I am the applicant and self-representing. I have agreed with the Respondent to a financial separation, under which she may buy me out of the family home. For this the Respondent has to release me from the joint mortgage and pay me a (much discounted) lump sum. Failing to complete the order by the 1st of August would lead to the sale of the family home to be ordered, splitting the net proceeds (over £160k each). For the Financial Remedy Order, we drafted under “IT IS ORDERED BY CONSENT with effect from Decree Absolute” a “produce Release form Mortgage and Indemnify & Lump sum order”.
The family court has rejected our application for the Financial Remedy Order, stating that the “release from Mortgage” section should be recited and moved to go under “the parties agree”. In the judge’s view the court has no jurisdiction to order the release of the Applicant from his liability under the mortgage.
RECITING WILL BE DIFFICULT
The Respondent is living alone in the family home, for which I pay half the mortgage. She has little incentive to sign this agreement again and all the benefits of delaying the Financial Remedy Order. So reciting and re-submitting seem difficult.
It is my understanding that the family court can include indemnities in the substantive orders. The President of the Family Division, Sir Justice Munby, has confirmed that in his view the family court does have the power to make an order of this sort and has endorsed this way of proceeding. There also seem to legal precedents set by Mr Justice Mostyn, though I am struggling to find any examples of “release from mortgage” orders. Can anyone point me to Financial Remedy Orders which include a substantial “Procure Release from Mortgage” order?
HOW TO APPEAL?
Has anyone appealed a judge's decision as to order the release of the Applicant from his liability under the mortgage? How do you do that?
All hints at precedents or at how to proceed will be greatly appreciated!
The court is correct, they do not have the jurisdiction to force a mortgagor to release a party from the mortgage.
Normally there will be an undertaking to attempt to release the other party. However this where difficulties normally arise as the party can simply go to a high street bank, get a rejection slip, and they have fulfilled their obligations.
The indemnity clause then kicks in as while you are still on the mortgage, should the lender come knocking for the arrears then you can claim them back from the other party.
The safest thing is to have an end date where the house will be sold if they have not been able to release the other party from the mortgage. This is often when the youngest child reaches 18, but other trigger points can be negotiated.
Has your solicitor drawn up this Consent Order? It's usual for this to be done by a solicitor even if both parties have self repped all the way through the case. DIY consent orders are very much frowned upon by the court - despite some template orders being published a year or so back.
I completely agree with Luna Shadow. You have an enforceable contract with the mortgagee/lender. Only the mortgagee can release you from your obligations. Why would they want to do that? It will only increase their risk. The family courts have no jurisdiction over this. So I doubt there is anything to appeal or legal precedent to assist you on this matter.
The Financial Remedy Order was done by a solicitor in East Anglia. Regarding the courts refusal on the "release from mortgage order" this solicitor replied (and I expect to receive an invoice for her response):
"The President of the Family Division (the most senior family Judge) has confirmed that in his view the court does have the power to make an Order of this sort and he has prepared a precedent set of Orders on this basis."
"However we are finding that some local Judges still consider they are not able to make such an Order. You could write to the court and point out to them that the President of the Family Division has endorsed this way of proceeding, but in all honesty the quickest way to have this situation resolved will be to remove the relevant clause from Orders up into Agreements."
The Respondent wants to renegotiate before the clause.
I have tried to find precedent orders that order a release from mortgage in some way. However, I have only found orders to pay a mortgage.
It would fantastic, if anyone could point me at release from mortgage orders?
Just guessing it is a CO, LJ Munmby has no authority to change current law alone, its a slow process and would require a high court ruling, a proposal is worthless.
The other two guys answering are quite right, as of right now no judge can order a third partie to release a spouse from a covenant they both agreed too, its beyond the scope of any family law be it MCA FLR or county courts act, even schedule one or TOLATA.
What the judge has said is they can`t seal an imperfect order - in plain English a judge has no authority to order the royal bank of me to release you from a deal (covenant) you made with me, if you asked me for a hundred quid and i say yeah but you and your spouse must sign this contract a judge cannot order me to release you from that deal.
So the wording is odd, as others have said, it should be "best endeavours" and if you want to keep that term is must be recorded in the recital not the body order.