Charging Order? The myth

Land_Registry

eggbox - the devil is as always in the detail re the actual wording of the restriction and this invariably impacts on how it can be removed

The fact that it is a NRAM would be irrelevant from our perspective I suspect. OR restrictions/notices are of course a separate matter as they come about through the legislative powers afforded to the Official Receiver and how such matters are processed through the court, Land Charges and then ourselves as appropriate - hence my referral to the online guidance around personal insolvency.

I am not aware that the fact that removal of the OR's restriction would then impact on a restriction in favour of some other party such as NRAM - they are after all protecting different interests and are not linked unless I am misunderstanding something here.

Can you clarify perhaps or can JMSCV provide more detail and wording re the restrictions' themselves?

JMSCV

LRR, here you go. This is what it states on the Land Registry

RESTRICTION: No disposition of the registered estate,
other than a disposition by the proprietor of any registered charge
registered before the entry of this restriction, is to be registered
without a certificate signed by the applicant for registration or their
conveyancer that written notice of the disposition was given to
Northern Rock (Asset Management) PLC (Co Regn No 03273685) at Northern
Rock House, Gosforth, Newcastle upon Tyne NE3 4PL, being the person
with the benefit of an interim charging order on the beneficial
interest of XXX XXXXX made by the XXX County
Court on XX July XXXX (Court reference XXXXXXX)

eggbox

I was asking as it was my understanding CO's weren't included in Bankruptcy debts but this would only be a Restriction?

As its a Standard Form K wording but registered prior to the BR Restriction, would it still be removed if the OR sold JMSCV's interest to the other part owner?

Land_Registry

eggbox - I am not too sure that is JMSCV's actual situation here as my understanding is that the OR can only transfer the registered estate if the bankrupt is the sole registered proprietor and my reading of the posts to date is that they are registered as joint owners? (the presence of the form K implies this as well)

As we already know the form K restriction is overreached and automatically cancelled because there has been a transfer for money by two or more proprietors to a third party - that would not be the case here

eggbox

My understanding from JMSVC is that he is a joint owner and NRAM obtained a CO on his BI 2 years before he was made BR. However, the OR has definitely sold his share of the property to his other half (who is a joint owner.)

This is where it gets confusing for the layman as JMSVC no longer has any BI in the property but, if I am reading this right, NRAM's restriction will not be removed as it is not over reached?

Land_Registry

eggbox - i read it slightly differently in that nothing has been registered yet so nothing is definite and he is asking what happens re the restrictions?

I appreciate that it get's confusing for the laymen and I use the phrase 'the devil is in the detail' perhaps far too often but a lack of detail is where things do become confusing and, in my experience, this is why we can be very reticent when it comes to explaining things as too often the reality is not quite what has been explained.

That is not to suggest anyone is holding details back but simply that without a complete picture it is impossible to offer any genuine clarity around what the approach might be from a registration perspective.

Our guidance on personal insolvency explains takes a bankrupt through the process from a registration perspective. Bankruptcy differs in a number of ways from a CO as the OR has powers a creditor would not.

Where a property is jointly owned, and I believe this one is still registered as such, where one of the joint owners is declared bankrupt a form J restriction is applied for and registered registered. It may also trigger the severance of the joint tenancy and a form A restriction is also registered. This is similar to how a CO impacts but instead of a form K we have a form J.

That similarity continues where you have the sale scenario where two or more joint owners then sell to a third party. Both a form K and a form J can be overreached in that scenario and automatically cancelled. As merely an aside here a form A would not be.

Do you know what form the second restriction is in perhaps as JMSCV only posted the NRAM form K restriction?

Or are we in fact now saying that the register is in his partner's sole name and only the NRAM restriction remains?

I suspect the actual situation is that the property is still registered in their joint names with a form K (NRAM) and form J (OR). The non bankrupt partner has bought the bankrupt’s beneficial share from the Trustee in Bankruptcy. In that case the form J is normally withdrawn by the Trustee in Bankruptcy using a form RX4. The legal ownership as registered does not change so there is no disposition and the form J is not overreached.

It is very difficult to shed a complete light on such matters and if you read the guidance on personal insolvency it becomes very clear that such matters are extremely complex. The guidance is written with solicitors/conveyancers in mind simply because the law is very complex around debt, bankruptcy and indeed sole/joint ownership. I can do my best to explain our own approach to such matters but only on the basis of what is posted as I do not think I have the depth of understanding you have with regards this thread in it's entirety or indeed the court/legal processes involved.

eggbox

JMSVC can correct me here, but I think the situation is as follows;

1. Property is jointly owned
2. NRAM get a CO and place a Form K Restriction on Deeds
3. JMSVC is then made Bankrupt
4. OR sells his share of property to joint owner

I think JMSVC understands the OR Restriction can be now be removed. What I think he is asking is what happens now regarding the NRAM Restriction as it is registered against his BI which he no longer owns as the OR has sold it to the other joint owner?

Land_Registry

eggbox - I think you are probably correct. It would be good to have JMSVC's confirmation but I'll speak to one of our lawyers (we have to get legal advice as well sometimes) and confirm

eggbox

Hi LRR that's very good of you and, I would imagine, it must be a fairly common occurrence?

p.s JMSVC has confirmed this is the situation in a PM

Land_Registry

eggbox wrote: »

Hi LRR that's very good of you and, I would imagine, it must be a fairly common occurrence?

p.s JMSVC has confirmed this is the situation in a PM

Common? - the legal advice or JMSVC's situation?

And has JMSVC confirmed whether there is also a form A restriction registered as well?