Yeats & Anor v Line Anor [2012] EWHC 3085 (Ch)
On 12 November 2012, the High
Court dismissed an appeal against a decision by the Deputy Adjudicator to HM
Land Registry (“the Adjudicator”), holding that an oral compromise agreement
between the appellants and respondents was not void under section 2(1) of the
Law and Property (Miscellaneous Provisions) Act 1989 (‘the 1989 Act’).
The appellants applied to the
Chief Land Registrar to alter the title register to reflect the fact that they
had acquired title to a piece of land by adverse possession. The respondents,
however, who were the registered proprietors of the piece of land, objected to
the application.
The dispute was referred to
the Adjudicator who decided that whilst the appellants had indeed acquired
title by adverse possession, an oral compromise agreement between the
appellants and the respondents relating to the adverse possession was a binding
contractual agreement that amounted to exceptional circumstances in not
altering the register, pursuant to paragraph 3(3) of Schedule 4 to the Land
Registration Act 2002.
The appellants sought
permission to appeal the Adjudicator’s decision, on the ground that the oral
compromise agreement was void as it fell outside the requirements of section 2(1)
of the 1989 Act that: ‘A contract for the sale or disposition of an interest in
land can only be made in writing and only by incorporating all the terms which
the parties have expressly agreed in one document, where contracts are
exchanged in each.’ This argument had not initially been put to the Adjudicator
for consideration. When the appeal was brought before the High Court, it
firstly had to consider whether the point of section 2(1) could be taken for
the first time on appeal.
In considering the appeal, the
High Court followed the guidance set out in Pittalis
v Grant [1989] QB 605per Nourse LJ
at p. 611, whereby permission should not be given unless the Court is satisfied
that:
i.
The failure to raise the new point has not
prejudiced the respondents;
ii.
The point is being raised as a pure point of
law;
iii.
No evidence could have been deduced before the lower
court/tribunal which could have prevented it from succeeding;
iv.
The respondents had not acted to their detriment
on the faith of the earlier omission to raise the point; and
v.
The respondents have had adequate opportunity to
meet the new point.
The High Court focused on
whether the appeal was a pure point of law, having found that all the remaining
requirements above had been satisfied. In so doing, it was held that the matter
could be heard as a pure point of law if the Court restricted itself to
considering the oral compromise agreement within the context of it having a
disposing effect of the title in
land, rather than a disposing purpose.
Giving reasons for this
approach, Mr Kevin Prosser QC stated at the outset that he was not prepared to
draw inferences regarding each party’s purpose for entering the agreement as the
Adjudicator had not made conclusive findings of fact on the issue. To do
otherwise might lead to the respondents being prejudiced by the new point having
not been raised before the Adjudicator.
Allowing the new point to be
raised in the appeal as a point of law only, the Court then considered whether
the oral agreement fell outside the written requirements of section 2(1) of the
1989 Act. In seeking guidance on the interpretation of this section the Court
considered the decision in Neilson v Poole
(1969) 20 P&CR 909, in which Megarry J made a distinction between
agreements relating to land that:
(a) conferred interests from
one party to another; and those that
(b) merely acknowledged/ identified
interests.
Megarry J held that the
requirement of a contract being in writing, (which in Neilson was pursuant to section 10(1) of the Land Charges Act 1925),
depended on the nature of the agreement. Whereas contracts which conveyed
interests in land had to be in writing, those which merely identified pre-existing interests did not. Mr Kevin Prosser QC duly
noted the reasoning in Neilson was applied
by the Court of Appeal in Joyce v Rigolli
[2004] EWCA Civ 79, which concerned an oral demarcation agreement.
In the judge’s
view, Joyce v Rigolli was binding authority upon him for the proposition
that an oral demarcation agreement, being an agreement to demarcate an unclear boundary
described in title documents or delineated on a plan, was not void by virtue of
section 2(1) of the 1989 Act even though such an agreement had a disposing effect, because the words “a contract for…” in section 2(1)
referred to an agreement which had a disposing purpose.
In following the reasoning, in
Joyce v Rigolli the Court dismissed the appellant’s appeal, finding that
the oral compromise agreement merely acknowledged pre-existing interests in
land. As the oral agreement had a disposing effect, rather than a disposing
purpose, in transferring interests from the respondents to the appellants, it
did not fall foul of section 2(1) of the 1989 Act.
Read the judgment here