HL Deb 19 July 1911 vol 9 cc555-67
THE EARL OF HALSBURY

My Lords, I rise to ask my noble and learned friend on the Woolsack the Question of which I have given notice—namely, whether he can give the House any information as to the steps which His Majesty's Government have in contemplation for utilising the labours of the Royal Commission on the Land Transfer Acts, and whether their recommendations for the improvement of the Land Registry will be carried out with a view to the extension of the system.

THE LORD CHANCELLOR (LORD LOREBURN)

My Lords, I am glad this question has been put. The country is under a great debt of gratitude to the members of the Royal Commission who investigated this most intricate and, to laymen, unattractive subject. Their Report is of great value. I have already practically got into shape a Bill for the purpose of giving, in substance, effect to their recommendations, and I hope to submit it to my colleagues with a view to obtaining their approbation and having the question brought before Parliament as soon as possible. I think the noble and learned Earl desires that I should say, as I desire to say, a little in regard to the subject in general and the reasons which led to the appointment of the Royal Commission. Although comparatively few people take an interest in it, the subject is one of very great importance for many reasons. The present condition of the law in England as regards titles to landed property and the methods of transferring landed property, except where provision exists for the registration of title—namely, in the County of London—is really a scandal, and is almost unique for its obscurity and its cost.

When a man wants to buy a piece of land, no matter how small, he must, personally or through his solicitor and at his own risk and expense, procure and examine all deeds, mortgages, and documents of that kind extending over a long period, ascertain dispositions by wills and settlements, and whether there has been payment or non-payment of duties, and so forth, so as to be practically safe in paying money for the purchase of land; and it does sometimes occur that after having done all that he finds himself still with a defective title. Further than that, often the purchaser's right to inves- tigate a title is limited to twenty or thirty years by the condition of the sale, which still leaves a good deal of investigation to be done and does not give complete security. Besides it is found to lead to the costly employment of solicitors, and the costly reinvestigation of title on every transfer of land, whether mortgage, sale, or lease, on which money has to be laid out. Sometimes, of course, the investigation can be dispensed with, and sometimes the full solicitors' charges are not charged. These are the legal conditions of transfer of property in England, and I say it is almost a scandal to civilisation. It is impossible to say with precision what this system costs those who are interested in land, but it has been estimated by a very high authority that, quite apart from stamps, duties, or Government charges, the solicitor's costs and charges out of pocket for these transfers of landed property amount to £4,000,000 sterling a year, and I believe that this is within the mark. The people who suffer from this are primarily the landowners, and also the purchasers of land. It is a clog upon landed property, and falls especially hard on poor people who like to buy their houses or small pieces of land. It has, therefore, a direct bearing on the policy of both Parties in the State, who wish to encourage the acquisition of land by larger numbers of occupying owners.

There are, moreover, dangers under the present system—the loss of deeds, which may involve the loss of proofs of right to property; frauds by duplication of deeds, or forgery; and concealment of deeds so as to hide defects of title. Fraud and concealment can be prevented to a large extent, at all events, by the registration of deeds, but we have registration of deeds only in two counties in England; and registration of deeds would have little or no effect upon all the other evils to which I have adverted. One may well ask how it is that this absurdity has lasted so long. The reasons, I think, are the extreme complexity and technical character of this subject, so that public opinion cannot be intelligently brought to bear upon it; the enormous strength of the vested interests concerned in the maintenance of the present system; and the aversion to learning a new system and dislike of innovation which are fortunately or unfortunately characteristic of the legal profession.

For these evils there is not the least doubt a remedy could be provided. It is possible for the Government to set up a register all over England under which the actual ownership or right to possession can be recorded, together with all other rights attaching to the land, and the Government can offer to any purchaser a guarantee of the title which he acquires, so that either he will get the property with a good title or will be repaid the money which he has given on the faith of getting a good title. A system of this kind has been for a long time in force in Australia and in New Zealand, in which the same laws prevail as in this country, and also in the whole of Central Europe under different laws. After the first registration the expense of such a system is very small. When a purchaser acquires property under a registered title, as I say he can pay his money with absolute safety because the guarantee of the State is behind it. This has already been partially accomplished in a very small degree in England. I am not going to give your Lordships the history of the efforts that have been made in this direction. They began in 1857, and Lord Westbury, Lord Hatherley, Lord Selborne, Lord Cairns, and Lord Herschell have all taken part in the endeavour to pass Registration of Titles Bills and some of them have passed instalments in that direction.

But the principal mover, the most-successful legislator, on this subject has been the noble and learned Earl, Lord Halsbury. The noble Earl began his efforts in 1887, and continued them down to 1897; and I am happy to think that in my position in the House of Commons during all that time I did my best to support and assist the passage of the proposals of the noble and learned Earl. In 1897 the noble Earl passed the Bill which is now applicable to the County of London, the effect of which was to institute registration of title compulsorily upon any transfer of land within the County of London and in any other county where the county council desired it. I am sorry to say that from the date of the passing of that Act the most strenuous resistance has been offered to it by the majority of the legal profession, principally supported by the Incorporated Law Society. The subject is one which laymen cannot understand without much study. No single county except London has asked for this Act to be applied. I do not suggest for a moment that there has been any unworthy action or unworthy motive, but the solicitors who have to advise the county councils have almost invariably advised against an extension of the system. The result is that the clause requiring the consent of the county councils has killed the prospect of an extension of this most beneficial system.

There is a regular literature upon the subject, making every kind of groundless objection to the system in the noble and learned Earl's Act, and there are constant efforts to prejudice it in the public mind. I may say, for example, that I have quite lately received from some of the borough councils in London a number of resolutions condemning the existence of the system of the registration of title in London and asking that it should be undone. If I thought that the members of the borough councils in London had studied the meaning of registration of title or familiarised themselves with the Act, I should, of course, pay attention to what they urged; but it is a great misfortune that important public bodies should be induced, without any inquiry, to commit themselves to opposition to a system which has been supported by so many very high authorities.

These criticisms, misleading to the ignorant public, were so rife that it was thought desirable to appoint a Royal Commission for the purpose of considering the subject. I do not say for a moment that the system established under the Act of 1897 is not susceptible of improvement. The noble and learned Earl himself would, no doubt, be the first to admit that. He carried the Act in the face of great difficulty, and if the noble Earl's intentions had been observed a great deal of the difficulty, such as it is, that has arisen in the working of that Act would not have arisen at all. But the obstacles that were placed in the way—I need not specify them as they are too technical to be appreciated—by the limitations of the Act have given rise to some difficulties, and those difficulties have been considered by the Royal Commission. The Royal Commission was appointed at the request, I may say, of the Incorporated Law Society, doubtless in the hope that it would condemn the registration of title. On the contrary, my Lords, the Report, which has now been published, approves the principle of registration of title, and it recommends the gradual extension of compulsory registration of title after sufficient experience has been obtained of its working, and under some amendments in technical and practical details. I hope that the result of these labours will not be thrown away, or that the Recommendations will be allowed to remain as a dead letter. I hope that I shall be able to present a Bill carrying them into effect in substance, and I hope it may also be found practicable—although at present I cannot put this beyond an aspiration—to reduce the expense to landowners in the initial stage of registration where alone the expense is complained of. Whether that will be done or not, the House will allow me to express my own personal and pious aspiration. I shall certainly do my best to suggest to my colleagues some such method if it is practicable.

I have very little further to say, beyond this. I should like to appeal to laymen on all sides of politics who do not understand the details of this subject to recall one or two facts. Every man who has held the Great Seal during the last fifty or sixty years has been in favour of this system of registration of title. The only Lord Chancellor of whom no record remains as to his opinion is Lord Chelmsford, but there is no reason whatever to suppose that he was opposed to it. Every other Lord Chancellor since the time of Lord Westbury, and including Lord Westbury, has told the House and the country that this is practicable, and has endeavoured actively to further it. I think that this fact might well be considered by those who are invited by interested opposition to believe that what is practicable in Australia and New Zealand is impracticable in England under the same law. The present system is, to my mind, an oppressive tax on landed property—as I have said, the solicitors' costs and charges for England alone amount to about £4,000,000 a year, whereas the Government stamps on dealings in land, which are often complained of, only amount to £1,000,000—it is a hindrance in the development of land and of its acquisition by small people; it depresses the value of land by making it less disposable; and I hope we shall be accorded some measure of public support in doing our best to overcome the inveterate prepossessions of professional men.

THE EARL OF HALSBURY

My Lords, this subject is almost too technical to ask your Lordships' attention upon it at any length. But there is one proposition which everybody will understand and which is very simple in itself—namely, whether when a title has been once examined and found to be a good title there should not be some finality about it. The great vice of the system hitherto is that there is no finality about it at all. On every change of ownership, on everything that necessitates an investigation of title, the whole thing has to be done over again, and the result is that the expense incurred is enormous.

I do not suggest unworthy or improper motives on the part of the solicitors in respect of the fees they charge. If you make a thing a necessity to be done, you cannot complain that people who have to do it should charge for what they do. No doubt there are some charges which it is quite reasonable for solicitors to make. I remember receiving in the course of my investigations, a very serious complaint from an old lady, who complained bitterly of her solicitors' charges. Her complaint was not in respect of the extent of the particular charge so much as that the charge had been made at all. She said "I took the solicitor over my land and pointed out to him everything that was mine. I gave him all the information, and then he charged me for it." Whether she thought that this ought to have been its own reward and that it was a delightful occupation to walk over land with herself as principal witness in this way I do not know, but she was perfectly sincere in believing that it was a most unreasonable and improper thing for the solicitor to charge her, as she put it, for her own information. Of course, I have no sympathy with unreasonable objections of this sort. But can any one say that it is a reasonable thing that after a title had been investigated possibly over sixty years and found to be good the whole thing should be gone over again whenever the owner desired to sell or to alter his ownership for some reason, and that every marriage which had taken place in the time and every dealing with the property of any sort or kind should be gone into once more to see whether the title had been affected. It is obvious that some system by which you should arrive at a final determination whether or not such and such a title is good is what we ought to look for. I believe some such system is absolutely essential, and I entirely concur with what the Lord Chancellor has said about the scandal of allowing the present system to continue.

I am afraid I must concur also with my noble and learned friend that there has been an unreasonable obstruction of the operation of the Act of 1897. I am not at all certain that I should not add something perhaps to what my noble and learned friend said, and say that I think that to some extent there has been an unreasonable charge of fees, owing to the effort on the part of those who are entrusted with the administration of this work that it should be self-supporting and that there should not be any application to the State. The Treasury, of course, are bound to look after the interests of the State; but I am afraid one of the difficulties has been that there has been an occasional overcharge in respect of large property. I do not think that in the case of smaller properties there has been any overcharge. That matter has been very fairly considered; but with regard to large properties, where it was thought, I suppose, that it was not unreasonable to charge a large fee, there has, I think, been some exaggeration in the amount charged. But whether that be so or not, and whether or not it is a desirable thing for the State to intervene and pay for this, there can be no doubt about the propriety of some such institution as has been established in the Land Registry. The acquisition of land for small holdings is a thing now greatly desired by both political Parties, and nothing could check that movement more than the cumbersomeness and cost of the present system. I am quite sure that under the guidance of my noble and learned friend on the Woolsack the system will be improved in pursuance of some of the recommendations of the Royal Commission, and I hope he will succeed in the end in crowning our labours, after a very, long struggle, by establishing a simpler and less expensive system.

THE SECRETARY OF STATE FOR WAR (VISCOUNT HALDANE)

My Lords, I rise to say a word or two in this discussion, having spent a good deal of my life in the practical dealing with this subject. I think the House is to be congratulated that my noble and learned friend on the Woolsack and the noble and learned Earl opposite are agreed upon a great principle and in the feeling that the time has come when that principle may be brought into operation. There is a class, no doubt, who dislike change and have obstructed the attempt to bring it about. On the other hand, there are many eminent legal practitioners who have given the matter careful consideration and while most desirous to do the best in the public interest are greatly impressed by the difficulties surrounding the subject. What is easy in New Zealand and in Australia is difficult in an old country like this, where, to begin with, land is much more valuable and minute boundaries are very important and it is difficult to ascertain them with exactness. In the second place, the interests associated with land in England are so complicated, ranging from settlements to leases, that the problem of land transfer is a different problem, in degree at all events, from what it is in other places. The Royal Commission over which the noble Viscount opposite presided has done a great deal to clear up the difficulties, and, I hope, to map out a simple course for the future; but I should not like it to go forth that the only source of the difficulties met with in this case has been a desire to hinder and obstruct change. As I have said, there are many legal practitioners who have taken the deepest interest in this question and who have given their time and labour with a view to bringing about improvements in the system.

I have known noble Lords in this House to take their title deeds to the Land Registry, and after a short interview the able officials of the Land Registry have investigated the title and given either a possessory or absolute title and the thing was done very easily. But every one has not the time or the inclination to do that, and consequently they employ a solicitor. The result is two bills of cost. That has tended, I think, to occasion a certain amount of criticism and misunderstanding about the system. I have no doubt that in course of time these things will be got right, but it is not altogether the simple matter that it appears at the outset. The Royal Commission have done a good deal to grapple with the problem, and I am glad to think that the noble and learned Lord on the Woolsack will in a Bill get rid of some of the difficulties. I only rose for the purpose of pointing out that there has been a good deal of legitimate criticism about the first fruits of the new system. It is not easy to apply a new system to anything so complicated as English land rights, and there has naturally been a certain amount of disappointment. But I do not think that one should class all the criticism under one head, but should rather welcome the labours of those who may have been very critical, but who, by the evidence they have given and by the work they have put into it, have done a good deal to smooth the path of the reformer in this matter.

VISCOUNT ST. ALDWYN

My Lords, as I had the honour to be Chairman of the Royal Commission which considered this subject, I may thank the noble and learned Lord on the Woolsack for the reference he made to our labours, but I should like to say that if the Commission has had any success it is really due to the never-failing attention which was paid to the subject by the five legal gentlemen, four barristers and one solicitor—gentlemen of the highest experience and standing in their profession—who sat on the Commission and devoted the greatest thought to the whole matter. We were successful in arriving at a unanimous Report on this very complicated subject, and I sincerely hope that it may have assisted the noble and learned Lord in the Bill which I am glad to hear he proposes to introduce.

I sympathise with what the noble and learned Viscount who has just sat down said. There has been, no doubt, unreasonable opposition on the part of solicitors, who feared interference with their professional work. They did not like the State stepping in as between them and their clients, and I suppose there has been dislike of a new system of land transfer to which they were not accustomed. But there have been other difficulties inherent in the nature of landed property itself. You cannot expect that under any conceivable system of registry of title land can be passed from hand to hand as simply as shares or stocks are transferred. That, I think, will be perfectly clear to anybody who has had to look into the subject. As it is, the certificates of title which have hitherto been given have often had such a complicated appearance that it was ex- tremely difficult for a layman to understand them. This, however, I hope will be remedied in the future.

There is another difficulty—the question of cost. It must be remembered that most corporations or individuals who buy land in England do not buy it in order to sell. They buy it in order to hold, and probably at the time they have no expectation whatever that they will ever be called upon to part with it. Therefore if to the necessary expense of purchase you add fees for something which to them appears useless because they are satisfied with the title to the property which their solicitors advise them to take, they naturally rather shrink from registration. Then, again, there are many persons holding properties which have descended to them perhaps through successions of hundreds of years who know that they have a good holding title, at any rate, but who do not want their titles investigated by a public authority which they think may discover some kind of flaw in the title which they have never heard of themselves. There have been difficulties of this kind in the way of registration of title, not entirely, I think, due to the opposition of solicitors, which have to be considered in dealing with the subject.

I have spoken of the expense. The noble and learned Lord on the Woolsack had to deal with this matter under new rules as to fees which he established in 1908, and he very wisely, if I may say so, lowered the fees on applications for absolute title. The great defect of the system hitherto has been that, as a rule, absolute title has not been given, only possessory title; and that is merely a certificate of the fact of a certain person being in possession at a particular moment, and does not clear the title before the date of registration at all, so that with every fresh transaction after the grant of possessory title it may be necessary to go into the whole history of the matter before the registration of the possessory title. What is wanted in this matter, as my noble and learned friend Lord Halsbury has said, is finality. You want an absolute title which shall be indefeasible. If you give that you are giving something to a landowner which is worth having; but if you give him anything less, you cannot blame him if he does not care to pay for it.

In the fee rules in 1908, to which I have referred, I think it was a misfortune that the noble and learned Lord on the Woolsack increased the charges in the case of properties over £1,000 in value. He was obliged to do it, I suppose, because the law provides that the receipts from fees for registration shall pay the cost of the office. We have made certain recommendations upon that subject which the noble and learned Lord, I suppose, was not authorised to say much about to-day, but which, to my mind, are of the greatest importance in dealing with this matter. I suppose the justification of compulsory registration of title is that it is for the benefit of the community as a whole. There is no reason why you should compel a landowner to register merely for his own benefit. You want to establish registration of title in order that the purchase and sale of property may be cheap and easy, and that therefore the owners of property may be multiplied in the country. You ought, therefore, to be careful how you burden the existing owners of property with excessive fees, or even high fees, for registration of title. One thing was done in this matter which to my mind cannot be defended. When the Registry Office building in Lincoln's Inn Fields was put up some twelve years ago it cost, I think, £55,000 to build, but the land on which it stood cost £150,000; yet it has been provided that the whole of that sum of £205,000 shall be paid out of the receipts of the Registry Office in forty years. County councils which buy land for the purpose of small holdings are allowed to pay off the loan in eighty years, and it is perfectly clear that the provision to which I have referred was not fair upon the existing working of the Registry Office. I hope that may be remedied.

I hope also that something may be done by the Government to utilise their new system of valuation of landed property, adopted under the Finance Act of 1910, so as to work it in with the registration of title. That is done in Germany, with the result that the fees charged to landowners for the registration of title are very small indeed. I commend that suggestion to the noble and learned Lord and his colleagues, because I am convinced that if a real attempt is made to work upon those lines you will go a long way towards getting rid of the present objection of landowners to register their properties. And if the present system is amended in various points—which I need not go into now because they are dealt with in our Report—I cannot help thinking that it will be found to work so much more easily that even the solicitors themselves may be induced to look upon it as an advantage to their profession. It surely must be clear that if owing to the adoption of a good system of registry titles can be made really secure, and all dealings in land simplified, transactions will be encouraged, so that where a solicitor now has merely to carry through one case he may have to carry through half-a-dozen cases in the future, and by the multiplicity of transactions he may actually increase the receipts of his profession. I apologise for having detained your Lordships at such length, but as I devoted two years and a half to the investigation of this subject perhaps I may be excused.

THE LORD CHANCELLOR

My Lords I quite agree that whatever difficulties have arisen have not been solely due to the resistance and opposition of solicitors, and I hope that they will assist in this reform. I must observe, however, in regard to what was said by the noble Viscount who has just sat down as to possessory title, that in the rules of 1908 I authorised the registrar to offer free of expense an absolute title where only a possessory title was asked for, and I am sorry to say that in a good many cases, notwithstanding that the offer of an absolute title was made without any charge, the solicitors concerned would not for their clients accept an absolute title with the benefit of State guarantee. I will now say a word about expense. I agree that this is a very important question. I cannot promise anything with regard to that, but the noble Viscount made a very fertile suggestion. It was this, that registration of title might be worked simultaneously with, and as part of, the system of valuation. In Germany registration of title, survey, and valuation of land are all worked together. I will certainly make the suggestion to those who are responsible for the finance of this country. I am quite sure that if they can they will endeavour to advance any good system of this kind; but I can say no more than that I will with great pleasure make the suggestion in the proper quarter. Indeed, I have already been considering it, although only from the legal point of view. I am very much obliged to the noble Viscount for what he has said, and I hope that his labours and those of his colleagues on the Royal Commission will prove to be of value to the country. In that case I am sure the noble Viscount will feel himself repaid for his great labour and trouble.