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	England and Wales High Court (Queen's Bench Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Queen's Bench Division) Decisions >> Landmark Mortgages Ltd v Bamrah & Anor [2017] EWHC 2041 (QB) (04 August 2017) URL: http://www.bailii.org/ew/cases/EWHC/QB/2017/2041.html Cite as: [2017] EWHC 2041 (QB)

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IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ON APPEAL FROM THE CENTRAL LONDON CIVIL JUSTICE CENTRE

		Royal Courts of Justice Strand, London, WC2A 2LL
		04/08/2017

Mr Justice Turner :

INTRODUCTION

1. Mr and Mrs Bamrah lived together at 123 Breamore Road, Ilford, Essex until his death on 22 November 2009. Mr Bamrah had purchased the property in his sole name with the aid of a mortgage in 2000 and had subsequently re-mortgaged the property in August 2003. Under the terms of the re-mortgage, Mr Bamrah had obtained an advance in the sum of £200,000 from Northern Rock Asset Management plc. The appellant, Landmark Mortgages Limited, is the legal successor to Northern Rock.
2. Under the terms of the re-mortgage, the accumulated debt thereunder fell due immediately upon Mr Bamrah's death. It was not paid and so Landmark started proceedings for possession of the property and for payment of the arrears. The procedural history thereafter is far too tedious and complicated to rehearse in this judgment. Fortunately, it is also irrelevant. Suffice it to say that the matter eventually came before HHJ Faber for trial in February 2017.
3. Mrs Bamrah defended the claim on the ground that she enjoyed an overriding interest in the property. On this point she lost and she does not appeal against this finding.
4. Landmark had claimed a debt in the sum of £355,457.54. The Learned Judge, however, awarded them only £200,000. It is against this heavy discount which Landmark now appeals to this Court with the leave of the single judge.

THE REASONING BELOW

5. The Judge started off from the uncontroversial premise that she would normally accept the computerised record of debt presented by Landmark as being accurate. In the event, however, she rejected the accuracy of the records on the basis of her interpretation of the contents of a paragraph in the witness statement of one Mr Smith who was employed as a specialist collector by Computershare Mortgage Services which was the company responsible for the management of the Northern Rock mortgage account.
6. The cause of the Judge's concern was composite photocopy on one sheet of paper of nine cheque stubs which had been disclosed by Mrs Bamrah and were appended to Mr Smith's witness statement. Each stub recorded payment of the sum of £500. Six of the stubs identified Northern Rock as the payee and were endorsed in Mrs Bamrah's own hand with express reference to the mortgage. These six payments appeared as credits in Northern Rock's transaction statement.
7. So far so good.
8. The fly in the ointment, however, was the remaining three stubs. Each reflected a payment in the sum of £500 but the payee was not identified to be Northern Rock and, in contrast to the other six stubs, there is no reference to the mortgage. Instead, the payee is identified to be Mrs Bamrah, herself. No credit is recorded in the transaction statement with respect to any cheques to which these three stubs refer.
9. The Judge found, on a balance of probabilities, that Mrs Bamrah had paid Northern Rock the sum of £1,500 by the presentation of the cheques to which these stubs related. These payments, not being reflected in the transaction statement, thus undermined the accuracy of the figure claimed by Landmark and she considered it appropriate to slash the claim down from £355,457.54 to the level of the capital sum originally advanced, namely, £200,000.
10. Landmark complains that the Judge fell into error in her analysis of the evidence relating to the three cheque stubs. In reaching her conclusion, she relied heavily upon a paragraph of Mr Smith's witness statement which referred to the stubs and which she took as evidence that he had conceded that the additional sum of £1,500 had actually been paid. Landmark contends that the paragraph in question, when properly analysed, contains no such concession.
11. This is what Mr Smith said:

"20 I exhibit for the Court's reference at [CS1/31-34], an up-to-date payment history, correct as at November 2016. The Court will note that, following the Deceased's death on 22 November 2009, there was a long period when no payments were made to the account. However, in March 2011, the Second Defendant began making payments towards the mortgage account which continued intermittently until July 2012, when I am advised by the Claimant's solicitors, the Second Defendant first raised the allegation that she had an interest in the Property. I exhibit at [CS1/355], copies of various payment stubs provided by the Second Defendant, evidencing various payments which she made towards the mortgage account with the Claimant."

12. The Judge found that at least two of the stubs related to payments made in 2012. The third was undated. She held:

"62 Either there was an error in the payment history or in Mr Smith's paragraph 20 that the finding I can make in relation to the figures is that the arrears should be £1,000 less than set out…

63 As the Defendant expressly put the Claimant to proof of the outstanding figures the Claimant should have provided a breakdown of the composition of the £355,457.54 so that the amounts attributable to interests (sic.) and legal fees and other costs could be verified by the court. Normally, however, the court would accept the computerised figures provided by the mortgage company but in this instance there is a demonstrable error either in the payment history or in Mr Smith's paragraph 20 which casts doubt on the Claimant's figures. Thus they cannot be accepted by the court in the absence of a proper breakdown setting out the precise details of the increases in charges over and above the £200,000 loan."

FLAWS IN THE REASONING BELOW

13. I agree with Landmark that paragraph 20 of Mr Smith's witness statement simply does not support the Judge's finding that he was conceding that the three controversial cheque stubs related to payments received by Northern Rock but not recorded by his company. I make the following observations:

i) Mr Smith expressly states in paragraph 20 that the payments continued intermittently until July 2012. This is entirely consistent with the transaction statement which records the last cheque from Mrs Bamrah to have been credited on 3 July 2012. This must relate to the stub dated 26 June 2012. It follows that Mr Smith was not accepting that any cheques were received thereafter and this is entirely consistent with the fact that two of the three controversial stubs were dated later than this and the remaining one was undated. He was not accepting, therefore, that the three stubs identifying Mrs Bamrah as the payee related to cheques paid to Northern Rock.

ii) Mr Smith did not state in his witness statement that all of the stubs which featured in the photocopied page disclosed by Mrs Bamrah related to payments received by Northern Rock but merely that various stubs evidenced various payments. Indeed, Mr Smith's knowledge was derived entirely from his company's computer records including the transaction account. He would, therefore, have had access to no evidence whatsoever upon which he could possibly have made the concession attributed to him by the Judge. Indeed, his evidence on the source of his information is recorded in the Judge's judgment thus:

"53 As to the source of information in the system he said that it comes from his company's computer not from the computers of Northern Rock or Landmark and that his company gets the information as to payment by updates from the bank if there is a transfer in and that would apply to the NatWest transfers. As to the cheques on page 166 to Northern Rock he said "they would notify our finance department" but he did not know how that notification would be done."

iii) The Judge appears to have failed to spot the very significant fact that the three controversial stubs do not name Northern Rock as the payee and record nothing attributing the payments to the mortgage. Had she done so, it is almost inconceivable that she would not have referred to the fact in her judgment. This omission is so obviously relevant that it would seem likely that the Judge had simply proceeded on the assumption that the cheque stubs had identified Northern Rock as the payee and not Mrs Bamrah herself. Indeed, this explanation is made more likely by the fact that in the passage quoted above she refers to the stubs as "cheques … to Northern Rock".

iv) The Judge's conclusions relating to the cheques are entirely based upon the purported admission by Mr Smith. With respect to Mrs Bamrah's evidence, she found her to be "an unreliable witness" and expressly rejected her claims to have made other payments. It is to be noted that Mrs Bamrah could easily have disclosed her bank statements over the relevant period and this would have resolved the question but she neither disclosed them at trial nor sought permission to introduce them on this appeal. Over the limited period in respect of which Mrs Bamrah did disclose her bank statements, they were entirely accurately reflected in the transaction statement.

14. From the above, I find that the Judge fell into error in concluding that there was evidence upon which she could properly conclude that the three cheque stubs related to payments made to Northern Rock. I interfere with her decision more readily than would usually be the case because she reached it entirely on her interpretation of the contents of Mr Smith's witness statement and without reference to any adverse finding as to his credibility when giving oral evidence.
15. It follows that this appeal is allowed and that the Judge's order is varied so that there is judgment for Landmark against Mrs Bamrah in her capacity as personal representative of the estate of Mr Bamrah in the sum of £355,457.54.
16. This leaves outstanding the issue of possession.

POSSESSION

17. The Judge allowed Mrs Bamrah time to pay the judgment sum of £200,000 by 2 June 2017 and suspended possession on condition that such sum would be paid by that date.
18. Her power so to do was derived from the familiar provisions of section 36 of the Administration of Justice Act 1970:

"Additional powers of court in action by mortgagee for possession of dwelling-house.

(1) Where the mortgagee under a mortgage of land which consists of or includes a dwelling-house brings an action in which he claims possession of the mortgaged property…the court may exercise any of the powers conferred on it by subsection (2) below if it appears to the court that in the event of its exercising the power the mortgagor is likely to be able within a reasonable period to pay any sums due under the mortgage or to remedy a default consisting of a breach of any other obligation arising under or by virtue of the mortgage.

(2) The court—

(a) may adjourn the proceedings, or

(b) on giving judgment, or making an order, for delivery of possession of the mortgaged property, or at any time before the execution of such judgment or order, may—

(i) stay or suspend execution of the judgment or order, or

(ii) postpone the date for delivery of possession,

for such period or periods as the court thinks reasonable.

(3) Any such adjournment, stay, suspension or postponement as is referred to in subsection (2) above may be made subject to such conditions with regard to payment by the mortgagor of any sum secured by the mortgage or the remedying of any default as the court thinks fit."

19. The Judge was persuaded to suspend possession on the basis that she was satisfied that Mrs Bamrah and her son could raise the sum of £200,000 to pay off the debt. However, there was no evidence before her (or before me) that Mrs Bamrah could afford to pay £355,457.54 within a reasonable or, indeed, any time even putting out of account her liability in respect of costs in the litigation.
20. It must follow that Mrs Bamrah must give vacant possession of the property to Landmark and I would invite Landmark to agree a relatively generous date by which such order will come into effect which may be incorporated in the order of this Court.