Mortgage Express v Lambert  (CA)
Lambert completed a sale/leaseback with two fraudsters selling her property to them at £30,000 when it was worth £120,000. Fraudsters then mortgaged with Mortgage Express and disappeared. Payments weren't met and ME sought repossession. Lambert argued 'unconscionable bargain' to have the whole transaction (between her a fraudsters) set aside, which would also set aside the mortgage. ME knew of the undervalue of the sale.
There was no question about actual occupation, and Lambert had the lease, however, she chose to argue for UB as opposed to a lease based argument. However, under s.26 LRA '02, at disposition all interests that could effect the validity of the disposition are removed. Therefore, her interest (due to UB) cannot override and bind ME. Her interest therefore was overreached when purchase money was paid to the two fraudsters. It was immaterial that ME knew of the undervalue and did not check what was happening.