UK High Court holds sanctioned borrower cannot use sanctions to resist mortgage possession claim

16 June 2026

The High Court has held that a mortgage lender was entitled to possession of a property owned by a UK-sanctioned person — West One Loan Limited v Okroyan [2026] EWHC 1428 (Ch).

Anna Okroyan took out a £4.55 million mortgage over her Surrey home with West One Loan in 2022. In 2023 she was designated under the UK Russia sanctions regime, which made it unlawful for her to make payments and for West One to receive them without an OFSI licence.

She did not apply for a licence to make mortgage payments because her funds were held in sanctioned Russian banks from which she could not transfer money, so she repayment was impossible even if a licence was granted. Both parties applied for licences to sell the property. West One's licence, obtained in 2025, permitted it to take possession of the property and sell it, but only if it first obtained a court order. Ms Okroyan obtained a licence to sell the property herself. In the meantime, payments under the loan agreement could not lawfully be made or received, and West One issued a default notice and sought a court order for possession. Ms Okroyan argued that her repayment obligation was suspended for the duration of her designation because it was unlawful for her to pay and for West One to accept payment under the Russia (Sanctions) (EU Exit) Regulations 2019, and in any event s44 of the Sanctions and Anti-Money Laundering Act 2018 protected her from civil liability for failing to comply with the loan agreement.

The Court rejected her arguments and held:

• Ms Okroyan's repayment obligation was not suspended. She relied on Fortenova Grupa, where the High Court held that a sanctioned party should not be penalised with additional interest charges for failing to pay when sanctions made payment unlawful. The Court did not apply it here because West One was not claiming interest or damages but was seeking possession on the basis that the loan was not repaid on its term date.

• s44 SAMLA did not apply. Following the Court of Appeal’s judgment in Celestial Aviation (the judgment does not refer to the Supreme Court judgment), s44 protects against new civil liabilities that arise because a person refused to do something they reasonably believed would breach sanctions, not enforcement of a debt that predated designation. Ms Okroyan’s mortgage predated her designation, so s44 did not apply.

• In any case, the sanctions gave West One grounds for possession. It breached a warranty Ms Okroyan had given that there had been no material adverse change in her financial condition since the loan date, directly and substantially impairing her ability to repay. It also prevented West One from crediting her monthly interest payments through the bookkeeping process the loan required, putting her in breach of her interest obligations too. Either breach would have entitled West One to possession.

• The Court rejected West One’s claim that the designation made the loan agreement invalid or unenforceable. Sanctions restricted certain dealings between the parties, but the contract remained valid throughout.

West One can now take possession of the property and sell it under its existing OFSI licence, with the proceeds applied to discharge the outstanding mortgage debt.