GMAC RFC Ltd v Grant-Sinclair & Anor

A registered transferee of a legal charge may enforce the charge under Land Registration Act 1925, even if other persons may hold beneficial interests arising from an underlying securitisation. Payment to the registered chargee remains legally effective. An appellate court will not ordinarily entertain a new statutory-unfairness challenge which was not raised below and would require a retrial. Permission will also be refused where no arguable error of principle is shown in a discretionary case-management ruling.

GMAC RFC Ltd sought possession of the mortgaged property and judgment for £72,631.31 plus contractual interest. The county court held that GMAC was entitled to enforce the charge as the registered transferee under sections 33 and 34 of the Land Registration Act 1925. The defendants sought permission to appeal out of time, challenging the loan document, repayment term, transfer and securitisation arrangements, and interest rate. They also raised for the first time an argument under sections 137 to 139 of the Consumer Credit Act 1974.

The central issues were whether the proposed grounds disclosed any realistic prospect of success and whether the new statutory challenge could properly be raised on appeal.

1. Permission refused. Lord Justice Clarke considered the merits despite the two-month delay and found no realistic prospect of success.
2. The county court was entitled to reject the late challenge to the interest rate. The repayment-term complaint was irrelevant because the claim had been limited to the principal advanced and contractual interest. The discretionary decision could only be challenged for an error of principle.
3. The registered transferee of a legal charge was entitled to enforce it under sections 33 and 34 of the Land Registration Act 1925. Possible beneficial interests arising from securitisation did not entitle the mortgagors to investigate underlying transactions as a defence. Payment to the registered transferee would be good payment under the charge and would protect them against later enforcement by another claimant.
4. City Mortgage Corporation Ltd v Reilly and Reilly, an unreported county court decision, did not assist the applicants. Its reasoning did not contradict the county court’s analysis.
5. The new argument under sections 137 to 139 of the Consumer Credit Act 1974 was too late. No evidence established that the 10.95 per cent rate was grossly exorbitant when agreed, and determining the issue would require a retrial.

Order: application for permission to appeal refused.

• Court of Appeal (Civil Division): Permission to appeal from the order of His Honour Judge Cowell in the West London County Court was refused. The county court had granted possession and entered judgment for £72,631.31 plus interest.