In Lederer & Anor v Allsop LLP (13/03/2018) the court refused to continue an injunction preventing the sale of a property on the grounds that it was in nobody’s interests to delay a sale.
The property was owned by the second claimant company (C2), the registered proprietor. The first claimant (C1) was a student who was the beneficial owner of C2.
The lender company entered into two separate loans with C2, the first for the purposes of purchasing the property and the second loan for the purposes of the development of the property for a subsequent sale. The loan agreement included a provision whereby should there be an “event of default” with regards to either of the two loans, the lender company had the right to appoint receivers and sell the property.
During the term of the loans, C1’s mother alleged that the lender company had miscalculated sums owed and she sent an offensive email to the surveyor working on the development. As a result, the lender company refused to proceed further and ordered the surveyor to discontinue his work on the development. This led to a specific “event of default” being triggered; whereby the development failed to complete three months prior to the anticipated date for completion.
In accordance with the loan agreements, the lender company appointed receivers in order to sell the property. C1 and C2 alleged that the lender company was the one in breach of the loan agreement by telling the surveyor to discontinue work.
The court held that although the claimants’ allegations gave rise to serious issues to be tried, it was ultimately not in anyone’s interests for the injunction to continue to trial since:
- The receivers would continue to incur the costs of insuring the property
- The development in its current state posed a safety risk to trespassers
- The property was continuing to deteriorate
Further, the court was not convinced that the claimants could meet their obligations under a cross-undertaking to make good any liability in damages if they lost at trial. The application to continue the injunction was therefore refused.
Lederer & Anor v Allsop LLP (13/03/2018)