Together Commercial Finance Limited & Ors v Matthew Stuart Slack & Anor

A mental health crisis moratorium restricts enforcement action only in relation to a moratorium debt. Under regulation 7 of the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020, security is outside the restriction where it secures a different debtor’s liability that is not a moratorium debt. A charge securing a company’s loan therefore permitted receivers to sell property charged by an individual who had separately covenanted to pay the company’s liabilities. Summary judgment and a declaration were granted. Applications for permission under regulation 7 and cancellation under regulation 19 were dismissed.

The claimants had lent money to a company. The first defendant owned property and executed a legal charge securing the company’s liabilities, while also covenanting to pay those liabilities. Following default, receivers took possession and wished to sell the property.

The first defendant entered a mental health crisis moratorium under the Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020. The claimants brought a Part 8 claim and sought summary judgment, arguing that the moratorium did not prevent the sale. The defendants contended that the sale would be enforcement action in respect of a moratorium debt and would be void under regulation 7(12). The central issue was whether the regulations prevented the receivers from selling the property while the moratorium continued.

Disposition. Summary judgment was granted to the claimants on the sale issue. The court declared that a sale by the receivers was not prevented by the regulations and would not be void because of the moratorium. The applications for a regulation 7 order and cancellation under regulation 19 were dismissed. Costs and consequential matters were reserved.

1. Summary judgment. The court treated the issue as a short point of law on undisputed facts. It applied the approach in ICI Chemicals & Polymers Ltd v. TTE Training Ltd [2007] EWCA Civ 725 and ED&F Man Liquid Products Ltd v. Patel [2003] EWCA Civ 472. The necessary evidence was available, the defendant had sufficient opportunity to participate, and no mini-trial was required. The court noted the regulations’ drafting difficulties, referring to Seculink Ltd v. Forbes [2025] EWHC 524 (Ch), but declined to resolve alternative issues requiring a longer interpretive exercise without fuller material.
2. Construction of the charge. The covenant to pay or discharge the company’s liabilities created a debtor-creditor relationship between the first defendant and the lender. However, the charge secured the company’s liabilities, not the first defendant’s separate covenant. The limited-recourse clause and reference to recovery of a shortfall did not extend the security. The court relied on the principle discussed in Evans v. Jones (1839) 5 M & W 296.
3. Moratorium debt. The first defendant’s own liability was not a secured debt because the lender had not provided him with credit under the charge and the charge did not secure that liability. It was therefore a qualifying debt and, on the evidence, a moratorium debt. The company’s liability could be a qualifying debt, but it was not a moratorium debt because it was not incurred by the moratorium debtor and had not apparently been notified as such.
4. Regulation 7. The protection is confined to enforcement action in relation to a moratorium debt. The charge was not held in respect of a moratorium debt, so the receivers’ sale was not prohibited enforcement action. The court left unresolved the wider question whether the regulations restrict a creditor’s agents, and also observed that permission under regulation 7(5) requires consideration of whether the step would significantly undermine the moratorium’s protections, separately from detriment to the debtor.
5. Regulation 19. The court doubted that the High Court had jurisdiction to cancel a moratorium, since regulation 19(1) confers that jurisdiction on the County Court. In any event, there was no material irregularity: the notified debt was qualifying, while the company’s debt was not a moratorium debt.