The Law Commission

 


PART XVII RULES AND ORDERS

INTRODUCTION

17.1      It will be apparent from one glance at the Bill, that it confers extensive rulemaking powers on the Lord Chancellor. In any modern legislation, rule-making powers are rightly the subject of close Parliamentary scrutiny and require justification.^[1] It is for this reason that we devote a whole Part of this Report to the Bill's rule-making powers. The Bill also confers a very limited number of powers by which the Lord Chancellor may make orders. When any of these powers is exercised, it will result in a change in the substantive law. In relation to some of them, the Lord Chancellor must consult on the proposed change before he exercises the power.^[2] All rules, regulations or orders under the Bill that are made by the Lord Chancellor have to be made by statutory instrument.^[3]

RULES

The present law

17.2      In Parts II and XIII of this Report, we explained the importance of rules to the operation of the Land Registration Act 1925, and why an extensive network of rules was essential to the continuing development of land registration.^[4] Indeed, we suggested not only that that the present system of land registration could not have been developed as it has been without the flexibility of wide rule-making powers,^[5] but also that the development of electronic conveyancing over the next few years could not occur without a similar flexibility.^[6] However, we also noted that the present law left something to be desired.^[7] In particular, we commented on the absence of any principled demarcation between what is in the Act and what is in the rules made under it.^[8] There are indeed some remarkably important matters that are addressed in the rules rather than in the Act.^[9] There is a lingering suspicion that this may not have been entirely accidental. Rules made under the Land Registration Act 1925 have "the same force and effect as if enacted in [that] Act",^[10] a provision that has no counterpart in the Bill.

17.3      The rule-making powers are presently found in section 144 of the Land Registration Act 1925. However, although that subsection lists some 31 rulemaking powers, almost all the rules have been made under the last of them. Section 144(1)(xxxi) permits rules to be made-

For regulating any matter to be prescribed or in respect of which rules are to be made under this Act and any other matter or thing, whether similar or not to those above mentioned, in respect of which it may be expedient to make rules for the purpose of carrying this Act into execution.

The approach to rule-making powers adopted in the Bill

17.4      The approach of the Bill to rules is rather different to that adopted in the Land Registration Act 1925. First, the Bill attempts to make a more rational division between primary and secondary legislation. Secondly, although there is a residual rule-making power, similar to section 144(1)(xxxi) of the Land Registration Act 1925^[11] it is, quite explicitly a residual power. Thirdly, the rule-making powers are not collected in one place, but are, in general, set out in the context in which they arise.^[12] This is likely to make the legislation more comprehensible. It seems likely that many of the rules made under the Bill will be similar to those that have been made under the 1925 Act.

The rule-making powers under the Bill Land registration rules

17.5      All rules under the Bill are designated "land registration rules" except^[13]-

(1) those made under Clause 93, which require specified dispositions to be made electronically and simultaneously registered;^[14]

(2) those made under Part 11 (the provisions dealing with adjudication);^[15]

(3) those relating to the forwarding of applications relating to certain registered charges to the registrar of companies;^[16] and

(4) some of those made in relation to the Land Registry Network under Schedule 5.^[17]

The reasons for the exclusions are explained below. ^[18] The role of land registration rules is to explain the detail of how land registration is to be conducted, matters such as the manner in which applications are to be made to the registrar, how notices are to be served, and the like. The power to make land registration rules is, as now, exercisable-

(a) by the Lord Chancellor with the advice and assistance of a body called the Rule Committee;^[19]

(b) by statutory instrument to be laid before Parliament.^[20]

17.6      The Rule Committee exists under the Land Registration Act 1925,^[21] and presently consists of-

(1) a judge of the Chancery Division of the High Court as Chairman (nominated by the Lord Chancellor);^[22]

(2) the Chief Land Registrar;

(3) a person nominated by the General Council of the Bar;

(4) a person nominated by the Council of the Law Society; and

(5) a person nominated by the Minister of Agriculture Fisheries and Food.

The intention is that the Committee should comprise persons with a particular expertise in conveyancing matters. In its 76 years it has proved its worth repeatedly and subjects draft rules to intensive scrutiny.

17.7      Under the Bill the composition of the Rule Committee will change in two respects. First, at its own request, the Ministry of Agriculture Fisheries and Food will cease to be represented on it. In its place, the Council of Mortgage Lenders will nominate a member.^[23] Given the great importance of secured lending on land which has developed since 1925, this is an obvious change. Secondly, the Lord Chancellor is to have power to nominate to be a member of the Rule Committee any person who appears to him to have qualifications or experience which would be of value to the committee in considering any matter with which it is concerned.^[24]

17.8      The reason why the four matters mentioned above, in paragraph 17.5, are not included within the definition of land registration rules is as follows. The first relates to a matter of importance both to the public and to those who conduct conveyancing. It would be inappropriate to make such a change without full consultation.^[25] As regards the second and third, they are matters in which the Rule Committee could have no possible interest because they are not concerned with the conduct of the conveyancing process. As regards the fourth, the rules in question relate to network access agreements, and once again, these are of such importance that the Bill requires the Lord Chancellor to consult before he makes them.^[26]

17.9      Many of the land registration rules arise out of specific provisions of the Bill and have been the subject of comment in the context of those provisions. However, Schedule 10^[27] contains a series of miscellaneous and general powers. Although some of these have already been considered,^[28] the matters explained in the following paragraphs have not.

(1) There is a power to make rules applying the Bill to a pre-registration dealing with a registrable legal estate^[29] as if the dealing had taken place after the date of the first registration of the estate, and about the date on which registration of the dealing is effective.^[30] This replicates a power under the present legislation.^[31] The rules made under that power have provided that the provisions of the Land Registration Act 1925 apply to such pre-registration dealings as if they had taken place after the date of first registration.^[32]

(2) There is a power for rules to make provision about the form, content and service of any notice under the Bill.^[33] As might be expected, the power enables rules to make provision for matters such as-

(a) requiring that an address for service be supplied;

(b) the entry of addresses for service in the register;

(c) the time for service of notices;

(d) the mode of service; and

(e) when service is to be regarded as having taken place.^[34]

(3) A number of statutes require that an instrument which makes a disposition must contain certain particulars. This is so (for example) in relation to certain dispositions by charities,^[35] and in relation to vesting deeds which convey the legal estate to the tenant for life of a settlement under the Settled Land Act 1925.^[36] Under the Bill, rules may make provision about the form of any statement required under an enactment to be included in an instrument effecting a registrable disposition or a disposition which triggers the requirement of compulsory registration.^[37]

Other rules and regulations

17.10      The Bill contains certain other miscellaneous powers to make rules and regulations by statutory instrument that are required merely to be laid before Parliament, but which are not land registration rules. Some of these have already been mentioned above,^[38] but they also include regulations made under the Bill.^[39]

17.11      There are certain rules that are required to be made by a statutory instrument that is subject to annulment in pursuance of a resolution of either House of Parliament and, indeed, only after prior consultation by the Lord Chancellor. These powers relate to network access agreements,^[40] and have been mentioned above.^[41]

ORDERS

17.12      The Bill contains a number of powers for the Lord Chancellor to make orders. These fall into three classes.

17.13      First, there are orders which can be made by the Lord Chancellor by a statutory instrument that does not require to be laid before Parliament.^[42] None of these is in any way unconventional. They are-

(1) a fee order under Clause 101: this replicates the present position;^[43]

(2) an order prescribing any fees that are to be paid in proceedings before the Adjudicator;^[44]

(3) an order making any transitional provisions and savings in connection with the bringing into force of the Bill;^[45] and

(4) a commencement order.^[46]

17.14      Secondly, there is one class of order that has to be made by statutory instrument that is laid before Parliament after it is made. This is an order under Clause 99(3), designating a particular office of the Land Registry as the proper office for the receipt of specified applications or kinds of application.^[47]

17.15      Thirdly, there is a limited class of orders that must be made by a statutory instrument that is subject to annulment in pursuance of a resolution of either House of Parliament.^[48] As we have mentioned above,^[49] what characterises an order of this kind, if made, is that it will change the substantive law. Some such orders can be made without prior consultation,^[50] but such is the importance of the others that they can only be made after consultation by the Lord Chancellor.^[51]

LAW COMMISSION

ROBERT CARNWATH, Chairman

HUGH BEALE

CHARLES HARPUM

MARTIN PARTINGTON

ALAN WILKIE

MICHAEL SAYERS, Secretary

HM LAND REGISTRY

PETER COLLIS, Chief Land Registrar

CHRISTOPHER WEST, Solicitor

31 May 2001

Ý
Ü   Þ

Note 1   Such powers are examined by the Delegated Powers Scrutiny Committee of the House of Lords (which was set up in 1992-93, “to report whether the provisions of any bill inappropriately delegate legislative power; or whether they subject the exercise of legislative power to an inappropriate degree of Parliamentary scrutiny”). Furthermore, in our experience, delegated powers are not infrequently the subject of comment in one or other House during the passage of a Bill.    [Back]

Note 2   There are good reasons why there is no obligation to consult in relation to some of these powers.    [Back]

Note 3   Cl 125(2). The Bill confers on the registrar the power to make orders, as in Cl 41; above, para 6.37. These orders are not made by statutory instrument.    [Back]

Note 4   See above, paras 2.76-2.78; 13.66-13.71. The principal rules made under the Land Registration Act 1925 are the Land Registration Rules 1925. See above, para 2.76. As we there explained, there are presently more than 300 rules.    [Back]

Note 5   In the period 1990-2001, there have been no less than 46 sets of rules or orders made under the Land Registration Act 1925.    [Back]

Note 6   See above, paras 2.76, 13.69.    [Back]

Note 7   See above, para 276.    [Back]

Note 8   Ibid.    [Back]

Note 9   The system of priority searches of the register is a case in point: see above, paras 9.62-9.66.    [Back]

Note 10   Land Registration Act 1925, s 144(2).    [Back]

Note 11   Schedule 10, para 8.    [Back]

Note 12   There are also some general rule-making powers that are collected in Schedule 10.    [Back]

Note 13   See the definition of “land registration rules” in Cl 129(1).    [Back]

Note 14   See above, para 13.80.    [Back]

Note 15   See above, Part XVI.    [Back]

Note 16   Cl 119; above, para 9.81.    [Back]

Note 17   See Schedule 5, paras 1, 2, 3, 11.    [Back]

Note 18   See para 17.8.    [Back]

Note 19   Cl 124(1).    [Back]

Note 20   Cl 125(3).    [Back]

Note 21   Section 144(1).    [Back]

Note 22   Mr Justice Blackburne is currently the Chairman.    [Back]

Note 23   Cl 124(2).    [Back]

Note 24   Cl 124(3).    [Back]

Note 25   Though the views of the Rule Committee would, no doubt, be sought by the Lord Chancellor as part of that process of consultation.    [Back]

Note 26   See Schedule 5, para 11. The rules relate to the terms of network access agreements, the terms of access to the Land Registry Network, and the termination of network access agreements: see Schedule 5, paras 1-3, above, paras 13.36-13.56. By contrast, the network transaction rules made under Schedule 5, para 5 will be land registration rules. These rules are concerned with the manner in which network transactions are conducted. That is plainly a matter of interest to the Rule Committee.    [Back]

Note 27   See Cl 123.    [Back]

Note 28   In relation to Schedule 10 para 2 (regulation of matters between sellers and buyer), see above, para 12.8; ibid, para 3 (implied covenants), see above, para 12.20;ibid, para 4 (land certificates), see above, para 9.90;ibid, para 6 (applications), see above, para 9.77;ibid, para 8 (residual power), above, para 17.4.    [Back]

Note 29   That is, a legal estate that a person must register under Cl 6: Schedule 10, para 1(2)(a). For Cl 6, see above, paras 3.38, 3.39.    [Back]

Note 30   Schedule 10, para 1(1). Cf above, paras 3.23-3.41. A pre-registration dealing is one that takes place before the application to register the registrable dealing with the legal estate: Schedule 10, para 1(2)(b).    [Back]

Note 31   See Land Registration Act 1925, s 123A(10)(a).    [Back]

Note 32   Land Registration Rules 1925, r 73.    [Back]

Note 33   Schedule 10, para 5. Again this replicates the effect of provisions found in the Land Registration Act 1925: see s 79; and Land Registration Rules 1925, rr 311-315.    [Back]

Note 34   Schedule 10, para 5(2).    [Back]

Note 35   See Charities Act 1993, ss 37, 39.    [Back]

Note 36   See Settled Land Act 1925, s 5.    [Back]

Note 37   Schedule 10, para 7.    [Back]

Note 38   See para 17.5.    [Back]

Note 39   Cl 125(3)(c). See, eg, Cl 99(2) (regulations about the carrying out of functions of the registrar during any vacancy in that office); see above, para 15.5 ; Schedule 9, para 5 (regulations about the carrying out of functions of the adjudicator during any vacancy in that office); see above, para 16.4.    [Back]

Note 40   See Cl 125(4)(a); Schedule 5, paras 1-3; above, paras 13.36-13.56.    [Back]

Note 41   See para 17.8.    [Back]

Note 42   See the matters excluded by Cl 125(4)(b).    [Back]

Note 43   For fee orders, see above, para 15.9. Such fee orders are made at least once a year and sometimes more often.    [Back]

Note 44   See above, para 16.19.    [Back]

Note 45   Cl 131.    [Back]

Note 46   Cl 133(2).    [Back]

Note 47   Cl 125(3)(d). See above, para 15.6.    [Back]

Note 48   Cl 125(4)(b).    [Back]

Note 49   See para 17.1.    [Back]

Note 50   See Cl 62(9) (changing the number of years required to upgrade a possessory title); above, para 9.17(2); Cl 80(4) (extending events that trigger compulsory registration of demesne land); above, para 11.15. Although the latter power can be exercised without prior consultation, it is inconceivable that the Lord Chancellor would in practice exercise it without prior discussion with the Crown.    [Back]

Note 51   See Cl 5 (power to extend triggers to compulsory registration); above, para 3.37; Cl 116 (power to reduce the length of lease that is registrable); above, para 3.17.    [Back]