Section 25(1) of the Land Registration Act 2002 provides that a registrable disposition “only has effect if it complies with such requirements as to form and content as rules may provide.” Furthermore, rule 58 of the Land Registration Rules 2003, and Schedule 9 to the rules, provide that a transfer of a registered estate must be in prescribed form and, unless the instrument is an assent, that it must be executed as a deed.
The general formalities for the execution of deeds are laid down by the Law of Property (Miscellaneous Provisions) Act 1989. Section 1(3)(a) requires a person executing a deed to sign it in the presence of a witness. So what is the position if it transpires, after registration, that a transfer was not properly witnessed? Would this mean that the registration was a “mistake” for the purposes of Schedule 4 of the Land Registration Act 2002?
The answer is important because different rules apply when the Land Registry “alters” the register and “rectifies“ mistakes. Furthermore, the Land Registry is not liable to pay compensation if it alters the register to bring it up to date – but may be liable to indemnify anyone who loses out when it rectifies a mistake.
In Akhtar v Slough Borough Council [2019] UKUT 308 (LC), the First Tier Tribunal (FTT) had applied the test approved by the Court of Appeal in NRAM Ltd v Evans [2017] EWCA Civ 1013; [2017] PLSCS 154. But the Upper Tribunal disagreed with the FTT’s thinking.
The approved test requires a court or tribunal to consider whether, had it known the true facts at the time of the registration of an instrument, the Land Registry would have done something different. This is because, if a change in the register was correct when it was made, it cannot be called a “mistake”. This means that a change to the register to reflect a transaction that is voidable is correct at the time it is made. But an entry recording an interest acquired under a void disposition is a mistake, because the register would not have been changed had the true facts been known when the change was made.
The FTT had reasoned that the Land Registry would have raised a requisition if it had realised that, although the transfer in question bore the name and address of a witness, the signature might not be his. And, on the facts of this particular case, the applicant would have dealt with the requisition and satisfied the Land Registry that the transfer was in order. Consequently, the Land Registry would not have done anything differently. So the registration of the transfer was not a “mistake”
On appeal, the Upper Tribunal decided that the signature on the transfer was, in fact, the witness’s signature. So it agreed with the FTT that the registration of the transfer was not a mistake. But it explained that a failure to attest the Land Registry transfer properly would have vitiated the disposition. So, if the transfer had not been properly witnessed, it would have been void. And, had the Land Registry known that the disposition was void, it would have refused to change the proprietorship register. Consequently, the registration of the transfer would have been a “mistake” and the FTT would have had to apply the conditions set out in the Land Registration Act 2002 in order to decide whether rectification was available.
Allyson Colby, property law consultant
