Tanfield Chambers

Banks are appointing receivers rather than taking possession — but this might not always be appropriate

Since the banking crisis, banks, in enforcing their security, are increasingly appointing Law of Property Act 1925 (LPA) or fixed charge receivers rather than taking possession. There are usually said to be two main advantages of such appointments.

First, following the appointment of a receiver, it will be for the receiver to obtain possession of the property (if necessary) and find a buyer for it. Awkward or violent mortgagors will therefore be problems for the receiver and not for the mortgagee.

Second, pursuant to s109(2) of LPA, an LPA receiver is deemed to be the agent of the mortgagor. Similarly, a charge permitting the appointment of a fixed charge receiver almost invariably provides for the receiver to be the agent of the mortgagor. Consequently, in the absence of such interference by the mortgagee as can be said to nullify the receiver’s independence, the mortgagor (not the bank) is solely responsible for the receiver’s acts or defaults (unless the mortgage deed otherwise provides — which it never does)…

If you are registered and logged in to the site, click on the link below to read the rest of the Tanfield Chambers briefing. If not, please register or sign in with your details below.

Sign in or Register to continue reading this article

Sign in


It's quick, easy and free!

It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.

Register now

Why register to The Lawyer


Industry insight

In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.


Market intelligence

Identify the major players and business opportunities within a particular region through our series of free, special reports.


Email newsletters

Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.

More relevant to you

To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.

Browse This Firm’s


2-5 Warwick Court