Ivan Kaye v Amanda Lees

A mental health crisis moratorium under regulation 28(2)(e) requires evidence of both a mental disorder of a serious nature and crisis, emergency or acute care or treatment for that disorder. The provision is a supplementary category, but must be read consistently with the compulsory detention and treatment situations in regulation 28(2)(a)–(d). Routine or periodic outpatient appointments will not ordinarily satisfy the treatment requirement. A creditor may obtain cancellation under regulation 19 where the eligibility criteria were not met or the moratorium unfairly prejudices the creditor. The court may also restrain repeated applications where there is a real risk that the statutory scheme will be abused to frustrate enforcement of a judgment debt.

The claimant held a substantial judgment debt against the defendant arising from nuisance and harassment. Enforcement against the defendant’s leasehold flat had been declared null and void because it breached an earlier mental health crisis moratorium. The defendant then obtained a further moratorium.

The claimant applied under regulation 19 of the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 to cancel it, alleging ineligibility, material irregularity and unfair prejudice. He also sought an injunction restraining further applications for a limited period. The central issues were whether the regulation 28(2)(e) criteria had been met, whether the moratorium unfairly prejudiced the claimant, and whether injunctive relief was appropriate.

1. Current moratorium cancelled. The court was satisfied that the defendant did not meet the eligibility criteria when the moratorium was initiated. It therefore cancelled the moratorium under regulation 19(3)(a) and (b).
2. Interpretation of regulation 28(2)(e). The provision requires two conditions: the debtor must suffer from a mental disorder of a serious nature, and must receive crisis, emergency or acute care or treatment for that disorder. Sub-paragraph (e) is a sweeping-up provision, but it must provide an equivalent situation to those in sub-paragraphs (a)–(d), although treatment may be given without detention or removal. The seriousness threshold reflects the severity of disorders which might otherwise justify overriding the debtor’s liberty or free will.
3. The words crisis, emergency and acute are alternatives, but each denotes urgency and severity. General or routine treatment is insufficient. Three-monthly outpatient psychiatric appointments, without other medical or clinical intervention, did not satisfy the second condition. The available evidence also did not demonstrate a disorder of the requisite seriousness. A bare professional assertion that the defendant was receiving crisis treatment added nothing capable of evaluation.
4. Unfair prejudice. Independently, the court concluded that the claimant was unfairly prejudiced. The assessment is objective and requires a balancing exercise. Relevant matters included the substantial and longstanding judgment debt, the absence of any repayment plan, the weakening security, the claimant’s depleted enforcement resources, the sequence of moratoria, and evidence that the defendant remained economically productive. The statutory purpose includes helping debtors and creditors devise a realistic repayment plan.
5. Injunction. The High Court had power to restrain potential abuse of the statutory scheme. Given the history of repeated moratorium applications close to enforcement steps and the defendant’s failure to provide adequate evidence, there was a real risk of a further application frustrating enforcement. A proportionate injunction was granted, with permission for the defendant to apply to vary or discharge it, including on notice with supporting evidence.