Clause 25 - Mode of exercise
Land Registration Bill [Lords]
12:00 pm

Photo of Mr William Cash

Mr William Cash (Stone, Conservative)

I beg to move amendment No. 24, in page 11, line 27, leave out 'and content'.

Photo of Mr Eric Illsley

Mr Eric Illsley (Barnsley Central, Labour)

With this it will be convenient to take amendment No. 76, in schedule 10, page 66, line 35, leave out 'and content'.

Photo of Mr William Cash

Mr William Cash (Stone, Conservative)

The object of the amendment, which relates to proceedings in the other place, through which we appear not to have made the desired impression on the contenders on this battleground, is that the content of registrable dispositions should be determined not by rules but by the particular terms of individual transactions. Although the Land Registry wishes to control the form of documents submitted to it to ensure that they can be admitted to the register in the most efficient way, there seems absolutely no reason why the content should be prescribed by general rules, given that such content varies widely depending on the individual terms of each transaction. I hope that the Minister will also take account of the important point that freedom of contract makes the United Kingdom an attractive place to do business. In that regard, there should be no unnecessary constraints, and I should be interested to hear his comments on those points.

12:15 pm
Photo of Mr Michael Wills

Mr Michael Wills (Parliamentary Secretary, Lord Chancellor's Department; North Swindon, Labour)

Both amendments would reduce the scope of the Bill's rule-making powers. In recent years, the Land Registry has altered its requirements in respect of the forms of disposition used for registered land. Those forms now have an easily recognisable appearance and must contain certain information about the transaction in designated places. Although it has taken time for internal staff and external customers to get used to the forms, I understand that they are generally regarded as much easier to navigate and to extract key information from. However, the requirements have to stipulate certain essential details that the document must contain for the legal attention to be achieved. Otherwise, they would allow the parties to agree their own additional terms and conditions, provided that they are located in the appropriate place.

It is difficult to imagine the exact form that documents used in the electronic conveyancing system will take. That form will be novel, but the rules introducing the documents will be constructed after wide consultation, and after scrutiny in the Rule Committee. The rules must inevitably provide for formally structured information containing at least certain basic and essential details. There is no present or future intention to restrict the parties' ability to agree their own terms. Rather, the aim is to make the extraction of information about those terms—whether by human beings or by an automated land registration system—as easy as possible. It seems more likely that, in the electronic world, the content rather than the form of the documentation will be controlled. In the light of the reassurance given in another place, that by ''content'' the Bill means the generic context rather than specific details, I hope that the hon. Gentleman feels able to withdraw the amendment.

I turn now to amendment No. 76. Schedule 10(3), which fulfils an important function in the conveyancing process, relates to implied covenants. An obligation to deduce title to land in accordance with a contract of sale comes to an end on completion of the sale. Establishing that a breach of implied covenants for title has occurred is the only way in which a transferee can seek a remedy for defects in title that emerge after completion. Rule 77A(2) of the Land Registration Rules 1925 currently provides that a person will not be liable for a breach of most implied covenants in respect of matters set out in the register of title. The Bill addresses that issue by inserting a new subsection in section 6 of the Law of Property (Miscellaneous Provisions) Act 1994. That insertion does not replicate existing law exactly, but the differences are not material and the law is made clearer, more coherent and accessible as a result.

The rule-making powers in schedule 10 are fairly limited in scope, but they are nevertheless important. They are designed purely to ensure that everybody knows when implied covenants have been given in relation to a transaction, and whether the statutory form of covenant has been modified in any way. There is no intention, as the hon. Member for Stone may fear, to tinker with the precise wording of implied covenants, which has been developed and refined over centuries. In the light of that reassurance, I hope that he feels able to withdraw the amendment.

Photo of Mr William Cash

Mr William Cash (Stone, Conservative)

No doubt the Minister has observed that pressing an amendment to a Division tends to be accompanied by certain movement from another Committee Room. I have as many troops at my disposal as I am able to muster, and I am extremely grateful to them for turning up yet again.

I am afraid to say that I do not regard the Minister's response as sufficient. He looks suitably shocked, but we regard this matter as important. I mentioned that freedom of contract makes the United Kingdom an attractive place to do business, and although time will tell, we regard the provision as an unnecessary constraint. The Opposition must form judgments on such questions. The Minister nods his head sagely and I am grateful to him for that, but we still intend to press the amendment to a vote.

Question put, That the amendment be made:—

The Committee divided: Ayes 3, Noes 8.

Question accordingly negatived.

Clause 25 ordered to stand part of the Bill.