No CrossRef data available.
Article contents
The Effect of Statutory Notice of Incumbrances
Published online by Cambridge University Press: 16 January 2009
Extract
In the second part of his decision in Re Forsey and Hollebone's Contract Eve J. held that, as a consequence of the statutory notice effected by section 198 of the Law of Property Act, 1925, (i) a purchaser of land was not entitled to object to incumbrances registered at the date of the contract; and (ii) that this was true even where the contract expressly provided that the sale should be free from incumbrances.
It is submitted that both conclusions are erroneous as well as inconvenient.
The objection to conclusion (i) is that a purchaser is bound to accept incumbrances only if he has waived objection to them, and he cannot be said to show an intention to waive by acts done when the necessary knowledge was not actually in his mind; and, furthermore, section 198 is a provision about the doctrine of notice and should be confined to that subject—it has nothing to do with the construction of a contract or of acts of the parties.
The objection to conclusion (ii) is a fortiori, since the purchaser has expressly protected himself against incumbrances. To say that this right depends on the vendor's inability to give oral evidence of a waiver is incorrect: the right arises ex vi contractus, and the effect of the special stipulation about incumbrances is to rebut any allegation that the purchaser waived his right by entering into the contract with knowledge of an incumbrance. An act of waiver can always be proved by oral evidence, and its effect is a question of intention. If there is no question of waiver, there is nothing relevant which the vendor can prove by any evidence of any kind, either written or oral.
- Type
- Articles
- Information
- Copyright
- Copyright © Cambridge Law Journal and Contributors 1954
References
1 (1677) 29 Car. 2, c. 3, s. 4, now replaced (as regards dispositions of land) by the Law of Property Act, 1925, s. 40.
2 A striking example is offered by Williams, Vendor and Purchaser, 4th ed., 1936, which cites the case four times but ignores the point of difficulty altogether. In the passages on waiver (pp. 227–29, 241) to which the point is so important, the case is not mentioned.
3 [1927] 2 Ch. 379.
4 See e.g., Hughes v. Parker (1841) 8 M. & W. 244; Williams, Vendor and Purchaser, 4th ed., p. 37.
5 The question whether this right is “implied” or collateral is discussed below, p. 98.
6 The foremost object of the Law of Property Act, 1925, was “to reduce to a minimum the requisite investigation and reinvestigation of title”: Wolstenholme and Cherry, Conveyancing Statutes, 12th ed., p. 205.
7 s. 13.
8 s. 4 (2).
9 [1927] 2 Ch. 379.
10 The decision of the Court of Appeal is reported directly after that of Eve J.
11 R. Ainscough, 51 L.Q.H. at pp. 383, 385; Emmet on Title, Vol. 1, p. 4.
12 [1927] 2 Ch. at p. 387.
13 64 L.J.N. (1927) p. 22.Google Scholar There is a Short discussion of this “serious and rather complex problem” by S. J. Bailey in 10 C.L.J. 241, 248.
14 Ibid., at p. 26. Cf. George, Sale of Land, p. 63, who says “Although in Re Forsey and Hollebone's Contract it was suggested that no matter need be disclosed which is the subject of registration as a local land charge, the decision has only been accepted by conveyancers as authority for the narrower proposition that town planning schemes and resolutions therefor need not be disclosed.”
15 Law Society's Gazette, 05, 1947, p. 97.Google Scholar
16 13th ed., 149, pp. 2–4.
17 Land Charges Rules, 1925, rr. 2, 4, 5, 6. As explained below, this problem does not present itself in the case of local land charges.
18 Cf. White v. Bijou Mansions, Ltd. [1937] Ch. 610, 620–1, a decision on the corresponding provision of the Land Registration Act, 1925, s. 50 (2); affirmed on appeal [1938] Ch. 351.
19 See S. J. Bailey, 10 C.L.J. 241, 248. In a note in 44 L.Q.R. 18, which is the only complacent notice of the case I have found, H. P. wrote: “Obviously the appropriate course is to make the necessary searches at the Land Registry and Local Land Charges Registry before entering into the contract.” But the difficulties of this course are not mentioned. The author's further suggestion that the parties are at liberty to contract out of s. 198 is, it is submitted, untenable; although a similar result could no doubt be achieved by an express provision that the purchaser might rescind if registered incumbrances existed. The suggestion that s. 43 of the Law of Property Act, 1925, has no proper scope is also difficult to understand; the section applies in any event to removable incumbrances, e.g., mortgages or rentcharges, which in the absence of express provision to the contrary a purchaser is always entitled to have discharged by the vendor. A similar criticism may be made of the final passage of the note by J. M. L. in 64 L.J.N. 26, already referred to, where s. 43 is apparently misquoted as s. 42.
20 Local Land Charges Rules, 1934.
21 For example potential liabilities for contravention of the Town and Country Planning Act, 1947, or for making up of private roads under the Private Street Works Act, 1892, or a proposal for requisition which is not yet effective (cf. Re Winslow Hall Estates Co. [1941] Ch. 503 and James Macara, Ltd. v. Barclay [1945] Ch. 148).
22 See Emmet, on Title, 13th ed., Vol. 1, pp. 4–5Google Scholar, 574, and The Conveyancer, Vol. 17, p. 349.
23 See footnote 4, above.
24 Ogilvie v. Foljambe (1817) 3 Mer. 57, 64; Re Gloag and Miller's Contract (1883) 23 Ch.D. 320; cf. Ellis v. Rogers (1885) 29 Ch.D. 661; McGrory v. Alderdale Estate Co., Ltd. [1918] A.C. 503.
25 Cato v. Thompson (1882) 9 Q.B.D. 616, 620 (Jessel, M.R.).Google Scholar
26 Ibid.
27 Re Gloag and Miller's Contract (1883) 23 Ch.D. 320, 327.Google Scholar
28 McGrory v. Alderdale Estate Co., Ltd. [1918] A.C. 503, 508.Google Scholar
29 Ogilvie v. Foljambe (1817) 3 Mer. 57, 64; McMurray v. Spicer, (1868) L.R. 5 Eq. 527, 542.
30 In Ogilvie v. Foljambe (above) the “oral evidence” doctrine appears to have been put forward by counsel, but it was brushed aside by Sir W. Grant, M.R., at pp. 63–64. In Cato v. Thompson (above, footnote 25) it was favoured by Lindley L.J., and by Lopes J. (at p. 620), but it was not mentioned by Jessel M.R.
31 Re Gloag and Miller's Contract (1883) 23 Ch.D. 320, 328–29. The “earlier authorities” referred to by Fry J. will be found in Williams, Vendor and Purchaser, 4th ed., pp. 227–29, where the cases are collected.
32 The difficulties are well explained in Cheshire and Fifoot, Law of Contract. 3rd ed., pp. 449–51. They are expounded in more detail by the same learned authors in the second part of their article in 63 L.Q.B. 289.
33 (1877) 2 App.Cas. 439. See the article last referred to at pp. 287–8, 299–300.
34 See again the article above referred to, and also J. F. Wilson in 67 L.Q.B. 330.
35 These three propositions all appear in Ogilvie v. Foljambe (1817) 3 Mer. 57, 64, and were probably there invented by Sir W. Grant M.R., despite his reference to earlier authority. The first proposition (that the right to a good title is given by a rule of law rather than by an implied term) is criticised in Williams, Vendor and Purchaser, 4th ed., p. 35, note (e); on the second and third propositions Williams is confusing, for a passage on p. 227 is based wholly upon waiver, which is consistent with the doctrine of an implied term, but a subsequent (although logically anterior) passage at p. 241 is based upon notice, without mention of waiver, and this is intelligible only with the aid of the reasoning which Williams has already repudiated
There is even a mention of “constructive notice” for this purpose in Wealdstone U. D. C. v. Evershed (1905) 69 J.P. 258, 263 (Lord Alverstone C.J.)Google Scholar.
36 The question was treated as open by the Court of Appeal in Ellis v. Rogers (1884) 29 Ch.D. 661, where the authorities are referred to by Cotton, L.J.Cf. McMurray v. Spicer (1848) L.R. 5 Eq. 527, 541,Google Scholar where Malins V.-C. held the purchaser to be bound “not only by virtue of the notice but by virtue of the contract.”
37 See the opinion of Lord Finlay L.C., quoted above, pp. 95–96; Fry, Specific Performance, 6th ed., p. 174, citing Doe d. Gray v. Stanion (1836) 1 M. & W. 695, 701 (Parke B.) and Worthington v. Warrington (1848) 5 C.B. 635; Williams, Vendor and Purchaser, 4th ed., p. 35, note (e); the authority of Lord St. Leonards has also been claimed (as by Cotton L.J., see footnote 36) for the better view from the statement in Sugden, Vendor and Purchaser, 14th ed., p. 16; but since the opposite is positively stated at p. 337 (cf. also p. 345), Lord St. Leonards' testimony is contradictory.
38 See footnote 35, above.
39 (1885) 29 Ch.D. 661.
40 Above, p. 98.
41 Le Neve v. Le Neve (1747) 1 Vea.Sen. 64.
42 Re Brall [1893] 2 Q.B. 381; Re Carter and Kenderdine's Contract (1897) 66 L.J.Ch. 408.
43 Cox v. Hakes (1890) 15 App.Cas. 506 (refusal of right of appeal from order discharging a prisoner under a habeas corpus, despite s. 19 of the Judicature Act, 1873).
44 Vane v. Vane (1872) L.R. 8 Ch.App. 383, esp. at p. 400.
45 Bryan v. Child (1850) 5 Ex. 368, placing a restricted interpretation upon the language of the Bankrupt Law Consolidation Act, 1849, in order to limit it to its true purpose, the protection of creditors. Accordingly, it was held that an order “null and void to all intents and purposes whatever” was not void against a trader himself but only against his assignees if he later became bankrupt. See in particular the reference to earlier cases in the judgment of Rolfe B., at p. 376.
46 See the catalogue of examples collected by Plowden, 204–205.
47 Cox v. Hakes (1890) 15 App.Cas. 506, 518 (Lord Halsbury L.C.).Google Scholar
48 Stradling v. Morgan (1559) Plowd. 205.
49 It does not seem possible to derive much help from Eve J.'s own decision in Coles v. White City (Manchester) Greyhound Association, Ltd. (1928) 45 T.L.R. 125, where he decided that registration of a town-planning resolution did not operate to give notice to a purchaser of shares in a company which owned the land affected, so as to prevent her from rescinding the contract on the ground of misrepresentation. Since she was purchasing shares, not land, the purpose was presumably not “connected with the land affected” within the meaning of s. 198. Those words are plainly capable of limited interpretation, but they are not in issue here. The Court of Appeal (ibid., p. 230) once again ignored the question of registration in affirming the decision of Eve J.
50 Above, p. 95.
51 See the opinion of Lord Finlay L.C., above, pp. 95–96.
52 Re Gloag and Miller's Contract, above, p. 96.
53 Above, p. 97.