Relief from forfeiture: timing requirements and abuse of process

Mentmore Golf Investments Limited v Michael Gaymer [2025] EWHC 2604 (Ch) addresses critical questions about when mortgagees may seek relief from forfeiture of a lease, particularly where possession orders have been made but not yet executed. Sir Anthony Mann's judgement clarifies the temporal requirements under section 146 of the Law of Property Act 1925 whilst reinforcing the courts' willingness to strike out applications that constitute an abuse of process.

Procedural timing under section 146

The central issue concerned whether a mortgagee's application for relief becomes invalid once a landlord executes a possession order, even where the application was filed before execution. The court examined sections 146(2) and 146(4) of the LPA 1925, which permit applications "where a lessor is proceeding" to enforce forfeiture.

Drawing on Billson v Residential Apartments [1992] AC 494, Sir Anthony Mann held that the critical date is when the application is issued, not when it is heard. Once a possession order is executed, a landlord is no longer "proceeding" to forfeit—possession then rests on the court's judgement rather than the exercise of rights under the lease. However, where an application is filed before execution, the jurisdictional requirement is satisfied even if execution subsequently occurs.

This interpretation finds support in Lock v Pearce [1892] 2 Ch 328, where North J held that an application was made when the summons was issued, and relief could be granted despite subsequent possession being obtained. The natural meaning of section 146(2), derived from section 14(2) of the Conveyancing and Law of Property Act 1881, supports this construction. Section 146(4), though differently worded, should be interpreted consistently.

The court rejected arguments that mortgagees must apply within the landlord's proceedings rather than by separate action. The statutory language is permissive, and the legislative history confirms this—county courts lacked jurisdiction to grant relief in 1881 and 1892, necessitating separate High Court proceedings for mortgagee applications.

Abuse of process findings

Despite succeeding on the procedural point, the appellant's claim was struck out as an abuse of process. The evidence established that Mentmore Golf Investments Limited was part of a corporate structure controlled by Mr Simon Halabi, who had directed a succession of tenant companies through protracted litigation whilst accumulating unpaid costs orders exceeding £596,000.

The mortgagee had been notified of forfeiture proceedings in August 2022 but took no action until December 2023, after a possession order was made. Its explanation—that it was waiting to see the outcome of the tenant's defence—was inadequate given the close relationship between the entities. An arm's-length lender would have intervened when significant unless orders were made against the tenant, particularly given the mounting costs liabilities that would need to be discharged as a condition of any relief.

The court found that the mortgagee had been held in reserve as a further line of defence, deployed only when the tenant's opposition collapsed. This constituted oppressive conduct designed to prolong litigation and cause additional expense to the landlord, whose expert evidence indicated property deterioration exceeding £2.5 million in restoration costs.

The appeal succeeded on the narrow procedural question but failed overall, with the abuse of process finding upheld on different grounds from those relied upon by HHJ Murch. The case demonstrates that whilst the temporal requirements of section 146 may be satisfied, substantive abuse principles remain a potent barrier to relief applications lacking genuine commercial independence.