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Possession of Mortgaged Residential Property: Pre-action protocol update

On 5 October 2015 the Civil Procedure Rules Committee released revised form N120 (Particulars of Claim for mortgaged residential premises) and N123 (Mortgage pre-action protocol checklist). The forms, which, at the time of writing, are shortly due to be made available on the HM Courts and Tribunals Service Form Finder [1], have been amended to reflect the Pre-Action Protocol for Possession Claims based on Mortgage or Home Purchase Plan Arrears in Respect of Residential Property (the Possession Protocol), which took effect in April.

Justin Coley has previously explained the key aspects of the Possession Protocol and its impact for lenders [2] and in this briefing he shares his observations arising from the amended forms.

Form N120 – Particulars of Claim for Possession (mortgaged residential premises)

Paragraph 10 of the amended form has been extended to provide options as to whether a known tenancy of a property is authorised or not. However, despite the final sentence stating: “If a tenancy was entered into with the authorisation of the mortgagee explain what if any steps the mortgagee intends should be taken in respect of that tenancy”, no space has been provided in which to enter any supporting commentary.

This may well be a technical issue that will be corrected in due course and claimants should arrange to provide the court with this information within paragraph 7 of the new N123 Mortgage pre-action protocol checklist.

It is understood that the changes required to Possession Claims OnLine to cater for the amendments to Form N120 will be effected as soon as possible.

Form N123 – Mortgage pre-action protocol checklist

The first point to note is that some renumbering has occurred throughout the checklist to bring this in line with the revised Possession Protocol.

Paragraph 2 (c) now requires an additional response from claimants confirming when they provided the defendant with information about the arrears; the total outstanding mortgage; and whether interest or charges have been added to the arrears.

Paragraph 7 is a new section, requiring claimants to confirm what steps the mortgagee has taken to check whether there is a tenant of the borrower in occupation, whether that tenant was authorised by the mortgagee and what order the mortgagee is seeking in light of the information obtained. The corresponding section of the Possession Protocol (5.2) states only that the lender should seek information about whether the property is occupied by an authorised tenant and so it seems that the revised checklist has created the need for more detailed requirements than the Possession Protocol itself.