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Ex-billionaire fights bid to foreclose on London home

UBS seeks possession of Vijay Mallya's property, saying that firm that took out £20.4m mortgage has not repaid it

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The source of Mr Mallya's global legal problems are more than £1 billion in loans that he took out for his now defunct Kingfisher Airlines.

London

UBS Group is trying to foreclose on a £20.4 million (S$37.2 million) mortgage loan on former billionaire Vijay Mallya's London house, which overlooks the capital's Regent's Park.

The bank is seeking possession of the property, which Mr Mallya - an Indian tycoon who's battling extradition in a separate case - used as a family home. It says Rose Capital Ventures, the company that took out the mortgage, has not repaid it.

Mr Mallya, a high-profile figure in India where he's often referred to as the "King of Good Times", hoped to turn the site - previously used as offices - into a "beautiful palatial property" that would be "very fancy," UBS' attorney Thomas Grant told a London court Monday. "At the end of the day we are simply saying you haven't paid your mortgage loan, as per the term, therefore we seek a remedy given to us, which is possession," he said.

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Rose Capital Ventures is based in the British Virgin Islands and owned by a Mallya family trust, UBS' London court filings said, attributing the information to Mr Mallya.

It is the latest in a series of London lawsuits that the 62-year-old Mr Mallya is fighting. The source of his global legal problems are more than £1 billion in loans that he took out for his now defunct Kingfisher Airlines. Disputes over the loans led to civil lawsuits in India and the UK as well as criminal fraud charges.

Mr Mallya was arrested in London in April 2017 and is waging a fight - in a different court a few miles across town - to block extradition to India on the fraud charges. At one point, the tycoon had to get by on £5,000 a week amid civil lawsuits to collect the money, according to court filings.

The house, located a stone's throw from Regent's Park, is in an area known for some of "the most cherished addresses in London", Trevor Abrahmsohn, a London-based real estate agent, said.

"You overlook the beauty of Regent's Park but you can get to Mayfair in 10 minutes," he said. "It's the oasis for wealthy, cultured people."

UBS appointed receivers over the property, who began proceedings to take possession of the house in November 2016, the bank said in court filings dated April 2018.

The family's housekeeper, who lived at the house, was originally brought into those proceedings by being named as a defendant, but she's now moved out of the house, those filings said.

Lawyers for Mr Mallya and Rose Capital Ventures said that UBS called the mortgage in early and gave no explanation for this, having previously given them "a legitimate expectation" that the bank would not do so.

This was "wrongful" and caused Rose Capital Ventures to be unable to repay the loan, their filings said.

UBS said it called in the loan, in June 2016, because it had decided to "terminate its relationship" with Mr Mallya and "associated entities" including Rose, after media reports identified Mr Mallya as a "willful defaulter" over Kingfisher Air.

In any case, the bank added, the five-year loan expired in March 2017.

Mr Mallya is "one of, if not the, largest individual judgment debtor in British history", UBS said in court filings, and the bank wanted its money back.

Mr Mallya, his son Sidharta and his mother Lalitha have a right to remain in the property under "an irrevocable contractual licence" from Rose Capital Ventures, which holds the property for them, according to their earlier court filings from May this year.

The hearing over the London property was due to continue this week. BLOOMBERG