A High Court case has highlighted the significance of the principles behind the Family Home Protection Act 1976 and the importance of obtaining spousal consent to the sale or mortgaging of the family home. This also applies to judgement mortgages.
Judge Gerard Hogan in a recent Court of Appeal decision ruled that the judgement holder, Skibbereen Credit Union, could not enforce its security by having the properties sold, despite it being “well charged” over the family home as the wife had neither been party to the commercial loan agreement entered into by her husband nor signed her name to any loan documentation that would have provided her consent to using the family home as security for the loan.
The ruling was made after a determination of the principles governing the possible partition and sale of a family home under section 31 of the Land Law and Conveyancing Act 2009.
In the circumstances, the Judge ruled it would be unjust giving the facts of the case to allow the family home to be sold “over the wishes of the innocent spouse who was not a party to the loan transaction.”
Two important points can be extracted from this case. Firstly, it highlights the requirement for lending institutions to ensure that the written, fully informed consent of the spouse is obtained so that a judgement mortgage can be fully enforced and its security realised by power of sale.
Secondly and more significantly, it copper fastens the importance of the role that spousal consent plays and begs the conclusion that if you want to take security over a family home even by way of a judgement, the right of the spouse ultimately survives.
Please contact Jemma Lyons () of Gordon Judge Solicitors if you have any queries.