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Bankers Trust Company v Amir Namdar & Ors (1997)

Summary

Mortgage on matrimonial home discharged by mortgagee producing a bank guarantee and following it up with a charge bearing forged signatures. Whether bank could claim right of subrogation or mortgagee's refinancing arrangements created an equitable mortgage over his beneficial interest in the property. Bank's remedy and position of the co-owning wife.

Facts

Plaintiff's appeal and 2nd defendant's cross-appeal against the decision Evans-Lombe. The appellants contended that having provided the funds to discharge the 1987 mortgage they were entitled to exercise rights under the mortgage by subrogation or that the 1st defendant's facility letter created an equitable charge over his beneficial interest entitling the plaintiff to an order for sale as the judge had accepted, under s.30 Law of Property Act 1925.

Held

No right of subrogation arose because the 2nd defendant did not know of the re-mortgaging and the money provided for the discharge of the mortgage was not the appellant's money. The court was bound by Re Domenico (a bankrupt) (1990) 3 All ER 952 to give preference to the wishes of a creditor when exercising its discretion under s.30 Law of Property Act 1925.

Appeal and cross-appeal dismissed.

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Judgment
14 Feb 1997

Court of Appeal
Kennedy LJ, Peter Gibson LJ, Buckley J

References
[1997] EGCS 20

Members
John McGhee QC

Practice areas
Real Estate