Seculink Limited v Eren Salih
[2023] EWHC 1706 (KB)
Goldhill Finance Limited v Tracey Margaret Smyth
21 February 2023
[2023] EWHC 362 (KB)
High Court
A woman defaulted on a loan, and the lender wanted her house. She argued the loan was unfairly high interest. The court said she didn't raise this properly in the first trial and wouldn't let her argue it now, so the lender gets the house.
Key Facts
- •Ms Smyth took out a £66,978.69 bridging loan from Goldhill Finance, secured by a second charge on her leasehold property.
- •The loan was declared to be for business purposes, making it an unregulated loan under the Consumer Credit Act 1974 (CCA).
- •Ms Smyth defaulted on the loan, and the debt ballooned due to a 5% per month compounded default interest rate.
- •Goldhill sought possession of Ms Smyth's property.
- •Ms Smyth argued the loan was mis-sold and the terms were unfair, seeking to invoke the 'unfair relationship' provisions of the CCA.
- •The trial judge found the loan was unregulated and dismissed Ms Smyth's arguments, granting possession to Goldhill.
Legal Principles
Unfair relationships between creditors and debtors.
Consumer Credit Act 1974 (CCA), sections 140A-D.
Regulated mortgage contracts (RMCs) and regulated consumer credit agreements.
Financial Services and Markets Act 2000 (FSMA) and the Regulated Activities Order 2001 (RAO).
Fairness of terms and relationships in regulated agreements.
FCA Handbook, Principles (PRIN) and Mortgages and Home Finance: Conduct of Business sourcebook (MCOB).
Burden of proof in unfair relationship claims.
CCA section 140B(9).
Allowing new points on appeal.
Notting Hill Finance Ltd v. Sheikh [2019] EWCA Civ 1337.
Penalty clauses.
Cavendish Square Holdings BV v. Makdessi [2015] UKSC 67; Cargill International Trading Pte Ltd v. Uttam Galva Steels Ltd [2019] EWHC 476 (Comm).
Outcomes
Appeal dismissed.
Ms Smyth did not plead an unfair relationship claim at trial; the judge's findings should be considered in the context of the pleaded case; allowing a new claim on appeal would prejudice Goldhill and violate principles of finality.