The High Court has found Stepstone Mortgage Funding Limited entitled to an order for possession of John and Teresa Hughes’s family home in Cootehill, but adjourned the case so the property covered by any order can be accurately identified.
In a judgment delivered on 21 July 2015, Ms Justice Murphy said the mortgage charge registered against the land included part of a neighbouring commercial building. The parties had agreed to mortgage the family home, she found, not that part of the commercial premises. The lender must produce an agreed map identifying the land covered by the mortgage and give an undertaking that the charge registration will be corrected. The court proposed to adjourn the proceedings for that purpose. It did not make a final possession order in this judgment.
The couple borrowed €185,000 in 2008, secured against their home. By the hearing in February 2015, the outstanding balance, including arrears, was €215,041.02. The defendants argued that the lender’s 2010 demand letter was invalid, that it had failed to comply with the mortgage-arrears code, and that its claim included land the parties had not intended to mortgage.
The court rejected the demand-letter argument. Although the amount in the letter was wrong, the mortgage terms made the debt payable after a default lasting more than seven days; a demand letter was not required before proceedings began.
The judge criticised the lender’s handling of the arrears process, describing its compliance as more a matter of form than substance. She noted that the defendants had made substantial payments relative to their limited income, had sought help through a mortgage broker, and owned other land that might have been considered for sale instead of their home.
However, the Supreme Court’s recent rulings in linked cases limited the role of a court hearing a possession claim. The judge said the court could consider whether the lender had breached the code’s moratorium on starting possession proceedings, but could not assess other aspects of its engagement with borrowers. The lender had waited more than two years after sending the defendants a mortgage-arrears resolution pack before issuing proceedings in July 2013. The court therefore found the moratorium had expired and held that the lender was entitled to possession, subject to the unresolved identification and registration of the land.