Applying to Set Aside or Vary a Possession Order
This type of application is most likely to be made by a borrower who did not know about the court proceedings and / or the hearing at which the possession order was made.
When a court issues a claim for possession they will send the borrower a notice giving the date and location of the hearing. The lender is legally obliged to send a letter to the property giving the time, date and location of the hearing. However, this letter must be addressed to “The Occupier” and is frequently ignored by borrowers.
If all the necessary documents have been sent to the correct address they are deemed to have been delivered and the lender is entitled to ask for a possession order. This is true even if it can be proved that the documents were not received by the borrower.
To have a possession order set aside, borrowers will have to prove that:
- they had a good reason for not attending the hearing; AND
- the possession order would not have been made if they had been present.
If a borrower did not receive notice of the hearing this may provide a good reason for his failure to attend. However, the borrower will still have to convince the court that the possession order would not have been made if he had been present. When a mortgage is in arrears and the lender’s case has been correctly presented it is highly unlikely that a court will agree that the possession order should not have been made.
To succeed in his application the borrower would probably have to prove that:
- the lender had acted incorrectly;
- there was a problem with the way the lender had presented their case;
- the arrears had been cleared or significantly reduced when the possession order was made; or,
- there was a valid defence to the claim, (rare in mortgage cases).
Strictly speaking, the judge should look at the circumstances as they were at the time the possession order was made. For example, if a borrower has cleared the arrears since the possession hearing the possession order should not be set aside because the lender was entitled to it when it was made.
Applying to Vary a Possession Order after Failure to Attend a Hearing
A borrower may argue that a suspended possession order would have been made if they had been at the hearing. A judge will consider the borrower’s financial circumstances and decide whether to substitute a suspended possession order. If the borrower can satisfy the judge that he is able to make payments it is highly likely that a suspended possession will be entered. The borrower may also be asked to explain why he did not attend the hearing.
Applying to Vary a Possession Order after a Change in Circumstances
If a borrower can no longer afford the payments he originally promised to make he can ask the court to reduce the payments required for the possession order to remain suspended.
A note of caution – the lender’s representative may argue that it is evidence that the borrower cannot afford the mortgage at all if:
- The borrower has failed to make regular payments of the monthly instalment plus the amount he now says he can afford; or,
- The original possession order provided for very low payments towards the arrears.
There are steps that can be taken to set aside or vary possession orders but they are not guaranteed to be successful. Most judges will take the view that the lender is entitled to a possession order if there are arrears on the account and the lender’s case is correctly presented. It is up to the borrower to convince the court that an order should not have been made or that a suspended possession order is more appropriate.