Jurisdiction(s):
United Kingdom

Mixed secured debts under Debt Respite Scheme: court permission required for possession/security if any part is moratorium debt (Bluestone Mortgages v Stoute, England and Wales)

Published on: 15 May 2025

Published by a LexisNexis Restructuring & Insolvency expert

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Article summary

Bluestone Mortgages Ltd v Stoute and others [2025] EWHC 755 (Ch)

What are the practical implications of this case?

This ruling carries material consequences for creditors—particularly mortgage lenders—and those who advise them. The court confirmed that if a secured liability comprises both qualifying (moratorium) and non‑qualifying strands, any step to enforce a judgment or security, including a possession order, requires the court’s leave where any part of the balance sits within a moratorium. Read this way, the Regulations, SI 2020/1311, reg 7, give primacy to the debtor’s mental health and guard against enforcement tactics that might sidestep statutory safeguards through fine legal niceties. For practitioners, the message is to proceed with care and strict procedural discipline. Before moving to enforce, lenders should analyse the character of each element of the indebtedness, and consider applying for permission whenever moratorium debt, however small, forms part of the total sum. Attempts to draw formal lines—such as treating distinct limbs of a possession order separately—will fail where the enforcement overall would intrude upon the debtor’s moratorium protections. The judgment also shows that moratoria may meaningfully pause enforcement, even in relation to historic arrears, where mental health difficulties continue. It further suggests that the court...

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