The Supreme Court dismissed the McLaughlins’ challenge to the receiver’s appointment over their secured properties, finding that Bank of Scotland plc (BOS) had contractual power to appoint him even though it was not registered as owner of a charge over their registered property at 40 Kerrymount Rise, Foxrock.
The appeal concerned a charge originally held by Bank of Scotland (Ireland) Ltd (BOSI), which transferred to BOS when a cross-border merger took effect at 11.59pm on 31 December 2010. BOSI then ceased to exist. The McLaughlins argued that, without BOS being entered on the relevant Land Registry folio as owner of the charge, it could not enforce the security, including by appointing a receiver.
A receiver was appointed by BOS on 6 June 2012 under deeds covering 40 Kerrymount Rise and “Latona”, an unregistered property. The High Court had declared the receiver validly appointed and entered a money judgment for BOS against the McLaughlins. On appeal, the Supreme Court considered the registration issue only insofar as it challenged the receiver’s appointment.
Justice Laffoy said the mortgage terms allowed BOSI’s successors and assigns to appoint a receiver once the power of sale was exercisable. The trial judge’s finding that an event of default had occurred before the appointment had been upheld in a separate judgment by Justice Clarke. The contract therefore gave BOS power to appoint the receiver independently of statutory powers under the Registration of Title Act 1964. The court affirmed that the receiver was validly appointed.
Justice Laffoy also addressed the wider question of statutory enforcement. She said the Act requires the registered owner of a charge to be registered as such to use the statutory enforcement powers and protections for registered land. In her view, BOS would have to be registered on the relevant folio to exercise those statutory powers. This conclusion was obiter: it went beyond what was necessary to decide the appeal. The judgment did not determine whether BOS could exercise a power of sale or give a purchaser good title without registration.
The court expressed no view on the effect of non-registration for the security over unregistered property. It cited limited evidence about the title position and the lack of submissions on the consequences of failing to register a transfer in the Registry of Deeds.