In April 2005, the first and second respondents applied to HM Land Registry to register title by adverse possession to a strip of land to the rear of their property. That application was duly entered on the day list. The third and fourth respondents, as the registered proprietors of the land in question, lodged an objection and the application was accordingly transferred to an adjudicator, under section 73(7) of the Land Registration Act 2002.
In June 2006, the adjudicator ordered the registrar to cancel the registration application on the ground of procedural defaults by the first and second respondents. No application was made or granted for a stay of execution of that order. The registrar proceeded to delete the record of the application from the day list.
The High Court allowed an appeal against the cancellation order in June 2007, but the registrar was not notified until December 2008. In the meantime, two adverse interests, in the form of charges in favour of mortgagees, were registered against the title to the land.
The first and second respondents applied to the court to reinstate their registration application with its original priority date of April 2005. The application was allowed on terms that reserved the right of third parties, such as the mortgagees, to apply to vary or set aside that order: see [2010] EWHC 1650 (Ch); [2010] 3 EGLR 29; [2010] 41 EG 128.
The Chief Land Registrar appealed. He contended that the court had no jurisdiction to make a restoration order since this would damage the integrity of the day list as a “real time” record of the actual time and date the entries were made or cancelled; instead, a new registration application would have to be made.
Held (Arden LJ dissenting): The appeal was dismissed. When determining an appeal against a cancellation order, the High Court is exercising the jurisdiction of an appeal court under CPR 52. If the court allows the appeal, it may make a consequential order restoring the registration application, pursuant to its power to “affirm, set aside or vary any order or judgment made or given by the lower court”: see CPR 52.10(2)(a). In a case where no third-party interests are affected, that will be the correct order to make. Such an order will not affect the scheme of priority under the 2002 Act and will achieve an “as you were” position by enabling the original application to be disposed of in the way that, but for the adjudicator’s error, it should have been. There is no reason in principle why a “real time” record such as the day list cannot retrospectively be corrected. Where third-party interests, such as mortgages, exist, the court still has jurisdiction to make a restoration order; the question will therefore be whether the jurisdiction should be exercised and on what terms and conditions. There had been jurisdiction to make the order in the instant case. In the absence of any challenge to the way in which the judge had exercised his discretion, that order should stand.
This was an appeal by the appellant, the Chief Land Registrar, from a decision of Briggs J, sitting in the Chancery Division of the High Court, allowing an application by the first and second respondents, Alexander Franks and Irene Franks, for the restoration of their application, to which the third and fourth respondents, Roy Bedward and Angela Bedward, objected, to register title to certain land on the ground of adverse possession.
Timothy Morshead (instructed by the Treasury Solicitor) appeared for the appellant; Daniel Gatty and Philip Fellows (appearing pro bono) appeared for the first and second respondents; the third and fourth respondents did not appear and were not represented.
Giving the first judgment, Rimer LJ said:
Introduction
1. This appeal is against an order made by Briggs J on 13 July 2010 in the Chancery Division. The issue before him arose at the end of a lengthy procedural story. Mr Alexander Franks and his wife Irene (the first and second respondents to the appeal) applied on 18 April 2005 to the Chief Land Registrar (the registrar) to be registered as proprietors of certain land on the basis of their claim to have acquired title to it by adverse possession. Mr Roy Bedward and his wife Angela (the third and fourth respondents) were the registered proprietors of the land and objected to the Franks’ application. The registrar referred the dispute so arising to the Adjudicator to HM Land Registry (the adjudicator), who, on 6 June 2006, made an order requiring the registrar to cancel the Franks’ application. That order did not follow a decision on the merits of the reference but was by way of a sanction following a procedural default on the part of the Franks in their prosecution of the reference. No stay of the adjudicator’s order pending an appeal was ordered and the registrar gave effect to the order by cancelling the Franks’ application.
2. The Franks appealed against the adjudicator’s order to the Chancery Division and Briggs J allowed their appeal on 20 June 2007 and set the order aside. For unexplained reasons, it was not until December 2008 that the registrar was notified of Briggs J’s order and, in the meantime, nothing had been done to give effect to it. What had happened in the meantime was that two charges in favour of third parties were created over land that included the disputed land.
3. On 4 January 2010, the Franks applied to have their original application restored as though it had never been cancelled. Briggs J heard their application on 28 June 2010 and, by his order under appeal, ordered the registrar to restore the original application with effect from 18 April 2005. Briggs J also, however, directed the registrar to serve notice of his order on the third parties who had acquired interests in the meantime and gave them liberty to apply to vary or discharge his order. No such application was made.
4. The registrar, who was joined as a respondent to the appeal before Briggs J, is the appellant in this court and challenges Briggs J’s order. He was represented, as below, by Mr Timothy Morshead. His case was that Briggs J had no jurisdiction to make the order. Mr and Mrs Franks sought to uphold the order. They were represented by Mr Daniel Gatty and Mr Philip Fellows, instructed by the Bar Pro Bono Unit, for whose assistance I express my gratitude. Mr and Mrs Bedward were not represented.
5. In what follows, I shall: (i) set out the story more fully; (ii) summarise the legislation; (iii) summarise the judge’s judgment; and (iv) explain the arguments and my decision on the appeal.
Facts
6. Mr and Mrs Franks are the registered proprietors of 50 Norfolk Avenue, Slough, Berkshire SL1 3AD (title no BK160521). Their neighbours are Mr and Mrs Bedward, who occupy a property backing onto the Franks’ property. The Bedwards’ property is 57 Hampshire Avenue, Slough (title no BK361792) and they were registered as proprietors on 7 May 2004.
7. The Franks claim that, in 1989, they entered into adverse possession of a strip of land at the rear of their property (the disputed land), which on 24 March 2000 was registered as part of title no BK361792 and of which the Bedwards are the registered proprietors. They claim that, in 1989, they fenced the disputed land off and incorporated it as part of their garden and that they have acquired a title to it by 12 years’ adverse possession expiring in 2001.
8. On 15 April 2005, the Franks applied to HM Land Registry (Gloucester office) on form AP1 to be registered as the proprietors of the disputed land. They relied on para 18(1) of Schedule 12 to the Land Registration Act 2002 (the Act). Schedule 12 contains transitional provisions, including provisions covering the case in which a party had acquired title to a registered estate in land by adverse possession prior to the implementation on 13 October 2003 of the new adverse possession provisions in section 97 of the Act. Under section 75(1) of the Land Registration Act 1925 (the 1925 Act), the consequence of such adverse possession was that the registered proprietor of the relevant land would hold it on trust for the adverse possessor, which would be entitled to be registered in his place as its proprietor. Paragraph 18(1) similarly entitles the adverse possessor to be so registered. The Franks’ application was supported by a statutory declaration they made on 9 August 2004.
9. I should also note another feature of the transitional provisions applying to the Franks’ application. Their claimed right to be registered as proprietor of the disputed land under para 18(1) was a proprietary right. Before the enactment of the Act, their like right under the 1925 Act to be registered as the proprietor would be protected against third parties as an “overriding interest” for so long as they remained in actual occupation of the disputed land. Under the Act, para 11 of Schedule 12 conferred on them a three-year grace period from 13 October 2003 during which their claim was protected whether or not they continued in such occupation. This was achieved by giving them a transitional overriding interest expiring on 13 October 2006. At the date of their application on 18 April 2005, the Franks had the benefit of that transitional overriding interest.
10. Reverting to the facts, the Franks’ application was received by the Land Registry on 18 April 2005, when the registrar entered it on the “day list”. Such entry was made pursuant to the obligation on him imposed by r 12 in Part 2 (“Indices”) of the Land Registration Rules 2003 (SI 2003/1417) (the LRR). Rule 15 of the LRR, in Part 3 (“Applications: General Provisions”), contains provisions as to the time at which such an application is to be taken as made, depending on whether it is received on a business day. The day list is a “real time” record and the making of an application is timed to the second of the relevant day: the Franks’ application was timed at 10.03.08. The significance of such an entry is that, under r 20(1) (“Completion of applications”) in Part 3 of the LRR:
20. – (1) Any entry in, removal of an entry from or alteration of the register pursuant to an application under the Act or these rules has effect from the time of the making of the application.
Any rectification of the register of title no BK361792 giving effect to the Franks’ application would, when made, thus take effect from 18 April 2005.
11. Notice of the Franks’ application was served on the Bedwards. They disputed that the Franks had occupied the disputed land for as long as they claimed, asserting that it was not until 2004 that it was fenced. On 10 May 2005, they notified the registrar of their objection to the application. Since their objection could not be disposed of by agreement, the registrar, on 15 July 2005, referred “the matter” to the adjudicator under section 73(7) of the Act.
12. The processing by the Franks of their case before the adjudicator was unsatisfactory, although it is unnecessary to explain why. The upshot was that following two unless orders of 28 November 2005 and 11 May 2006 directed to them, the adjudicator made an order on 6 June 2006 requiring the registrar “[t]o cancel the original application dated 18 April 2005 for registration based on adverse possession”. That order was made under r 55, with its formalities being governed by r 40, of the Adjudicator to Her Majesty’s Land Registry (Practice and Procedure) Rules 2003 (SI 2003/2171) (the AR), the rules in force at the time. As required by r 40(2)(b), the order was served on the registrar as well as on the parties.
13. On 14 June 2006 (at 14.29.08), the registrar acted on the order by cancelling the record of the Franks’ application earlier entered in the 18 April 2005 day list. He was obliged to do so by section 112 of the Act, which provides that a requirement of the adjudicator “shall be enforceable as an order of the court”. As Briggs J observed, from then on “no-one searching the Bedwards’ title (including for that purpose the day list) would know that the Franks’ registration application had ever been made”.
14. On 13 October 2006, there expired the three-year transitional period during which the Franks’ entitlement to be registered by right of their claimed 12 years’ adverse possession counted as an overriding interest: para 11 of Schedule 12 to the Act. That, coupled with the earlier cancellation of their application, resulted in a significant change in their rights. As from then, their claim to have acquired title to the disputed land by adverse possession could bind only parties taking a subsequent interest in it if: (i) they were in actual occupation so as to make their claim an overriding interest under para 2 of Schedule 3 to the Act (and Briggs J observed, but without finding, that by October 2006 it was probable that they were no longer in such occupation because, in proceedings in Slough County Court, they had undertaken not to enter on the disputed land pending the outcome of the ownership dispute); (ii) they had priority under sections 28 or 29 of the Act (and, as against a legal interest, they would have had such priority only if their claim was secured by the entry of a notice on the register pursuant to section 34, which it was not); or (iii) they made a fresh application under para 18 of Schedule 12 and their application was entered in the day list ahead of any application to register a subsequent disposition (and they made no such application).
15. On 24 October 2006, the Franks applied to the adjudicator for permission to appeal against his order of 6 June 2006. He purported to grant such permission on 27 October. The time for appealing had by then expired but he did not extend their time. Nor, contrary to r 45(4) of the AR, did he first give the Bedwards an opportunity to make objections. His reason for giving permission was that, had he been aware of a letter from the Franks’ solicitors of 5 June 2006, he would not have made his order requiring the cancellation of the Franks’ application. Rule 45 also contains provisions empowering the adjudicator, when granting permission to appeal, to grant a stay of his decision pending the outcome of an appeal. No stay was sought or granted. Nor could it have been: the registrar had, on 14 June 2006, already given effect to the adjudicator’s order.
16. The Franks filed their appellants’ notice in the Chancery Division on 6 December 2006, naming the Bedwards as the respondents. The notice was seriously late and they required an extension of time. For reasons that he gave on 27 March 2007 when dealing with the extension application on the papers, Henderson J ruled that the adjudicator’s order giving permission to appeal was ineffective but he both extended the Franks’ time for appealing and gave them permission to appeal.
17. The appeal was heard by Briggs J on 20 June 2007. The Franks were in person and the Bedwards were represented by counsel. In his extempore judgment, Briggs J held that the adjudicator’s cancellation of the Franks’ application was a disproportionate response to the preceding procedural muddle. By para 1 of his order, he varied the cancellation order of 6 June 2006 by imposing a new unless order that (as varied on 28 November 2007) provided that, in default of their compliance with a new unless requirement, “the adjudicator will require the [registrar] to cancel the original application dated 18 April 2005 to register title based on adverse possession”. It appears to me that that order implicitly required the restoration of the Franks’ original application with effect from 18 April 2005. If it did not, then: (i) on due compliance with the unless condition, there would have been nothing substantive to argue about on the revived reference before the adjudicator; and (ii) in default of such compliance, there would have been nothing for the registrar to cancel. The Franks did comply with the unless requirement. In his judgment leading to the order under appeal, Briggs J said that it was common ground that, as at 20 June 2007, everyone assumed that on such compliance the Franks’ application would be reinstated as though it had not been required to be cancelled.
18. More procedural trouble, however, lay ahead. Mrs Franks e-mailed the adjudicator’s office on 25 June 2007 to say that the appeal had been allowed, but it seems that her information was not passed to the registrar. There was also an unexplained delay in sealing Briggs J’s order, which did not happen until 31 July 2008. In around August 2008, the Chancery Division sent copies of his orders of 20 June and 28 November 2007 to the adjudicator’s office; and, on 19 December 2008, that office wrote to the registrar notifying him of the order allowing the appeal.
19. In the meantime, the Franks’ application had not been restored to the day list for 18 April 2005. What had, however, happened was that two adverse interests had been registered against the land (including the disputed land) comprised in title no BK361792. The first was a legal charge dated 29 October 2007 in favour of Southern Pacific Mortgage Ltd (Pacific), which had been registered in the charges register. The second was a general equitable charge dated 6 June 2008 in favour of Welcome Financial Services Ltd, which had been protected on the register by an agreed notice. Briggs J noted that it was unknown whether either chargee had made a priority search before entering into its charge or, therefore, whether either had relied on the absence of any reference to the Franks’ application in the day list.
20. The further issue with which Briggs J was destined to deal was reflected in an exchange of correspondence between the adjudicator and the registrar. On 19 December 2008, the adjudicator sought the registrar’s view as to whether:
the cancelled application can be in any way revived and re-entered on the Day List with the same original priority date (assumed to be 18th April 2005) so that the Adjudicator could make a further substantive order on it or whether you consider Mr and Mrs Franks will need to make a fresh application.
The registrar’s response on 9 January 2009 was that:
It is not possible to revive an old application once it has been cancelled. It appears that the applicant should make another application to the Land Registry if the matter is to be revived.
21. The rationalisation of the registrar’s response was this. Had the Franks at all material times since 13 October 2006 been in actual occupation of the disputed land, their claimed entitlement under para 18 of Schedule 12 would bind both the legal and the equitable chargees as an overriding interest under para 2 of Schedule 3. If, however, they had not been in such occupation, their claimed entitlement could not, without more, bind Pacific, the legal chargee. (The position with regard to the equitable chargee may be more complicated but there is no need to discuss it). The restoration of the original application with effect from 18 April 2005 would, however, have the effect of subjecting the legal chargee to a prior interest that: (i) was not the subject of any such application when it took its charge; (ii) was not protected by a notice on the register; (iii) was not (let it be assumed) in the nature of an overriding interest; and (iv) was not one that would have been disclosed by any search it made. The registrar’s point was, in part, that it is not possible to correct a real time index such as the day list by making a back-dated entry; and, more substantively, that such a restoration would undermine the scheme underlying the registration of title to land under the Act and the protection it gives to third parties that acquire their interests in reliance on what their search discloses.
22. Being reluctant to make a fresh application to HM Land Registry (which would be entered in the day list on the day it was made and would not give them priority over the legal chargee), the Franks elected to apply to Briggs J for the restoration of their original application as from 18 April 2005. If the making of such restoration was, as I consider, implicit in his order of 20 June 2007, they had already fought and won that battle. However, that order had not been carried out, the position then changed with the arrival on the scene of the two third-party interests and so the battle was fought again. The question for Briggs J was whether he could and, if yes, should direct the restoration of the application as from 18 April 2005 as though it had never been cancelled.
23. The hearing before Briggs J was on 28 June 2010. The Franks and the Bedwards appeared in person. Mr Morshead represented the registrar, who had been added as a respondent on the basis that the application raised questions of importance arising under the Act, and argued against the making of a restoration order. Ms Amanda Tipples, appointed by the Attorney General as an advocate to the court, advanced arguments in support of a restoration order. Apparently surprising omissions from the cast before Briggs J were the two chargees, who were given no notice of the Franks’ application. Since the point of their application was to achieve an outcome giving their claim priority over the chargees, it might be thought that they were essential respondents. As it was, the case was argued in their absence, although the registrar advanced arguments in their interests.
24. Briggs J, by his order under appeal, ordered the registrar to restore the original application with effect from 18 April 2005. He also, however, directed the registrar to serve notice of his order on the chargees and any other third parties who had acquired interests in the meantime, and gave them liberty to apply to vary or discharge his order. No such application was made.
Legislation
25. The judge provided a lucid explanation of this in his judgment (see [2010] EWHC 1650 (Ch)*), on which I have gratefully drawn. I have already referred to the main statutory provisions. The essential purpose of the scheme created by the Act is to provide a system of state-guaranteed registered title. Subject to exceptions, the register is intended to provide a comprehensive and accurate reflection of the state of the title to registered land at any given time, so that it is possible to investigate title to land on line with the minimum of additional enquiries and inspections.
* Editor’s note: Reported at [2010] 3 EGLR 29; [2010] 41 EG 128
26. The registrar is required to maintain a register of title, including an individual register for each registered estate vested in a proprietor: r 2(2) of the LRR. Section 68 of the Act requires him to keep an index enabling various prescribed matters to be ascertained in relation to any parcel of land. They include whether any registered estate relates to it and such other matters as the rules may provide. Section 68(2) provides that the rules may make provision about how the index is to be kept, the information to be included in it and the form in which it is to be kept, and for making of official searches of the index.
27. Rule 10 of the LRR prescribes that the index required under section 68 of the Act must comprise an index map and an index of prescribed verbal descriptions. Rule 11 requires it to include the names of proprietors of registered estates and charges. Rule 12 prescribes the keeping of the day list, in which the Franks’ 18 April 2005 application to be registered as proprietors of the disputed land was required to be entered, as it was. Rule 12 provides:
12. – (1) The registrar must keep a record (known as the day list) showing the date and time at which every pending application under the Act or these rules was made and of every application for an official search with priority under rule 147.
(2) The entry of notice of an application for an official search with priority must remain on the day list until the priority period conferred by the entry has ceased to have effect.
(3) Where the registrar proposes to alter the register without having received an application he must enter his proposal on the day list and, when so entered, the proposal will have the same effect for the purposes of rules 15 and 20 as if it were an application to the registrar made at the date and time of its entry.
(4) In this rule the term “pending application” does not include an application within Part 13, other than an application that the registrar designate a document an exempt information document under rule 136.
28. Rule 15 of the LRR, already mentioned, prescribes the time when applications are taken to be made. I have also cited from r 20 (see [10]), the effect of which was that if the Franks’ registration application had succeeded before the adjudicator, their registration as proprietors of the disputed land would have taken effect from 18 April 2005 and they would thus have enjoyed priority over every entry or application for registration made after that date: anyone considering acquiring an interest in the disputed land after that date would, on a priority search, have been notified of their application of 18 April 2005. Rule 20 owes its origin to para 6(c) of Schedule 10 to the Act, which provides that rules may “make provision about when an application under the Act is to be taken as made”.
29. Section 72 of the Act, in a section headed “Applications”, is headed “Priority protection” and it is sufficient to cite subsections (1) to (3):
(1) For the purposes of this section, an application for an entry in the register is protected if –
(a) it is one to which a priority period relates, and
(b) it is made before the end of that period.
(2) Where an application for an entry in the register is protected, any entry made in the register during the priority period relating to the application is postponed to any entry made in pursuance of it.
(3) Subsection (2) does not apply if –
(a) the earlier entry was made in pursuance of a protected application, and
(b) the priority period relating to that application ranks ahead of the one relating to the application of the other entry.
30. It was agreed between the parties that an applicant for an official search is given notice of the entry on the day list of any relevant pending applications affecting the registered title. As the judge put it, the day list plays an essential part in protecting parties contemplating acquiring interests in the registered land from doing so in ignorance of applications for registration that would take effect in priority to that party’s interest. It was also common ground that the grant of a legal charge over registered land such as that taken by Pacific was a disposition that was required to be completed by registration (section 27 of the Act); and that, in the events that happened in the present case, the effect of section 29 was that Pacific took its charge free of the Franks’ claim to be registered as proprietors of the disputed land.
31. I come to the legislation relating to the adjudicator. The adjudicator derives his office, a judicial one, from section 107 of the Act. The adjudicator entered the scene in the present case because (as they were entitled to under section 73) the Bedwards objected to the Franks’ application to be registered as proprietors of the disputed land. Since it was not possible to dispose of their objection by agreement, the registrar was required by section 73(7) to refer “the matter” to the adjudicator. The adjudicator’s jurisdiction to decide such matter derived from section 108(1)(a). It fell to him to determine the merits of the Franks’ application (he could instead have exercised his discretion to require the parties to refer it to the court for disposal, but did not: section 110).
32. Section 109 relates to the procedure before the adjudicator and provides for the making of rules, with section 110(3) providing for the making of rules about his functions in consequence of a decision on a reference under section 73(7). The AR (the full title is in [12] above) were the applicable rules at the material time. Rules 39 and 40 contain formal provisions relating to the adjudicator’s decision, the need for him to give reasons for it and the orders giving effect to it. Rule 41, which relates to his substantive jurisdiction and owes its origin to section 110(3)), provides:
Substantive orders on a reference that include requirements on the registrar
41. –(1) Where the adjudicator has made a substantive decision on a reference, the substantive order giving effect to that substantive decision may include a requirement on the registrar to –
(a) give effect to the original application in whole or in part as the objection to that original application had not been made; or
(b) cancel the original application in whole or in part.
(2) A requirement on the registrar under this rule may include –
(a) a condition that a specified entry be made on the register of any title affected; or
(b) a requirement to reject any future application of a specified kind by a named party to the proceedings –
(i) unconditionally; or
(ii) unless that party satisfies specified conditions.
33. Rule 55 of the AR empowers the adjudicator to impose sanctions on a party to the reference that is in default of compliance with his directions. Where that party was the party that made the original application, the sanction may include a requirement on the registrar to cancel the original application. That is the power that the adjudicator exercised by his order of 6 June 2006. The real cause of the Franks’ subsequent problems was because they did not have the benefit of a stay of that order pending judgment on their appeal to the High Court. The adjudicator has a jurisdiction to grant a stay under r 45. In this case, however, no stay was sought or ordered, and the registrar complied with the adjudicator’s order by cancelling the Franks’ application.
34. I should refer, in that last context, to what the judge said in [30] and [31] of his judgment. That was that, under current practice, it may in many cases be impracticable for a proposing appellant to obtain permission to appeal and a stay before the registrar has acted on the adjudicator’s order. That is because the adjudicator’s decision is usually communicated to the parties and the registrar more or less simultaneously and does not ordinarily defer the date on which the registrar is to act on it. In addition, under r 45(4), before reaching a decision on whether to grant permission to appeal or to grant a stay, the adjudicator must allow the parties to make representations or objections; and, in many cases, by the time those requirements have been met, the registrar will already have acted on the adjudicator’s order.
35. Section 111 of the Act provides for a right of appeal against an adjudicator’s decision to the High Court. That engages CPR 52.10(1) and (2)(a) by which the appeal court has all the powers of the lower court and a power to affirm, set aside or vary any order or judgment made or given by the lower court.
Judge’s judgment
36. The issue before the judge was, therefore, whether, having allowed the Franks’ appeal against the adjudicator’s order requiring the registrar to cancel their original application, he could and, if so, should order a restoration of their original application: that is, a retrospective restoration with effect from 18 April 2005 (which I will call a “restoration order”). The judge held that no assistance could be derived from the jurisdiction to alter the register under paras 2 and 4 of Schedule 4 to the Act. That was because the day list was not part of the register, as was agreed before him.
37. The registrar’s position, as explained in his written argument, was one that the judge described as a “doctrinaire” approach, namely that an application in the day list, once cancelled, was inherently incapable of being restored on appeal since it would damage the integrity of the day list as a real time record. Such a record, it was said, does not admit of any retrospective correction. The judgment reflects that Mr Morshead did not adhere to the doctrinaire approach but recognised that the court, on appeal, would at least have jurisdiction to make any one of four alternative orders, including a restoration order. The judge made it clear, however, that Mr Morshead argued strongly against a restoration order, submitting that “save in the most exceptional circumstances” the court should ordinarily choose between two of the other alternatives. The first was to direct that the steps made in the cancelled application should be treated as steps in a new application to be made by the appellant, and to waive any duplication of fees. The second was to direct the re-entry into the day list of the original registration application, but with a postponed date of entry. Neither alternative would give the applicant priority over third-party interests acquired in the meantime. Before this court, Mr Morshead adhered to the registrar’s doctrinaire approach, which was the beginning and end of his argument. There was brief discussion before us as to whether, in the hearing below, the judge correctly understood him to have departed from that approach. Mr Morshead did not submit that he did not.
38. In deciding what order he should make, the judge was fully alive to the registrar’s point that a restoration order would or could prejudice third parties who had since acquired rights in the land. He said:
46. … I readily accept that, where an intermediate incumbrancer would be prejudiced by the restoration of a cancelled application, then this would be the most powerful reason why, as a matter of discretion, the court would not direct its restoration by way of appeal, all the more so if compensation to the intermediate incumbrancer under the statutory scheme was, as it appears to be, unavailable. It follows that if, on appeal, the court is aware that there exists such an intermediate incumbrancer, then it would not ordinarily direct the restoration of the application and its re-entry in the day list with its original priority, otherwise than on terms which required the successful appellant fully to respect the intermediate incumbrancer’s rights. If, on the hearing of the appeal, the court did not have the requisite information available, then there is no reason why the appeal could not be adjourned. …
47. In a case in which there were intermediate incumbrancers who would be unfairly prejudiced by the making of an order for restoration of the application with its original priority, the court may have no alternative than to require the applicant to make a fresh application, and to direct that steps taken in the cancelled application be treated as steps in the new application, so as to save the incurring of unnecessary work and cost. Such a case would arise if, for example, the prejudice which would otherwise be caused to an intermediate incumbrancer could not be remedied by any form of conditional order, or where the appellant was unwilling to comply with the terms of any proposed conditions.
48. I do not pretend that any of the alternatives which I have outlined above represent a simple, easy, neat or necessarily cost-effective solution to the problems thrown up by a successful appeal against a cancellation order, not protected by a stay. The obvious solution to these difficulties is for the rules and practice relating to stay pending appeal to be reviewed, so as to make a stay more readily available as the sensible precaution against the difficulties revealed by these proceedings. …
39. In disposing of the appeal, the judge therefore approached it on the basis that he had jurisdiction to make a restoration order, but that whether and how he should so exercise such jurisdiction was a matter for his discretion. He said:
52. This is a case in which it would neither be just to the Franks to require them to make a new application (even with a provision that steps taken in the original application stand as steps in the new application) nor, necessarily, just to the two intermediate incumbrancers simply to make an order for the re-entry of the registration application in the day list with priority from its original entry date of 18th April 2005. The first alternative would forever deprive the Franks of the availability of the right to treat their adverse possession claim as a transitional overriding interest. The second alternative may unfairly prejudice the two chargees.
53. The court knows nothing about the precise nature of the rights of the two chargees, still less whether restoration of the Franks’ application would cause real rather than merely theoretical prejudice. The adverse possession claim is for a modest part of the Bedwards’ property, and it may well be that the value of the chargees’ security rights may be more likely to be increased by a final determination of this long-running boundary dispute, than decreased by the abstraction of some small part of the property from the land comprised with their security.
54. In those circumstances the choice lies between making an order for the re-entry in the day list of the Franks’ registration application with its original entry date, with liberty to the two chargees to apply to vary or set it aside, and a yet further adjournment of this long-running appeal to ascertain, if possible, the chargees’ views.
55. I prefer the first of those alternatives. It may well be that the chargees will, on inquiry, have no objection at all. Alternatively, if they do, the Franks may be able to provide satisfactory undertakings which preserve the chargees’ rights. Either of those outcomes would save the costs and delay of a further hearing.
56. I am satisfied that it would be wrong to require the Franks to make a fresh application now, unless compelled to that conclusion as the only way of avoiding irreparable prejudice to the chargees. That would deprive the Franks of the benefit of a transitional overriding interest, through no fault of their own. That would merely provide a windfall benefit to the Bedwards, as the consequence of the Adjudicator’s order which, as I concluded on appeal, should not have been made.
57. I will hear submissions on an appropriate form of order. It will need to include liberty to apply, not only to the two chargees, but also to any third party aggrieved by the order, and for the Registrar to be directed to notify any person appearing to be potentially prejudiced, as appears from the state of the Register and the day list on the day when he makes the re-entry.
As I have said, no application was made by anyone to vary or discharge the judge’s order.
Appeal
40. The registrar’s appeal was founded on the proposition that the judge had no jurisdiction to make a restoration order. If he did have jurisdiction, Mr Morshead expressly disclaimed any challenge to the way in which he exercised it. The registrar is not directly interested in the facts of the present case. He is concerned to have the question of principle clarified – that of jurisdiction.
41. Mr Morshead submitted that the key to the appeal was that the court should respect and uphold the system of priority established by the Act and on which registered conveyancing depends. That includes the principle that a registered proprietor should not be disturbed in its enjoyment of its interest save on grounds sanctioned by the Act, which do not include subjecting it to a prior interest of which, having conducted the type of search provided for by the Act, it was ignorant when it acquired its interest. The problem posed by the case is not one that requires, or should receive, a discretionary balancing of two conflicting interests; it simply requires the identification of which of the competing interests should prevail. The system of priorities operated by the Act requires the interest of subsequent incumbrancers to be protected.
42. In developing that submission, Mr Morshead pointed out that, in October 2007, when Pacific took its legal charge, the Franks: (i) were not registered as proprietors of the disputed land; (ii) they had not registered a unilateral notice under section 34 of the Act protecting their claim to it; (iii) they had not established their adverse possession claim as well founded; and (iv) they could at most assert that they had a claim that remained to be decided. By contrast, at the same date, Pacific had acquired a legal charge over the disputed land in circumstances in which it could not, by using the conveyancing procedure provided for by the Act, have been alerted to any risk of a claim by the Franks that could have affected its priority. There was simply no parity of interest between the Franks and Pacific; and, said Mr Morshead, it was plain that the scheme of the Act was that Pacific should not now be subjected to the risk of a claim that might, were it to succeed, have priority over its legal charge.
43. Mr Morshead submitted that the judge’s restoration order was therefore contrary to the scheme of the Act and that it followed that he had no jurisdiction to make it. The making of such an order had the potential to redesign the system of priority provided for by the Act and its making was, by necessary implication, beyond the court’s powers. Although, having allowed the Franks’ appeal against the adjudicator’s order, Briggs J had also to make a consequential order in order to get their claim back on track, the most that he could do, and should have done, was one or other of two things. First, he could have given a direction to the effect that they were at liberty to make a fresh application, perhaps accompanied by directions that steps taken in the cancelled application could be treated as steps in the new one; and perhaps with a relaxation of the imposition on the Franks of a renewed fees burden. As to the last point, I would question whether any order to that effect would be an appropriate one for a judge to make on an appeal. If the Franks must start again, I see no good reason why they could properly be released from the payment of any fees to which in the ordinary course they would be subject. Second, Mr Morshead submitted that Briggs J could alternatively have directed the reinstatement in the day list of the original application but at a current date, on terms making it clear that such reinstated application was, for the purposes of r 20 of the LRR, made as from the date of such reinstatement.
44. During his submissions, Mr Morshead devoted some attention to the question of whether there is anywhere to be found in the AR a provision that would enable the adjudicator to make a restoration order such as the judge made. The argument was, as I understood it, that if no such power could be found in the AR, the judge could have no such power either. In my judgment, that argument does not assist the registrar’s position. I am disposed to accept that there is nothing in the AR indicating that an adjudicator could make a restoration order of the type Briggs J made. Equally, I cannot imagine circumstances in which the making by an adjudicator of such an order could or would ordinarily arise. In my view, however, the inability to find any jurisdiction to make such an order in the AR is beside the point. As Mr Gatty pointed out, the jurisdiction that Briggs J was exercising was the jurisdiction of an appeal court; and that court’s jurisdiction is to be found in the Civil Procedure Rules 1998, in the appeal court’s powers in CPR 52. CPR 52.10(2)(a) provides that the appeal court has power to “affirm, set aside or vary any order or judgment made or given by the lower court”.
45. Mr Gatty submitted that the wide powers conferred by that provision must include a jurisdiction in the appeal court to make an order not merely setting aside the wrong order made by the adjudicator, but also to make a restoration order reversing its consequences. In his written submissions, Mr Morshead also accepted that prima facie CPR 52.10(2)(a) could be said to confer the jurisdiction that Briggs J exercised. In his submission, however, it in fact fell short of doing so because any such purported exercise of the power was counter to the scheme of priority that was of the essence of the Act and so was impliedly constrained by the Act. The Act itself implicitly removed the court’s jurisdiction to make a restoration order.
46. The question, therefore, is whether, following a successful appeal, the appeal court has jurisdiction to make a restoration order. In my judgment, the answer is that it does. I would reject Mr Morshead’s submission that its jurisdiction to make a restoration order is impliedly constrained by the Act.
47. What I would regard as the Achilles’ heel in the registrar’s contrary argument is the consideration of what would have been the appropriate order to make in the present case if the question as to the jurisdiction to make a restoration order had been the subject of argument before Briggs J at the hearing of the Franks’ appeal on 20 June 2007. The significance of that particular moment in the history of the case is that the third-party interests in favour of the chargees had not yet arisen. The situation was instead that which it would probably be in most similar appeals: namely, one in which, at the time when the High Court makes its order allowing the appeal, it is known that no third-party interests affecting the land have been acquired or applied for and that the making of a restoration order would not damage or impair the integrity of the Act’s scheme of priority.
48. In such a case, which I will call a “no third-party interest” case, I can see no reason why the court would not have jurisdiction to make a restoration order. I should add, however, that it may be that the time for inquiry as to whether any such interest has in the meantime arisen is not only when the court makes its order but also at the later stage when the registrar comes to give effect to it. That, however, would require only a minor adjustment to the procedure: the restoration order might have to provide for a reference back to the court if in the meantime a third-party interest had arisen.
49. Subject to that consideration, I would regard it as plain that in a no third-party interest case the court does have jurisdiction to make a restoration order. Its making would not have any effect on the Act’s scheme of priority; and, in the ordinary course, I can see no reason why the court should not make such an order. On the contrary, I can see good reason why it should do so. Such an order would achieve a real “as you were” position that ought to be a proper objective of the court in disposing of the appeal; and it would enable the original application to be disposed of just as, but for the adjudicator’s error, it ought to have been disposed of. It would, on the face of it, therefore be the correct order to make. There would, in such a case, simply be no need to fashion an order along either of the alternative lines that Mr Morshead suggested. As for the registrar’s point that a real time record such as the day list cannot be retrospectively corrected, that appears to me to be founded on unsound theory. In his written submissions in the court below, the registrar accepted that in practice, albeit only in “exceptional circumstances,” he does make backdated corrections to the day list, although apparently only to correct the mistakes of HM Land Registry; and, Mr Morshead told us on instructions, that it is never done to change priorities, instructions that I regard as unsurprising. Such practice shows, however, that corrections to the day list can be and are made. There is no reason in principle why a correction cannot be required by a court order.
50. In the course of his submissions, Mr Morshead recognised that it may be that, in a no third-party interest case, the court does have jurisdiction to make a restoration order, although he did not accept that it did. He submitted, however, that if it does have jurisdiction in such a case, that is the limit of its jurisdiction. He maintained firmly that it can have no like jurisdiction in cases in which third-party interests have in the meantime arisen.
51. In my judgment, if, as I consider, the court has jurisdiction in a no third-party interest case to make a restoration order, it must follow that it also has jurisdiction to make a restoration order in a third-party interest case such as that before Briggs J. There can be no logical basis for the proposition that, once third-party interests have intervened, the jurisdiction disappears. The only question that circumstances such as that will provoke is whether the jurisdiction should be exercised; and, if yes, on what, if any, terms and conditions.
52. That conclusion means that I would regard Briggs J as having had jurisdiction to make the restoration order that he made. Whether he should have exercised it in the way he did was a matter for his discretion and Mr Morshead advanced no challenge to that. It follows that the registrar’s appeal must fail.
53. I ought not to part with this appeal without adding that, having so ruled against the registrar, I recognise the force of Mr Morshead’s submissions that an exercise of the jurisdiction to make a restoration order in a third-party interest case will in principle impair the integrity of the Act’s scheme as to priority. I regard the submissions as very powerful. It appears to me to follow from his argument that, if, as I consider, the court has jurisdiction to make a restoration order, it ought not ordinarily to exercise it in a third-party interest case since it cannot ordinarily be a proper exercise of the court’s jurisdiction to make an order whose effect is to rearrange the scheme of priorities provided for by the Act.
54. In the light of the way the appeal was argued, I propose, however, to say no more on that save to add that, in the previous paragraph, I twice used the word “ordinarily” and did so because I do not wish to be taken as suggesting that in every third-party interest case there will be only one way in which the jurisdiction could properly be exercised. Trite though it is, “never say never” remains, in my view, a wise piece of judicial caution.
55. I would dismiss the registrar’s appeal.
Giving the second judgment, Toulson LJ said:
56. I agree that the appeal should be dismissed for the reasons given by Rimer LJ. I add some words only because the appeal has led to a division of opinion.
57. The question is whether a court that allows an appeal from an order of an adjudicator directing the cancellation of an application entered on the day list may direct the registrar to undo the cancellation and restore the entry as at the time specified in r 15 (that is, the date when the application was received by the Land Registry).
58. I agree with Rimer LJ’s and Briggs J’s affirmative answer, for the reasons given by them. Otherwise, the execution of the adjudicator’s wrongful order would be incapable of remedy through the appellate system, which exists to correct the consequences of error. My starting point is that I would require persuasion that this accorded with parliament’s intention when it enacted the land registration scheme.
59. The arguments for giving a negative answer depend partly on the rules about the time of entry of an application, particularly r 15 (which Arden LJ has set out), but also more broadly on the essential structure of the scheme.
60. As to the rules about the time of entry of an application, r 20(1) provides:
20. – (1) Any entry in, removal from or alteration of the register pursuant to an application under the Act or these rules has effect from the making of the application.
61. I agree with Rimer LJ that if the court orders the restoration of an application that has been wrongly cancelled, it would follow that the application would be reinstated with effect from the date of the application, as determined by r 15. In this case, that was 18 April 2005. I do not consider that rr 15 and 20 preclude the court from making the order that it did, consequential on Mr and Mrs Franks’ successful appeal under section 111 of the Act. In my view, the appellate jurisdiction created by section 111 includes the power to give such consequential directions as may be just in order to correct that which has been wrongly done.
62. In deciding what is just in all the circumstances, the risk of resulting prejudice to a third party was recognised by Briggs J to be extremely important, but he took account of it by the form of his order (which Rimer LJ has described in [24]).
63. The wider argument of the land registrar is that the statutory scheme is incompatible with the exercise of the power that Briggs J purported to exercise, because the integrity of the scheme requires that the day register cannot be altered retrospectively. Rimer LJ has referred in [37] to an apparent difference in the way that the case was argued before the judge and before this court on the question of the court’s jurisdiction.
64. Full adherence to the logic of what the judge referred to as the “doctrinaire” approach (that cancellation is an irreversible historical fact, and that the day register cannot be altered retrospectively) would prohibit the sensible practice of the land registrar himself making retrospective alterations when necessary to correct administrative errors, provided that third parties are not thereby prejudiced. I do not see a good reason for allowing the register to be rectified retrospectively to correct an administrative error but no other kind of error. In that respect, I take a different view from that expressed by Arden LJ in [78].
65. Suppose that the adjudicator ordered the cancellation of an application, but, by an electronic error, the registrar cancelled the wrong application. It ought to be possible to undo that error by reinstating the entry of the application as at the original date. Equally, it seems to me that it ought to be possible to reinstate an entry where the order for its cancellation was itself incorrectly made.
66. Arden LJ and the land registrar recognise that, if they are correct, the scheme requires amendment in order to avoid the risk of injustice. Although there may be circumstances where nothing short of amending legislation (primary or secondary) can remedy a risk of injustice inherent in a statutory scheme, in this instance, I agree with Rimer LJ and Briggs J that it is possible for the court to interpret and administer the statutory scheme in a way that does justice and does not undermine the essential integrity of the scheme.
67. Since neither of the chargees referred to in [19] has shown any wish for Briggs J’s order to be altered, the argument about the risk of third-party prejudice was conducted at a theoretical level. Everyone is agreed about the importance of the risk of third-party prejudice, but I support the views of Rimer LJ and Briggs J that this goes to the exercise, rather than the existence, of the court’s jurisdiction.
68. There was no argument before us that, if the judge had the jurisdiction that he purported to exercise, he exercised it in a way that failed properly to recognise the interest of third parties. This is perhaps unsurprising in view of the stance of the chargees.
69. To say more would be to repeat what has been said by Rimer LJ, with which I fully agree.
Giving the third judgment, Arden LJ said:
70. In an ideal world, one might suppose that a question of conflicting rights in relation to registered land would be resolved by one party obtaining the interest it thought it had and the other party obtaining compensation. In the present case, however, ignoring the point that the chargees may in fact be unconcerned about Mr and Mrs Franks obtaining priority over their interest in the strip of land in issue, contrary to what I have just supposed, either the Franks’ application must be entered in the day list with retrospective effect, with the consequence that the chargees’ interest is diminished without (it appears) any right to compensation, or, alternatively, (or so it is said), the Franks’ victory on appeal from the adjudicator’s decision is rendered useless and unjust to them because that order cannot be made and (it appears) no compensation is available to them either. Neither solution to this case enables the system to work as one supposes that it should. Moreover, the law has to make a policy decision as to whether, and if so in what circumstances, to protect parties in the position of Mr and Mrs Franks, who are the incumbent holders of an interest in the land, or to protect parties in the position of the chargees, who (so far as is known) were purchasers for value of an interest in the land in good faith and without notice of the unregistered interest of Mr and Mrs Franks. For an illuminating discussion of the issues here, see Professor E Cooke’s The New Law of Land Registration (Hart) (2003), chapter 5.
71. There is a clear need, as the Chief Land Registrar accepts, for the legislation to be amended. There are a number of options for the form of any such amendment. We are not concerned with that question. What, however, this court must do is decide what is the effect of the legislation, on its true interpretation, as it presently stands.
72. The basic rule, in relation to registered land, is set out in sections 28 to 30 of the Act. Under those sections, registration of an interest confers priority. There are, however, a number of specified minor exceptions to this basic rule, with which this appeal is not concerned. Subject to them, a party whose interest appears in the register will know that its interest has the priority there described. Moreover, contended Mr Morshead on behalf of the Chief Land Registrar, there is an important principle of registered conveyancing that:
registration is itself sufficient to protect a person’s interest in land fully, without the need for that person to make further efforts to protect his interest.
73. If this approach is correct, registration of an interest in land under the Act affords in very broad terms a double assurance: an assurance as to the existence of an interest created in the past and in addition an assurance that the party entitled to an interest will not need to take further steps to protect its interest in the future.
74. A chargee that wishes to be sure that no one will get on to the register before a proposed charge in its favour has been executed and registered will make an official search with priority in accordance with r 147 of the LRR. It thereby obtains a guarantee that its charge will obtain priority on the register over subsequently registered interests, provided that it completes the registration process for its charge within the priority period of 30 days and its application for registration is not cancelled for some reason. Thus, r 148 provides:
Entry on day list of application for official search with priority
148. – (1) An application for an official search with priority is to be taken as having been made on the date and at the time of the day notice of it is entered on the day list.
(2) Paragraph (3) has effect where —
(a) an application for an official search is in order, and
(b) the applicant has not withdrawn the official search.
(3) Subject to paragraph (4), the entry on the day list of notice of an application for an official search with priority confers a priority period on an application for an entry in the register in respect of the protectable disposition to which the official search relates.
(4) Paragraph (3) does not apply if the application for an official search with priority is cancelled subsequently because it is not in order.
75. Official searches bring certainty, and that certainty brings confidence on the part of lenders on the security of land that they will get the level of security they require. Lending on the security of land enables businesses to raise money and individuals to buy their homes, and thus makes an important contribution to the national economy and well-being.
76. An application for an official search will be entered in the day list. The precise terms of the rules here are important. The day list is governed by r 12 of the LRR, which Rimer LJ has set out in [27] of his judgment. The important features of the day list are that: (i) it deals with applications about matters that are, or are proposed to be, noted on the register maintained by the registrar; and (ii) it attaches importance to applications according to the date on which and time at which they are made. In consequence, there has to be a rule that deals with the time when an application is to be treated as made. This is r 15, which provides:
Time at which applications are taken to be made
15. – (1) An application received on a business day is to be taken as made at the earlier of —
(a) the time of the day that notice of it is entered in the day list, or
(b)(i) midnight marking the end of the day it was received if the application was received before 12 noon, or
(ii) midnight marking the end of the next business day after the day it was received if the application was received at or after 12 noon.
(2) An application received on a day which is not a business day is to be taken as made at the earlier of —
(a) the time of [the] day that notice of it is entered in the day list, or
(b) midnight marking the end of the next business day after the day it was received.
(3) In this rule an application is received when it is delivered —
(a) to the designated proper office in accordance with an order under section 100(3) of the Act, or
(b) to the registrar in accordance with a written arrangement as to delivery made between the registrar and the applicant or between the registrar and the applicant’s conveyancer, or
(c) to the registrar under the provisions of any relevant notice given under Schedule 2.
(4) This rule does not apply to applications under Part 13, other than an application that the registrar designate a document an exempt information document under rule 136.
77. The effect of r 15 is that (unless paras (2) to (4) apply) the application must be treated as made when it is entered in the day list, or at the times fixed by para (1)(b) of that rule. The provisions of r 15 are comprehensive, and accordingly r 15 must be regarded as establishing an exhaustive code of when an application can be treated as made. Rule 15 does not permit the entry on to the day list of a past date or time as the date or time when an application was made, save in the limited circumstances (not of assistance in this case) where para (1)(b) or (2) of that rule applies or where a power can be found by necessary implication from the legislation.
78. It is common ground that there is no express power either in the court or the adjudicator or the registrar to amend or rectify the day list. If the court had an express power to rectify the day list, it may well have a discretion to order retrospective rectification (compare Re Sussex Brick Co [1904] 1 Ch 598). That is not to say, however, that the registrar does not have some implied power to amend the day list if, for example, he has incorrectly transferred the information about an application on to the day list, or if he has cancelled an application without the necessary authority to do so, with the result that his entry does not fulfil his statutory obligation under r 12(1). A limited power arising by necessary implication from the LRR is not inconsistent with Mr Morshead’s acceptance that the court has the power to order restoration with retroactive effect in very exceptional situations, since, if the registrar has that power, it must undoubtedly be open to the court to compel him to exercise it in appropriate circumstances. However, since parliament has not given the registrar power to alter any property rights, I do not consider that the power can be implied in a third-party interest case, as Rimer LJ terms it, unless there has been produced to him satisfactory evidence that the third party entitled to the interest consents to the entry.
79. The exercise by the registrar of his functions is subject to the supervisory jurisdiction of this court in judicial review. If the registrar discovers that he has made an alteration to the register that was or had become wrong, he would have to consider what he was required to do in those changed circumstances.
80. The order made by the adjudicator in this case was an order that the adjudicator had jurisdiction to make. Accordingly, the registrar was bound to give effect to it, and his cancellation was effective. When the order of the adjudicator was set aside on appeal, the registrar ceased to have any authority to act under it, but that did not affect the lawfulness of what he had already done under it or the acquisition by third party of any right or anything done prior to the order being set aside on appeal: see the decision of this court in Brent London Borough Council v Botu (2001) 33 HLR 14. There used to be a power in order 59 r 13(1)(b) of the Rules of the Supreme Court for an appellate court to set aside any intermediate act, but the Civil Procedure Rules now in force do not confer any such express power. In my judgment, the power to set aside the order of the adjudicator under CPR 52.10(2)(a) is not of itself sufficient to enable the court to make the order that Rimer and Toulson LJJ have concluded can be made.
81. The inescapable conclusion from those matters is that the registrar could enter Mr and Mrs Franks’ application, following the order on appeal, on to the day list only on the basis that it was a new application or if he were in a position to exercise his implied power. In the case of a new application, the effect of r 15 would be that it is made when the registrar enters it on the day list unless the other provisions of the rule apply.
82. I share the desire that an appeal court should be able to put the successful litigant in the position it would have been in had the order that it has successfully appealed not been made. However, this can be achieved only within the framework of the relevant rules and legislation. If there is legislation that limits the desire that I have mentioned, it must be the case that parliament has concluded that there is some policy consideration that in this instance should supersede it.
83. As already explained, under the CPR, an appellate court is not given power to do more than cancel or set aside the order of the adjudicator. It has no power to set aside or vary the act of registrar in cancelling the entry or that of the chargees that have come on to the day list in the meantime. Moreover, an appellate court cannot compel the registrar to make an entry in the day list with retrospective effect in a case where he has no power to make that entry in the first place, unless it has a separate and independent power to order restoration to the day list with retroactive effect. Section 111 of the Act does not confer any such power. Its absence is remarkable, given the power of the court to rectify the land register under schedule 4 to the 2002 Act, and tends to confirm that such a power is not intended to arise by implication. A power to rectify the day list with retrospective effect so as to affect third-party interests would have to be conferred by parliament since the exercise of such a power would interfere with property rights.
84. If the court had a power to order restoration to the day list with retrospective effect, the court might become involved in investigating the question of whether any party with a third-party interest had at the time it acquired its interest notice of the application sought to be registered retrospectively. That possibility cannot be excluded, and it would be liable to introduce into the land registration system questions of notice. The question of whether (even exceptionally) to order restoration with retrospective effect where there is a third-party interest may well depend on whether the third party knew or had notice of the application sought to be so restored. Contrary to a point made by Rimer LJ in [49] of his judgment, there could in such circumstances be an effect on the Act’s scheme of priority. That would be inconsistent with the statutory scheme in sections 28 to 30 of the Act.
85. Rimer and Toulson LJJ take the view, contrary to that expressed above, that the court has jurisdiction to direct the registrar to reinstate Mr and Mrs Franks’ original application with retrospective effect. However, they consider that the jurisdiction should not ordinarily be exercised where there is a third-party interest. If the position is that the order should not be made unless those entitled to a third-party interest consent, then there is probably no need to make an order with retrospective effect in any event. Furthermore, the prejudice to Mr and Mrs Franks is not so great as it might seem, since, if the chargees in reality do not object to their application having priority, Mr and Mrs Franks will be able to obtain their agreement to subordinate their interest as chargees to that of the Franks. In that event again, no retrospective entry in the day list may be required.
86. Although it may seem that there is little difference in the result in this case between the course that I consider the legislation permits and the course that Rimer and Toulson LJJ have concluded can be taken, the former course not only, as I see, conforms to the statutory powers conferred on the court and registrar but also has the advantage that it means that no third party is at risk that an order may be made that interferes with its interest or that requires it to object to a course that the court has directed should be taken within a limited period to prevent such interference. Accordingly, it provides a significantly greater level of assurance for third parties acquiring interests in registered land. The result is also probably one that it is easier for the registrar to administer (and thus more likely to have been intended by parliament), and it also produces more predictable results. In those circumstances, it is, with respect, a misuse of language to dismiss the registrar’s approach as “doctrinaire”.
87. Rimer and Toulson LJJ have not stated that the effect of the judge’s order on the Bedwards is in any way relevant to the exercise of the discretion. I likewise do not consider that it is possible to escape the conclusion that there is no jurisdiction to make the order proposed simply because the Bedwards obtain what the judge called a windfall benefit if the Franks’ application does not take priority.
88. Adjudicators do not have power to grant a stay pending appeal until permission to appeal has been granted. Pending any alteration in the legislation, it may be possible to solve the problem of their limited powers in this respect by a change of practice. For example, when they are minded to make an order for cancellation of the entry relating to an application in the day list, they could communicate their intention to make that order and invite submissions on a stay pending appeal or an application for permission to appeal if such an order were to be made.
89. For the reasons given above, I would allow this appeal.
Appeal dismissed.
