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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Bank of Scotland Plc v Joseph & Ors [2014] EWCA Civ 28 (23 January 2014) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2014/28.html Cite as: [2014] EWCA Civ 28 |
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ON APPEAL FROM THE BOW COUNTY COURT
HER HONOUR JUDGE WALDEN-SMITH
1PB43436
Strand, London, WC2A 2LL |
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B e f o r e :
LADY JUSTICE SHARP
and
SIR ROBIN JACOB
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BANK OF SCOTLAND PLC |
Claimant/ Respondent |
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- and - |
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(1) Ms RENATA JOSEPH (2) PERSONS UNKNOWN (3) Mr ENDA LYONS |
Defendants/ Appellant |
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WordWave International Limited
A Merrill Communications Company
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Tom Leech QC and Nicole Sandells (instructed by Walker Morris LLP) for the Respondent
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Crown Copyright ©
Lord Justice Patten :
"The only remaining question is whether registration of the notice by the Claimant was sufficient to protect its equitable interest in priority to Wingfield's. I have dealt with the effect of sections 28 and 29 of the Land Registration Act earlier in this judgment and an analysis thereof in Frankel. However, the Third Defendant argues that the wording of the notice makes reference to a mortgage, not the unpaid vendor's lien, and thus it is incapable of protecting the latter. Ms Sandells dismisses this, saying that the notice protects not just the mortgage but all rights and interests arising thereunder. All the Claimant's rights derive in any event from the deed of mortgage. In crude terms, the Claimant is entitled to subrogate because of the mortgage. That to my mind is an obvious and correct analysis. At the time of registration of the notice, the Claimant thought it was protecting a mortgage (it may well still maintain the charge is valid). Only much later has the issue of unpaid vendor's lien arisen. It could not possibly be correct that a notice in respect of a charge is insufficient to protect any equitable interests arising therefrom. The unilateral notice affords the Claimant priority to Wingfield's interest and will continue to do so, in my judgment, even if the Claimant's charge were to be removed from the charges register."
"….. under the system of electronic dealing with land that it seeks to create, the register should be a complete and accurate reflection of the state of the title of the land at any given time, so that it is possible to investigate title to land on line, with the absolute minimum of additional enquiries and inspections."
"6.26. Unilateral notices are intended as part of the replacement for cautions against dealings. As we have explained above, all notices, whether agreed or unilateral, will protect the priority of an interest, if valid, as against a subsequent registered disposition. In this respect, unilateral notices are a very considerable improvement on cautions (which, as we have explained, confer no priority). The essence of a unilateral notice is that it does not require the consent of the registered proprietor of the estate or charge to which it relates. It can be entered even though the applicant has not satisfied the registrar as to the validity of his or her claim. A unilateral notice must indicate that it is such a notice and identify who is the beneficiary of it. It is unlikely that anything else will appear on the register. This is a point of some importance. Under the present law, cautions are often lodged in respect of agreements in preference to a notice in order to protect their confidentiality. This is because the entry of the caution on the register gives no indication as to the matter that lies behind it. A number of those who responded to the Consultative Document were concerned that it should remain possible to preserve commercial confidentiality in the same way after cautions had been abolished.
6.27 Because a unilateral notice may be entered without the consent of the registered proprietor, it is necessary to provide safeguards for that proprietor. Under the Bill there are three principal safeguards.
6.28 First, a person must not exercise his or her right to apply for a notice without reasonable cause. Any person who does apply for a notice without reasonable cause is in breach of this statutory duty and is liable in tort accordingly to any person who suffers damage in consequence of that breach.
6.29 Secondly, where a unilateral notice is entered by the registrar, he must give notice of the entry to the proprietor of the registered estate or charge to which it relates and to such other persons as rules may provide.
6.30. Thirdly, and following from this, the Bill makes provision for the cancellation of a unilateral notice. Both the registered proprietor of the estate or charge to which the notice relates and any person who is entitled to be registered as the proprietor of that estate or charge may apply to the registrar for the cancellation of a unilateral notice. When such an application is made, the registrar must serve a notice on the person who is identified on the register as the beneficiary of the unilateral notice. That notice must inform the beneficiary?
(1) of the application; and
(2) that if he or she fails to exercise his or her right to object before the end of the period specified in the notice, the registrar will cancel the notice.
The right to object is the general right conferred by the Bill to object to an application to the registrar. If the matter cannot be disposed of by agreement, it must be referred to the Adjudicator for resolution."
"28. Basic rule
(1) Except as provided by sections 29 and 30, the priority of an interest affecting a registered estate or charge is not affected by a disposition of the estate or charge.
(2) It makes no difference for the purposes of this section whether the interest or disposition is registered.
29. Effect of registered dispositions: estates
(1) If a registrable disposition of a registered estate is made for valuable consideration, completion of the disposition by registration has the effect of postponing to the interest under the disposition any interest affecting the estate immediately before the disposition whose priority is not protected at the time of registration.
(2) For the purposes of subsection (1), the priority of an interest is protected—
(a) in any case, if the interest—
(i) is a registered charge or the subject of a notice in the register, ….
30. Effect of registered dispositions: charges
(1) If a registrable disposition of a registered charge is made for valuable consideration, completion of the disposition by registration has the effect of postponing to the interest under the disposition any interest affecting the charge immediately before the disposition whose priority is not protected at the time of registration.
(2) For the purposes of subsection (1), the priority of an interest is protected—
(a) in any case, if the interest—
(i) is a registered charge or the subject of a notice in the register, …"
"32. Nature and effect
(1) A notice is an entry in the register in respect of the burden of an interest affecting a registered estate or charge.
(2) The entry of a notice is to be made in relation to the registered estate or charge affected by the interest concerned.
(3) The fact that an interest is the subject of a notice does not necessarily mean that the interest is valid, but does mean that the priority of the interest, if valid, is protected for the purposes of sections 29 and 30.
…
34. Entry on application
(1) A person who claims to be entitled to the benefit of an interest affecting a registered estate or charge may, if the interest is not excluded by section 33, apply to the registrar for the entry in the register of a notice in respect of the interest.
(2) Subject to rules, an application under this section may be for—
(a) an agreed notice, or
(b) a unilateral notice.
(3) The registrar may only approve an application for an agreed notice if—
(a) the applicant is the relevant registered proprietor, or a person entitled to be registered as such proprietor,
(b) the relevant registered proprietor, or a person entitled to be registered as such proprietor, consents to the entry of the notice, or
(c) the registrar is satisfied as to the validity of the applicant's claim.
(4) In subsection (3), references to the relevant registered proprietor are to the proprietor of the registered estate or charge affected by the interest to which the application relates.
35. Unilateral notices
(1) If the registrar enters a notice in the register in pursuance of an application under section 34(2)(b) ("a unilateral notice"), he must give notice of the entry to—
(a) the proprietor of the registered estate or charge to which it relates, and
(b) such other persons as rules may provide.
(2) A unilateral notice must—
(a) indicate that it is such a notice, and
(b) identify who is the beneficiary of the notice.
(3) The person shown in the register as the beneficiary of a unilateral notice, or such other person as rules may provide, may apply to the registrar for the removal of the notice from the register.
36. Cancellation of unilateral notices
(1) A person may apply to the registrar for the cancellation of a unilateral notice if he is—
(a) the registered proprietor of the estate or charge to which the notice relates, or
(b) a person entitled to be registered as the proprietor of that estate or charge.
(2) Where an application is made under subsection (1), the registrar must give the beneficiary of the notice notice of the application and of the effect of subsection (3).
(3) If the beneficiary of the notice does not exercise his right to object to the application before the end of such period as rules may provide, the registrar must cancel the notice.
(4) In this section—
"beneficiary", in relation to a unilateral notice, means the person shown in the register as the beneficiary of the notice, or such other person as rules may provide;
"unilateral notice" means a notice entered in the register in pursuance of an application under section 34(2)(b)."
"83. An application for the entry in the register of a unilateral notice must be in Form UN1.
84. (1) A notice under section 32 of the Act must be entered in the charges register of the registered title affected.
(2) The entry must identify the registered estate or registered charge affected and, where the interest protected by the notice only affects part of the registered estate in a registered title, it must contain sufficient details, by reference to a plan or otherwise, to identify clearly that part.
(3) In the case of a notice (other than a unilateral notice), the entry must give details of the interest protected.
(4) In the case of a notice (other than a unilateral notice) of a variation of an interest protected by a notice, the entry must give details of the variation.
(5) In the case of a unilateral notice, the entry must give such details of the interest protected as the registrar considers appropriate."
"The ability to obtain information from the registers of title and cautions is an essential feature of the system of conveyancing that the Bill seeks to create. Easy and open access to information held by the Registry are the keys to speedier conveyancing."
"77. Duty to act reasonably
(1) A person must not exercise any of the following rights without reasonable cause—
(a) the right to lodge a caution under section 15,
(b) the right to apply for the entry of a notice or restriction, and
(c) the right to object to an application to the registrar.
(2) The duty under this section is owed to any person who suffers damage in consequence of its breach."
Sir Robin Jacob :
Lady Justice Sharp :