Financial Services Update: Are you Registered as Charge Holder?

15 June 2015

Justice Laffoy concluded obiter dictum (not binding as a precedent but instructive nonetheless) in a recent case that a charge holder cannot exercise its statutory rights, including the ability to enforce a charge over registered land, i.e. land/property which is registered in the Land Registry in Ireland as opposed to the Registry of Deeds, under the Registration of Title Act 1964 unless the charge holder is noted as the owner of that charge in the Land Registry. 

Tom Kavanagh & Bank of Scotland plc - and - Patrick McLaughlin & Roseann McLaughlin [2015] 

An appeal by a husband and wife against the appointment of Tom Kavanagh as receiver over certain properties secured in favour of Bank of Scotland (Ireland) Limited, subsequently merged with Bank of Scotland PLC, was unanimously dismissed by the Supreme Court.

Tom Kavanagh & Bank of Scotland plc - and - Patrick McLaughlin & Roseann McLaughlin [2015] The Supreme Court was satisfied that: 

(i)  the relevant mortgages/charges had validly transferred to Bank of Scotland PLC (“BOS”) when Bank of Scotland (Ireland) Limited (“BOSI”) merged with BOS; and

(ii) a receiver had been validly appointed by BOS under the terms of the mortgages/charges granted by the couple in favour of BOSI. BOS had a contractual right to appoint a receiver under the mortgage and BOS did not need to avail of the statutory powers under the Registration of Title Act 1964 (the “Act”).  

Of particular note in this case, however, was the conclusion by Ms. Justice Laffoy. In order to avail of the statutory powers and protections under the Section 62 of the Act (which includes enforcement powers), and without a specific statutory provision to exempt that registration requirement, a charge holder must be registered as owner of the charge in the Land Registry.

This will be of particular relevance where a mortgage/charge document does not contain the required enforcement language to enable a charge holder to enforce its mortgage/charge as a matter of contract.

Registration of Title Act 1964

Justice Laffoy referenced:

Section 62(2) of the Act which provides: "…until the owner of the charge is registered as such, the instrument shall not confer on the owner of the charge any interest in land; and

Section 62 (6) of the Act which provides: … the registered owner of the charge shall, for the purpose of enforcing his charge, have all the rights and powers of a mortgagee by deed, including the power to sell the estate or interest which is subject to the charge.

Justice Laffoy was satisfied that the receiver was validly appointed under the terms of the mortgage/charge documents as a matter of contract.  The fact that BOS was not registered as the owner of the charges in question did not affect its contractual powerto appoint the receiver. However that would not be the case if BOS was seeking to rely on its statutory powers to appoint a receiver under the Act.


This case is of relevance for entities/individuals who have acquired Irish loans/Irish loan portfolios and who wish to rely on statutory enforcement rights rather than contractual enforcement rights acquired on the foot of an acquired mortgage/charge document. It is clear that such entities/individuals must be noted as the registered owner of the security/charge document in the Land Registry. Such registration is effected by the registration of a Form 56 in the Land Registry.  

For more information, please contact a member of our Banking team.

The content of this article is provided for information purposes only and does not constitute legal or other advice. 

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