(1)The court may on application by a person who—
(a)claims an interest in the disclaimed property, or
(b)is under a liability in respect of the disclaimed property that is not discharged by the disclaimer,
make an order under this section in respect of the property.
(2)An order under this section is an order for the vesting of the disclaimed property in, or its delivery to—
(a)a person entitled to it (or a trustee for such a person), or
(b)a person subject to such a liability as is mentioned in subsection (1)(b) (or a trustee for such a person).
(3)An order under subsection (2)(b) may only be made where it appears to the court that it would be just to do so for the purpose of compensating the person subject to the liability in respect of the disclaimer.
(4)An order under this section may be made on such terms as the court thinks fit.
(5)On a vesting order being made under this section, the property comprised in it vests in the person named in that behalf in the order without conveyance, assignment or transfer.
Cases considering section 1017 (6)
[2019] EWCA Civ 2047 · 22 November 2019Limits
The court interpreted and applied the statutory jurisdiction governing vesting orders for disclaimed property, including the distinct routes based on an interest in the property and on an undischarged liability (see paras [16]; [21]-[24]; [34]-[50]).
A claimed interest gives access to the jurisdiction, but is implicitly connected with the requirement that the person be entitled to the disclaimed property. The court rejected a reading which divorced the claimed interest from entitlement (see paras [21]-[24]).
The appellant was subject to an undischarged liability in respect of the lease because he was contractually required to comply with its terms (see para [34]).
An applicant must establish an interest in the disclaimed property which, in the court’s judgment and in the circumstances, is sufficient to entitle that applicant to the property. Entitlement need not be absolute (see paras [21]-[24]).
The provision permits vesting in a person subject to an undischarged liability, but its exercise is restricted by the compensatory requirement in subsection (3) (see para [35]).
A liability-based vesting order must justly compensate the applicant in respect of the disclaimer. There must be a reasonable relationship between the liability and the benefit obtained; a general preference about who should receive a windfall is insufficient (see paras [39]-[40]; [45]-[49]).
[2025] EWHC 1572 (Ch) · 24 June 2025Interprets
The court considered the statutory jurisdiction to make a vesting order in respect of disclaimed property. The application failed under both statutory limbs. (see paras [15]-[17]; [25]-[36])
The provision required the claimants to claim an interest in the disclaimed property. Their shareholding, directorship and leasehold contractual rights did not establish the necessary interest in the freehold. (see paras [25]-[30])
The provision requires an applicant to be under a liability in respect of the disclaimed property which is not discharged by the disclaimer. The claimants’ tenant liabilities arose under their leases and were not liabilities in respect of the freehold itself. (see paras [31]-[34])
The provision permits vesting in a person entitled to the disclaimed property. The claimants were not entitled to the freehold because neither their corporate roles nor landlord covenants gave them the requisite legal interest. (see paras [25]-[30])
The provision permits vesting in a person subject to the relevant liability. It did not assist because the claimants’ liabilities were not liabilities in respect of the disclaimed freehold and the compensation condition was unsatisfied. (see paras [31]-[36])
The vesting order had to be just for compensating the person subject to the liability. That required comparison of the value of the disclaimed property with the liability. The freehold’s more-than-nominal value was disproportionate to the claimants’ lease liabilities, and lease-related difficulties were irrelevant to that comparison. (see para [35])
[2023] EWHC 121 (Ch) · 6 February 2023
Applies the vesting-order power to the mortgagee’s interest in the disclaimed lease. The resulting order vested the lease in the mortgagee as substituted security (see paras [131]-[135]).
Cited only.
Cited only.
Cited only.
Applies the power to impose terms on a vesting order. The claimant’s subrogation declaration was made subject to equivalent accounting obligations on any sale (see paras [39], [143]-[144]).
What each judgment says about section 1017 is in the case-law panel in the full Act.