Bryant Homes Northern Ltd v Thompson

Under the proviso to section 54(1) of the Land Registration Act 1925, a cautioner must obtain the registrar’s consent to lodge a caution where the relevant interest is already protected by a notice or restriction. The cautioner need not prove that the registrar considered why consent was required or investigated the rationale of the proviso. Consent permits the caution to be lodged, but does not establish that it was lodged with sufficient cause or prevent a claim for compensation under section 56.

The appellant had protected rights arising from a transfer by a notice entered against the respondent’s registered title. He later lodged a caution against dealings. The respondent sought its removal and compensation, alleging that the caution had been lodged without reasonable or sufficient cause and without the registrar’s consent under the proviso to section 54(1) of the Land Registration Act 1925.

His Honour Judge Langan QC held on a preliminary issue that the registrar’s approval did not amount to the required consent because he had not addressed his mind to the proviso. The central issue on appeal was whether consent required conscious consideration of the statutory prohibition and the reason for dispensing with it.

1. Appeal allowed. The operative order allowed the appeal, on the reasoning of Arden LJ and Robert Walker LJ. Auld LJ’s concluding sentence stated that the appeal should be dismissed, but no reasons were given and the formal order was to allow the appeal.
2. Arden LJ held that the proviso to section 54(1) makes entitlement to lodge a caution dependent on the registrar’s consent where the interest is already protected by a notice or restriction. The required consent is consent to lodging the caution. It is unnecessary to show that the registrar addressed his mind to the rationale of avoiding duplication or to the existence of the statutory prohibition itself. The appellant therefore discharged the onus by showing that the registrar approved lodging the caution.
3. The court rejected the assumption that consent under section 54(1) necessarily establishes sufficient cause under section 56. The registrar may consent on incomplete information or make a mistake. Conversely, absence of consent does not necessarily mean that the caution was lodged without sufficient cause, particularly where the cautioner reasonably believed consent had been given.
4. Robert Walker LJ agreed. Consent merely permits the caution to be put in place; it does not guarantee that the caution is well founded or immunise the cautioner from liability under section 56(3). He considered that the first-instance judge’s contrary assumption led to the wrong conclusion.
5. The application to amend the defence was granted by consent, but whether the amendment disclosed a good defence was left to the High Court. The appellant received permission to re-amend the defence as sought, with costs as in the agreed draft.

• Court of Appeal (Civil Division): [2002] EWCA Civ 1080 — appeal allowed on the preliminary issue, with permission to re-amend the defence.
• Chancery Division, Leeds District Registry: His Honour Judge Langan QC’s order dated 23 July 2001 — held that the registrar had not given consent under the proviso to section 54(1) because he had not addressed his mind to that question; that conclusion was reversed.