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Government’s response to the Law Commission’s review of the Land Registration Act 2002

The Law Commission undertook a project, as part of its 12th programme of law reform, to improve specific aspects of the operation of the Land Registration Act 2002. Its report ‘Updating the Land Registration Act 2002’ contained 53 recommendations.

The Government has now published its full response: https://www.gov.uk/government/publications/land-registration-act-2002-government-response-to-the-law-commission-review/law-commission-review-of-the-land-registration-act-2002-government-full-response.

The Government has accepted 40 of the Law Commission’s recommendations and rejected three. As to the remainder, the Government wishes to consider the issues further alongside other policy development work around comprehensive registration and in one case (the notification of surface owners of an application to register any estate in mines and minerals beneath their land) wishes to consult further before reaching any view. In most of the other cases, the Government will confirm its position at the implementation stage. The response explains the Government’s position in respect of those recommendations which it has not accepted. 

The Government has rejected recommended changes to the process for applications by an owner to remove a unilateral notice and a recommendation to introduce a statutory list of factors to be considered to distinguish boundary and property disputes.

The Government is yet to be convinced by recommendations (23-30), which concern the Registrar’s and Court’s powers to make alterations to the register where there is a mistake. The bill significantly extends and complicates Schedule 4, in order to give effect to:

i)    a proposed long stop of 10 years, after which a mistake cannot be corrected save for in very limited circumstances; and

ii)   the introduction of three species of proprietor and possession (the original proprietor, the current proprietor and any other proprietor).

The recommendations which have been accepted deal with a wide range of topics, including:

i)        compulsory first registration of the transfer / grant out of a qualifying estate of discontinuous leases;
ii)       priority rules applicable to unregistered land on the triggering of the requirement of compulsory first registration, but before the application for first registration to HM Land Registry is made;
iii)      clarification of owner’s powers to ensure that any limitation on a trustee’s powers of disposition (not reflected by an entry in the register) does not affect the validity of the title of the disponee;
iv)      the definition of valuable consideration is to be amended so that “nominal consideration in money” is no longer excluded from the definition of valuable consideration- the definition is to be excepted from application to s 86 (bankruptcy of proprietor);
v)      amendment of the registration rules to make express provision to permit the recording of a non-dispositive variation of a lease;
vi)     the ability to seek alteration or rectification of the register to correct a mistake will not be capable of being a property right;
vii)    clarification of limitation periods and valuation principles affecting indemnities,
viii)   easements and profits à prendre benefiting non-registrable leases are to be capable of being overriding interests;
ix)    further restrictions on registering land following adverse possession including, in particular, where a claimant relies on the condition in Schedule 6 paragraph 5(4), an application must be made within 12 months of cessation of reasonable belief in ownership;
x)     the Land Registration Division of the FTT is to be given the following express powers:

      (a) to decide where a boundary lies when an application is referred to it under s.60(3); 
      (b) to determine how an equity by estoppel should be satisfied; and 
      (c) to declare the extent of a beneficial interest; and

xi)    provisions relating to mandatory electronic conveyancing.

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