restrictions and not just COs. I suspect objections in the CO example are much rarer but that may well be simply because you never get to the notification/objection part of the process. Most are removed automatically through overreaching or the debt is cleared and the restrictioner either removes the restriction themselves or let the owner do it and of course don't then object
    Last edited by Land Registry; 17-02-2017 at 1:38 PM.
    Official Company Representative
    I am the official company representative of Land Registry. MSE has given permission for me to post in response to queries about the company, so that I can help solve issues. You can see my name on the companies with permission to post list. I am not allowed to tout for business at all. If you believe I am please report it to forumteam@moneysavingexpert.com This does NOT imply any form of approval of my company or its products by MSE"
  • Land Registry
    Hmmm.. can I go off on a bit of a tangent, please? This may be one for LRR and relates to changes made in the rules for applying for an ICO…

    I came across this;

    From April 2016 the rules changed again the process of obtaining a charge.
    There are three key differences:-

    An application for a charging order with respect to a judgment made in the county court will need to be made to the County Court Money Claims Centre;

    Where an application is made to the County Court Money Claims Centre it will be determined by a Court Officer; and
    Where an application is to be determined by a Court Officer this will be an administrative action and a hearing will not be listed.

    Under the previous rules, applications were sent to the County Court where the judgment was made, and determined at a hearing by a district judge before the claimant and whichever other party who saw fit to attend. Under the new regime, if the County Court Money Claims Centre receives an objection to the application, the matter will be transferred to the local court of the judgment debtor and the process will essentially revert back to the old regime, whereby the application will be determined at a hearing by a district judge.


    Does this mean that if a creditor was to make the application at the wrong court, it would be refused… and if not, and it went to a full CO, would that CO still be valid?

    D45
    Originally posted by DAKOTA45
    Not one for us I'm afraid as it relates to the court process so more likely one for eggbox or others

    We would deal with any application which was then made to protect the CO on the land register. If someone then argued it was invalid thereafter they would need to make that legal argument
    Official Company Representative
    I am the official company representative of Land Registry. MSE has given permission for me to post in response to queries about the company, so that I can help solve issues. You can see my name on the companies with permission to post list. I am not allowed to tout for business at all. If you believe I am please report it to forumteam@moneysavingexpert.com This does NOT imply any form of approval of my company or its products by MSE"
    • DAKOTA45
    • By DAKOTA45 17th Feb 17, 2:26 PM
    • 479 Posts
    • 38 Thanks
    DAKOTA45
    No, it's designed to cut down on the administration process. All applications go through the same process. It just means if a creditor makes an application and there is no objection from the debtor the Court personal can process the work.

    If the debtor objects, however, it goes before a Judge as was the case for all applications previously.
    Originally posted by eggbox
    I just wondered… the judgement creditor first made an application for an ICO in another court.

    Then the application was considered again, but this time at my home court…it was not verified by a Statement of Truth as the 1st application was.

    Crafty !!!!!!s produced the first app in court when I questioned the unsigned one…

    D45
    • Rileybaby
    • By Rileybaby 17th Feb 17, 9:41 PM
    • 213 Posts
    • 127 Thanks
    Rileybaby
    I've paid off the debts and requested that the owners have them removed from the property so hopefully it should all be done and dusted in a couple of weeks. Thanks Land registry representative and eggbox
    • eggbox
    • By eggbox 18th Feb 17, 2:03 PM
    • 1,238 Posts
    • 635 Thanks
    eggbox
    I've paid off the debts and requested that the owners have them removed from the property so hopefully it should all be done and dusted in a couple of weeks. Thanks Land registry representative and eggbox
    Originally posted by Rileybaby
    No problem and at least it leaves you to now sell as and when you wish so good luck with that.
    • eggbox
    • By eggbox 18th Feb 17, 2:20 PM
    • 1,238 Posts
    • 635 Thanks
    eggbox
    eggbox
    If no objection is received that's it and the application would be completed a day or two later depending on workloads.
    Originally posted by Land Registry representative
    Thank for the clarification LRR and it would appear NZS1985 would have to deal with the debt before any sale could proceed as well doing so should any remortgaging be required?

    Just to be clear on what you say above, however, regarding an objection out of time; what is the situation if the creditor claims not to have been notified by the Land Registry or does the LR send notification by recorded delivery?

    I'm only asking because, on a side issue, when the police issue a NIP they only have to send it by standard post and if you are unlucky enough to not have received it (as occasionally happens if rare) then its tough luck on the person who was served unless they can prove they never received? Does that rule apply here, too?
  • Land Registry
    eggbox - notifications aer sent by ordinary post in the same way. Responsibility for ensuring your contact details are up to date on the register rests with the relevant person/company. They are not issued by registered/recorded post.

    There is a process to be followed if a notice is returned 'undelivered' but this is relatively rare and focusses on what other details we have and/or whether other contact addresses have been used to serve the notices already.

    Every instance is treated on merit and notices are deemed to have been delivered if not returned. See Rules 197 – 199 of LRR 2003 for more details.
    Official Company Representative
    I am the official company representative of Land Registry. MSE has given permission for me to post in response to queries about the company, so that I can help solve issues. You can see my name on the companies with permission to post list. I am not allowed to tout for business at all. If you believe I am please report it to forumteam@moneysavingexpert.com This does NOT imply any form of approval of my company or its products by MSE"
    • eggbox
    • By eggbox 20th Feb 17, 10:44 AM
    • 1,238 Posts
    • 635 Thanks
    eggbox
    Thanks for clarifying LRR!
    • weimimamma
    • By weimimamma 20th Feb 17, 1:43 PM
    • 80 Posts
    • 1 Thanks
    weimimamma
    I had the document from land registry advising of an ICO for my husband and his mom. My father in law had one too. I objected by sending my letter to the court and a copy to the land registry but nothing g else was received until the Fco appeared in the post the document we had from the court said the date of the decision was to be made by ..... Without a hearing
    • DAKOTA45
    • By DAKOTA45 22nd Feb 17, 7:12 AM
    • 479 Posts
    • 38 Thanks
    DAKOTA45
    I had the document from land registry advising of an ICO for my husband and his mom. My father in law had one too. I objected by sending my letter to the court and a copy to the land registry but nothing g else was received until the Fco appeared in the post the document we had from the court said the date of the decision was to be made by ..... Without a hearing
    Originally posted by weimimamma
    I think most ICOs are made without notice of a hearing… very unfair, especially if one party does not owe the debt and needs to object… But there would have been an opportunity to put your case at the FCO…So are you saying the FCO was made without a hearing? D45
    • Choochybaby69
    • By Choochybaby69 22nd Feb 17, 9:50 AM
    • 19 Posts
    • 0 Thanks
    Choochybaby69
    Hi Eggbox,
    I was in a partnership ( I was a sleeping partner) and it went bust after he, emptied the account, run up supplier debts, took assets from the shop and left town over night. I went bankrupt after receiving the c/o. I included the debt that was from the c/o, but I believe the c/o still stands. My ex business partner did not go bankrupt, but received the same c/o. The organisation say they cannot discuss anything about him. A couple of years ago he divorced, but the house remained in joint names. The house was on the market for £130,000 and from a land registry check it only had a £50,000 mortgage and it recently sold. How do I find out from Investec if any moneys were paid off the joint c/o, if they won't discuss it and how do I know they are telling the truth? I am thinking of getting CAB involved, as they have been a great help in the past, or should I consider a solicitor?
    Thanks, Paul.
    • eggbox
    • By eggbox 27th Feb 17, 9:18 AM
    • 1,238 Posts
    • 635 Thanks
    eggbox
    Choochbaby69

    Were you sued jointly or separately for the debt? Also, are you still living in the property that the Charging Order or Restriction was placed on the deeds?
    • weimimamma
    • By weimimamma 27th Feb 17, 9:30 AM
    • 80 Posts
    • 1 Thanks
    weimimamma
    Yes never attended a hearing my paperwork said decision to be made by. ..... date without a hearing. I sent letters saying I was joint owner blah blah but never heard anything until
    Fco appeared
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