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10 December 2020

An abuse of process to relitigate a decision by the Land Registry (Ainscough v. Ainscough)

Ainscough v Ainscough and another [2020] EWHC 2909 (Ch)

Property Disputes analysis

The claimant’s action to have the Bank of Scotland’s charge removed from the register of title failed where an assistant land registrar had previously found that exceptional circumstances existed which justified its retention, notwithstanding that the mortgagor (who was not party to the proceedings) had only become the registered owner of the freehold through a forged transfer. The court found that to permit the claimant another chance at having the charge removed would be an abuse of process, and therefore dismissed the claim on that basis. The court also held that the claimant was not entitled to have the first defendant’s name removed from the register of title. The Land Registry had already rectified the position to that which existed prior to the forged transfer, and the judge could not see that there was any relevant mistake in respect of which a claim for rectification or alteration of the register could be made. The counterclaim by the first defendant seeking to have the claimant removed from the register was also dismissed.

What are the practical implications of this case?

This case is heavily fact-specific but on these facts, the court found that the removal of the charge from the register had already been submitted to administrative determination at the Land Registry, so the claimant had no recourse to the courts to determine the same issue.

The court decided that this would be an abuse of process, as it would give the claimant a ‘second bite at the cherry, having already consumed the only half of the cherry offered to him by his application to the Land Registry’. The court noted that if a party is dissatisfied with the decision of the Land Registry they can apply to have it judicially reviewed, within the strict time limits set out for this procedure. If they fail to do so, they cannot subsequently challenge the decision in the courts, which would allow them a greater period of time to challenge the decision.

Care should therefore be taken to consider carefully, where a client can submit a claim to the courts or to the Land Registry for administrative determination, which route offers the best prospects of success.

What was the background?

The claimant sought two remedies relating to dealings with a residential property in Liverpool. The claimant wanted the removal of the first defendant’s name (his brother) from the registered freehold title to the property and the removal of the second defendant’s registered charge from the register of title. The litigation had been protracted in part because the claimant had been unrepresented for most of the proceedings and the first defendant had for the whole time. The first defendant counterclaimed that the property’s freehold title should be registered in his sole name.

The matter had previously been considered by the Land Registry in an administrative determination. The assistant land registrar had removed the claimant’s son from the title (as it adjudged his name had been added as the result of a forged transfer completed while the claimant was in prison) and reinstated the claimant and first defendant as tenants in common as was the position following an uncontested transfer of the property from 2006. As the claimant had received some of the sums advanced as a result of the mortgage, it now sought to remove and had paid some installments of the mortgage, the assistant land registrar held that exceptional circumstances applied which meant the charge should remain on the register, even though it had originally been entered onto the title by mistake.

What did the court decide?

The court decided that it would be an abuse of process for the claim for removal of the charge to continue as that issue had already been determined by the assistant land registrar. The court was referred to Hunter v Chief Constable of the West Midlands Police [1981] 3 All ER 727 which established that a court had the power to strike out a claim on the grounds of abuse of process if it would amount to a collateral attack on a decision by a competent court of law. This was a facet of procedural law and separate from the doctrine of res judicata.

Subsequent decisions extended this principle to apply to the decisions of administrative bodies as well. In Re Barings plc (No 3) [1999] 1 All ER 311 it was held that the principle applied to a previous decision of a disciplinary tribunal of the Securities and Futures Association. The court, following this, held that if the claimant disagreed with the decision of the Land Registrar then he had the right to challenge it through judicial review, but not through separate subsequent proceedings in the courts.

In deciding whether an abuse of process had occurred the test which was to be applied (taken from Re Barings plc (No 3)) was whether in the circumstances it would be ‘manifestly unfair’ to a party or would bring the administration of justice into disrepute among ‘right-thinking people’ to allow the claim to proceed. The court was of the opinion that in this case it would.

The other aspect of the claimant’s claim, namely, the removal of the first defendant from the register failed as no relevant mistake in the register had occurred. The first defendant’s counterclaim failed on the grounds there was no legal or evidential basis to the claim.

Case details

  1. Court: Property, Trusts and Probate List (Chancery Division), Business and Property Courts in Liverpool, High Court of Justice
  2. Judge: Judge Hodge QC (sitting as a High Court judge)
  3. Date of judgment: 30 September 2020

This content was first published on the Lexis®PSL on 13 November 2020. For more information, please contact Oliver Park on +44 (0)1483 252538 or at oliver.park@crsblaw.com.

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