Ganga Bahadur Basnet v Linaben Prafulchandra Patel

A party who has freely executed a deed acknowledging that he has no rights over land cannot later assert a beneficial interest inconsistent with that deed. A deed which records the repayment of money and expressly excludes further rights in specified property is conclusive between its parties as to the beneficial interests it addresses. It also gives rise to estoppel by deed unless vitiated by force, fraud or other improper practice.

The party challenging the deed must establish a proper basis on which it is void, voidable or unreliable. Mere lack of separate legal representation, or the fact that the other party instructed and paid the solicitor who prepared it, does not suffice.

The appellant applied for a restriction against the registered title to a property, claiming a beneficial interest based on payments said to have contributed to its purchase. The respondent, the registered proprietor, maintained that the payments were loans and relied on a deed dated 8 January 2009.

The First-tier Tribunal directed cancellation of the application after the appellant failed to attend the hearing. The Upper Tribunal granted permission to appeal and directed a rehearing because medical evidence should have received greater consideration.

At the rehearing, the central issue was whether the appellant had executed the 2009 deed and understood its effect. The deed acknowledged repayment of the alleged loan and stated that the appellant had no rights over the property.

1. Appeal dismissed. The Upper Tribunal upheld the First-tier Tribunal’s direction to cancel the application for a restriction, although it did so on the evidence and findings made at the rehearing.

2. The 2009 deed did not create a trust. It declared, as between the parties, that the respondent did not hold the property on trust for the appellant. Applying the principle in Goodman v Gallant [1985] EWCA Civ 15, the judge held that, if it was the appellant’s deed, it was conclusive as to the beneficial interests between them. In any event, the appellant accepted that estoppel by deed prevented him from denying its unambiguous statements unless it had been obtained by force, fraud or other foul practice.

3. The appellant admitted that the signature was his. The judge accepted the solicitor’s contemporaneous attestation that the deed had been read and translated to him and that he confirmed his understanding. The respondent’s evidence supported the finding that he freely agreed to execute it on 8 January 2009.

4. There was no evidential basis to treat the deed as forged, void, voidable or unreliable. The respondent’s instruction and payment of the solicitor did not establish undue influence or a disqualifying conflict. The appellant could have obtained independent advice.

5. Accordingly, the appellant could not challenge his express acknowledgement that he had no interest in the property. He was ordered to pay the respondent’s summarily assessed costs of £23,220, including VAT, within 28 days.

• Upper Tribunal (Lands Chamber): Appeal dismissed in [2019] UKUT 141 (LC). The Tribunal upheld the direction cancelling the application, on the basis of findings made at the rehearing.
• First-tier Tribunal (Property Chamber, Land Registration Division): Directed the registrar to cancel the appellant’s application for a restriction after he did not attend the listed hearing. The citation is not stated in the judgment.