Franks and another v Bedward and another

Land registration – Applicants’ registration application cancelled by registrar on order of adjudicator and removed from day list – Adjudicator not granting stay of execution of order – Cancellation order subsequently overturned by High Court on appeal – Whether possible to restore application in day list with original priority date – Whether applicants obliged to make fresh application – Application for restoration allowedIn April 2005, the applicants applied to the Land Registry to register title to a strip of land along the boundary of their property on the ground of adverse possession. The land in question formed part of the respondents’ adjoining property. The application was entered on the day list as an application for a transfer of part of the land comprised in that title. The respondents objected and, accordingly, the application was transferred to the adjudicator, pursuant to section 73(7) of the Land Registration Act 2002.As a result of procedural defaults on the part of the applicants, the adjudicator made an order in June 2006 requiring the registrar to cancel their registration application. No stay of execution of that order was applied for or granted under r 45(1) of the Adjudicator to Her Majesty’s Land Registry (Practice and Procedure) Rules 2003. A few days later, the registrar acted on the order by deleting the record of the application on the day list. The High Court subsequently granted permission to appeal against the cancellation order and, in June 2007, allowed the appeal on the ground that the cancellation was a disproportionate response to their procedural defaults. It substituted an “unless” order relating to the applicants’ statement of case, with which the applicants subsequently complied.The registrar was not informed that the cancellation order had been set aside until December 2008. Meanwhile, in October 2007 and June 2008, adverse interests, namely two charges in favour of mortgagees, were registered against the respondents’ title. On the advice of the adjudicator, the registrar decided that it was not possible to revive the applicants’ registration application and re-enter it on the day list with the same priority date of April 2005, and that the applicants needed to make a fresh registration application.The applicants applied to the court to reinstate their registration application with priority from its original date of April 2005. The Attorney-General appointed an advocate to the court to make submissions in support of the applicants’ position. The Chief Land Registrar advanced opposing arguments. He contended that since the day list played a vital role as a “real time” record, based on the actual time and date the entries were made on or cancelled from it, it was possible to reverse the historical fact of the application’s cancellation.Held: The application was allowed. (1) Where the court allowed an appeal against a cancellation order, it could order the restoration of the registration application, and its re-entry on the day list with its original priority date, without the applicant having to make a fresh application. The registrar was required, under r 12(1) of the Land Registration Rules 2003, to record every pending application for registration in the day list; the effect of setting aside a cancellation order in respect of a registration application was that that application was once again pending. The view that an application for registration, once cancelled, could not be restored on appeal ran counter to the general ability of an appeal court to restore a struck-out claim with retrospective effect. The understandable desire of the registrar to preserve the integrity of the day list as a real-time record was not sufficient to require the court to adopt a fundamentally different approach to appeals from the adjudicator. Where the court was aware of an intermediate incumbrancer who would be prejudiced by the restoration of a cancelled registration application, an order for the restoration of the registration application, and its re-entry on the day list with its original priority, should normally be made only on terms that required the applicant to respect the intermediate incumbrancer’s rights. If, on the hearing of the appeal, the court did not have the requisite information, it could either adjourn the appeal or make an order for re-entry on the day list but with leave for any aggrieved third party to apply to vary or set aside that order. In the latter case, the court’s order should contain a direction to the registrar to notify any third party that appeared to him, from the register and the day list, to be capable of being adversely affected. If any intermediate incumbrancer would be unfairly prejudiced by the making of an order to restore the application with its original priority, for example, where the prejudice to them could not be remedied by any form of conditional order, the court might have to require the applicant to make a fresh application, with a direction that steps taken in the original application be treated as steps in the new application so as to avoid unnecessary work and costs.In the instant case, where the court was ignorant of the precise nature of the two mortgagees’ rights or whether the restoration of the application would cause them real rather than theoretical prejudice, the appropriate order was to direct re-entry of the registration application on the day list with its original entry date but to allow aggrieved third party to apply for a variation or setting-aside.(2) It appeared to be the adjudicator’s practice, when directing the registrar to cancel an application, to communicate that decision more or less simultaneously to the registrar and to the parties, rather than to set a deferred date on which the registrar was to cancel the application so as to allow time for the unsuccessful applicant to seek permission to appeal and a stay of execution. If the applicant applied to the adjudicator for a stay, it could not expect a decision until its opponent had had time to object, as required by r 45(4) of the AR. The result was that even a competently represented applicant might, in practice, find it impossible to take effective steps to obtain a stay before the registrar had cancelled the application. Moreover, if the adjudicator refused permission to appeal he could not grant a stay, even though the applicant might subsequently obtain permission to appeal from the High Court and succeed on that appeal. Although the High Court’s powers under the Civil Procedure Rules were sufficient to enable it to grant a stay of the order appealed against, it was not satisfactory that the aggrieved recipient of a cancellation order could obtain a stay in time only by an emergency application to the High Court. The best solution was for the rules and practice relating to stay pending appeal to be reviewed to make a stay more readily available as the sensible precaution against the difficulties revealed by the instant proceedings. In the meantime, there was no reason why the adjudicator could not change his practice to ensure, as far as possible, that the registrar did not have to act on an order for cancellation until the expiry of a period that was sufficient for the applicant to obtain both permission to appeal and a stay, with time built in for the obtaining of representations from other parties. A two-month period before implementation of a cancellation order, built into the order when first made, would be adequate to enable the necessary processes to be undertakenThe applicants and respondents appeared in person; Amanda Tipples (instructed by the Treasury Solicitor) appeared as advocate to the court by appointment of the Attorney-General; Timothy Morshead (instructed by the Treasury Solicitor) appeared for the Chief Land Registrar.Sally Dobson, barrister