Undoing Unlawful Re-entry: Clarifying interim possession under section 47(2) and recall standards amid late buy‑out offers in sequestration sales

Undoing Unlawful Re-entry: Clarifying interim possession under section 47(2) and recall standards amid late buy‑out offers in sequestration sales

Introduction

Decision: Opinion of Lord Richardson, Outer House, Court of Session, 14 October 2025, [2025] CSOH 97 (P755/25).

Parties: The Accountant in Bankruptcy (AiB), acting as permanent trustee on the sequestrated estate of the first respondent (Andrew Michael Speight), petitioned against Mr Speight and his co‑owner spouse (Frances McGregor Speight), who jointly own and occupy a residential property in north Edinburgh.

Core dispute: Following sheriff court decrees authorising sale of the property and ejectment, sheriff officers executed an ejection on 17 July 2025. The respondents then re‑entered and resumed occupation. The AiB sought:

  • a final order under section 46 of the Court of Session Act 1988 for removal; and
  • interim relief under section 47(2) (interim possession and interim interdict) to prevent further obstruction of the sale.

Key issues:

  • Whether, pending resolution of a narrow factual dispute about service of a “Form 4” notice, the court should grant interim possession to the trustee.
  • How the “balance of convenience” operates where respondents have re‑entered after a lawful ejection.
  • Whether a late “buy‑out” offer by the non‑bankrupt co‑owner constitutes a material change in circumstances justifying recall of interim orders.

Summary of the Judgment

At first calling (9 September 2025), Lord Richardson declined to grant the final order under section 46, because a material factual dispute existed over service of a Form 4 notice. The court then entertained the trustee’s motion for interim possession under section 47(2), together with interim interdict and ancillary warrants. Applying Dem‑Master Demolition Ltd v Alba Plastics Ltd and Scottish Power Generation Ltd v British Energy Generation (UK) Ltd, His Lordship:

  • found an “extremely strong” prima facie case in the trustee’s favour ([23]);
  • held there was a continuing breach of the trustee’s right to possession ([24]); and
  • held the balance of convenience favoured granting interim possession, notwithstanding disturbance of the respondents’ current occupation ([25]–[30]).

The court emphasised that respondents’ re‑entry after a lawful ejection was prima facie an unlawful act of the kind for which it is appropriate to depart from the usual status quo principle (Scottish Power, para 31; applied at [26]–[27]). Ancillary warrants (including to open shut and lockfast places) and interim interdict were granted, tempered by an undertaking that the trustee would act reasonably in execution ([30]).

On 2 October 2025, the respondents sought recall, arguing a material change in circumstances: a late offer by the second respondent to buy out the trustee’s interest (£50,000), which the trustee had rejected, counter‑proposing £250,000. The court was prepared, despite “without prejudice” correspondence, to consider this for the limited purpose of assessing whether there was a material change ([41]). However, it held:

  • the trustee’s rejection was not unreasonable given the absence of an up‑to‑date valuation and the late stage of proceedings, particularly where earlier valuation attempts had been thwarted ([43]); and
  • the offer and its rejection did not alter the balance of convenience previously assessed ([44]).

The recall motion was refused.

Analysis

Legal Framework

  • Court of Session Act 1988, section 46: the petition sought a substantive order for removal under this head ([9]–[10]). The court deferred that final relief because of a factual dispute about service.
  • Court of Session Act 1988, section 47(2): empowers the court to grant interim possession and interim interdict pending final determination. The principal question at both hearings was whether to grant or recall interim possession under this section ([12]–[13], [21]).
  • Bankruptcy (Scotland) Act 2016:
    • section 113: the sheriff court had granted authority to sell the property and dispensed with the co‑owner’s consent ([4], first bullet).
    • section 50: directions remedy in the sheriff court for concerns about a trustee’s conduct; the Outer House flagged this as the proper route for such complaints ([39]).

Precedents Cited and Their Influence

The court explicitly adopted a structured three‑limb test for interim possession orders under section 47(2):

  • Dem‑Master Demolition Ltd v Alba Plastics Ltd [2014] CSIH 58 at para 12: authority for the general approach to interim orders requiring a prima facie right, a breach/threat of breach, and the balance of convenience.
  • Scottish Power Generation Ltd v British Energy Generation (UK) Ltd 2002 SC 517 at paras 22–24, 31: confirms the triadic test and, crucially, explains when the court may depart from preserving the status quo. Paragraph 31 recognises that interim relief may grant specific performance‑type relief to arrest or reverse a prima facie unlawful act. Lord Richardson relied on this to discount the weight of the respondents’ de facto occupation achieved by re‑entry after ejection ([17], [26]).
  • Toynar Ltd v Whitbread & Co plc 1988 SLT 433 at 434B‑F: establishes that the perceived strength of the prima facie case is itself an element in the balance of convenience. Lord Richardson expressly used that principle to bolster the case for interim possession ([25]).

Together, these authorities supplied both the analytical structure and two decisive weighting principles: strength of merits can tip balance, and the “status quo” will not protect a prima facie unlawful self‑help act.

Legal Reasoning

1) Prima facie right. The court found the trustee’s merits “extremely strong” ([23]). The sheriff court had:

  • declared the trustee entitled to insist on division and sale;
  • authorised sale under section 113 of the 2016 Act; and
  • granted warrant for sale by private bargain and subsequently warrant to eject, which was extracted ([4]).

Appeals had been refused as out of time or unsuccessful. The only live contention was the narrow service point about the Form 4 notice. The trustee produced two sheriff officer affidavits detailing signature, service, posting, and control processes; the respondents provided only a bare denial without affidavits ([23]). On that record, the trustee’s merits were overwhelming.

2) Continuing breach. The respondents’ re‑entry after ejection, and refusal to vacate, constituted a continuing breach of the trustee’s right to possession ([24]). The court treated the re‑entry as a prima facie unlawful self‑help act squarely within Scottish Power para 31 ([26]).

3) Balance of convenience. The court’s balancing analysis had several strands:

  • Strength of merits weighed heavily for the trustee (Toynar, [25]).
  • Status quo. Although interim relief often preserves the status quo, the court departed from that because the status quo was brought about by a prima facie unlawful re‑entry ([26]).
  • Practicalities and proportionality. Interim possession would allow an up‑to‑date valuation and progression of the court‑authorised sale ([28]). By contrast, leaving respondents in situ would only prolong an already protracted process “at least in part because of the respondents’ actions” ([28]).
  • Personal hardship. The court recognised the respondents’ age, long occupation, and disruption. Sympathy was tempered by the reality that hardship flowed from the sheriff court orders, not from the interim step itself; the respondents had “been burying their heads in the sand” ([27]).
  • Adequacy of damages. If the trustee were later shown to have been wrong, damages would provide adequate relief to the respondents ([29]).

Ancillary measures. Having granted interim possession, the court granted warrants to enter by force if necessary and an interim interdict prohibiting re‑entry without consent, while recording an undertaking that the trustee would act reasonably in execution ([30]).

The Recall Motion: “Material Change” and Reasonableness

The respondents sought recall based on a purported change: a buy‑out offer by the second respondent, which the trustee rejected. Two points are significant:

  • Material change threshold. The court was prepared, “on balance,” to consider whether the offer and counter‑response were a material change, even though correspondence was marked “without prejudice” and had not been aired at the earlier hearing ([41]). This was a pragmatic, limited exception to enable the court to test balance of convenience anew; it was not a general dilution of privilege.
  • Reasonableness of the trustee’s stance. The trustee’s rejection was not unreasonable. There was no up‑to‑date independent valuation, and the late offer came after the respondents had themselves thwarted valuation attempts ([43]). The trustee was seeking an open‑market sale in creditors’ interests and was entitled to approach a late unvalued offer with scepticism. The email counter‑proposal could have been clearer in rationale, but was not unreasonable ([40], [43]).

Consequence: The late offer had no material impact on the balance of convenience; recall was refused ([44]).

Impact and Prospective Significance

This judgment consolidates and applies existing principles in a way that has real, practice‑level consequences in sequestration and beyond.

  • Interim possession as a tool to progress insolvency realisations. Trustees who can show a strong prima facie right and a continuing breach will be able to obtain interim possession to facilitate valuations and sales, even while a narrow procedural challenge (e.g., to service) is unresolved.
  • “Status quo” will not shield self‑help re‑entry. The court will depart from maintaining occupation as the status quo where that position was established by prima facie unlawful re‑entry after lawful ejection. This discourages tactical self‑help and gamesmanship.
  • Strength of merits matters at the interim stage. Toynar’s principle—merits may tip the balance—was given decisive effect. Parties opposing interim relief should therefore meet the merits head‑on with tangible evidence, not bare denials.
  • Recall based on settlement developments. Late buy‑out offers, especially without independent valuation, will not usually amount to a material change in circumstances or undermine interim orders. If respondents wish to pursue alternative realisation (e.g., buy‑out), they should do so promptly, with funding proof and valuation support, and in the proper forum.
  • Proper forum for trustee conduct complaints. Concerns about a trustee’s realisation strategy should generally be addressed via section 50 directions in the sheriff court, not folded into the balance of convenience in section 47(2) proceedings ([39]).
  • Damages as an adequate remedy. The court underscored that, where interim relief is later vindicated as wrongful, damages can compensate respondents ([29]). Applicants and respondents alike should factor this into risk assessments and undertakings.

Complex Concepts Simplified

  • Prima facie case: A case that appears likely to succeed on the limited material available at the interim stage, without making a final finding.
  • Continuing breach: Ongoing conduct that infringes another’s legal right. Here, remaining in and re‑entering the property after lawful ejection.
  • Balance of convenience: A comparison of practical advantages and disadvantages of granting the interim order now. It considers the strength of the merits, the risk of irreparable harm, adequacy of damages, and the real‑world consequences.
  • Status quo: The present state of affairs. Courts often preserve it, but not where it was created by a prima facie unlawful act (e.g., self‑help re‑entry).
  • Interim possession (section 47(2) of the 1988 Act): A temporary order giving control of property to a party pending final resolution, often paired with an interim interdict to prevent interference.
  • Interim interdict: A temporary prohibition order (akin to an injunction) to restrain specified conduct until final judgment.
  • Warrant to open shut and lockfast places: Authority for officers of court to force entry to premises to implement a court order.
  • Charge for removing and Form 4 notice: Formal documents served by sheriff officers warning of removal and notifying of the proposed ejection procedure/date; defects in service can found objections to ejection.
  • Extracted decree: An enforceable formal copy of a court’s decree; extraction enables implementation (e.g., ejection).
  • Section 113 of the Bankruptcy (Scotland) Act 2016: Allows sale of a family home in bankruptcy, possibly dispensing with a co‑owner’s consent, where the court finds it appropriate.
  • Section 50 of the 2016 Act: Mechanism for interested persons to seek directions from the sheriff court regarding a trustee’s conduct.
  • Recall for material change: An application to set aside an interim order must point to a genuine, relevant change in circumstances since the order was made; mere re‑argument or late unsubstantiated proposals will not suffice.

Practical Guidance

  • For trustees/creditors:
    • Prepare robust affidavit evidence of service and enforcement steps; contemporaneous records and officer protocols matter.
    • Where respondents re‑enter after ejection, consider swift section 47(2) applications to secure interim possession and prevent frustration of sale.
    • If faced with late buy‑out offers, insist on up‑to‑date independent valuation and proof of funds; communicate reasons for any rejection clearly.
    • Offer reasonable undertakings as to implementation to assist proportionality assessments.
  • For respondents/co‑owners:
    • Bare denials on service are weak; support challenges with sworn affidavits and any corroborating material.
    • Avoid self‑help re‑entry after ejection; courts are likely to characterise this as prima facie unlawful and will not preserve that position as the status quo.
    • If proposing a buy‑out, do so early, with independent valuation and financing evidence. Use section 50 to challenge trustee conduct, rather than trying to fold those issues into interim possession proceedings.
    • Recognise that damages may be viewed as adequate if an interim order proves wrongful; tailor arguments accordingly.

Conclusion

Speight clarifies and operationalises the law on interim possession under section 47(2) of the Court of Session Act 1988 in the sequestration context. The court affirmed a structured test—prima facie right, continuing breach, and balance of convenience—while emphasising two decisive refinements:

  • the strength of the prima facie merits can materially tip the balance; and
  • the court will not preserve a “status quo” that has been achieved by prima facie unlawful self‑help re‑entry following lawful ejection.

On recall, the court made clear that late buy‑out offers lacking valuation and funding do not ordinarily amount to a material change in circumstances, nor do they render it unreasonable for a trustee to insist on open‑market sale in creditors’ interests. Concerns about a trustee’s strategy belong in a section 50 directions application to the sheriff court, not as a collateral attack on interim possession.

The decision will assist trustees and courts in expediting realisations and curbing obstructive tactics, while preserving fairness through undertakings and the availability of damages if an interim order is later shown to have been wrongly granted. In short, it vindicates principled, evidence‑based interim intervention to undo unlawful re‑entry and to enable lawful sales to proceed.

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