When Would a Law of Property (LPA) Act Receiver be Appointed

A Law of Property Act Receiver (LPA Receiver) is appointed by a lender who has a fixed charge over property under the statutory power given to that lender in section 109 of the Law of Property Act 1925.

Such an appointment of a Law of Property Act (LPA) Receiver may only take place if:-

1. the mortgage money has become due, and

2. the mortgagee has become entitled to exercise the statutory power of sale, where:-

2.1 there has been default in repayment of a loan for 3 months after a notice requiring it, or

2.2 Interest remains unpaid for 2 months after becoming due, or

2.3 there is another breach of the Act.

A Law of Property Act (LPA) Receivers powers are limited to collecting rents and income, however the Law of Property Act Receiver does have a duty to keep property in good repair and to insure the property.

There is an interesting case on the above which is known as Chatsworth Properties Ltd v Effiom. If you would like to read this case, please click here.

Obtain a copy of the Law of Property Act 1925 to fully understand when a Law of Property Act (LPA) Receiver may be appointed.