“ in addition to the loan she has already made, my daughter can also be reimbursed for all future payments that she makes towards the mortgage from the proceeds of any sale of the Property and/or the car and/or the garage (upon her showing evidence of payments from her account into mine and my wife's mortgage account). ”
“As your clients are already well aware, my wife and I are in very severe financial difficulties as a result of the proceedings that they have brought against me and there is not sufficient time for me to seek your client’s agreement and to wait for their response each and every time a mortgage payment falls due. For example, it took your clients 44 days to consent to the sale of the car which is unacceptable. My daughter has agreed to make some payments towards the mortgage until we can release funds from the sale of the garage in Russia and the car in England and it is only right that she be allowed to recover those payments from the proceeds of the sale of the property or the garage or the car - as your clients have previously acknowledged when she loaned my wife and I£40,000 to pay off the mortgage arrears. There is no reason why your clients should treat any other mortgage payments made by my daughter any differently. Please provide your client’s agreement by return.”
“Please would [your clients] also confirm they also consent to my daughter being repaid out of the proceeds of sale of the Property… b) As I have already explained in previous e-mails, my daughter's funds come from savings that she has accumulated from her salary. My daughter is not a defendant to these proceedings and she [sic] entitled for her personal finances to be kept private. Neither I nor your clients are entitled to ask her to provide such information and she does not agree to such a request. c) My daughter has paid and will pay the mortgage instalments straight into the mortgage account. I agree to provide your clients with a copy of the mortgage statement showing the payment coming from my daughter's account.”
“Reimbursement of your daughter’s mortgage contribution We have previously raised concerns over the source of your daughter’s mortgage contributions given the previous statements you have given regarding your daughter’s financial situation. Notwithstanding this, our clients do not object, in principle, to your daughter being reimbursed for any contribution she has made to your mortgage on the following basis: 1) such contributions must be supported by documentary evidence; 2) each contribution must have been necessary in the circumstance, i.e. made as a loan to you and/or your wife owing to a shortfall in your weekly allowance, rather than as a voluntary payment to the mortgage bank; 3) any such reimbursement must be made from your wife’s share of the capital in your property. Our clients maintain that any sale proceeds attributable to your interest in the property shall be paid into an account subject to the terms of the freezing order. In relation to point 2 above, please confirm why your daughter was continuing to contribute to your mortgage arrears when you were able to save funds of£12,029.88 from your weekly allowance.”
“It depends when the sale of the house takes place in relation to the trial of this action. If the sale occurred before the trial was completed, and Mr Mikhaylyuk wished at that stage to repay friends or relatives who had lent him money out of the proceeds of sale, he would, it seems to me, have a reasonable argument that he should be entitled to do so, on the grounds that they fall within the The Angel Bell exception; that they are ordinary trade debts and he should be entitled to pay them. If it means that there is then less left for you from the proceeds, then that is the consequence of you not having security. However, it the proceeds only come into being some time after the trial, then it may be different.”
“i) Why the loan must be given on a secured basis; and ii) That this is the only terms on which you can obtain the funding.”
“12. In those circumstances, the claimants contend that the loan due to Miss Mikhaylyuk has been paid by Mrs Mikhaylyuk. That is, they submit, because it is plain from the agreements that are relied upon that both Mr and Mrs Mikhaylyuk are liable, and the obvious inference, they submit, is that when sums exceeding£16,000 , the product of the two loan agreements, were paid by Mrs Mikhaylyuk to Miss Mikhaylyuk, she must have been repaying the whole amount that was due by both Mr and Mrs Mikhaylyuk to their daughter. That, it is submitted, is the natural inference when somebody who owes the whole of the debt pays to the creditor a sum which exceeds the debt. 13. I entertain some doubts as to the accuracy of this analysis. Whatever may be the position as between businessmen, it seems to me that it may be the case that as between Mrs Mikhaylyuk and Miss Mikhaylyuk, the sum that was paid to Miss Mikhaylyuk out of the proceeds of 24 Oakland Road, Bromley, was treated as being as to some£8,000 a repayment of a portion of the joint debt of Mr and Mrs Mikhaylyuk, and as to the balance was a gift. Whether that is the correct inference is not presently clear to me, and I decline to reach an inference adverse to Mr and Miss Mikhaylyuk without hearing from Miss Mikhaylyuk, who is available to give evidence.”
“15. There is, however, another problem that arises so far as Mr and Miss Mikhaylyuk are concerned, and that is this. A judgment creditor is ordinarily able to obtain a third party debt order, even if there are other creditors. 16. The court has, however, a discretion as to whether or not it will make an interim third party debt order final. It is likely to decline to make an order final if there is an issue as to the ownership of the monies that are the subject of the interim order, or if the debtor has been made bankrupt or is in administration or liquidation, for in those circumstances a statutory scheme for the sharing of assets will have come into being and the making of a third party debt order, which is final, will or may be inconsistent with that scheme. 17. That is, however, not the case here. Mr Mikhaylyuk is not a bankrupt. Miss Mikhaylyuk has no proprietary claim to the monies in the Royal Bank of Scotland. It seems to me that in those circumstances the claimants are entitled to have their interim third party debt order made final, and that, if I were to order that it was to be made final but not as to the£8,000 which should be paid to Miss Mikhaylyuk, I would in effect be preferring her as a creditor, and a creditor without judgment, over the claimants who are judgment creditors. 18. In addition, the figures are stark. Mr Mikhaylyuk, in the light of my judgment, owes the claimants something like US$80 million . Even if the sum held by the Royal Bank of Scotland was divided up pro rata as between the claimants and Miss Mikhaylyuk, the upshot would be that that which she would receive would be negligible. 19. For those reasons, and not without sympathy towards Miss Mikhaylyuk, I propose to make the interim order final, and I do not propose to vary the freezing order so as to permit a payment by Mr Mikhaylyuk out of RBS bank account of£8,000 to Miss Mikhaylyuk. The difficulties in which Mr Mikhaylyuk and Miss Mikhaylyuk find themselves, and indeed Mrs Mikhaylyuk, arise as one of the consequences of the very large sum, which in the light of my judgment, Mr Mikhaylyuk has been held liable to pay to the claimants. ”
“I do not propose to examine individually these various authorities cited to us, the outcome of which necessarily depended in the end on the particular facts of each particular case. I shall rather try to distil from those authorities the principles of law which they appear to me collectively to establish. In cases where a charging order being made absolute is not precluded by a winding up order, those principles can, in my view, be summarised as follows:- “(1) The question whether a charging order nisi should be made absolute is one for the discretion of the court.. (2) …….[this proposition relating to the burden of proof was subsequently disapproved in a later case] (3) For the purpose of the exercise of the court's discretion there is, in general at any rate, no material difference between the making absolute of a charging order nisi on the one hand and a garnishee order nisi on the other. (4) In exercising its discretion the court has both the right and the duty to take into account all the circumstances of any particular case, whether such circumstances arose before or after the making of the order nisi. (5) The court should so exercise its discretion as to do equity, so far as possible, to all the various parties involved, that is to say the judgment creditor, the judgment debtor, and all other unsecured creditors. (6) The following combination of circumstances, if proved to the satisfaction of the court, will generally justify the court in exercising its discretion by refusing to make the order absolute:- (i) the fact that the judgment debtor is insolvent; and (ii) the fact that a scheme of arrangement has been set on foot by the main body of creditors and has a reasonable prospect of succeeding. (7) In the absence of the combination of circumstances referred to in (6) above, the court will generally be justified in exercising its discretion by making the order absolute.”