Aruna Nair, ‘Property, Priority and Apportionment: The Case of the Acquisition Creditor’

In Abbey National Building Society v Cann, the House of Lords held that a mortgagee who has funded the purchase of the mortgaged title to land (an ‘acquisition creditor’) has a right over the land that binds any other grantee of the purchaser. This article considers the basis for and limits of this principle, in light of its origins. It argues that the cases treat the lender’s financial contribution as an independent source of an equitable interest in the purchased asset, rather than as a reason why the grant in favour of the lender takes effect earlier in time than the grant in favour of any third party. This has important and desirable consequences for the scope of the principle, rendering it more coherent with general principles of English property law and allowing for an apportionment solution in some situations involving co-contributors to acquisition.

Aruna Nair, Property, Priority and Apportionment: The Case of the Acquisition Creditor, Cambridge Law Journal, Published online by Cambridge University Press: 18 February.

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