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The Directorate General for Legal Certainty and Public Faith has upheld a registrar's refusal to register the adjudication of an undivided half-share of a property and the cancellation of its mortgage. The issue arises because the judicial ruling fails to specify the mortgage liability that must be attributed to the other half of the property, which belongs to non-insolvent third parties (Arts. 123 and 125 of the Insolvency Law). Regulations require that the cancellation of charges in insolvency proceedings must be precise regarding the portion of the property not subject to the adjudication.
For purchasers in insolvency auction proceedings, a lack of precision in the adjudication decree regarding the mortgage liability of non-insolvent parties can block registration (Art. 123 of the Insolvency Law). Professionals must ensure that charge cancellation orders clearly delimit which part of the debt affects which part of the property to avoid negative assessments from the Land Registry.
The tax team reviews your specific situation.
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