Yeates & Anor v Line & Anor

For the purposes of section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1989, an agreement is a contract for the sale or other disposition of an interest in land only where the parties’ purpose includes achieving that sale or disposition. A disposing effect alone is insufficient. The principle applies generally and is not confined to boundary or demarcation agreements. An oral compromise agreement may therefore remain valid despite transferring an interest in land, where the transfer was an effect rather than a purpose of the agreement.

The appellants appealed under section 111 of the Land Registration Act 2002 against a decision of a Deputy Adjudicator of HM Land Registry. The Adjudicator found that the appellants had acquired land by adverse possession but refused to alter the register because the parties had reached a binding oral compromise agreement amounting to exceptional circumstances under paragraph 3(3) of Schedule 4 to the Act.

The appellants argued for the first time on appeal that the compromise was void under section 2(1) of the Law of Property (Miscellaneous Provisions) Act 1989. The central issues were whether the new point should be admitted and whether the agreement was caught by section 2(1) merely because it had the effect of disposing of an interest in land.

1. Admission of the new point. Applying the approach in Pittalis v Grant [1989] QB 605, the court permitted the argument based solely on the agreement’s disposing effect. It was a pure point of law, the respondents had adequate opportunity to meet it, and no further evidence could affect its determination. The alternative argument based on the parties’ disposing purpose was refused because it depended on factual inferences which might have led to further findings below and the respondents might thereby have suffered prejudice.
2. Construction of section 2(1). The binding decision in Joyce v Rigolli [2004] EWCA Civ 79, applying the reasoning in Neilson v Poole (1969) 20 P&CR 909, established that the words “a contract for” require a disposing purpose. The fact that an agreement actually conveys land, where that consequence is not the parties’ purpose, is not the determining test.
3. The principle is not confined to demarcation agreements. Section 2(1) refers generally to contracts and land, and provides no basis for giving “for” different meanings according to the type of agreement. The decision in Melluish v Fishburn [2008] EWCA Civ 1382 did not decide the wider question and did not support the appellants’ proposed distinction.
4. The parties’ compromise agreement had a disposing effect but no established disposing purpose. It was therefore not a contract for the sale or other disposition of an interest in land within section 2(1), and remained valid despite being oral. The appeal was dismissed.

1. High Court (Chancery Division) — Appeal under section 111 of the Land Registration Act 2002 from the Deputy Adjudicator’s decision dated 1 March 2012. The appeal was dismissed.