For many years lenders have had issues in deciding how to deal with contents left in a property following eviction of the occupier. In some cases large storage bills have incurred and sale of the property has often been delayed, sometimes for prolonged periods. Thankfully this topic was recently addressed by the Court of Appeal in the case of Da Rocha-Afodu v Mortgage Express Ltd [2014] EWCA Civ 454 and the outcome will be of considerable relief to mortgage lenders.
The case involved a claim in conversion, following the disposal of the contents left in the property. It is of relevance to lenders because it arose out of a mortgage repossession. A suspended possession order had been made against the appellants in October 2005. They were eventually evicted on 9 September 2006. Their notice of eviction, and previous correspondence, had reminded them of their duty to remove their belongings from the property. When they left the property, a considerable quantity of their possessions remained. They returned three times to collect possessions: the mortgagees had put up notices stating that if the chattels were not removed within 14 days, they would be disposed of in an appropriate manner. By the time the appellants returned on a fourth occasion the property had been cleared and the chattels disposed of. The appellants appealed both against the District Judge’s decision that there had been no conversion, and against her determination of the damages that would be payable if she were wrong on the former point.
The Court of Appeal approved the finding of Mr David Kitchin QC in Scotland v Solomon [2002] EWHC 1886 (Ch) that a mortgagee in these circumstances was an involuntary bailee whose duty to the appellants was to do what was right and reasonable. The appellants argued that the section of the Mortgage Conditions which dealt with the disposal of chattels prescribed an exclusive procedure which the mortgagees had to follow. The mortgagee, on the other hand, argued that the conditions were illustrative of what would be a reasonable course for it to take in order to satisfy the requirements imposed upon it as an involuntary bailee. If the appellants’ arguments were upheld it would have meant that the mortgagee could not dispose of the contents of the property in situ but would have had to have first placed them into storage. This would often not be a sensible course of action to take and could prove costly.
The appellants had originally claimed a total of £80,000 as the value of their possessions. The District Judge held that they had entirely failed to prove this loss and would have awarded – if there had been a liability in conversion – a ‘fairly nominal’ £5,000. In view of the finding of the Court of Appeal on the liability issues this ground of appeal did not need to be considered.
In summary it is now clear, and supported by Court of Appeal authority, that a mortgagee in this situation does not need to remove and store contents left in the property. It is however necessary to serve on the former occupant and/or affix to the property the relevant notice requiring removal of the contents within a reasonable period before they are disposed of. It would also be sensible to remind the occupant of this requirement prior to the eviction.
Even where the mortgage conditions prescribe a procedure to be adopted in respect of the contents, which is not always the case, deviation from this will not present a problem if the mortgagee has done what is “right and reasonable”.
