Rectification of the Land Register – An Introduction
Ahead of our upcoming seminar on Land Registration, Christopher McCauley has prepared this note as a brief introduction to the fundamentals of rectification of the Land Register.
The principle objective of the Land Registration Act 2002 (‘the LRA 2002’) is that the Register should be a complete and accurate reflection of the state of the title to land, at any given time, so that it is possible to investigate title to land online with the absolute minimum of additional enquiries and inspections.[1] To help facilitate this objective, the LRA 2002 ushered in a shift from registration of title to title by registration.[2] The act of registration, therefore, confers title to a legal estate[3] and Section 58 of the LRA 2002 provides that a person shall be deemed to be the proprietor of the legal estate, by virtue of being registered as such, even if the legal estate would not otherwise be vested in him. Pursuant to this, although his title will be vulnerable to an application to alter the Register, a person who has obtained title, for example, by fraud will (as registered proprietor) have the right to exercise “owner’s powers” including the power to make a disposition.[4]
Although at first blush this may seem surprising, as a fraudulent disposition would be a nullity, the reasoning behind Section 58 of the LRA 2002 is that there is a utilitarian benefit in the Register being conclusive, in that it is supposed to be an accurate reflection of the state of title to land at any given time and, as such, it avoids the need for the title to be investigated on each conveyance (“the mirror principle”).
However, the conclusiveness of the Register is subject to Schedule 4 of the LRA 2002 and our land registration system provides a qualified indefeasibility of registered title.[5] This means that, where the circumstances provided for in Schedule 4 of the LRA 2002 (‘Schedule 4’)[6] are established, the Register may be altered to correct a mistake even where the alteration will prejudicially affect the title of a registered proprietor[7] and an alteration to correct a mistake that prejudicially affects the title of a registered proprietor is termed “rectification.”[8]
There is no statutory definition of the term “mistake” in Schedule 4. However, it is a broad concept[9] and examples of mistake range from a typographical error[10] to double registration[11] to registration of a party through adverse possession who was not entitled to apply[12] to registration following a forged disposition.[13]
When determining whether an entry in the Register is a mistake, one looks at the point in time it was made.[14] Accordingly, there is an important distinction between a void disposition and one that is merely voidable. An entry of an interest acquired under a void disposition is a mistake as, had the true facts been known at the time, the Registrar would not have entered it onto the Register.[15] By contrast where a disposition is merely voidable its entry, onto the Register, is not a mistake as the disposition is valid until it is rescinded.[16] Therefore, the change made to the Register by a voidable disposition is correct at the time it is made. Further, if the voidable disposition is rescinded after it has been entered in the Register, it does not retrospectively become a mistake[17] for the purposes of rectification; as if it did, the principle that the Register is an accurate statement of the title at any given time would be undermined.[18] However, where a voidable disposition is rescinded, the Court must, unless there are exceptional circumstances which justify its not doing so,[19] make an order for the alteration of the Register to bring it up to date.[20]
Although paragraphs 2 and 5 of Schedule 4 use the word “may” in the sentence “the Court/Registrar may alter the Register for the purposes of correcting a mistake”, i.e. conferring a discretion, paragraphs 3(3) and 6(3) dictate that where the Court or Registrar has the power to make the alteration then Court or Registrar it must do so unless there are exceptional circumstances. Therefore, in a case falling within paragraph 3(3) of Schedule 4, where exceptional circumstances are alleged, the Court has to firstly establish whether the alleged circumstances are exceptional in that they are “out of the ordinary course, or unusual or special, or uncommon”[21] and, if there are exceptional circumstances, then the Court has to decide whether those circumstances justify not altering the register.[22]
It is important to note, however, that Schedule 4 draws a distinction between whether the registered proprietor is, or is not, in possession and special added protection is afforded to proprietor of a registered estate if he is in possession. Where the alteration affects the title of a registered proprietor in possession no order can be made, without his consent, unless he has by fraud or by lack of proper care contributed to the mistake or it would for any other reason be unjust for the alteration not to be made.[23] In determining whether a party is, or is not, in possession the Court will apply section 131 of the LRA 2002.[24]
Christopher McCauley will be discussing this topic in greater depth at our upcoming Land Registration Seminar and, if you would like to attend or, if you would like to instruct Christopher in a claim relating to land registration then please contact his clerks on 01483 539131 or email them at clerks@guildfordchambers.com
[1] Law Commission Report 2001 No 271 Land Registration for the Twenty First Century: A Conveyancing Revolution at 1.5
[2] Harpum & Bignell Registered Land Law and Practice under the Land Registration Act 2002 (Jordan Publishing Limited, Bristol, 2004) at paragraph 1.20; see also Antoine v Barclays Bank Plc & Ors [2018] EWHC 395 (Ch)
[3] Where an estate is unregistered, the transfer will trigger the first compulsory registration. Further, registration is required where the legal title to a registered estate is conveyed.
[4] Section 23 and 24 of the LRA 2002
[5] Gold Harp Properties Ltd v MacLeod [2014] EWCA Civ 1084; see also Law Commission Report 2001 No 271 Land Registration for the Twenty First Century: A Conveyancing Revolution Part X Alteration, Rectification and Indemnity
[6] Paragraph 2 of Schedule 4 of the LRA 2002 provides that the Register may be altered, by Court order, for the purposes of correcting a mistake, bringing the register up to date and giving effect to any estate, right or interest excepted from the effect of registration. Further, paragraph 5 of Schedule 4 states that, the Registrar can alter the Register on these three grounds and an additional ground which is to remove a superfluous entry.
[7] Gold Harp Properties Ltd v MacLeod [2014] EWCA Civ 1084 at paragraph 23
[8] Paragraph 1 of Schedule 4 of the LRA 2002. However, it should be noted that, prior to the implementation of the LRA 2002 the term “rectification” was applied to any alteration of the Register, to correct a mistake (See Law Commission Report 2001 No 271 Land Registration for the Twenty First Century: A Conveyancing Revolution Part X Alteration, Rectification and Indemnity at 10.7), but the term was refined by the LRA 2002 to mean an alteration that involves the correction of a mistake which prejudicially affects the title of a registered proprietor. Rectification is, therefore, a specific type of alteration.
[9] The Law Commission has recently rejected the idea that there should be a statutory definition of mistake or a move away from a broad category of mistake. See Law Commission Consultation Paper 2016 No 227 Updating the Land Registration Act 2002 at 13.76
[10] Law Commission Consultation Paper 2016 No 227 Updating the Land Registration Act 2002 at 13.7
[11] Parshall v Hackney [2013] EWCA Civ 240
[12] Baxter v Mannion [2011] EWCA Civ 120
[13] Mohammed Rashid v Farakh Rashid [2017] UKUT 332 (TCC)
[14] NRAM v Evans [2017] EWCA Civ 1013 Paragraph 52
[15] NRAM v Evans [2017] EWCA Civ 1013 paragraph 53
[16] NRAM v Evans [2017] EWCA Civ 1013 paragraph 59 and Ruoff & Roper Registered Conveyancing (Sweet & Maxwell, London) at 46.009
[17] Ruoff & Roper Registered Conveyancing (Sweet & Maxwell, London) at 46.009
[18] NRAM v Evans [2017] EWCA Civ 1013 paragraph 59 citing with approval a passage from Ruoff & Roper Registered Conveyancing (Sweet & Maxwell, London) at 46.009
[19] Paragraph 3(3) of Schedule 4
[20] Paragraph 2(1)(b) of Schedule 4; see also NRAM v Evans [2017] EWCA Civ 1013 at paragraph 60
[21] Paton v Todd [2012] EWHC 1248 (Ch)
[22] Paton v Todd [2012] EWHC 1248 (Ch)
[23] Paragraph 3(2) and 6(2) of Schedule 4
[24] Knightsbridge Property Development Corporation (UK) Ltd v South Chelsea Properties Ltd [2017] EWHC 2730 (Ch); Baxter v Mannion [2010] 1 WLR 1965; Knight Construction (March) Limited v Roberto Mac Limited; see also Justice Morgan’s comments in Paton v Todd [2012] EWHC 1248 (Ch).
If you require advice, or representation, in a claim relating to land you can instruct Christopher by contacting his clerks on 01483 539131 or emailing them at clerks@guildfordchambers.com
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