In last month’s issue we answered a question as follows.
Anonymous: A plan to an underlease that is available to download from the portal is uncoloured. We want to provide you with an original coloured lease plan to update the copy you hold accordingly.
Adam: If you have a better copy of the plan or deed, then we would be grateful if you would lodge it with us. Please send us a certified copy of the plan and specific details of the deed and title number that it relates to and we can update our records as appropriate.
We'd like to correct our answer to say: We would be grateful for a better copy of the plan but please note that we usually require a complete certified copy of the deed. Under rule 135 of the Land Registration Rules 2003, the scanned document is admissible in court as a true copy of the original deed. We can therefore generally only accept a complete certified copy of the deed, rather than a plan or individual pages in isolation. In this case, if you are able to supply a complete certified copy of the lease, including the coloured plan, we can consider it for electronic filing.
Sarah Hodgson, Ramsdens Solicitors: Hi Adam, I am purchasing a leasehold flat for a client. The flat is in a converted block of terrace houses. Each terrace house has a separate freehold title number and each freehold is currently in common ownership. The flat lease, we are buying straddles two of the freehold title numbers. I am concerned that the fact there are two freehold title numbers which are capable of being transferred out of common ownership leaves the Lease vulnerable and as such, I had requested that our sellers have the freeholder amalgamate the two freehold title numbers which affect this flat. They advise that this cannot be done. I do not think a lender would lend on the basis that the lease is vulnerable. Is it possible to amalgamate the two freehold title numbers
Adam: An amalgamation is the joining of two or more parcels of registered or unregistered estates affecting different extents of land under a single registered title.
We do not amalgamate titles unless some positive advantage accrues to a number of prospective purchasers (such as an amalgamation of areas of land comprising a housing development), or the request does not add unnecessarily to our workload.
Amalgamation can only happen where:
- the estates are of the same kind [for example, freehold title]
- the estates are owned by the same proprietor[s] and in the same capacity [for example, if an owner holds one title as joint proprietor and another as sole proprietor, amalgamation of the two cannot take place]
- the impact upon any encumbrances on individual titles, such as mortgages, have been accounted for
You can read more about amalgamations here.
If you wish to apply for amalgamation you will need to complete and submit:
- Form AP1
- a covering letter outlining the reasons for the request along with any supporting evidence [If you are being refused insurance, for example, then you should include a copy of that refusal with the application]
- a sufficient description or plan of the land being amalgamated
- the appropriate fee payable under Article 12 of the Fee Order
The fact that the seller’s view is that they can’t be amalgamated alongside your own that the current arrangement creates a vulnerability for a mortgage lender aren’t matters we can comment on.
Anonymous: Hi Adam, we act for the registered proprietor of a leasehold title. We are instructed to add an easement to an underlease we are party to by way of a deed of variation. For clarity we are the landlord of this second lease, the underlease. Our client's own leasehold title contains a restriction on dispositions that calls for the written consent of a third party for a disposition. Therefore my reading is that we will need to obtain the consent of the third party named in the restriction to get the deed of variation registered at Land Registry in due course, as the restriction will catch on the grant of the easement in the Deed of Variation. Is that accurate to say?
Adam: If the deed of variation grants a legal easement that is a registrable disposition, we will require consent or other appropriate evidence of compliance with any ‘no disposition …’ type of restriction on any of the servient titles. This applies whether the deed extends an existing right granted by the lease, for example by extending a right of way on foot to include vehicular access, or grants new rights.
Practice Guide 62: easements contains further information on our requirements.
Amy Scott, Trethowans: I asked this question and you replied:
Amy Scott: In respect of a Form A restriction, is it best practice for the seller to provide an ST5 and/or RX3 in order to remove this restriction as they have the knowledge of why the restriction was added, when it no longer applies or is this for the purchasers to complete?
Adam: Much will depend on the circumstances of the sale/purchase and what is needed and agreed between the conveyancers involved. From your question I assume that there is a single seller and the register refers to a Form A restriction that is preventing that sole owner from selling the property.
Form A restrictions are being left on titles even when the criteria has been met for them to be automatically removed according to the Practice Guide 19, and this includes dispositions of more than one owner, we are finding we are having to subsequently make further registrations to remove the form A restriction with no information of why it was added in the first place.
In these cases where the restriction has been added due to say the registered proprietors being tenants in common or a Trust was in place and all parties are disposing, (or even when there is a sole proprietor surviving and a trustee has been added for overreaching purposes) this is happening. In this case us as purchasers would not necessarily have the information requested as to why the restriction was added in the first place.
Any time we have not submitted a request to remove the Form A restriction as a transaction on an application, it has been left on the title even when the criteria for it to be removed automatically has been met. When our clients are holding as joint tenants for example which is clearly shown on the Transfer, we are having to submit RX3's saying 'Restriction added due to previous owners beneficial interests, not required by our client who purchased the property - as you can see they are holding as joint tenants' etc.
Is it your standard process now to leave on a Form A restriction regardless, and does the process guide need updating, do we need to be applying to cancel Form A restrictions 100% of the time and therefore gathering the RX3 and or ST5 from the other side if required, or is this a staff training error that needs looking into?
Adam: As confirmed in Practice Guide 19, section 3.7.5, a restriction may be cancelled without application if it is clear the restriction has become superfluous. Regarding a Form A restriction, we might cancel this restriction automatically where the interest has since been overreached by the payment of capital money arising on a registrable disposition to the proprietors who have given a valid receipt. Section 6.1 of Practice Guide 24 sets out the circumstances where a Form A restriction can be cancelled automatically.
Where there is a sole proprietor, they would need to appoint one or more new trustees to join in the disposition otherwise overreaching will not have occurred. Section 7.2 of Practice Guide 24 contains further information on this.
Please also note that, if no capital money arises under the disposition, the Form A restriction will not be cancelled automatically because overreaching has not taken place. In this scenario, although registration of the disposition may not be prevented by the Form A restriction, you will need to provide the appropriate application and evidence to cancel the restriction, if the trust(s) protected by the restriction have come to an end.
This remains accurate and reflects our internal practice. If you believe we have made an error and should have automatically cancelled restrictions in specific applications, then please raise these through our Contact Us form and they can be considered in the context of the applications.
