Sommer & Anor v Sweet & Anor

In registered land, a right of way may be an overriding interest under rule 258 of the Land Registration Rules 1925 where it is openly exercised and enjoyed with the dominant land, or is known or reputed to appertain to it. The right may arise from a proprietary estoppel equity. Actual occupation concerns the separate statutory category in section 70(1)(g), not rule 258. An erroneous register entry does not prevent a right otherwise within rule 258 from being overriding. Such an equity is not an equitable interest capable of being overreached under section 2(1) of the Law of Property Act 1925. A claimant need not beat its own Part 36 offer to recover costs; failure only removes specified Part 36 advantages.

The Sweets, owners of Forge Meadow and the Northern Field, claimed rights of vehicular access over the Old Forge Yard, owned by Ms Sommer. Proceedings begun in the Newport County Court were transferred to the High Court. Hart J upheld the claimed rights, ordered rectification of the relevant titles, granted injunctions, awarded damages and ordered costs, dismissing Ms Sommer’s counterclaim.

The appeal challenged the rights to Forge Meadow and the Northern Field, the rectification orders and the indemnity-costs order. The central questions were whether the rights were overriding interests under rule 258, whether the proprietary-estoppel equity had been overreached, and whether the costs order was justified under Part 36.

The appeal was dismissed. The Vice-Chancellor’s judgment was agreed by Lord Justice Clarke and Lord Justice Jonathan Parker.

1. Forge Meadow. The court declined to determine whether a vehicular way of necessity should be implied. The appeal was resolved on the alternative proprietary-estoppel ground. The evidence supported an equity arising from the Loverings’ representation, the Martins’ belief and detrimental expenditure, and the Loverings’ knowledge and acquiescence.
2. Overriding interest. Rule 258 of the Land Registration Rules 1925 validly extended the categories of overriding interest under the Land Registration Act 1925. Following Celsteel Ltd v Alton House Ltd [1985] 1 WLR 204, a right openly exercised and enjoyed with land could fall within the rule. The Martins’ usual entry through the Meadowgate drive did not prevent their use of the Old Forge Yard from being sufficient. Actual occupation was relevant only to section 70(1)(g), not to rule 258.
3. Overreaching. The proprietary-estoppel equity was not an equitable interest capable of being overreached under section 2(1) of the Law of Property Act 1925. As it was an overriding interest, section 20 of the Land Registration Act 1925 meant that Ms Sommer took subject to it.
4. Northern Field. Although the right had been used rarely, it was known or reputed to appertain to the Northern Field because relevant dispositions and title entries referred to it. Its mistaken entry on the register did not prevent it from being an overriding interest. The later deletion of the entry did not remove the existing reputation.
5. Footpath and rectification. The new argument based on section 34 of the Road Traffic Act 1988 had not been raised below or permitted on appeal. In any event, no public right of way on foot was established. Hanning v Top Deck Travel Group Ltd (1993) 68 P&CR 14 had been overruled by Bakewell Management Ltd v Brandwood [2004] 2 AC 519. The rectification and noting orders were lawful under the Land Registration Act 1925.
6. Costs. A claimant need not beat its own Part 36 offer. Failure to do so affects only the advantages under CPR Rule 36.21, not the court’s general discretion to award costs. The Sweets obtained relief exceeding their offer, and there was no basis to interfere with the indemnity-costs order.

The appeal was dismissed. The High Court order stood, with the appellants liable for the respondents’ appeal costs on the standard basis.

• Court of Appeal (Civil Division): In [2005] EWCA Civ 227, the appeal was dismissed and the order of Hart J was left standing.
• High Court (Chancery Division): Hart J’s judgment, reported at [2004] EWHC 1504 (Ch), upheld the claimed rights of way, ordered rectification and injunctions, awarded damages and ordered costs.