Introduction

The Debt Respite Scheme (Breathing Space Moratorium and Mental Health Crisis Moratorium) (England and Wales) Regulations 2020 (the “Regulations”) provide legal protection to individuals struggling with problem debt. These protections include a moratorium on certain creditor actions, such as enforcement or the addition of fees or penalties, in respect of qualifying debts.

Importantly, secured debts are generally excluded from the scheme, except for arrears. While the principal balance under a mortgage is not a qualifying debt, any arrears, even under an interest-only mortgage, are covered by the moratorium (Per Regulation 5(4)(a)).

But what is the position when a judgment or order relates only partly to a qualifying debt (“mixed judgment”), or where the security covers both moratorium and non-moratorium debts (“mixed security”)? 

The High Court has now answered these questions in Bluestone Mortgages Ltd v Stoute [2025] EWHC 755 (Ch).

Case Background

In Bluestone, the claimant mortgage lender advanced £300,000 to the defendants, secured by a first legal charge over the family home. Following default in August 2018, the claimant obtained an order in March 2019 for possession of the property and a money judgment totalling £315,923.68 (approximately £12,061.56 of which was arrears)

The defendants subsequently entered several mental health crisis moratoriums. The claimant argued that the latest moratorium applied only to the arrears and not to the enforcement of the possession order or the principal debt. The High Court disagreed. 

Case Decision

The court focused on the wording of two key enforcement actions under the Regulations that are prohibited by virtue of Regulation 7(2):

• Regulation 7(7)(b) – which prohibits steps to enforce a “judgment or order... regarding a moratorium debt”.
• Regulation 7(7)(c) – which bars enforcement of “security held in respect of a moratorium debt”.

The court emphasised the wide scope of these terms. The possession order was “regarding” arrears because those arrears were its legal foundation; without them, the order could not have been granted. Thus, enforcement of the order during the moratorium was prohibited.

While the security covered both moratorium and non-moratorium debt, it remained security “in respect of” a moratorium debt. The High Court concluded that the Regulation does not require that the security be solely in respect of moratorium debt; it is enough that it includes such debt. 

In line with this, the court concluded that any enforcement action would require court permission.

This case affirms that creditors cannot sidestep moratorium protections by separating non-moratorium debts where security or judgments are “mixed”.