REC/2006/0012

 

 

THE ADJUDICATOR TO HER MAJESTY’S LAND REGISTRY

LAND REGISTRATION ACT 2002

 

 

BETWEEN

(1) JURINDER KUMAR GUPTA

(2) JADISH KAUR GUPTA

 

APPLICANTS

 

and

 

(1) DAVID JOHN STEWART

 

RESPONDENT

 

 

 

Property Address: 46 West Hill Portishead North Somerset

 

 

Before: Mr Owen Rhys sitting as Deputy Adjudicator to HM Land Registry

 

 

Sitting at: Procession House 55 Ludgate Hill London EC4M 7JW

On: 27^th July 2007

 

 

___________________________________________________________________________­

 

DECISION

___________________________________________________________________________

 

 

1. On 18^th October 2006 the Applicants made an application pursuant to Section 108(2) of the Land Registration Act 2002 for the rectification of a Contract and Transfer to correct an alleged mistake. The Contract was dated 23^rd December 2003 and was made between the Applicants Surinder Kumar Gupta and Jagdish Kaur Gupta (1) and the Respondent Mr David John Stewart (2). Under the terms of the Contract, the Applicants agreed to sell the following property, namely: “West Hill Post Office Stores, West Hill, Portishead, North Somerset BS20 6LR” under Title No AV172865. The Transfer was dated 23^rd December 2003 and purported to transfer to the Respondent “WEST HILL POST OFFICE AND STORES 46 WEST HILL PORTISHEAD North Somerset” under the same Title number. Completion took place on this date. Pursuant to that Transfer, the Respondent was registered as proprietor of the Title on 16^th January 2004.

 

2. A short statement from the Applicants was included under cover of the application to rectify, made on their behalf by the firm of Licensed Conveyancers M.C.Hullah and Co (“Hullah”). This statement includes the following: “We therefore apply to the Adjudicator to HM Land Registry for the original contract and Transfer to be rectified to show the part that was intended to be sold which is clearly defined by physical boundaries marked on the proposed Deed of Rectification … so that the parties’ intentions can be restored to that originally intended i.e a sale of part only.” The Deed of Rectification referred to was prepared by Hullah, and agreed by the Respondent’s former solicitors, but has not been agreed by the Respondent himself. It has not proved possible to contact him. Nor has the Deed been agreed by the Respondent’s mortgagees. His former solicitors are of course not instructed to act for him in connection with these proceedings.

 

3. The application was further supported by a letter from the Solicitors who had acted for the Respondent on the sale to him, confirming that “The intention was that Mr Stewart would purchase part only of the building…”, and a letter from Hullah (which had acted for the Applicants in the sale) stating that “The intention of both parties was that the purchaser, Mr Stewart, would purchase only part of the building i.e the 3-bedroom house….”. Additional documents included a Memorandum of Sale which refers to the Property Address as “46 West Hill” and Estate Agents’ Particulars referring to “Newly refurbished three bedroom house at top end of Portishead”.

 

4. The Respondent failed to respond to the proceedings and in the event by virtue of an Order dated 25^th January 2007 he was debarred from defending the application or adducing any evidence in opposition to it. The Applicants, through their representative, asked for the matter to be determined on paper. This request was declined, and a short hearing was listed for 29^th July 2007 for the evidence to be heard. I should add that Hullah have been very dissatisfied with the procedure adopted by the Adjudicator, and in particular have strongly objected to the need for a hearing. They have taken the view that the documents submitted in support of the application are sufficient for the Adjudicator to reach a conclusion, and there is no point in hearing further evidence. However, on several occasions this Office has written to Hullah, pointing out, in express terms, that these are judicial proceedings and that in view of the relief sought, the Adjudicator requires to hear direct oral evidence from the relevant parties so as to be satisfied that the alleged mistake occurred and that all the other ingredients of rectification are present.

 

5. In the event, apparently due to family commitments, the Applicants did not attend the hearing, which at their request had been re-arranged so as to take place in London rather than Bath. Nor did their representatives attend. Accordingly, no oral evidence was heard by the Adjudicator and it was not possible to put any questions to the Applicants with regard to the parties’ intentions at the time of the Contract and Transfer and the mistake. The hearing ordered for 27^th July 2007 did not therefore take place.

 

6. In the circumstances, I must decide what course to take. Before doing so, I should set out the basis of my jurisdiction. Section 108(2) of the Land Registration Act 2002 provides as follows:

 

“(2) Also, the adjudicator may, on application, make any order which the High Court could make for the rectification or setting aside of a document which – (a) effects a qualifying disposition of a registered estate or charge, or (b) is a contract to make such a disposition [o1] ……………

 

7. Accordingly, the jurisdiction which I am exercising is the same as the equitable jurisdiction of the High Court, and the same principles apply. It has been said that rectification is a discretionary remedy “which must be cautiously watched and jealously guarded” – Whiteside v Whiteside [1950] Ch 65 at page 71 per Evershed M.R. Although the civil standard of proof applies, a court will require very cogent evidence of the mistake before acceding to a claim to rectify. Since the alleged intention of the parties contradicts the written instruments, the evidence in support of the claim must be sufficient to contradict the inherent probability that the written instrument truly represents the parties’ intentions since it is a document signed by them – see Thomas Bates and Sons v Wyndham’s (Lingerie) Ltd [1981] 1 WLR 505 at 521. Rectification is not a question of rubber-stamping an application to that effect. It is a serious step, to alter the legal documents executed by the parties, in this case each with the benefit of legal advice and representation. That is why, in most cases, a claim to rectify a document ought to be resolved at a hearing where oral evidence can be heard and the party claiming rectification can be questioned as to the circumstances of the mistake.

 

8. As I have indicated, the Applicants did not attend the hearing. Their supporting statement, which is brief in the extreme, does not even contain a statement of truth. There is support for the application from the conveyancers who acted on both sides, but again only in the form of letters unsupported by statement of truth. No explanation is given as to how the mistake came about. The verbal description of the property to be sold is stated in the contract to be “WEST HILL POST OFFICE AND STORES 46 WEST HILL PORTISHEAD”, albeit that the Applicants contend that only part of the property was intended to be included in the sale.

 

9. In the circumstances, I do not consider that the Applicants have been able to satisfy me, on the balance of probabilities, that there has been a common mistake as to the identity of the property to be comprised in the sale. I fully accept that the Sales Particulars suggest that only the cottage was to be included, but I have no idea of the circumstances in which the Particulars were produced, or the negotiations between the parties, or whether the sales instructions changed prior to the contract. The written evidence filed by the Applicant is, as I have said, laconic in the extreme. Where, as in the present case, the other party to the transaction (the Respondent) has been debarred from adducing evidence, it is all the more incumbent on the Applicants to satisfy the tribunal that the ingredients of rectification have been made out. The Applicants have been given every opportunity to come before the Adjudicator and give evidence in support of their claim, but they have declined to do so. Having regard to the inadequacy of the evidence relied on, I have no alternative but to dismiss the application.

 

 

OWEN RHYS

 

DEPUTY ADJUDICATOR

Dated this 7^th day of August 2007