Re Farnol Eades Irvine & Co Ltd [1915] 1 Ch 22
No valid objection to action of foreclosure by debenture-holder
Facts
The plaintiff was a debenture-holder who claimed, inter alia, forpayment of the amount secured, foreclosure or sale and appointment of a receiver and manager of the company. The plaintiff had made no application under the Courts (Emergency Powers) Act 1914 to bring or proceed with the action and the defendants objected that such an application had not been made.
Issues
The defendants argued that the object of the Act would be defeated if a motion such as that raised by the plaintiff could be brought in open Court without a previous application by the plaintiff under the Act. The Act provides that such a previous application is required to be made in chambers in order to avoid publicity affecting the credit of the defendants.
Decision/Outcome
The Court dismissed the defendant’s objections and granted the orders sought by the plaintiff. The word “foreclose” as it appeared in the Act means to destroy the equity of redemption which had previously existed. But a proper construction of the Act did not lead to the conclusion that a person is prevented from issuing a writ or summons for foreclosure. All that the Court does in an action under the Act is to direct an account of what is due and provides that if it is not paid within a specified time, then the equity of redemption shall be foreclosed. Having considered the intention of the Act, the Court found that there was no reason to prevent a man from taking steps to obtain an order of foreclosure from the Court.
267 words
Updated 20 March 2026
This article accurately summarises the decision in Re Farnol Eades Irvine & Co Ltd [1915] 1 Ch 22. The case remains a valid historical authority on the construction of foreclosure proceedings and the meaning of “foreclose” in the context of equity of redemption. Readers should note, however, that the Courts (Emergency Powers) Act 1914 was a temporary wartime measure and has long since ceased to have effect. The case therefore has limited contemporary practical relevance, serving primarily as an illustration of historical statutory interpretation in the context of mortgage law and debenture-holder rights. Modern foreclosure proceedings are governed by the Law of Property Act 1925 and associated rules under the Civil Procedure Rules 1998. The substantive principles concerning equity of redemption discussed in the case remain part of English property law, but readers should not treat the procedural framework described here as reflecting current practice.
