Alteration, Rectification, and Indemnity Flashcards
What is rectification?
The correction of a mistake on the register that prejudicially affects the title of a registered proprietor
What is a mistake?
Would the registrar have done something different had he known the true facts at the time which he made or removed the relevant entry in the register?
NRAM Ltd v Evans
What is the effect of Schedule 4?
Alteration of the register
(1) Relates to involving the correction of a mistake that prejudicially affects the title of a registered proprietor
(2) The court may make an order for rectification to correct a mistake or bring the register up to date
What was said in the case of Swift 1st Ltd v Chief Land Registrar?
-Forgery renders a transaction void
-Where a claimant derives an interest in good faith under a forged disposition, he will be entitled to an indemnity following rectification
-Confirmed the Malory 2 argument
What is the difference between a void and voidable transaction?
-An entry made due to a void disposition is a mistake, it cannot legally exist
-An entry made by transaction that is voidable is correct at the time it was made unless rescinded (inducing the person to give you the thing, valid contract until other party exercises the right to go against it, e.g. duress or misrepresentation)
NRAM Ltd v Evans
What does Schedule 4 Para 3 say about restricting an alteration of the register?
Alteration that affects the title of the proprietor cannot be made without his consent unless he has by fraud or lack of proper care contributed to the mistake or it would be unjust for any other reason not to make the alteration
What three things are needed in order for rectification to occur?
- Registered party must not be in possession
- The party with the equitable interest (i.e. contractual right but no registration) must be in actual possession
- Would it be unjust not to rectify?
What is the effect of Para 8 of Schedule 4?
Powers under schedule 4 relating to rectification extend to changing for the future the priority of any interest (I.e. the interest can be changed so that the person receiving a rectification takes priority)
What case confirms the power of Sch4 Para 8 and gives important information on how this works?
MacLeod v Gold Harp Properties Ltd
Under Para 8 Schedule 4 Land Registration Act 2002, the power of rectification can change the priority of interests with retrospective effect – it postpones an interest created between the corrected mistake and the date of rectification
What is an indemnity and where is this dealt with?
Schedule 8 LRA 2002
Para 1
A person is entitled to an indemnity (payment) where they suffer loss due to rectification or a mistake that would require rectification
Para 5
No indemnity is to be paid due to loss suffered wholly or partly by a result of his own fraud or lack of proper care, and where it is partly due to his lack of proper care the indemnity is to be reduced to such extent that is fair
What was the decision in Malory v Cheshire Homes?
The right to seek rectification was said to be a proprietary interest. Because of actual occupation, this therefore amounted to an overriding interest (known as the Malory 2 argument)
What does the case of Barclays Bank v Guy (No1) tell us?
-Rectification against C for A should not be possible based on the provisions of the LRA 2002
-A would have to show that C had some actual notice or was turning a blind eye to the known facts which if addressed properly would have shown B did not have good title
What does the case of Barclays Bank v Guy (No2) tell us?
There are two ways to argue rectification against C:
-Registration of C is part and parcel of the mistake involving B
-Even if it is not, correcting the mistaken registration of B may involve removing C from the register
What does the Land Registration Act say about a person in occupation of the land?
S131- land is in the possession of the proprietor of a registered estate in land if it is physically in his possession, or in that of a person who is entitled to be registered as the proprietor of the registered estate
S58- If, on the entry of a person in the register as the proprietor of a legal estate, the legal estate would not otherwise be vested in him, it shall be deemed to be vested in him as a result of the registration
What was said in the case of Nasrullah v Rashid?
In order for a party to have a beneficial interest in land there must be a fraudulent taking, without the consent of A
