McDonagh v Bank of Scotland plc and others

Mortgage – Receiver. Where a receiver had an opportunity to include a mortgaged property in a portfolio sale, it could not be said that the receiver would be in breach of his duty to the mortgagor by considering whether to take advantage of that opportunity. However, the receiver was not able to include a mortgaged property in a portfolio sale, unless he had asked himself whether that course was likely to be in the best interests of the mortgagor of that property. The Chancery Division, in dismissing the claimant's claim against the second to the third defendant receivers, who had been appointed by the first defendant bank, held that the claimant had failed to establish that they had breached the duty they had owed to him by selling mortgaged property as part of a portfolio. The court further dismissed the claimant's claim against the bank, having construed the first loan agreement made by the parties in favour of the bank. The court also ruled that there had been no breach or duress on the part of the bank in respect of a second loan agreement made with the claimant and the bank's counterclaim for the sum due to it under that agreement succeeded.

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