# Judgement Mortgage not enforced on Sale of Property...do we have a case?



## Opuntia (5 Apr 2011)

Hi,

Can anybody tell me if a business would recourse to action against a solicitor if he/she fails to do a search/ignores the result of a search for any judgement mortgages that may be attached to a property he/she is charged with selling and subsequently does sell. And if so, is there a time line for any action?

We had secured a jm against a commercial property a number of years ago but it was sold shortly afterwards...we cannot understand how we could pay thousands for the procurement of the jm only for it to be completely ignored when the premises were sold. As far as we are aware it was the only judgement registered against the premises. 

Thanks in advance, 
Opuntia


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## Vanilla (5 Apr 2011)

It seems unlikely the solicitor who acted in the sale was your solicitor. So how could you think they were negigent- to whom were they acting for negligently?

Normally it is the buyer who searches against the property to see if there is a jm registered, though the vendor should, in the normal course of the transaction, answer a question about whether there is any jm registered or pending.


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## Brendan Burgess (5 Apr 2011)

Should the solicitor for the vendor not discharge the mortgage from the sales proceeds? 

What is the point of a judgement mortgage if this does not happen.

Can Opuntia now pursue the buyer to pay off the mortgage?

Brendan


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## Opuntia (6 Apr 2011)

Vanilla, thanks for your reply. 

It is not my solicitor that I am suggesting acted negligently, it is the solicitor for the *vendor* in this case. 

My solicitor had no hand, act or part in the sale of the property.

Is the onus on the vendor's solicitor or the buyer's solicitor to perform a search for any judgement mortgages pending before closing a sale?

Like Brendan says:
"Should the solicitor for the vendor not discharge the mortgage from the sales proceeds? 

What is the point of a judgement mortgage if this does not happen."???

To whom can we take our case?

Thank you, Opuntia


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## mf1 (6 Apr 2011)

The judgment mortgage attaches to the property. 

If it was correctly placed on the title then it is still there and the new owner is now responsible for it. It may be that the new owners solicitor missed it on the searches. 

So do a few things: 

1. Do a search on the title and check if the judgment mortgage is still on the title. Your solicitor can do this. 

2. Once you've established that, ask your solicitor to write to the new owners and ask them to discharge the debt. 

3. If they won't, enforce the judgment mortgage. 

From Brendan's post:  

"Should the solicitor for the vendor not discharge the mortgage from the sales proceeds?"

If the judgment mortgage was not on the title............
If the purchasers solicitor did not see it and require it to be paid.........

"Can Opuntia now pursue the buyer to pay off the mortgage?"

Yes. 

From Opuntia: 

"To whom can we take our case?"
See above steps to follow

mf


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## Bronte (6 Apr 2011)

Searches are always carried out on the day of sale in order for judgment mortgages etc to be discovered. 

Are you sure there is a judgment mortgage. If you are then you need to go to your solicitor and hire him to go after the either the vendor, the vendor's solicitor or whoever did not put the judgment mortgage on the deeds.


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## Opuntia (6 Apr 2011)

Thanks to all of you for your replies.


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## Brendan Burgess (6 Apr 2011)

Hi Opuntia

I wonder are you confusing a judgment with a judgment mortgage? 

The judgment mortgage is a further stage and is not automatic. Maybe your solicitor did not actually register the judgment? 

Brendan


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## Opuntia (7 Apr 2011)

Brendan, 
No, I am not confusing them I know the difference. 

We had a judgement mortgage registered against a commercial property. I have the copy of same in front of me. The property was subsequently sold.

Acting on our instructions our Solicitor wrote a letter to the Solicitors representing the Purchaser enclosing copy of Judgement Mortgage and asking that arrangements would be made for the discharge of said Judgement Mortgage from the sale thereof.

There was no reply to this letter.

Another letter was sent a month later referring to the first correspondance and the fact that we did not receive a reply. It was requested that they respond by return regarding the discharge of the Judgement Mortgage.

There was no reply to this letter either.

So from what I can gather based on the reponses I've had here, we are entitled to pursue the current owners of the building (not an attractive prospect as they are known to us personally and professionally) and they in turn could pursue their Solicitors for negligence.


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## Brendan Burgess (7 Apr 2011)

If they are known to you professionally and personally, then I think you should speak to them directly and not correspond through solicitors. 

_If _their solicitor has made a mistake, then it sounds as if they are liable. They may well be sticking their head in the sand and hope you go away. They might not have told the purchaser what the problem is. 

After talking to the purchasers, you might consider making a complaint to the Law Society. That could prompt action from the solicitors for the purchaser.

Brendan


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## mf1 (7 Apr 2011)

Brendan 

I'm going to re-phrase that for you! 


"After talking to the purchasers,  and after establishing the true facts of the case rather than surmising that the solicitor is to blame! you might consider making a complaint to the Law Society"

Perhaps the purchasers bought the property at a knock down price to take account of the  JM and hoped not to have to pay it!


mf


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## Brendan Burgess (7 Apr 2011)

MF1

As I wrote that post, I could sense you watching over my shoulder which is why I said:  



> _If _their solicitor has made a mistake...



 

But seriously, if I see a property with a judgment on it, I can simply buy it and force the holder of the judgment to chase me in the courts for it? 

I had thought that a person could not sell a property with a judgment mortgage on it.

Brendan


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## Vanilla (7 Apr 2011)

JM attaches to a property, not a person. Property can be bought and sold over and over with JM attached. Owner of the property at any given time is liable. 

Normally the buyers solicitor sees the JM and advises the buyer to insist that it is discharged from the proceeds of sale on closing.

And BTW only a client of a solicitor can make a complaint against them to the law society, so in this case the OP cannot make a valid complaint against the buyer's solicitor, even if they made a mistake in this case- which is not known.


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## Opuntia (7 Apr 2011)

> JM attaches to a property, not a person. Property can be bought and sold  over and over with JM attached.


Very interesting, Vanilla.

Like Brendan I thought that the sale could not proceed without the Judgement Mortgage being discharged.

The fact that the JM far exceeds the value of the property might have  lead the buyers to believe that it was worth the risk that we would  never enforce it as all the money could never be recovered anyway.



> "After talking to the purchasers,  and after establishing *the true facts of the case*"


I think this is where I have to start and take it from there...thank you! 

This discussion has been very informative. When I think of how much money our company has spent registering JMs over the years...to little or no effect...it really would make you wonder. I guess you live and learn.


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## Brendan Burgess (7 Apr 2011)

Hi Vanilla

That is very interesting.

 I am sure that the Law Society will reject Opuntia's complaint, but I think Opuntia should make it anyway. The Law Society may investigate. When I can't collect a debt, i always make a complaint to any professional body I can. It often results in a prompt payment. 

What is the point of the judgment mortgage. Should Opuntia now seek the sale of the property to discharge the debt?

Brendan


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## Vanilla (7 Apr 2011)

OP can seek a well charging order from court and then, if successful,  seek the sale of the property to recover the sum plus costs.

Point of a jm is to either proceed for a well charging order or to wait and hope that property needs to be sold or mortgaged by the owner in which case, normally, the jm will have to be discharged. Obviously that didnt happen here. That might be because the buyer took a punt, or the purchase happened in a very short window of time when the jm had not yet been  registered and the buyers registration was not lodged ( possible but nightmareish- however if an order had been made against the vendor capable of being registered as a jm this should have been disclosed by them during the purchase process), or,  the purchaser was a cash buyer and decided not to have searches done, or the purchasers solicitor was negligent or, or, or...


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