Time limits for recovery of money owed after mortgaged property is sold

The House of Lords has held that West Bromwich Building Society could not recover the shortfall of monies due to it after a sale of mortgaged property because the claim was statute barred.

The cause of action was the claim to a debt secured on a charge and the action should have been brought within 12 years from the date of the cause of action (the House of Lords approved the Court of Appeal decision in Bristol and West plc v Bartlett). Despite inadequate repayment provisions in the charge, the right to recover the mortgage advance arose one month after the date of the mortgage and had certainly arisen by the time the possession order had been obtained. The claim to recover the shortfall was therefore statute barred.