A charging order can be enforced more than 12 years after it was made.

This was confirmed by the Court of Appeal in Yorkshire Bank Finance Ltd v Mulhall. Mulhall had guaranteed a loan and when default took place the Bank obtained a judgment in default and then a charging order against Mulhall's property. Some 16 years later, Mulhall sought to set aside the judgment and charging order on the basis that the Bank had taken no steps to enforce them. Mulhall argued that a 12 year limitation period applied and as the charging order could no longer be enforced, the Bank had no continuing right under it and it should be discharged.

The Court held that s 20(1) of the Limitation Act did not apply to the enforcement of the charging order nor to any of the steps taken to enforce it, such as applying for an order for sale and for possession for the purposes of sale. There was no provision in the Limitation Act that affected the enforcement of the charging order and it could be enforced despite the lapse of time.

Things to consider  

This is good news for lenders who may not have sought to enforce a charging order for a number of years and for a variety of reasons. Delay, and even substantial delay, in doing so will not affect the security.