''Royal Trust Bank v Buchler''

989 Year 989 ( CMLXXXIX) was a common year starting on Tuesday of the Julian calendar. Events By place Byzantine Empire * Emperor Basil II uses his contingent of 6,000 Varangians to help him defeat Bardas Phokas (the Younger), who suffe ...

BCLC 130 is a

UK insolvency law United Kingdom insolvency law regulates companies in the United Kingdom which are unable to repay their debts. While Bankruptcy in the United Kingdom, UK bankruptcy law concerns the rules for natural persons, the term ''insolvency'' is generall ...

case, which decided that before a creditor may enforce security, it must show it is appropriate to do so.

Facts

Mr Buchler's company borrowed £500,000 from Royal Trust Bank. It purchased and refurbished some property to let it out again. The loan was secured by a charge entitling the bank to appoint a receiver. When an

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was appointed, he decided it would be best to go ahead letting the property and then sell. Letting failed. The administrator decided to sell. The property got £850,000, and the bank sought leave under the

Insolvency Act 1986 The Insolvency Act 1986 (c. 45) is an act of the Parliament of the United Kingdom that provides the legal platform for all matters relating to personal and corporate insolvency in the UK. History The Insolvency Act 1986 followed the publication ...

s.11(3) (see now, Schedule B) to enforce its security.

Judgment

Peter Gibson J refused the bank leave. He held the bank failed to discharge its burden of showing a proper case to enforce security. The decision to delay the property's sale was a sound one, and if it was sold the bank could be paid in full. If the bank was allowed to appoint a receiver, costs would be increased, which would decrease assets available to all creditors.

Notes

{{reflist, 2 United Kingdom insolvency case law 1989 in United Kingdom case law

Facts

Judgment

See also

Notes