Danske appoint receiver on performing mortgage cos a joint borrower in default on unconnected loan

Discussion in 'Mortgage arrears & negative equity case studies' started by The Partnership, Mar 20, 2016.

  1. The Partnership

    The Partnership Registered User

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    Mary is not in a position to pay the partnership her share of negative equity and walk away.

    Mary is in negotiation with Danske in other troubled loans of a much higher value.

    In 2011 Danske refused to release Mary from the partnership mortgage.

    In 2005 we were aware Mary had other mortgages ,but we were not aware of the possibility these loans could affect our mortgage in any way.

    The offer to resume our mortgage with 10 years remaining of € 300K was made to the partnership.

    The offer of € 225K full and final looks good on paper but the property is only worth € 120K how can we go to a bank with this.
    Regards
     
  2. llgon

    llgon Frequent Poster

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    Last edited: Apr 10, 2016
    So it's a case more that Mary cannot rather than will not give up her share of the partnership. You're in negative equity of approx 180k now, 60k each. If you could get the offer from Danske back and two of you were able to refinance at 225k and release Mary from the partnership for no (or possibly a small) payment you would be in negative equity of 52,500 each and free of Mary and her financial problems. This could be of great benefit to the three of you. Have you looked at this possibility? I know refinancing is a big problem but there may be some way around this, worth looking at anyhow.
     
    Last edited: Apr 10, 2016
  3. The Partnership

    The Partnership Registered User

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    Hi a few things have happened since my last post
    Danske bank have produced a grounding affidavit,which has some factual errors.
    Our barrister has produced a detailed replying affidavit which we are very impressed with,It covers all the main points.
    2 adjournments in masters court
    We have been sent to the judges list for October.
    Danske contacted us before the last visit to the masters court asking us to consent to an adjournment of 2 or 3 weeks ,but we declined.
    Anyone with thoughts or comments gratefully taken on board.
    Regards
     
  4. Brendan Burgess

    Brendan Burgess Founder

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    By all means, get ideas and suggestions from Askaboutmoney, but if you have a good legal team, be very careful about annoying them with anonymous advice.

    Brendan
     
  5. The Partnership

    The Partnership Registered User

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    I take your point .
    I hope our legal team understand that for them a day in court is just another day.
    A day in court for us can mean the difference between struggling for the next 10 years or getting on with our lives.
    So i will try my best to understand the system and the terms so i can make informed choices and try not to annoy to much
    Regards
     
  6. The Partnership

    The Partnership Registered User

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    Hi we have been in court lately and Danske asked for an adjournment ,we tried to block it but the judge adjourned to feb
    Regards
     
  7. Brendan Burgess

    Brendan Burgess Founder

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    Thanks for the update on this very interesting case.


    What is the court case about?

    I presume that the Receiver is in place. Can they not just sell the property?

    Brendan
     
  8. The Partnership

    The Partnership Registered User

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    Hi Brendan
    Danske are looking for a judgement against the partnership of €300,000
    The receiver is in but we have heard he has not collected any rent in 30 months.
    Danske did put the property up for auction but removed it prior to auction in 2014
    We contacted the receiver in 2016 and asked about the rent and sale of the property, we were told over the phone that they were instructed by the bank not to evict the tennant and hold off on the sale
    Regards
     
  9. The Partnership

    The Partnership Registered User

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    Hi has anyone any ideas on our case ,we are back in court in a few weeks in the judges list
    Regards
     
  10. Brendan Burgess

    Brendan Burgess Founder

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    As I said...
    What is your barrister advising?

    It would seem clear that you owe €300k + the costs of the Receiver
    But the Receiver or Danske must be negligent in not collecting the rent.

    Why is the tenant not paying? Is the tenant a third party or is the tenant related to the owners of the building?

    Brendan
     
  11. Lone Star

    Lone Star Frequent Poster

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    sounds messy - any approach from Danske to meet yous?
     
  12. The Partnership

    The Partnership Registered User

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    Hi Brendan
    The barrister is moving ahead with the case. Our legal team believe we have a very strong case.
    We have not heard from Danske in months.
    Why the tenant is not paying is clear to me ,why should she when no one is asking for the rent.
    The tenant is not a third party and has no connection with the partnership.
    regards
     
  13. The Partnership

    The Partnership Registered User

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    Hi we were in court on Monday,moved to Wednesday on consent, where the Deputy Master gave us a date in May and an agreed ninety minutes to trash out our affidavits .
    We are now heading for three years of this constant worry and its taking its toll on our familys health and to be honest we are wondering will this drama ever end.
    On another note our tennants buisness is booming and in May they will be 3 years rent free. The receiver has not collected any rent ,to my knowledge.
    Regards
     
  14. TLO

    TLO Frequent Poster

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    An incredible situation. You're probably aware of another receiver case reported in this weeks media involving bad behaviour by a lender. In this case, the receiver, Stephen Tennant of Grant Thornton, is at the wrong end of a High Court injunction as borrowers say that the loan is up to date as per the original agreement. So, another "receiver case" going to a full High Court hearing. Media coverage here:

    http://www.independent.ie/irish-new...s-injunction-over-135m-property-35441755.html
    http://www.irishtimes.com/news/crim...ip-gets-injunction-against-receiver-1.2971073

    IMHO, the OPs "receiver" is on very shaky ground for not collecting 3 years rent. Once Danske told the OPs receiver not to collect any rent, the receiver should have resigned thus giving control back to the borrowers.
     
    MrEarl likes this.
  15. The Partnership

    The Partnership Registered User

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    Hi we were aware of the media coverage and we were waiting for the results which looks promising .
    We got a new bit of info about Mary who is a partner.
    Mary did not enter an appearance ,why i dont know.
    She has received a letter from banks solicitor notifying her that a judgement for full amount 300k has been made against her.
    i am not sure how this will affect our case
    Regards
     
  16. MrEarl

    MrEarl Frequent Poster

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    Last edited: Feb 12, 2017
    Hello,

    Pepper are the ones who have most likely convinced Danske to run with this strategy and will ultimately be the ones pushing the paperwork back and forth between Danske and the Receiver (even post appointment of the Receiver).... unfortunitely, they will now be starting to sound like a scratched record, saying it's nothing to do with them and all communications need to be via the Receiver, despite the fact that someone in Pepper will now be doing everything imaginable to defend the strategy they proposed and got Danske to sign up to.

    Does you solicitor have significant experience in dealing with commercial property, insolvency and Banks ?

    Is the solicitor proven in commercial negotiaton, alongside litigation ?

    .... if not, then this may not be the right person to be guiding you.

    Personally, I think it's a brave move to just wait for the Ombudsman to make a decision (not least, because I don't believe that the Ombudsman's office has notable experience in working with commercial banking transactions, despite smaller cases (with T/o below €3m) being within their remit).

    If the decision goes against you, you can expect to see the property feature in the Allsop auction after the Ombudsman's decision is made, because while the Ombudsman's decision is pending, preperations are most likely being made behind the sceenes to sell the property.

    That is just crazy - at the very least, the rent shoud be paid on an ongoing basis into an escrow account. If no one has dealt with this already, then they need to deal with it immediately (and ensure historic rent is also lodged, not just rents going forward). Odds are, the tenant will now be feeling a little opportunistic, so don't be surprised if you've another small battle to face here !

    I agree with you Mr. Burgess and beleive the non-legal strategy is ultimately how this gets resolved.

    However, pesonally I would be running legal and non-legal strategies parrallel to each other (but clearly ensuring that one team is not undermining the other etc.).

    I have seen this type of strategy implemented by another unconnected Bank in times past. Suffice to say it was a mess from everyones point of view.... the true winners were the legal teams and the receiver, who all ran up plenty of fees as a result !

    If I were involved in this case, I would be asking for a meeting "without prejudice" between all parties - you will need to put this request in writting through the Receiver, but if the Bank has any sense they will agree to it - if only to see if you can get them out of this mess, with all sides saving face.

    Keep an eye out for updated interest accruals on the sum the Bank is demanding payment for, as they should be undermined on the basis that the rent has not been collected and offset against the daily interest on the debt. The costs asssociated with the receivership should be undermined on the same basis.
     
    Last edited: Feb 12, 2017
  17. The Partnership

    The Partnership Registered User

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    Hi
     
  18. The Partnership

    The Partnership Registered User

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    Hi
    The Ombudsman has not accepted this case ,we received a letter from their office telling us to go to court to settle this.
    We are happy with our solicitor for the moment.
    We are not going to contact the bank or receiver as we feel that any time the bank comes back to us to talk they are not really interested in solving this mess ,they just want us to cave in.
    So we are going to let this run until we get our day in court and hope there is a little justice in our court system.
    Remember both the bank and the partnership signed the offer letter and we upheld our side of the bargan.
    Regards