recent case law in respect of joint borrowers being prejudiced by actions of lender

W

Whizkid

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Hi, Can anyone advise me. I'm a joint borrower and my business partner has passed away. We owned property on a 66.6%/33.4% basis as well as the corresponding debt in respect of same. I'm unable to establish if the lender has made a claim against his estate. If not, has the lender prejudiced my position assuming they have a duty of care to both borrowers?
 
1. Talk to your solicitor.
2. Have that solicitor talk to the deceased's solicitor. Or you talk to his executor.
3. Find out if a claim has been made by the lender and if there are any assets to meet the claim.

Otherwise, the last sentence of your post requires a major crystal ball gazing session !

mf
 
Thanks MF.

Have spoken with my solicitor. Share of debt and assets have been included in probate.
Relations are not good with deceased's wife, who is now on 5th firm of Solicitors.
Can't get a straight answer from the lender.

I was wondering if the was any case law in respect of same?
 
Is this a mortgage?

What is the property worth?
How much is outstanding on the mortgage?

Would you not have a claim on the estate as well if it's in negative equity?

Brendan
 
Whizkid said:
I'm a joint borrower and my business partner has passed away. We owned property on a 66.6%/33.4% basis as well as the corresponding debt in respect of same. I'm unable to establish if the lender has made a claim against his estate. If not, has the lender prejudiced my position assuming they have a duty of care to both borrowers?
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You are a joint borrower. Liability on the loan is joint & several meaning that you are fully liable for the outstanding loan facility although owning only a share of the property. Assuming that this is a Tenancy in Common the residual share of the property will pass according to your co-owners will (presumably to the widow). She will own a share of the positive equity in the property and here is your quandary!! I.e. you need to either buy out her net share or make some agreement with her re the loan/continuing usage of the property.
You have no claim against the bank here as they have no obligation to make a claim against the estate. However they will also have difficulties if the ownership/borrowing position is not cleared up within a 2 year period from death.
These are common mistakes made when loans are taken out in partnership names. There should be both a buy/sell agreement on events such as death or partnership dissolution and also joint mortgage protection to clear the balance of the loan on 1st death.
 
However they [bank] will also have difficulties if the ownership/borrowing position is not cleared up within a 2 year period from death
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. 44brendan, I've seen you post something similar before, but I couldn't find relevant legislation. Would you have anything concrete to confirm this view? What sort of 'difficulties' would the bank have?

edit to add: not doubting you, just want to be clear in my own head.
 
This is Irish Statute Law. I don't have a link to the relevant paragraph but can assure you from long experience in the area that the 2 year period is written into the statute book and no claim can be successful if not progressed within this period. I.e. in the event where there is no will and the estate winding up drags on a creditor can apply to the Court to have an "Administrator Ad Litem" appointed in order for a claim to be submitted within the 2 year timeframe.
 
For anyone else in the same boat; here's the applicable act
Civil Liability Act, 1961

9.—(1) In this section “the relevant period” means the period of limitation prescribed by the Statute of Limitations or any other limitation enactment.

(2) No proceedings shall be maintainable in respect of any cause of action whatsoever which has survived against the estate of a deceased person unless either—

(a) proceedings against him in respect of that cause of action were commenced within the relevant period and were pending at the date of his death, or

(b) proceedings are commenced in respect of that cause of action within the relevant period or within the period of two years after his death, whichever period first expires.
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It's not a 'carte blanche' to sit back and do nothing though in regards to an estate (if you are executor/personal rep), as the creditor can apply for Administrator ad litem (per 44brendan's post above).

I'm not 100% clear though if this two year limitation also applies to a secured debt (as in the mortgage in this case).

Another edit - from some Solicitor's websites (Evershed for example) it appears that the 2 year limitation does indeed apply to mortgages.

I've found in the past that Soltr's don't always update their website info, so I wouldn't put a downpayment on the Masterati based on that ;)

edit to fix quote
 
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