Jurisdiction(s):
United Kingdom

Seculink v Forbes: principal secured debt excluded from mental health crisis moratorium; interest enforceable; court may determine moratorium debt status (England and Wales)

Published on: 16 April 2025

Published by a LexisNexis Restructuring & Insolvency expert

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Article summary

Seculink Ltd v Forbes [2025] EWHC 524 (Ch) What are the practical implications of this case?

This judgment bolsters the position of secured creditors looking to enforce a debtor’s liability for the principal on a secured borrowing that has been called in, confirming that the principal itself falls outside an MHCM. As that principal is not a ‘qualifying debt’ under the Regulations, interest continues to accrue during the MHCM and remains recoverable by the creditor.

The court also confirmed it has jurisdiction to decide whether a liability owed by a debtor subject to an MHCM is a ‘moratorium debt’ and therefore benefits from the MHCM. This gives creditors the ability to challenge, in court, the inclusion of their debts within an MHCM rather than being limited to the review procedure provided by the Regulations.

However, Mr Justice Mann prefaced the ruling by noting an appeal pending in the Court of Appeal in Interbay Funding Ltd v Forbes (involving the same respondent), listed for hearing in May of this year, which raises very similar issues. Accordingly, we may see this current decision referred to...

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