§ 7.23 p.m.
§ Report received.
§ Clause 1 [Open register]:
Lord Coleraine moved Amendment No. 1:
Page 1, line 12, leave out first ("leases or").
§ The noble Lord said: My Lords, in tabling this amendment I seek to persuade your Lordships to reverse in part an amendment agreed in Committee on 16th December and tabled by the noble and learned Lord, Lord Templeman. The amendment which the Committee accepted provided that the public should not be able to obtain from the Land Registry Office copies of documents including leases and charges. I have no wish to suggest that there should be public access to charges, which are basically personal matters and do not affect the land. However, in my view there are cogent reasons why the public should have access to leases.
When I originally read Law Commission Paper No. 148 containing the Bill moved by the noble and learned Lord, I understood that the commission was broadly agreed that both leases and charges should be available to everyone. In concluding its report it wrote:
we recommend that the register of title to freehold land and leasehold land kept at Her Majesty's Land Registry should become public. In substance this means that statutory provision should be made so that the right to inspect and make copies of the whole or any part of any register or of any document in the custody of the registrar and referred to in the register at present enjoyed by registered proprietors and persons authorised by them would be extended to any person".
That was the sense of the Bill which was originally before the House.
§ I believe that there should be public access to copies of leases for two reasons. The first is as between tenants and landlords and other tenants. It is desirable that any tenant should be able to obtain a copy of the lease (for example, of any other flat in his building) for a number of reasons but I shall instance only two. The first is in order that the tenant can find out from inspection of other leases whether the management and repair structure which the lessor had imposed are satisfactory. The second is more directly as between one tenant and another. It is in order that a tenant can be satisfied as to the ceiling, floor and party wall boundaries between his and adjoining flats. That is one of the points made by the Law Commission in its report. It stated that one of the reasons for throwing open the register in all respects as regards freehold titles is in order that boundaries can be seen to be where they are.
§ The second and more important reason is to enable a prospective purchaser of a leasehold flat to obtain a copy of the lease of the flat which he wishes to buy at an early stage in the negotiations. That would be desirable and would probably have the effect of speeding up conveyancing and avoiding wasted conveyancing. I understand it often happens that someone sees a flat that he likes and makes an offer based on the information gleaned from the agent's particulars. It is probable that the flat is let for 99 years at a ground rent of £100 a year. It is at that 377 point that the tenant should be looking at the lease, where he may well find that the flat is not what it seems. The lease may be defective and he may be well advised to keep away from the property or reduce his offer appropriately.
§ It happens so often in practice that the purchaser probably does not think of seeing the lease at an early stage. When his solicitor eventually asks for the lease he discovers that the vendor must obtain the deeds and the lease from the building society. Therefore it may be two or three weeks before it is eventually discovered that it is defective and that the prospective purchaser should never have entered into the preliminary stages of the purchase. At that stage he may wish to withdraw from the purchase, having expended a fair sum of money in legal fees, surveyor's fees, building society mortgage application fees and so forth.
§ The alternative way of looking at the matter is from the point of view of the solicitor, who will find that it is as well for his client to see the lease at an early stage in the proceedings so that he knows exactly what is wrong. The general experience of those in the profession is that if it is left until much later it is then difficult to persuade one's client that what appeared to be an attractive flat three weeks before is riddled with what the purchaser will see as pettifogging legal complications.
§ For both those reasons I think that it will help conveyancing if copies of leases can be seen by purchasers at an early stage in their purchase and that the Bill should be re-amended in accordance with the amendment tabled in my name. I beg to move.
§ 7.30 p.m.
§ Lord Mishcon
My Lords, everyone respects an amendment moved by the noble Lord, Lord Coleraine; but I hope that on this occasion the House will not accept it. He gave two reasons—and I shall deal with them briefly—as to why copy leases should be supplied to the public. The first is the case of a flat in a building where one wants to know where the boundaries are. I have not in practice encountered a difficulty that is in any way a substantial one with regard to such a problem.
The noble Lord's second reason was in regard to the purchase of a house or flat where there is leasehold interest and where the lease comes late in the life of the purchase. From a practical point of view, the usual procedure is that there is a copy of the lease—-even if the deeds are elsewhere—lurking in a file which is immediately supplied with a draft contract. The noble Lord, Lord Coleraine, is very optimistic with regard to the officials of the Land Registry if he feels that a copy lease will arrive to a member of the public any quicker than it would arise in the normal course of events. It is hardly likely that a member of the public will apply to the Land Registry; it will be the solicitor for the purchaser and he will obtain that quickly in any event.
Having dealt with the arguments for, let me deal with the argument against, commenting that the Law Society is not in favour of this amendment. The reason against is that although 90 per cent. of the contents of a lease are of a general nature, in many cases—and certainly in commercial leases—some 10 378 per cent. is of an entirely confidential nature. I shall give one quick example to the House and then sit down.
The example is where you have a commercial lease when, for example, there is a clause that if at any time that planning permission for the carrying on of a certain trade ceases to be effective, then other trades can be carried on but not the original trade. That can give some very vital information to a competitor. It could persuade the competitor, having obtained a copy of this private document, to make life extremely difficult for that lessee by talking to the planning authority about the cancellation of the permission. Indeed, quite apart from planning permission, there is a normal case where use is obviously of a very private nature where permitted by a lessor to a lessee. For those reasons, I hope that the House will not accept this amendment.
§ The Lord Chancellor
My Lords, I regret that I too must take the same attitude. To include leases within the general right to inspect and make copies would be to impose a very considerable burden on the registry's manpower resources, without in my view giving any significant benefit. The benefits suggested by my noble friend are, I would suggest, more apparent than real. It would not, for example, be realistic to expect a solicitor advising a client about a lease in a block of flats to read through 20 or 40 other leases of flats in the same block. It certainly would not be conducive to speedy and efficient conveyancing. Leases often run to 50 or 60 pages, and can be as long as 100 pages and I am sure that is not an absolute maximum. To allow general inspection and copying of copy leases held at the registry would be immensely time-consuming and would seriously hamper the registry's work.
The registrar already has a discretion to allow inspection of such copy leases as the registry holds, and he does indeed allow inspection in cases of real need, as where the original lease has gone astray. The Bill as at present drafted would preserve the registrar's discretion. It should not be forgotten that the register of title is not a deeds register, and it is inappropriate to treat it as if it were. As the noble Lord, Lord Mishcon, pointed out, difficult questions of confidentiality might arise if leases were generally made available for public inspection. My noble friend's amendments certainly go beyond what was originally proposed by the Law Commission.
I consider that my noble friend's amendments create more problems than they solve. They would involve substantial resources and will not make transactions quicker or more efficient. For those reasons, I resist these amendments and advise your Lordships to do so.
§ Lord Templeman
My Lords, this Bill as it emerged from Committee represented the combined wisdom of the Law Commission, the Chief Registrar, the Lord Chancellor, parliamentary counsel and the Law Society. Having heard the objections raised by the noble Lord, Lord Mishcon, with his vast experience, and the objections raised by my noble and learned friend the Lord Chancellor, I hope that the noble Lord will withdraw his amendment.
§ Lord Coleraine
; My Lords, I was very sorry to hear my noble and learned friend refer to the stretching of resources of the Land Registry. My heart bleeds for the Chief Land Registrar in that respect. It is plain that anything that this Bill provides for—if it is enacted—will have to be paid for by those who wish to take advantage of the facilities it offers. Therefore, it is not a question of financial resources but manpower resources. I understand that the Bill will take a couple of years before the necessary arrangements can be brought into effect to bring it into operation. I should have hoped that in that time arrangements of a financial nature might have been made for the Land Registry to enable it in any instance such as this to produce the necessary manpower resources, if the public are prepared to pay for the services.
My noble and learned friend also referred to the unlikeliness of any solicitor wanting to wade through 40 or 50 pages. I agree with him. However, it would be a very rare occasion when this would arise and I believe that in reserve, it would be desirable for the possibility to be available to solicitors and purchasers, and possibly the Chief Land Registrar would consider exercising his discretion in those circumstances to make the documentation available.
The noble Lord, Lord Mishcon, dealt very fairly with my arguments but I think that the occasions when the solicitor of a vendor of a flat has a copy which he can hand over before he receives the deeds from the Land Registry are not as frequent as one would wish. My experience is that those occasions would be where the title is in perfect shipshape order and the lease is an admirable document. The occasions when it takes some time for a vendor's solicitor to produce the documentation are generally those occasions, by coincidence, when there is a problem.
The noble Lord has carefully balanced the instance which I was giving and the instance of confidentiality in a commercial lease. I agree that there are considerations to be taken into account on both sides. It is a matter of balance and I believe that perhaps the best thing I can do is to ask your Lordships' leave to withdraw this amendment in the knowledge that these matters will be looked at again in another place.
§ Amendment, by leave, withdrawn.
§ [Amendment No. 2 not moved.]
§ Lord Beaverbrook
My Lords, I beg to move that the House do now adjourn during pleasure until 7.50 p.m.
Moved accordingly, and, on Question, Motion agreed to.
§ [The Sitting was suspended from 7.40 to 7.50 p.m.]