Ministry of Housing and Local Government v Sharp

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeTHE MASTER OF THE ROLLS,LORD JUSTICE CROSS,MASTER OF THE ROLLS
Judgment Date29 Jan 1970
Judgment citation (vLex)[1970] EWCA Civ J0129-1

[1970] EWCA Civ J0129-1

In The Supreme Court of Judicature

Court of Appeal

Appeal of plaintiffs from Judgment of Mr. Justice Fisher dated 3 June, 1969.

Before:

The Master of the Rolls (Lord Denning),

Lord Justice Salmon and

Lord Justice Cross

Between
Ministry of Housing and Local Government
Plaintiffs Appellants
and
W. A. F. Sharp and Heenel Henpstead Rural Henpstead Rural District Council
Defendants Respondents

Mr. J.P. WARNER and Mr. GORDON SLYNN (instructed by The Solicitor, Ministry of Housing and Local Government) appeared on behalf of the plaintiff appellants.

Mr. DAVID HUNTER and Mr. COLIN SYDENHAM (instructed by Messrs. Beddington, Hughes & Hobart) appeared on behalf of the defendant respondents.

THE MASTER OF THE ROLLS
1

1. INTRODUCTION

2

In order to show the issues in this case, I will first state the facts in outline.

3

In 1960 the Ministry of Housing and Local Government (whom I will call the Ministry) registered a planning charge with the local land registry at Hemel Hempstead. It was a charge for £1, 828 11s. 5d. on a piece of land at King's Langley owned by a Mr. Neale. In 1962, a Company which intended to purchase the land requisitioned an official search at the local land registry. The clerk in the Registry who made the search was negligent. He failed to notice the Ministry's charge; or to include it in the Official Certificate. He issued a clear certificate to the purchasers. They completed the purchase on that footing. The Ministry said that in consequence they had lost the benefit of their charge: and that they could not claim against the purchasers for the sum of £1, 328 11s. 5d. So they claimed damages for the mistake made by the clerk. They sued the Local Registrar; and also the local council on the ground that they were responsible for the mistake of the clerk.

4

The Judge rejected the claim because, he said, the Ministry suffered no damages from the clerk's mistake. They could have recovered, he said, the £1, 828 11s. 5d. from the purchasers, despite the clear certificate that was given to them.

5

This decision has made conveyancers tremble. They fear that no purchaser will, in future, be able to rely on an official certificate of search — at any rate if it comes from a local land registry. Even if it states that the land is clear of any local land charge, yet the purchaser may be afterwards saddled" with one. Government Departments are alarmed too. So much disturbance has been caused by the decision that we expedited the appeal. We now give our decision. But I must first state thefacts in detail.

6

2. THE FACTS

7

In 1960, Mr. Neale, a jeweller, owned a piece of land fronting Chipperfield Road at King's Langlay, Hertfordshire. It was 1.3 acres, just opposite his house. He had owned it for twenty years. He thought it might be ripe for development. So he applied for permission to build on it. On 16th February, 1960, the local planning authority refused him permission. The reason they gave was because it was in the Green Belt. Mr. Neale claimed compensation for this refusal. In July 1960 the Ministry determined the amount of compensation at £1, 826 11s. 5d.; and paid it to Mr. Neale.

8

But the payment was subject to this proviso: If the planning authorities afterwards changed their minds and gave permission to develop, then the £1, 828 11s. 5d. would have to be repaid — by someone or other. Not necessarily by Mr. Neale, who received it. But by the person who was going to develop the land. That was made clear by Section 29 of the Town and Country Planning Act, 1954. It said that no development was to be carried out until the sum was reapid.

9

In order to secure this repayment, the Ministry were given a charge on the land. Section 28(4) required the Ministry to give a "Compensation Notice" to the Local Council and to the local planning authority. That Notice was to be registered by the "proper officer" of the local Council in the Register of Local Land Charges, see Section 28(5). The purpose of this registration was this: If any person was minded to buy the land, he would be able to search the Register and see that the land was charged with repayment of the £1, 828 11s. 5d. He would know that he could not develop the land without repaying it. It would be his obligation to repay it before developing the land.

10

On 25th July, 1960, the Ministry duly deposited a "Compensation Notice" with the Hemel Hempstead Rural District Council (the R. D. C.), and also with the local planning authority, theHertfordshire County Council, On 27th July, 1960, the clerk to the R. D. C., or someone on his behalf, entered particulars in the Register of Local Land Charges. The entry was under "Planning Charges" and was numbered 982. It stated that the notice was registered under Section 28 for the sum of £1, 828 11s. 3d. compensation paid owing to the refusal dated 16th February, 1960. It described the land by reference to a map annexed.

11

The map was the most important part of the Register. It was a large-scale map showing the boundaries of every plot of land. Upon many of the plots there were numbers which represented entries in the register. Upon this plot (of 1. 3 acres fronting Chipperfield Road) there were four numbers. There was No. 982 which represented the ministry's charge for £1, 828 11s. 5d. and three other numbers representing other entries in the Register. These other numbers are of no materiality in this case save that they contributed to the mistake afterwards made. When the clerk, two years later, searched the register, he noted the other three numbers and entered their particulars on the official certificate. But he overlooked No. 982 (which was the Ministry's change for £1, 828 11s. 5d.), and so did not enter the particulars of it on the official certificate.

12

At any rate, in 1960 the Ministry's charge was registered. All particulars were duly entered. Two years later, on 13th July 1962, Mr. Neale again applied for planning permission for this same plot of land. He wanted to build houses on it. This time it was granted. On 2nd October 1962, the R. D. C. on behalf of the local planning authority, granted him outline permission. Mr. Neale then. offered the plot for sale with planning permission. A company called J. & A. Parsons (Builders) Limited came on the scene as prospective purchasers. Their solicitor made a requisition for an official search in the Register of Local Land Charges. It was made on 1st November, 1962, to the R. D. C., and was in these words; "A search in the Register of local Land"Charges is required for subsisting entries against the land described below up to and including the day of search.

13

Land in Chipperfield road. King's Langley, Herts. Flan annexed here to.

14

(This plan showed the plot of 1.3 acres).

15

Early in November 1962, some clerk in the R. D. C. 's offices made the search and made the mistake. He overlooked No. 982 and prepared the official certificate without any mention of it. He put it before the proper officer (the clerk to the R. D. C., who was the local Registrar) for signature: and he signed it. It was in these words:" Hemel Hempstead Rural District Council. Official Certificate of Search (For the use of the Land Registrar).

The search in the Register of Local Land Charges of the above-named authority against the land specified in the plan accompanying the above requisition reveals up to and including the day named hereunder the subsisting entries referred to in the Schedule attached hereto.

16

Signature of Land Registrar. W. A. F. Sharp.

17

Date: 13th November, 1962".

18

The Schedule showed the three other entries against the land "but omitted the entry relating to the ministry's Charge for £1, 828 11s. 5d.

19

The purchasers accepted that official certificate as accurate. They believed that the land was clear of any charge. On 14th December 1962, they completed the purchase of the plot from Mr. Noale. They paid him £12,000. If they had known of the charge for £1, 828 11s. 5d., they would, no doubt, have deducted that sum from the price they paid. They have since developed the land and built four houses on it.

20

On 28th February 1963, the Ministry asked Mr. Neale to pay back the £1, 828 11s. 5d. He at first seemed ready to do so, hut afterwards, having consulted his solicitors, he refusedto do so. Re was, indeed, under no obligation to repay it. The Statute (Section 29 of the 1954 Act) imposes the obligation on the developer, Mr. Neale was not the developer. The purchasers, J. & A. Parsons(Builders) limited, were the developers.

21

On 27th March 1965, the Ministry asked the purchasers to pay the £1, 828 lie. 5d. Their solicitors rejected the claim, saying that they had no knowledge of the charge. They enclosed a Photostat copy of the Official Certificate, which showed no entry of the charge.

22

On 27th September, 1963. the Ministry acknowledged that they could make no claim against the purchasers. They wrote saying that: "… in view of the clear search certificate, "J. & A. Parsons (Builders) Limited "are entitled to claim the protection of Section 17(3) of the Land Charges Act, 1925, and cannot be required to make a repayment The Department are, therefore, pursuing this matter with the Local Registrar".

23

On the same day the Ministry wrote to the clerk to the A. D. C., saying that they looked to him, in his capacity of Local Registrar, to reimburse the sum of £1, 828 11s. 5d. He denied liability. In July 1967. the Ministry claimed repayment from the R. D. C.: but they, too, contested it. So the Ministry have taken these proceedings against Mr. W. A. F. Sharp, the local Registrar who signed the official certificate: and the local Council, the R. D. C. who employed the clerk who made the mistake.

24

Mr. Justice Fisher held that, if the Ministry had suffered damage, they could have recovered against Mr. Sharp (the local Registrars) because...

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