Land Registry Error - Removal of Covenant

ejlwsn

I’m looking for advice regarding my mother’s property which benefited from a restrictive covenant that has been mistakenly removed by the Land Registry.

My mother bought her home around 1996. It is a country house surrounded by woods/farming land etc and the rear view looks onto a valley - key to its value. Behind the house is a garden and at the end, a straight fence boundary. Behind that is a paddock that slopes down and belongs to the rear neighbouring house. This property has had a restrictive covenant preventing any development or erection of any building within 80 yards of my mothers boundary. The covenant was recorded on the title ever since my mothers owned the house (maybe before - we are currently waiting on the original title). It would prevent any blockage of the view and light as the property is south facing.

The rear neighbouring property was sold earlier this year and the LR, by written admission, mistakenly removed the restrictive covenant. We have downloaded title documents to confirm this. They have offered a small (read pitiful) amount of compensation. This does not accord in the slightest for the huge loss in value of my mothers house were the paddock to be built on - something that we are very aware the new owner intends to do and has the freedom to, subject to planning.

I have read the LR Act 2002 and guidance note 39. Whilst it is clear the LR only wish to pay a small compensatory amount to get the issue off their desk, I understand they also have the power to reinstate the covenant by rectification of the title, provided the owner of the rear property consents (and would therefore i’m sure be entitled to their own compensation) or if it is “just” to do so. Can any one give any assistance on whether this is likely and any process involved? The new owner is not open to discussion.

I appreciate the court also has the power to do so - we are currently seeking advice from a property lawyer specialising in land disputes and litigation. Any help would be appreciated.

da_rule

So just to get this the right way round, your mums property has the benefit of a restrictive covenant. The serviant property (i.e. the property subject to the restriction) is the paddock?

The paddock has been sold and for some reason the covenant was removed from a title register when the Land Registry registered the transfer? Which title was it removed from, the paddock, your mums or both?

Also, how did the covenant come in to existence, was it contained in a transfer or a specific deed of covenant etc?

G_M

It seems starnge that the covenant could be removed from your mother's Title without her being written to and asked.

Is that the error that the LR made?

If so surely a rectivication application would correct this?


I asume you are familiar with
https://www.gov.uk/government/publications/rectification-and-indemnity

da_rule

My other thought is that it hasn’t been removed. I have have seen some examples where a title register contained the restriction listed verbatim in the charges register, but then on re-issue it simply said “The transfer dated XXX between XXX and XXX contains covenants -note: copy filed”.

The covenant is still contained in the title, but as a referred document. Personally, I prefer this as just having a quote can cause some laziness, especially if referring to boundaries or physical features, as land changes over time so what is on the ground now may not reflect what was there in the deed and the deeds often contain plans.

ejlwsn

Thanks all.

Correct - my mother’s property had the benefit. The covenant attached to the paddock.

The covenants were removed by mistake a year before the purchase. The paddock was part of a deceased estate in 2016 held on trust by World Land Trust who instructed LR to remove other covenants. LR removed all by mistake in 2016. The property was then purchased with clear title in good faith by the now owners.

The LR have admitted their mistake and we
applied for rectification - this was rejected as a) the new owner will not consent and b) the LR do not believe it unjust not to rectify.

We are aiming to challenge the LR on the unjust basis. This is what I could get some guidance further on - they have given no reasoning for why it is not. Does anyone have experience of what is unjust?

ejlwsn

The indemnity basis compensation they have offered is way too low. If we can show the unjust basis, by they won’t rectify, can we
push for higher compensation? It is essentially for consequential loss as the “possible development” has not yet happened.

da_rule

I think you’re going to struggle to show that it would be unjust to not rectify the register. The purchaser is not at fault, they purchased in good faith relying on the title register as it was presented to them. This is the exact reason the Land Registry indemnity policy exists.

As you’ve identified though the loss is pretty remote at the moment as there isn’t a development. Therefore the loss will probably be limited to the difference in value between your mothers property with the restriction vs what it is worth without. You could obtain a valuation of the property on this basis. Your valuation costs should be recoverable under the indemnity policy.

steampowered

The legal details are going to be very important in a case like this.

I think this is a situation where you have to rely on advise from a specialist lawyer.