Housing Act 1985

Section 452.

SCHEDULE 17 E+W Vesting of Mortgaged House in Authority Entitled to Exercise Power of Sale

Modifications etc. (not altering text)

C1 Sch. 17 modified by S.I. 1986/797, regs. 20, 22

Vesting of house with leave of court E+W

1 (1) The authority may, if the county court gives it leave to do so, by deed vest the house in itself— E+W

(a) for the estate and interest in the house which is the subject of the mortgage and which the authority would be authorised to sell or convey on exercising its power of sale, and

(b) freed from all estates, interests and rights to which the mortgage has priority.

but subject to all estates, interests and rights which have priority to the mortgage.

(2) Where application for leave under this paragraph is made to the county court, the court may adjourn the proceedings or postpone the date for the execution of the authority’s deed for such period as the court thinks reasonable.

(3) An adjournment or postponement may be made subject to such conditions with regard to payment by the mortgagor of any sum secured by the mortgage or the remedy of any default as the court thinks fit; and the court may from time to time vary or revoke any such conditions.

Effect of vesting E+W

2 (1) On the vesting of the house the authority’s mortgage term or charge by way of legal mortgage, and any subsequent mortgage term or charge, shall merge or be extinguished as respects the house.

(2) Where the house is registered under the Land Registration Acts 1925 to 1971, the Chief Land Registrar shall, on application being made to him by the authority, register the authority as the proprietor of the house free from all estates, interests and rights to which its mortgage had priority, and he shall not be concerned to inquire whether any of the requirements of this Schedule were complied with.

(3) Where the authority conveys the house, or part of it, to a person—

(a) he shall not be concerned to inquire whether any of the provisions of this Schedule were complied with, and

(b) his title shall not be impeachable on the ground that the house was not properly vested in the authority or that those provisions were not complied with.

(4) A house which is vested under this Schedule in a local housing authority shall be treated as acquired under Part II (provision of housing).

Compensation and accounting E+W

3 (1) Where the authority has vested the house in itself under paragraph 1, it shall appropriate a fund equal to the aggregate of— E+W

(a) the amount agreed between the authority and the mortgagor or determined by the district valuer as being the amount which under sub-paragraph (2) is to be taken as the value of the house at the time of the vesting, and

(b) interest on that amount, for the period beginning with the vesting and ending with the appropriation, at the rate prescribed for that period under section 32 of the M1 Land Compensation Act 1961 (rate prescribed for compulsory purchase cases where entry is made before compensation is paid).

(2) The value of the house at the time of the vesting shall be taken to be the price which, at that time, the interest vested in the authority would realise if sold on the open market by a willing vendor on the assumption that any prior incumbrances to which the vesting is not made subject would be discharged by the vendor.

(3) The fund shall be applied in the following order—

(a) in discharging, or paying sums into court for meeting, any prior incumbrances to which the vesting is not made subject;

(b) in recovering the costs, charges, and expenses properly incurred by the authority as incidental to the vesting of the house;

(c) in recovering the mortgage money, interest, costs and other money (if any) due under the mortgage;

(d) in recovering any amount which falls to be paid under the covenant required by section 35 or 155 (repayment of discount, etc. on disposal) or paragraph 6 of Schedule 8 (terms of shared ownership lease: payment for outstanding share on disposal) or any provision of the conveyance or grant to the like effect;

and any residue then remaining in the fund shall be paid to the person entitled to the mortgaged house, or who would have been entitled to give receipts for the proceeds of sale of the house if it had been sold in the exercise of the power of sale.

(4) Section 107(1) of the M2 Law of Property Act 1925 (mortgagee’s written receipt sufficient discharge for money arising under power of sale) applies to money payable under this Schedule as it applies to money arising under the power of sale conferred by that Act.

Marginal Citations

M1 1961 c. 33.

M2 1925 c. 20.

Modifications in case of conveyance or grant before 8th August 1980 E+W

4 E+W In a case to which this Schedule applies by virtue of section 452(6) (disposals before 8th August 1980 of property held by local authorities for housing purposes), the preceding paragraphs have effect with the following modifications—

(a) for “house” substitute “ property ”;

(b) for paragraph (a) of paragraph 3 (1) (value of house) substitute—

“(a) the price at which the authority could have re-acquired the property by virtue of the condition mentioned in section 452(6)(b),”

and omit paragraph 3(2) (which provides for ascertaining the value of the house);

(c) omit paragraph (d) of paragraph 3(3) (which relates to repayment of discount and similar matters).