Parker-Tweedale v Dunbar Bank Plc and Others (No 4)
| Jurisdiction | England & Wales |
| Judgment Date | 15 February 1990 |
| Date | 15 February 1990 |
| Court | Court of Appeal (Civil Division) |
Court of Appeal
Before Lord Justice Purchas, Lord Justice Nourse and Lord Justice Woolf
Mortgagee - right to costs - third party proceedings
A mortgagee who successfully defended an action, brought by a third party with a beneficial interest in the mortgaged property, was not entitled to add the costs of defending those proceedings to its security, even though the costs were reasonably and properly incurred, if the action impugned the title to the mortgage or the enforcement or exercise of the mortgagee's right.
The Court of Appeal so stated dismissing an appeal by the the first defendant mortgagee, Dunbar Bank plc, from a decision of Mr Justice Peter Gibson dated August 9, 1989 who had held that Dunbar was not entitled to add to its security the costs of defending the proceedings brought by the plaintiff, Mr Barry James Parker-Tweedale.
Mr Parker-Tweedale's action for an order setting aside a contract for the sale of the mortgaged property, of which his wife, the third defendant, Mrs Annabel Parker-Tweedale, was the sole legal owner and mortgagor, had been dismissed by the judge on January 26, 1989. That decision had later been affirmed by the Court of Appeal (The Times December 29, 1989).
Mr Timothy Lloyd, QC and Mr Stephen Acton for Dunbar; Mr Maurice Kay, QC and Mr Steven D Whitaker for Mrs Parker-Tweedale; Mr Parker-Tweedale in person.
LORD JUSTICE NOURSE said that a mortgagee was allowed to reimburse himself out of the mortgaged property for all costs, charges and expenses reasonably and properly incurred in enforcing or preserving his security.
In regard to such proceedings three propositions might be stated:
1 The mortgagee's costs of proceedings between himself and the mortgagor or his surety were allowable.
2 Allowable also were the mortgagee's costs of proceedings between himself and a third party where what was impugned was the title to the estate. There the mortgagee acted for the benefit of the equity of redemption as much as for that of the security.
3 But where a third party impugned the title to the mortgage, or the enforcement or exercise of some right or power accruing to the mortgage, the mortgagee's costs of the proceedings, even though they were reasonably and properly incurred, were not allowable.
The first and second propositions had together been called the general rule. The third, which applied to the present case, had been called...
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