Adjudication in a new landscape Charles Auld, St John s Chambers Published on 13 th March 2014 Introduction 1. Under the Land Registration Act 1925 disputes were referred to the Solicitor to HM Land Registry. However, the Solicitor was considered not to be sufficiently independent of the Land Registry and therefore Part 11 (sections 107 to 114) of and Schedule 9 to the Land Registration Act 2002 [ the 2002 Act ] together make provision for the appointment of the Adjudicator to Her Majesty s Land Registry. 2. Section 108 of the 2002 Act gave the Adjudicator three distinct functions: a) To determine appeals from a decision of the land registrar relating to entry into or termination of a network access agreement; b) To order the rectification of certain land related documents; c) To determine matters referred to him by the land registrar. Page 1 of 10
In practice the last of these is the most important, but it is as well to remember the power of the Adjudicator to rectify documents. Rectification 3. An application could be made to the Adjudicator for an order to rectify a document that: a) Effected a registrable disposition of a registered estate or charge; b) Was a contract to make a registrable disposition of a registrable estate or charge; c) Effected a disposition which creates an interest which may be the subject of a notice in the register; d) Was a contract to make such a disposition; e) Effected a transfer of an interest which is the subject of a notice in the register. Matters referred by the Registrar 4. If an application was made to the Land Registry, subject to two exceptions, any person could object to it 1 provided that person has reasonable cause to do so 2. It has been established that a person can have reasonable cause to object even though he 1 Section 73(1) of the 2002 Act 2 Section 77(1) of the 2002 Act Page 2 of 10
does not advance any claim to an interest of his own (see Walker v. Burton [2013] EWCA Civ 1228 at paragraph 15 per Mummery LJ). The two exceptions are: a) In the case of an application to cancel a caution against first registration only the person who lodged the caution may object to the application to cancel it; b) In the case of an application to cancel a unilateral notice only the person registered as the beneficiary of that notice may object. Once an objection has been made the registrar cannot determine the application until the objection has been disposed of 3, unless he is satisfied that the objection is groundless. The registrar tries to bring about agreement, but if agreement is not possible, under the old procedure the matter had to be referred to the Adjudicator. 5. One of the weaknesses of the system (and it remains even with the recent changes) is that, once there is a dispute, section 73(7) requires the Land Registry to send the matter to the adjudicator for determination. This has resulted in the number of cases going to the adjudicator exceeding 1,000 per year (as opposed to about 70 per year being dealt with by the Solicitor to HM Land Registry). The Trap 6. Practitioners should be aware of a potential trap. Once the matter has been referred to the Adjudicator, he has proved distinctly reluctant to release a matter or let 3 Section 73(5) of the 2002 Act Page 3 of 10
it be withdrawn, even if the parties think that it would be better determined by the Court (eg there are major factual issues to determine). It will be interesting to see whether the Tribunal proves similarly reluctant. 7. Thus in Silkstone v. Tatnall [2010] EWHC 1627 (approved on appeal [2011] EWCA Civ 1148) the Silkstones claimed a right of way over their neighbour s land by prescription and lodged a Unilateral Notice. Mr Tatnall applied to cancel the unilateral notice; the Registrar gave notice of this application to the Silkstones who in their turn objected to the cancellation. This meant that a dispute had arisen and so the matter was referred to the Adjudicator. During the proceedings the Silkstones (who were acting in person) wrote to the Adjudicator requesting disclosure relating to an alternative way of supporting the claim to the right of way, based on section 62 of the Law of Property Act 1925, as opposed to prescription. The application was dismissed on the grounds that no case under section 62 had been pleaded by the Silkstones. Just before the hearing the Silkstones applied to withdraw their application, making it clear that they intended to reinstate it when they had got all their evidence together. The deputy adjudicator refused to allow them to do so and make a decision on the case. Their appeal to the High Court was dismissed as was the subsequent appeal to the Court of Appeal. 8. If the client does not want the matter determined immediately (eg, like the Silkstones, more time is needed to collate the relevant evidence) it is normally possible to get the Land Registry to extend the time either for the parties to negotiate or to make representations about the Case Summary which accompanies the referral to the Page 4 of 10
adjudicator. Equally, if the matter is at risk of going to the Adjudicator before you are ready, it may be an option to withdraw the application that has given rise to the objection and remake it (bearing in mind that could have an impact on the priority of what you are trying to register). The New Landscape 9. Following the reorganisation of the tribunals consequent upon the Tribunals, Courts and Enforcement Act 2007, there is now a First tier Tribunal which is sub-divided into 7 chambers, including a Property Chamber. The Property Chamber is sub-divided into 3 divisions: a) Residential Property b) Land Registration c) Agricultural Land & Drainage By article 4 of the Tribunals and Inquiries, England and Wales, Transfer of Tribunal Functions Order 2013 [SI 2013 No 1036] the functions of the Adjudicator were transferred to the First tier Tribunal and the office of Adjudicator was abolished. The former Adjudicator is now the principal judge for land registration and the former deputy adjudicators are now judges of the First tier Tribunal. 10. Accordingly the old procedural rules, Adjudicator to Her Majesty s Land Registry (Practice and Procedure) Rules 2003 [SI 2003/2171] (as amended by Adjudicator to Her Majesty's Land Registry (Practice and Procedure) Page 5 of 10
(Amendment) Rules 2008 [SI 2008/1731]) have been revoked and replaced by Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 (SI 2013/1169). Interestingly the Referral Rules (which set out that the Land Registry must prepare a case summary and the like) continue to be the Land Registration (Referral to the Adjudicator to HM Land Registry) Rules 2003 (SI 2003/2114) although references within them to the adjudicator have been amended to the First tier Tribunal. The New Rules 11. Rule 3 provides that the overriding objective of the Rules is to enable the Tribunal to deal with cases fairly and justly. Whilst the old rules effectively imported the overriding objective from the CPR, the definition in Rule 3 is far wider and includes dealing with the case in ways which are proportionate to: a) the importance of the case, but nothing is said about to whom this importance attaches; b) the anticipated resources of the parties; c) the resources of the Tribunal. Furthermore it includes avoiding unnecessary formality, so, hopefully, the nonsense of not allowing the Silkstones to advance an unpleaded point will not happen again. 12. Rule 4 says that the Tribunal should bring to the attention of the parties the availability of ADR and facilitate the use of the procedure. Mediation is often an expensive procedure as the mediator has to be paid and appropriate premises rented. It Page 6 of 10
is interesting that the State, having created a system that gives rise to disputes and having set up a State funded tribunal to resolve those disputes, then urges the citizens to spend their own money employing alternative ways to resolve those disputes. 13. Rule 42 of the old Adjudicator Rules enabled a costs order to be made and the new rules continue that ability (see Rules 12 and 13). Certain points are to be noted. 14. Rule 12 provides that an order for security for costs may be made if it is satisfied that one or more of the conditions subject to which security for costs might be ordered in proceedings in a court to which the CPR apply exists and the applicant in the proceedings has the ability to comply with the order. There are two points to note here: a) Only the respondent may apply (but the identity of the respondent is selected by the Tribunal 4 ); b) Since the basis of applying for security is that the other party is unlikely to be able to pay costs, the requirement that that party has the ability to provide security seems odd. 15. Rule 13 contains the general costs provisions and gives the Tribunal the power summarily to assess costs or to order a detailed assessment. Rule 13(9) also allows the Tribunal to make an order on account of costs before assessment. 4 See paragraph 18 below; in Silkstone the Adjudicator had ordered that Mr Tatnall should be the applicant because he was applying to remove the Unilateral Notice. Page 7 of 10
16. Rule 19 provides for expert evidence to be given to the Tribunal. 17. Rule 22 now provides an express provision for withdrawal by a party of its case. Nonetheless it is still subject to Rule 22(3) which provides that a notice of withdrawal will not take effect unless the Tribunal consents to the withdrawal. Furthermore, Rule 22(8) provides that any party may apply for a case, or part of a case, which has been withdrawn to be re-instated. Equally Rule 35 now makes provision for consent orders, but only if it [the Tribunal] considers it appropriate. 18. Rule 26 deals in general with starting proceedings, but it does not apply to cases referred to the Tribunal by the Land Registry, which are covered by Rule 28 (see Rule 28(2) 5. Rule 28 copies fairly closely the procedure set out in the old Adjudicator Rules. So that, on receipt of a matter from the Land Registry, the Tribunal shall send the parties: a) a notice setting out when it received the matter; b) directing who will be the applicant and who will be the respondent; c) directing the applicant to send or deliver to the Tribunal a statement of case. 19. Rule 28(4) provides what a statement of case should contain. In simple terms, this includes the identity of the parties; what the applicant is seeking; the reasons for it and attaching any relevant documents. A statement of case should be verified with a statement of truth [see Rule 26(2)(j)]. 5 28(2): The requirement to start proceedings in accordance with rule 26 does not apply. Page 8 of 10
20. The power of the Adjudicator to order a party to apply to the Court (see section 110(1) of the 2002 Act) is retained by the Tribunal. Rule 39 provides that, upon such a direction being given, the Tribunal proceedings are automatically stayed. If, however, a party commences Court proceedings without being directed to do so by the Tribunal, whilst that party is under a duty to notify the Tribunal of those proceedings, no automatic stay of the Tribunal proceedings arises. 21. The old right of appeal to the Chancery Division under section 111 of the 2002 Act has gone. Today appeal lies, in the first instance, to the Upper Tribunal (and then, on limited grounds, to the Court of Appeal). Permission to appeal must be sought from the First tier Tribunal (Rule 52) within 28 days of receiving the written reasons for the decision [there is power for this to be extended see Rule 52(4)]. 22. Rule 53 requires that, on receiving an application for permission to appeal, the First tier Tribunal must first consider whether to review its original decision. Rule 55(1) provides that the First tier Tribunal may only undertake a review of its decision if it is satisfied that a ground of appeal is likely to be successful. Rule 53(2) provides: If the Tribunal decides not to review the decision, or reviews the decision and decides to take no action in relation to the decision, or part of it, the Tribunal must consider whether to give permission to appeal in relation to that decision or that part of it. Page 9 of 10
If the First tier Tribunal refuses to give permission to appeal it must state it reasons and notify the party of its right to apply direct to the Upper Tribunal for permission to appeal. Charles Auld 10th April 2014 charles.auld@stjohnschambers.co.uk St John's Chambers Page 10 of 10