Date:

Jameer v Paratus AMC [2012] EWCA Civ 1924

Summary

A Court refused to suspend a warrant for possession on the basis that a mortgagor (“Jameer”) had made obvious omissions in her employment status and financial information that she had provided to the Court following a failure to comply with the terms of a Suspended Possession Order.

Facts

Jameer had obtained a mortgage from Paratus in 2006.  From 2008 she fell into arrears with her mortgage repayments and Paratus commenced proceedings against her.  In 2011, the District Judge gave judgment in favour of Paratus for the total owing and granted a Possession Order in favour of Paratus.

A warrant was suspended on an application by Jameer on the basis that she would meet her monthly instalments going forward and make a monthly repayment towards the accrued arrears.  However, Jameer did not make the payments as ordered and a further warrant was issued in 2012.

Jameer applied again to the Court for a suspension of the warrant as her circumstances had improved due to an offer of partnership and a new lodger at her residence.  The Court concluded that the £200 per month she offered towards the repayments was beyond her means.  Permission to appeal was granted on the condition that Jameer filed up-to-date information concerning her employment and finances.  At the time of the appeal, Jameer's second mortgage and a buy-to-let mortgage were both in arrears which amounted to £10,000.  The issue was whether in light of the further information before the appeal judge, he was right to refuse to suspend the warrant for the second time.

Judgment

The Court was right to refuse Jameer’s application to suspend the warrant.  Jameer had not provided any wage slips and the lodger agreements she had filed had either expired or were, without reasonable explanation, in conflict with the terms of a tenancy agreement that Jameer had also filed.  It was clear that under the Administration of Justice Act 1970 s. 36(1) there was a jurisdictional gateway which allowed the Court to exercise its discretion in cases where there was evidence to show that a mortgagor could repay the sums due within a reasonable period of time (see Zinda v Bank of Scotland Plc [2011] EWCA Civ 706).  It was only if that gateway was open that the Court had power to suspend a warrant.

Previous case law puts the onus on the mortgagor to present frankly and fully to the Court information about their income and expenditure.  Assuming that the jurisdictional gateway was open in the instant case, both Judges decided to exercise their discretion against Jameer.  She had not demonstrated that she could adhere to the terms of the original suspension order and there remained too much uncertainty and obvious omissions by her in the information that she had presented about her employment and finances, including no account of expenditure on clothing or socialising.  On her own account she had had the ability to make the repayments but had not done so.  Even on the up-to-date information on appeal, the Court was not entitled to say that either of the Judges had reached a decision which was plainly wrong. Other Judges might have given Jameer another chance to pay however the fact that the Judges had not done so did not mean that their decisions were plainly wrong.

Comment

Commonly, the lower courts do not expect the Defendant, particularly if acting in person, to substantiate by way of documentary evidence an assertion that payments can be made.  The decision in Paratus thus signals a shift towards the requirement of more detailed evidence and places a greater responsibility on Defendants to prove the mortgage is affordable.  The decision is clear in that if the Defendant wants the Court to exercise its discretion under the Administration of Justice Act 1970 s.36 then they are required to show that their assertions can be relied upon by a full, frank and contemporaneous account of their finances.

It remains to be seen how much impact Paratus will have in a practical sense and whether the lower courts will implement the suggestion that fuller evidence of affordability rather than simple assertions and promises should be provided if they are to exercise their discretion in favour of a Defendant.

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